
Wednesday, 19th November 2008
Prospects for a Doha breakthrough at World Trade Organisation talks
Leaders of the G20 group of rich and emerging countries agreed at a summit in Washington on Saturday to strive to reach the outlines of a deal in the World Trade Organisation's (WTO) Doha round by the end of the year.
What are the prospects of success in the talks, launched almost exactly seven years ago?
The G20 leaders sent a clear political signal that they want a deal to boost confidence in the battered world economy.
The headline figures - cuts in farm subsidies and industrial and agricultural tariffs, and the main exceptions to them - are highly political and need trade ministers' approval.
Negotiators need to resolve a mass of complicated technical problems before any ministerial meeting. To do this, they need governments to give them room to bargain. How flexible will recession-threatened governments be?
Timing
The WTO holds its last policy-making General Council on December 19 before closing for Christmas and the New Year.
Ministers may need a week or more to agree a deal by December 19. Their July meeting, which came close to a breakthrough, lasted a record nine days.
Ministers would meet at least one week after a revision of negotiating texts in the core agriculture and industrial goods areas was completed.
Texts would have to be revised in late this month for ministers to meet in the week of December 8.
Negotiators can revise the texts only if WTO members budge from entrenched positions. They will have to show signs of that this week to allow WTO chief Pascal Lamy and key members to assess on Sunday the prospects for a ministerial meeting.
Technical issues
Many members have sensitive sectors they want to protect from the full force of competition. Agreeing on these exceptions or "flexibilities" is very difficult.
Rich countries like the US and EU members want to shield sensitive farm sectors such as dairy or sugar from tariff cuts.
Argentina complains proposals for industrial tariff cuts require developing countries to make bigger reductions than rich ones, even after special arrangements for developing countries.
A key stumbling block in July was that India and some other big developing countries wanted to protect subsistence farmers by having the right to raise tariffs temporarily to withstand a sudden surge in imports. The US and other food exporters - rich and poor - said this must not undermine the expansion of farm trade, and rejected proposals that would allow tariff increases.
Developing countries must show voters that a deal respects their development needs; rich countries must be able to point to new opportunities for business to win backing at home.
The US is pushing for the total elimination of duties in individual sectors, on top of general cuts in industrial tariffs. Washington says that for such deals to work, they need "critical mass" - which Beijing complains is code for Chinese participation.
The US election
Earlier this year the conventional wisdom was that a deal must be done before the US election, or fall victim to changed priorities in Washington when the new administration comes in.
Many still want to get the outlines of a deal before Mr Obama takes office.
Some countries may be reluctant to put all their cards on the table because they fear Mr Obama will not stand by what Mr Bush's team agrees.







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