So now we come to the assignment of blame. Conventional wisdom holds that the chief reason for the collapse of the Doha Round of global trade negotiations was a dispute between India and the United States over agricultural safeguards. The late developing skirmish over the safeguard mechanism, however, belied the depth of problems that have plagued the Doha Round since its inception in 2001.
Considering the short legislative season in Washington and the rapidly expiring term of the Bush Administration, the July WTO ministerial became the last great hope of a breakthrough on the round for those seeking broad new gains in trade liberalization. Conversely, the pressures built into the July negotiating session also provided extra impetus for countries increasingly cautious toward opening their own markets. Thus China’s late support for India over the safeguard issue may be viewed more appropriately as an opportunistic move designed to prevent significant progress on the round, rather than a tactic motivated by legitimate concerns for the future applicability of farm safeguards.
China has, since shortly after Doha’s launch, played a passive, defensive role in the negotiations. Beijing’s intransigence is rooted in the domestic political problems caused by China’s WTO accession, and the growth of foreign competition in the Chinese market. Politically, China is not ready to accept greater trade liberalization, nor will it be until the government is secure in the belief that it has successfully consolidated the many pieces of WTO accession.
Absent Chinese support, and considering the difficult dynamics of trade relations between Brazil, India, the EU and the United States, insufficient leadership exists to forge a workable compromise with the G20 and G33 groups of developing nations.
WTO Director General Pascal Lamy is now engaged in shuttle diplomacy between capitals and public diplomacy in Geneva in an effort born of urgency rather than strategy. The outcome of Lamy’s initiative is predictable so long as Beijing and other leading developing economies are — of their own volition — on the sidelines. Ministers may well keep talking, and reconvene in the autumn, but there is no deal that may be done that will be passed by the sitting U.S. Congress. Once more, global trade liberalization will have to wait.