- The Washington Times - Sunday, June 8, 2008

ANALYSIS/OPINION:

It is tempting to take a cynical view that the Doha trade negotiations will continue as long as Third World diplomats can stay in five-star hotels. For almost seven years these talks have been a cascade of unmet deadlines and expectations.

Yet Doha’s worst failure would not be negotiators’ continued delay but if, in desperation to reach any deal, they reach a poor one that neither people nor politicians will accept. Such an outcome would not only fail to advance trade liberalization but further forestall future agreements.

The solution for Doha is simple: Start over with the goal of achieving a trade agreement among developed nations. Such a route reversal still has much to offer on all fronts - including eventually restarting Doha’s developmental agenda.

The World Trade Organization’s multilateral trade negotiations, began inauspiciously enough in Doha, Qatar - forced there by the 1999 riot-plagued debacle in Seattle. It was in fact 2 years old when it finally began. While its beginning was hardly auspicious, it countered with an agenda that was hugely auspicious.

It was to be a multilateral negotiation comprising the full WTO membership with a goal to increase economic opportunities for its less-developed members. Dubbed the Doha Development Agenda, enormous gains from such an approach were projected and four years allocated for talks.

Fissures opened early on every possible issue - few of which have been resolved, including even the method of negotiation, so-called “modalities” - and particularly between developed and developing nations. The result of overreaching has been underperformance and overtime. Originally scheduled for a January 2005 completion, DDA still continues to march in place.

The DDA’s failure is symptomatic of trade’s global fall from grace. Seen at DDA’s conception as a solution to larger problems, trade increasingly has come to be seen by many as itself a problem requiring solution. Increased global competition, growing demands creating price pressures, and a slowing U.S. economy all fuel a questioning rather than an embracing of trade.

As a result, the President’s Trade Promotion Authority (TPA) expired last year, the innocuous Colombia FTA is stalled, and Democratic presidential contenders call for re-examining existing trade agreements, not broaching new ones.

In sum, trade is at an impasse, DDA could never originate today and the DDA of 2001 cannot conclude, continuing only on inertia.

Ironically, the way to a successful multilateral trade deal is to declare an end to the current attempt. Rather than pursue the DDA’s unattainable ambitious global agenda, aim instead for an agreement among developed nations. Far from an admittance of defeat, it would be an acceptance of reality.

Such a decision to make a tactical retreat to attain a strategic advance has much to offer. It would retain an expansive multilateral approach and a high degree of ambition. It immediately removes Doha’s biggest stumbling block, the split between developed and developing nations. It also offers less complexity - an important attribute in negotiations dependent on consensus.

Policywise, such a course would allow developed nations to reach agreement among themselves and gain a coherent trade position. This would facilitate larger negotiations by forging a working relationship within the developed community, providing a template for subsequent negotiations and giving leverage in negotiations with developing nations. That leverage should be welcomed implicitly even by developing nations unable to achieve their own consensus.

A developed nation trade agreement would also offer substantial economic returns. An agreement among the G-7 (major industrial nations) nations would comprise nearly half the world’s GDP - one between the United States and European Union, slightly less; one between the United States and Europe, slightly more.

Domestically, it would offer large political advantages as well. It would build on last year’s labor and environmental accord between the administration and Democrats - virtually the only bright spot on trade since its occurrence. Democrats could embrace a trade agenda while preserving their labor and environmental concerns. Republicans could continue to advance trade and do so on a far more ambitious scale than any pending or potential bilateral FTA offers.

Finally, in today’s political climate, TPA will not be extended to the next president without a trade agenda. There must be justifying trade goals for its extension. Yet without TPA, no trade deals can possibly be negotiated. A developed nation trade agreement goal solves this Catch-22 problem - not just advancing but restarting the trade process. Without that goal, it is difficult to see what will.

The Doha Development Agenda has done trade no favors and has had its chance. Its only realistic prospect at this juncture is to set the trade agenda back even further by reaching a deal-at-any-cost agreement that is rejected.

Trade’s best way forward is to go back - to the drawing board - and design an attainable end. Getting back on track requires momentum, and momentum ultimately comes only from success. That means an attainable goal, successful conclusion and acceptance by the negotiating countries’ governments and people. These are things Doha no longer offers, if it ever did.

J.T. Young served in the Treasury Department and Office of Management and Budget in 2001-2004 and as a congressional staff member in 1987-2000.

LOAD COMMENTS ()

 

Click to Read More

Click to Hide