19.04.2021 Views

Life after Doha: Some reflections in the run up to the 9th WTO Ministerial Conference on Bali

This is a book chapter that I wrote for an edited volume commissioned by the World Trade Institute in Berne, University Pelita Harapan and the Economic Research Institute for ASEAN and East Asia (ERIA), both in Jakarta. My chapter discusses how the multilateral trading system came to become intractibly bogged down in the Doha Round and argues that the WTO is still the best organization the world has for tacking a number of increasingly pressing issues. The book in its entirety can be viewed and downloaded at: https://www.eria.org/publications/the-road-to-bali-eria-perspectives-on-the-wto-ministerial-and-asian-integration/

This is a book chapter that I wrote for an edited volume commissioned by the World Trade Institute in Berne, University Pelita Harapan and the Economic Research Institute for ASEAN and East Asia (ERIA), both in Jakarta.

My chapter discusses how the multilateral trading system came to become intractibly bogged down in the Doha Round and argues that the WTO is still the best organization the world has for tacking a number of increasingly pressing issues.

The book in its entirety can be viewed and downloaded at: https://www.eria.org/publications/the-road-to-bali-eria-perspectives-on-the-wto-ministerial-and-asian-integration/

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ong>Lifeong> ong>afterong> ong>Dohaong>

ong>Someong> ong>reflectionsong> ong>inong> ong>theong> ong>runong> ong>upong> ong>toong> ong>theong>

ong>9thong> ong>WTOong> Mong>inong>isterial ong>Conferenceong> on Bali

Simon Lacey | Universitas Pelita Harapan | Indonesia


TABLE OF CONTENTS

Abstract

Executive Summary

1

2

1 Rememberong>inong>g ong>theong> ong>Dohaong> Mong>inong>isterial ong>Conferenceong> (MC 4) 3

1.1 Seattle, September 11 and Launchong>inong>g ong>theong> ong>Dohaong> Development Agenda 3

1.2 Implementation Issues and ong>theong> Flaws of ong>theong> Grand Bargaong>inong> 5

1.3 The ong>Dohaong> Mong>inong>isterial Declaration 6

2 Gettong>inong>g ong>toong> ong>theong> Current Impasse 8

2.1 The Collapse at Cancun (MC 5), and ong>theong> Round's Subsequent Rescue ong>inong> July 2004 9

2.2 Hong Kong (MC 6), Aid for Trade and Pork-­‐Barrel Commercial Diplomacy 13

2.3 Geneva 2008 – Much Ado about Special Safeguard Measures 14

2.4 The Global Economic Crisis and Subsequent Developments for ong>theong> DDA 17

3 What ong>toong> do with ong>theong> ong>WTOong> 20

3.1 Debunkong>inong>g ong>theong> Bicycle Theory 20

3.2 The ong>WTOong> is not a Development Organization (at least not directly) 22

3.3 Thong>inong>gs ong>theong> ong>WTOong> Does Well 25

Conclusion

References

28

30


ong>Lifeong> ong>afterong> ong>Dohaong> |

Abstract

The ong>Dohaong> Round contong>inong>ues ong>toong> struggle on with its ultimate fate still largely uncertaong>inong>. This

paper, written as part of a broader ong>inong>itiative by ong>theong> World Trade Institute (WTI), ong>theong> Economic

Research Institute for ASEAN and East Asia (ERIA) and Universitas Pelita Haparan (UPH) ong>inong> ong>theong>

ong>runong> ong>upong> ong>toong> ong>theong> nong>inong>th ong>WTOong> Mong>inong>isterial ong>Conferenceong> on Bali ong>inong> December 2013, discusses how ong>theong>

multilateral tradong>inong>g system got ong>toong> ong>theong> current impasse and offers some prelimong>inong>ary thoughts on

decoong>upong>long>inong>g ong>theong> fate of ong>theong> ong>WTOong> from that of what is now a largely moribund round of

multilateral trade negotiations. This paper argues that ong>theong> ong>WTOong> is still ong>theong> best organization ong>theong>

world has for tacklong>inong>g a number of ong>inong>creasong>inong>gly pressong>inong>g issues, and that despite ong>theong> quagmire

that ong>theong> ong>Dohaong> Round has become, ong>theong>re still remaong>inong>s a number of important roles for ong>theong> ong>WTOong>

ong>toong> assume and ong>toong> contong>inong>ue playong>inong>g, not least of which beong>inong>g ong>theong> ultimate arbiter of what

constitutes compliance with ong>inong>ternational trade rules.

1


Executive Summary

The ong>Dohaong> Round has proven ong>toong> be an ong>inong>terestong>inong>g but ultimately anticlimactic ride. It is probably

not unfair ong>toong> say that it should never really have been launched when it was and certaong>inong>ly not

under ong>theong> auspices of a development round. The Uruguay Round was arguably ong>theong> last round ong>inong>

which large-­‐scale, cross-­‐cuttong>inong>g trade-­‐offs could be achieved under ong>theong> all-­‐or-­‐nothong>inong>g formula

that is ong>theong> Song>inong>gle Undertakong>inong>g. Pascal Lamy, ong>theong> man who many would agree has ong>inong>vested ong>theong>

most energy ong>toong> try and see ong>theong> ong>Dohaong> Round come ong>toong> at least some kong>inong>d of positive conclusion ong>inong>

his capacity as Direcong>toong>r General, likely came ong>toong> ong>theong> same conclusion when previously, as chief

negotiaong>toong>r for ong>theong> European Union, he started ong>toong> question ong>theong> Song>inong>gle Undertakong>inong>g approach by

floatong>inong>g ong>theong> concept of variable geometry. This concept was quickly forgotten, probably

because most oong>theong>r ong>WTOong> Members -­‐ developed and developong>inong>g -­‐ distrusted ong>theong> EU's motives,

but this approach now seems ong>toong> have prevailed by sheer attrition, song>inong>ce it apparently offers ong>theong>

only possible way ong>toong> get thong>inong>gs done given ong>theong> ong>WTOong>'s growong>inong>g and ong>inong>creasong>inong>gly fractious

membership.

This short opong>inong>ion piece first revisits how and why ong>theong> ong>Dohaong> Round was launched, ong>theong>reby

seekong>inong>g ong>toong> show that it was actually done on little more than false pretences, which ong>inong>cidentally

goes a long way ong>toong> explaong>inong>ong>inong>g why Members have been so divided and half-­‐hearted ong>inong> wheong>theong>r

or not ong>toong> push for its conclusion. It ong>theong>n follow ong>theong> trajecong>toong>ry of ong>theong> Round through some peaks

and troughs, while also keepong>inong>g one eye on how ong>theong> global economy has changed over ong>theong>

years that ong>theong> Round has been on-­‐goong>inong>g. This ong>inong> order ong>toong> show that ong>theong> assumptions and

objectives on which ong>theong> DDA was predicated are now largely obsolete, meanong>inong>g that ong>theong> Round

has also lost much of its ong>inong>herent raison d'etre.

Fong>inong>ally it discusses some of ong>theong> issues that ong>theong> ong>WTOong> should be focusong>inong>g on, while attemptong>inong>g ong>toong>

make ong>theong> case that despite ong>theong> many setbacks of ong>Dohaong>, ong>theong> ong>WTOong> still remaong>inong>s ong>theong> song>inong>gle most

important forum for discussong>inong>g and resolvong>inong>g many of ong>theong> world's most pressong>inong>g and seemong>inong>gly

ong>inong>tractable trade policy issues. Although ong>theong> lion's share of trade liberalization nowadays is

clearly takong>inong>g place via preferential tradong>inong>g arrangements ong>inong> ong>theong> form of bilateral or regional (or

even ong>inong>ter-­‐regional) free trade or economic partnership agreements, this is no way dimong>inong>ishes

ong>theong> relevance and importance of ong>theong> ong>WTOong> as an ong>inong>stitution, but raong>theong>r only reong>inong>forces ong>theong> need

for a robust and viable global referee ong>inong> a world of ong>inong>creasong>inong>gly ong>inong>tegrated markets.

2


ong>Lifeong> ong>afterong> ong>Dohaong> |

1 Rememberong>inong>g ong>theong> ong>Dohaong> Mong>inong>isterial ong>Conferenceong> (MC 4)

The ong>Dohaong> Mong>inong>isterial ong>Conferenceong> was ong>theong> culmong>inong>ation of almost two years of plannong>inong>g and was

a carefully conceived and meticulously scripted event that still contaong>inong>ed its fair share of

surprises. Perhaps ong>theong> most surprisong>inong>g thong>inong>g at all is that many trade negotiaong>toong>rs and ong>theong> ong>WTOong>'s

Direcong>toong>r General allowed ong>theong>mselves ong>toong> be blong>inong>ded by ong>theong> fact that ong>inong>itiatong>inong>g a round that would

ultimately fail could be as disastrous as failong>inong>g ong>toong> ong>inong>itiate a round at all, and that of ong>theong>se two

scenarios, ong>theong> latter is arguably easier for ong>theong> organization ong>toong> recover from. This section starts

by discussong>inong>g ong>theong> ong>runong> ong>upong> ong>toong> ong>Dohaong> -­‐ especially Seattle -­‐ and concludes by discussong>inong>g some of ong>theong>

ong>inong>herent ong>inong>consistencies ong>inong> ong>theong> ong>Dohaong> Mong>inong>isterial Declaration that have played such an important

role ong>inong> damnong>inong>g ong>theong> DDA ong>toong> become a raong>theong>r unfortunate real-­‐life ong>inong>carnation of Samuel

Beckett's unforgettable play Waitong>inong>g for Godot.

1.1 Seattle, September 11 and Launchong>inong>g ong>theong> ong>Dohaong> Development Agenda

There were probably two overridong>inong>g facong>toong>rs that, more than anythong>inong>g else, led ong>toong> ong>theong> launch of

ong>theong> ong>Dohaong> Development Agenda ong>inong> December 2001, neiong>theong>r of which would really have resulted

ong>inong> anythong>inong>g if it were not for ong>theong>

personality of ong>theong> ong>WTOong> Direcong>toong>r

General Mike Moore and his

willong>inong>gness ong>toong> act (for better or

worse) on ong>theong> strength of his own

convictions. These two facong>toong>rs were

1) ong>theong> shock of ong>theong> really spectacular

failure of ong>theong> Seattle Mong>inong>isterial

ong>Conferenceong> ong>inong> 1999 and ong>theong> belief by

many, ong>inong>cludong>inong>g ong>theong> ong>WTOong> Direcong>toong>r

General, that ong>theong> best way ong>toong> put

Seattle behong>inong>d ong>theong> organization was

ong>toong> launch a new Round; and 2) ong>theong>

September 11 attacks on ong>theong> United States which compelled many ong>toong> ong>theong> (erroneous)

conclusion that ong>theong> best way ong>toong> show ong>inong>ternational solidarity ong>inong> ong>theong> wake of this terrible tragedy

was ong>toong> launch anoong>theong>r round of multilateral trade negotiations. 1

A law enforcement agent sprays pepper spray at ong>theong> crowd; source:

Wikimedia Commons

1 It is Mike Moore who is generally credited – as ong>theong> Mong>inong>isterial talks ong>inong> ong>Dohaong> reached an impasse on wheong>theong>r or not ong>toong> launch a

new round – with addressong>inong>g delegates and forcefully askong>inong>g ong>theong> rheong>toong>rical question of wheong>theong>r he needed ong>toong> remong>inong>d anyone

present as ong>toong> what had taken place ong>inong> New York just a few weeks before ong>theong> ong>Dohaong> meetong>inong>g. Anoong>theong>r account tells of ong>theong>

Direcong>toong>r General ong>inong>tervenong>inong>g durong>inong>g a crucial impasse, confrontong>inong>g Members with words ong>toong> ong>theong> effect that ong>theong> multilateral

3


For anyone who needs remong>inong>dong>inong>g about just how dramatic ong>theong> collapse of ong>theong> ong>WTOong> Mong>inong>isterial

Meetong>inong>g ong>inong> Seattle (MC 3) was, ong>theong> easiest thong>inong>g is probably ong>toong> search for footage of ong>theong> debacle

on YouTube. Oong>theong>rwise, a 2007 French film production starong>inong>g a whole range of well-­‐known

Hollywood celebs captures ong>theong> mood quite nicely. 2 While commentaong>toong>rs disagree about ong>theong>

importance or impact that ong>theong> street protesong>toong>rs had on ong>theong> actual ong>WTOong> meetong>inong>g, ong>theong> consensus

seems ong>toong> be that developong>inong>g country representatives certaong>inong>ly felt empowered by ong>theong> mood

that ong>toong>ok hold ong>inong> Seattle, and decided that politically, ong>theong>y could afford ong>toong> let ong>theong> concerted

efforts by many developed country Members ong>toong> launch a new round go down ong>inong> flames. 3 In any

event, ong>theong> months ong>afterong> ong>theong> failure of Seattle saw a large degree of soul searchong>inong>g by ong>theong>

organization's Direcong>toong>r General, who became

convong>inong>ced that not only did ong>theong> ong>WTOong> need ong>toong>

launch a new round as soon as possible, but

that ong>theong> organization should be "re-­‐branded"

with a new-­‐found focus on development (and

ong>theong> role that trade can play ong>inong> promotong>inong>g

economic growth). 4

____________________________________

The sense of doom and gloom ong>afterong> 9/11

was best captured by Song>inong>gapore Prime

Mong>inong>ister Goh Chok Tong, who noted that

ong>theong> September 11 attacks had "probably

tipped ong>theong> world ong>inong>ong>toong> a global recession

____________________________________

The economic impact of ong>theong> devastatong>inong>g

attacks on ong>theong> World Trade Centre ong>inong> New

York on September 11 went beyond those

secong>toong>rs most directly affected, such as ong>inong>surance, civil aviation, and ong>toong>urism, and led ong>toong> a more

widely-­‐felt loss of overall consumer confidence, particularly ong>inong> ong>theong> United States, but also ong>toong> a

very real extent globally. This was confirmed by a survey done by ong>theong> IMF immediately ong>afterong> ong>theong>

attacks and published ong>inong> December 2001. 5 The sense of doom and gloom hangong>inong>g over world

leaders ong>afterong> 9/11 was perhaps best summarized by Song>inong>gapore Prime Mong>inong>ister at ong>theong> time, Goh

Chok Tong, who at an Ocong>toong>ber summit meetong>inong>g ong>inong> preparation for ong>theong> ong>Dohaong> talks noted that ong>theong>

September 11 attacks had "probably tipped ong>theong> world ong>inong>ong>toong> a global recession". 6 It was also ong>inong>

ong>theong> period between ong>theong> September 11 attacks and ong>theong> November Mong>inong>isterial ong>Conferenceong> that

tradong>inong>g system and ong>theong> ong>WTOong> would not be able ong>toong> survive yet anoong>theong>r failure of a Mong>inong>isterial ong>Conferenceong> ong>toong> launch a Round, see

Paul Blusteong>inong>, Misadventures of ong>theong> Most Favoured Nations, Public Affairs Publishers, New York 2009, at p. 126.

2 Battle ong>inong> Seattle, http://www.imdb.com/title/tt0850253/?ref_=fn_al_tt_5 (visited on 19 July 2013); some of ong>theong> well-­‐known

names that appear ong>inong> ong>theong> film ong>inong>clude André Benjamong>inong>, Woody Harrelson, Ray Liotta, Channong>inong>g Tatum and Charlize Theron.

3 Gary Horlick and several oong>theong>rs, writong>inong>g ong>inong> ong>theong> Journal of International Economic Law a few months ong>afterong> Seattle, note that a

lot more was actually achieved substantively at ong>theong> Mong>inong>isterial Meetong>inong>g than much of ong>theong> coverage that documented ong>theong>

meetong>inong>g's failure ong>toong> launch a round seem ong>toong> admit; see Gary Horlick et al, Reactions ong>toong> Seattle, ong>inong>: Journal of International

Economic Law, 3(1) March 2000, pp. 167 et seq.

4 See ong>theong> account ong>toong>ld ong>inong> Blusteong>inong>, op cit., at p. 82.

5 IMF's World Economic Outlook: The Global Economy After September 11, at:

http://www.imf.org/external/pubs/ft/weo/2001/03/ (visited on 25 July 2013).

6 Cited by BBC News, "Fight terror with trade, summit ong>toong>ld", 13 Ocong>toong>ber, 2001, at: http://news.bbc.co.uk/2/hi/asia-­pacific/1597016.stm

(visited on 25 July 2013).

4


ong>Lifeong> ong>afterong> ong>Dohaong> |

ong>theong> narrative started ong>toong> take hold, that ong>theong> best way ong>toong> mitigate ong>theong> effects of this downturn

would be ong>toong> launch a new round of trade negotiations. One example of this was ong>theong> testimony

provided by Alan Greenspan before ong>theong> Senate Committee on Bankong>inong>g, Housong>inong>g, and Urban

Affairs on 20 September, who stated, "A successful round would not only significantly enhance

world economic growth but also answer terrorism with a firm reaffirmation of our commitment

ong>toong> open and free societies". 7 But ong>theong> economic press also ong>toong>ok ong>upong> this call, such as ong>theong> Fong>inong>ancial

Times, who ong>inong> an article entitled "A Round ong>toong> Steady ong>theong> Nerves", exong>toong>lled ong>theong> "symbolic and

psychological" value that launchong>inong>g a new round of trade talks would have. 8

1.2 Implementation Issues and ong>theong> Flaws of ong>theong> Grand Bargaong>inong>

It should not be forgotten that developong>inong>g countries on ong>theong> whole were less than enthusiastic

about ong>theong> prospect of a new round, particularly one that would ong>inong>corporate yet anoong>theong>r set of

"new issues", ong>toong>wards which ong>theong>y generally

harboured a great deal of suspicion, if not

actual hostility, such as trade and ong>theong>

environment, and long>inong>kages between trade and

labour. However it was specifically with regard

ong>toong> ong>theong> so-­‐called Song>inong>gapore Issues, particularly

trade and competition, trade and ong>inong>vestment

and government procurement that developong>inong>g

countries seemed ong>toong> harbour ong>theong> greatest

Workers sort bananas for export on ong>inong> Costa Rica; source:

Reuters

enmity. 9 In fact, many developong>inong>g countries

wished ong>toong> keep ong>theong> Organization focused on

so-­‐called implementation issues, meanong>inong>g ong>theong>

7 See Testimony of Chairman Alan Greenspan: The condition of ong>theong> fong>inong>ancial markets, Before ong>theong> Committee on Bankong>inong>g,

Housong>inong>g, and Urban Affairs, U.S. Senate, September 20, 2001, at:

http://www.federalreserve.gov/boarddocs/testimony/2001/20010920/default.htm (visited on 25 July 2013).

8 Cited ong>inong> Blusteong>inong>, op cit., Notes ong>toong> Chapter 1, at p. 302, note 3.

9 The Song>inong>gapore Issues were a set of four areas, two "old" and two "new", that developed countries, particularly ong>theong> EU and ong>toong> a

lesser extent ong>theong> US, wished ong>toong> ong>inong>clude ong>inong> talks if a new round was successfully launched. These four issues were 1) trade and

ong>inong>vestment; and 2) trade ong>inong> competition as noted above (ong>theong> "new" issues), as well as 3) transparency ong>inong> government

procurement and 4) trade facilitation. These last two issues are labeled with ong>theong> moniker "old" because ong>WTOong> rules already

ong>inong>cluded provisions governong>inong>g ong>theong>se two areas, even if, for government procurement, ong>theong>se rules (under ong>theong> Government

Procurement Agreement or GPA) had not been part of ong>theong> Uruguay Round song>inong>gle undertakong>inong>g and thus not been adopted by

ong>theong> entire ong>WTOong> membership. The oong>theong>r "old" issue of trade facilitation (i.e. anythong>inong>g that affects goods as ong>theong>y physically cross

borders) had already been addressed by various GATT articles as early as 1947 (for example ong>inong> Art. V on freedom of transit, Art.

VII on cusong>toong>ms valuation, or Art. VIII on fees and formalities levied ong>inong> connection with importong>inong>g and exportong>inong>g), but also ong>theong>

results of ong>theong> Uruguay Round contaong>inong> no less than four separate agreements dedicated ong>toong> different trade facilitation issues

(namely agreements on cusong>toong>ms valuation, pre-­‐shipment ong>inong>spection, rules of origong>inong> and import licensong>inong>g). For more on ong>theong>

Song>inong>gapore Issues, see Simon J. Evenett et al, The Song>inong>gapore Issues and ong>theong> World Tradong>inong>g System: The Road ong>toong> Cancun and

Beyond, June 2003, at: https://www.alexandria.unisg.ch/export/DL/22682.pdf (visited on 25 July 2013).

5


challenges Members were still facong>inong>g ong>inong> implementong>inong>g ong>theong> many new obligations entered ong>inong>ong>toong>

when ong>theong>y signed ong>theong> Results of ong>theong> Uruguay Round of Multilateral Trade Negotiations. 10

Developong>inong>g countries as a whole also wished ong>toong> address what ong>theong>y perceived ong>toong> be ong>theong> glarong>inong>g

asymmetries that had become apparent ong>inong> ong>theong> so-­‐called "Grand Bargaong>inong>" of ong>theong> Uruguay Round,

namely liberalization of trade ong>inong> textiles and agricultural products ong>inong> exchange for rules on trade

and services and trade-­‐related ong>inong>tellectual property rights (TRIPS).

It was only ong>afterong> ong>theong> dust of ong>theong> Uruguay Round had settled that it became apparent ong>toong> many

that ong>theong> ong>WTOong> Agreement on Agriculture resulted ong>inong> little new market access, while leavong>inong>g ong>theong>

complex web of subsidies for (mostly) developed country agricultural producers largely ong>inong> place.

Moreover, ong>theong> ong>WTOong> Agreement on Textiles also left ong>theong> global system of quotas -­‐ ong>theong> Mutlifibre

Arrangement -­‐ that had been ong>inong> place song>inong>ce 1974 and that was so resented by developong>inong>g

countries, largely ong>inong>tact for anoong>theong>r ten years. Compare this ong>toong> ong>theong> liberalization commitments

made under ong>theong> ong>WTOong>'s General Agreement on Trade and Services (GATS) and ong>theong> TRIPS

Agreement, most of which came ong>inong>ong>toong> force on 1 January 1995 (ong>theong> day ong>theong> ong>WTOong> opened for

busong>inong>ess), and it is easy ong>toong> see why developong>inong>g countries were feelong>inong>g somewhat jilted. 11 In any

event, most developong>inong>g country Members felt that implementation issues and ong>theong> asymmetries

ong>inong> liberalization outcomes resultong>inong>g from ong>theong> Uruguay Round were both matters that could and

should be addressed outside of ong>theong> dynamics of a negotiatong>inong>g round per se.

1.3 The ong>Dohaong> Mong>inong>isterial Declaration

At ten pages, ong>theong> Mong>inong>isterial Declaration is

a relatively short document that lists ong>theong>

areas ong>inong> which negotiations are ong>toong> take

place, and attempts ong>toong> elucidate some of

ong>theong> possible outcomes that may or even

should ensue from ong>theong>se negotiations,

particularly greater trade liberalization and

a world tradong>inong>g system that produces more

development-­‐friendly outcomes. This

second element is, on its face, ong>theong> most

____________________________________________

The frequent use of ong>theong> terms "developong>inong>g" or

"development" ong>inong> ong>theong> ong>Dohaong> Mong>inong>isterial

Declaration is an example of ong>theong> law of ong>inong>verse

relevance, namely ong>theong> less you ong>inong>tend ong>toong> do

about somethong>inong>g, ong>theong> more you have ong>toong> keep

talkong>inong>g about it.

____________________________________________

10 See Asoke Mukerji, Developong>inong>g Countries and ong>theong> ong>WTOong>, Issues of Implementation, ong>inong>: Journal of World Trade, 34(6): 33–74,

2000.

11 Although this narrative does not do justice ong>toong> ong>theong> fact that ong>theong> GATS is a very flexible agreement that allowed many, ong>inong> fact

most developong>inong>g country Members ong>toong> largely opt out of sensitive and difficult liberalization commitments durong>inong>g ong>theong> Uruguay

Round, and also ignores ong>theong> fact that LDCs were given transition period ong>toong> implement ong>theong>ir obligations under TRIPS, this

neverong>theong>less is an accurate reflection of how many developong>inong>g countries (rightly or wrongly) viewed ong>theong> results of ong>theong> Uruguay

Round.

6


ong>Lifeong> ong>afterong> ong>Dohaong> |

important. What is most strikong>inong>g ong>upong>on a first readong>inong>g of ong>theong> Mong>inong>isterial Declaration is ong>theong> sheer

number of times ong>theong> words "developong>inong>g" or "development" appear. The numbers are 24 and 39

times respectively, so that, taken ong>toong>geong>theong>r, ong>theong>se two terms appear some 63 times, or, just over

6 times per page on average. This is arguably little more than a real-­‐life example of Sir

Humphrey's famous law of ong>inong>verse relevance, namely "[t]he less you ong>inong>tend ong>toong> do about

somethong>inong>g, ong>theong> more you have ong>toong> keep talkong>inong>g about it." 12 Over time it has become brazenly

obvious that this was sadly ong>theong> case. In fact this was evident as early as ong>theong> next meetong>inong>g of ong>theong>

ong>WTOong> Mong>inong>isterial ong>Conferenceong> ong>inong> Cancun ong>inong> September 2003 (MC5). This is because ong>theong> ong>WTOong> was

never, is not, and will probably never be a development organization (that is arguably ong>theong> job of

ong>theong> World Bank or ong>theong> United Nations Development Program), and those that believed or

advocated oong>theong>rwise, misconstrued ong>theong>

organization's hisong>toong>rical pedigree and ong>inong>deed its

ong>inong>stitutional purpose and drivong>inong>g imperative.

This is discussed ong>inong> more detail below.

Even a casual reader of ong>theong> ong>Dohaong> Declaration will

recognize that many, if not all of ong>theong> so-­‐called

"commitments" -­‐ if one can even call ong>theong>m that -­‐

ong>toong>wards helpong>inong>g developong>inong>g countries are

steeped ong>inong> aspirational and markedly "woolly"

language that "commits" Members, at most, ong>toong>

little more than "best endeavours", if that. One

example is ong>inong> para. 2 of ong>theong> ong>Dohaong> Mong>inong>isterial

Declaration: "We seek ong>toong> place ong>theong>ir [developong>inong>g

countries'] needs and ong>inong>terests at ong>theong> heart of ong>theong> Work Program adopted ong>inong> this Declaration".

Any developong>inong>g country representatives present ong>inong> ong>theong> room should at least have ong>inong>sisted that

ong>theong> words "seek ong>toong>" be replaced with eiong>theong>r ong>theong> word "will" or "shall". Anoong>theong>r example is

paragraph 42 on Least-­‐Developed Countries, which contaong>inong>s a strong>inong>g of "commitments"

purportedly ong>inong>tended ong>toong> promote ong>theong> ong>inong>terests of LDCs, but which ong>inong> reality promise little more

than "considerong>inong>g" how ong>toong> do more ong>toong> help LDCs. Contrast this language with that used ong>toong>

describe potential negotiatong>inong>g outcomes ong>inong> oong>theong>r areas, primarily of ong>inong>terest ong>toong> developed

countries (like ong>theong> desire ong>toong> see negotiations start on trade and ong>inong>vestment ong>inong> para. 20) and ong>theong>

woolly and aspirational language is gone. In this paragraph ong>theong> Mong>inong>isterial Declaration states

"we agree that negotiations will take place ong>afterong> ong>theong> Fifth Session of ong>theong> Mong>inong>isterial ong>Conferenceong>

on ong>theong> basis of a decision ong>toong> be taken, by explicit consensus, at that Session on modalities of

The plenary session at ong>theong> Fourth ong>WTOong> Mong>inong>isterial

ong>Conferenceong> ong>inong> ong>Dohaong>, Qatar from 9 ong>toong> 14 November 2001;

source: ong>WTOong>.

12 Jonathan Lynn and Anong>toong>ny Jay, Yes Mong>inong>ister : Volume 1 :The Diaries of a Cabong>inong>et Mong>inong>ister by ong>theong> Rt Hon. James Hacker MP,

BBC Publishong>inong>g, 1983, at p. 21

7


negotiations". Anyone readong>inong>g that paragraph at ong>theong> time of ong>Dohaong> (and thus without ong>theong>

benefit of hong>inong>dsight), could be excused for thong>inong>kong>inong>g that negotiations on trade and ong>inong>vestment

were a matter of "when" and not "if".

To summarize, ong>theong> ong>WTOong> Mong>inong>isterial Declaration that emerged from ong>theong> ong>Dohaong> talks, although a

seemong>inong>gly ambitious document ong>inong> terms of envisagong>inong>g a pivot ong>toong>wards ong>theong> needs of developong>inong>g

country members, really just confirmed that ong>theong> ong>WTOong> was all about busong>inong>ess as usual, and that

Members would do ong>theong>ir best ong>toong> look like ong>theong>y were takong>inong>g ong>theong> concerns of developong>inong>g

countries seriously while ong>inong> reality doong>inong>g

what ong>theong>y were really sent ong>toong> ong>theong>

organization ong>toong> do, namely negotiate ong>theong>

best market access concessions for ong>theong>ir own

export ong>inong>terests. This is what ong>theong> ong>WTOong>, and

its predecessor ong>theong> GATT were designed ong>toong>

do, and this is what ong>theong> GATT and now ong>theong>

ong>WTOong> have had a great deal of success ong>inong>

doong>inong>g. As Aaditya Matong>toong>o and Arvong>inong>d

Subramanian poong>inong>ted out ong>inong> a 2008 paper on

___________________________________

"The genius of ong>theong> [GATT] was ong>toong> recognize

that ong>theong> politics of trade policy is unavoidably

mercantilist and ong>theong>n ong>toong> harness this very

mercantilism ong>toong> avoid protectionist outcomes"

Aaditya Matong>toong>o and Arvong>inong>d Subramanian

______________________________________

a ong>toong>tally unrelated issue "[t]he genius of ong>theong> [GATT] was ong>toong> recognize that ong>theong> politics of trade

policy is unavoidably mercantilist and ong>theong>n ong>toong> harness this very mercantilism ong>toong> avoid

protectionist outcomes". 13 Given ong>theong> huge gap ong>inong> terms what ong>theong> document that launched ong>theong>

ong>Dohaong> Work Program and that also established ong>theong> negotiation agenda promised and aspired ong>toong>

on ong>theong> one hand, and ong>theong> underlyong>inong>g political-­‐economy realities that it was steeped ong>inong> on ong>theong>

oong>theong>r, is it any wonder that we are currently at such a seemong>inong>gly ong>inong>surmountable impasse? This

is even less surprisong>inong>g when one considers ong>theong> many significant changes that have transformed

ong>theong> global economy song>inong>ce ong>theong> launch of ong>theong> round.

2 Gettong>inong>g ong>toong> ong>theong> Current Impasse

It has admittedly been a long road from ong>theong> ong>Dohaong> Mong>inong>isterial ong>Conferenceong> ong>inong> November 2001 ong>toong>

where we are now -­‐ at ong>theong> time of writong>inong>g -­‐ almost 12 years later and with still no end ong>inong> sight.

To put ong>theong> extraordong>inong>ary length of time ong>theong> current round has lasted ong>inong>ong>toong> context, it should be

recalled that even ong>theong> Uruguay Round only dragged on for some eight years (September 1986

until December 1993), and it was based on an agenda that was much more radical -­‐ ong>inong> terms of

13 Aaditya Matong>toong>o and Arvong>inong>d Subramanian, "Currency Undervaluation and Sovereign Wealth Funds: A New Role for ong>theong> World

Trade Organization", Peterson Institute for International Economics, January 2008, at:

http://www.iie.com/publications/ong>inong>terstitial.cfm?ResearchID=871 (visited on 25 July 2005).

8


ong>Lifeong> ong>afterong> ong>Dohaong> |

brong>inong>gong>inong>g new issues under multilateral disciplong>inong>es -­‐ and much more controversial -­‐ ong>inong> terms of

fong>inong>ally subjectong>inong>g agricultural trade ong>toong> actionable trade rules -­‐ than one could arguably contend

is ong>theong> case for ong>theong> DDA. This section discusses how ong>theong> Round got ong>toong> where it is now, focusong>inong>g

first on Cancun and ong>theong> July 2004 Package, followed by ong>theong> Hong Kong Mong>inong>isterial, ong>theong> 2008

meetong>inong>g ong>inong> Geneva, and ong>theong> fong>inong>al, and ultimately unsuccessful push ong>toong> conclude ong>theong> round, first

by ong>theong> end of 2010, ong>theong>n by ong>theong> end of 2011, and fong>inong>ally, whenever Members can be roused

from ong>theong>ir current ong>inong>ertia ong>toong> do so.

2.1 The Collapse at Cancun (MC 5), and ong>theong> Round's Subsequent Rescue ong>inong> July 2004

Two words (actually three) seem ong>toong> sum ong>upong> ong>theong> Mong>inong>isterial ong>Conferenceong> that ong>toong>ok place ong>inong>

Cancun Mexico from 10-­‐14 September 2003, namely "cotong>toong>n" and "explicit consensus". The

first issue overshadowed ong>theong> meetong>inong>g from ong>theong> outset and seemed ong>toong> be ong>theong> spark that ignited

a mood of militancy among developong>inong>g country

representatives. The explicit consensus language ended

ong>upong> givong>inong>g ong>theong>se representatives ong>theong> mechanism by which

ong>theong>y could dig ong>inong> ong>theong>ir heels and ultimately brong>inong>g ong>theong>

meetong>inong>g ong>toong> an ignomong>inong>ious collapse.

The cotong>toong>n issue had slowly but steadily been brewong>inong>g at

ong>theong> ong>WTOong> for well over a year before it sparked ong>theong>

collapse of ong>theong> Cancun Mong>inong>isterial. As early as January

2001, Mali had explicitly tabled a request ong>inong> ong>theong> Special

Session of ong>theong> Committee on Agriculture (established

under ong>theong> so-­‐called ong>inong>built agenda) for subsidies on this

commodity ong>toong> be drastically reduced. 14 However ong>theong> issue

really began ong>toong> pick ong>upong> some traction with ong>theong> release of

a damnong>inong>g report by Oxfam ong>inong> September 2002 entitled

"Cultivatong>inong>g Poverty: The impact of US cotong>toong>n subsidies

on Africa" 15 , and with ong>theong> ong>inong>itiation of a dispute under ong>theong> ong>WTOong>'s Dispute Settlement

Understandong>inong>g by Brazil agaong>inong>st US cotong>toong>n subsidies ong>inong> February 2003. 16 Throughout ong>theong> course

of 2003, ong>theong> temperature contong>inong>ued ong>toong> rise on ong>theong> issue of how damagong>inong>g US cotong>toong>n subsidies

had been for African cotong>toong>n farmers, so it is somewhat mystifyong>inong>g why US trade negotiaong>toong>rs,

EU Trade Commissioner Pascal Lamy (L) and

USTR Robert Zoellick; source: Associated Press

14 See Malian Proposals for ong>theong> Future Negotiations on Agriculture (G/AG/NG/W/99), 11 January 2001.

15 http://www.oxfamamerica.org/publications/cultivatong>inong>g-­‐poverty (visited on 26 July 2013).

16 DS267; For a useful comparison of ong>theong> two tracks that were taken on ong>theong> issue of cotong>toong>n (negotiation versus litigation), see:

Philipp Stucki, Lessons Learned from ong>theong> Negotiations and Litigations on Cotong>toong>n, 2008, at:

http://www.ideascentre.ch/documents/2.28_AnnexactionplanWTICotong>toong>nFINAL.pdf (visited on 26 July 2013).

9


particularly USTR Robert Zoellick were caught so off-­‐guard ong>inong> Cancun when this issue

threatened ong>toong> take centre stage and became a cause célèbre around which many developong>inong>g

countries could rally. 17 Knowong>inong>g ong>theong> political sensitivities, particularly ong>theong> positions of key

members of Congress on this issue, ong>theong>re was little Zoellick could concede ong>inong> Cancun, which put

ong>theong> US delegation ong>inong> ong>theong> unenviable position of fightong>inong>g a rear-­‐guard action ong>inong> defence of a

collection of subsidies that were manifestly ong>inong>defensible given ong>theong>ir obvious and demonstrated

impact on cotong>toong>n growers ong>inong> ong>theong> affected African countries. This caused ong>theong> US delegation ong>toong>

look ong>inong>sensitive and made ong>theong> DDA's stated goal of improvong>inong>g development outcomes for ong>theong>

world's poor seem like a cruel and cynical joke. It is no wonder developong>inong>g countries ong>toong>ok ong>theong>

combative stance that ong>theong>y did on what seemed ong>toong> be ong>theong> most important issue ong>toong> developed

countries at ong>theong> talks, namely ong>theong> Song>inong>gapore Issues. 18

The "explicit consensus" language that hung over ong>theong> Song>inong>gapore Issues was ong>theong> result of

ong>inong>transigence on ong>theong> part of India as ong>theong> last holdout at ong>theong> ong>Dohaong> meetong>inong>g ong>toong> agree ong>toong>

negotiations on ong>theong> Song>inong>gapore Issues, so that ong>theong> Indian representative ong>inong> ong>Dohaong> (Maran) could

reportedly only be prevailed ong>upong>on ong>toong> accept this concession if ong>theong> decision ong>toong> start negotiations

on ong>theong>se issues was ong>toong> be taken by "explicit consensus" at ong>theong> Fifth Mong>inong>isterial ong>Conferenceong> (i.e.

ong>theong> one ong>afterong> ong>Dohaong>). 19 Although

nothong>inong>g ong>inong> ong>theong> ong>WTOong>'s charter

(ong>theong> Marrakesh Agreement)

suggests that such a thong>inong>g as

explicit consensus exists, over

ong>theong> months leadong>inong>g ong>upong> ong>toong> ong>theong>

Cancun meetong>inong>g, Geneva-­‐based

representatives, and ong>theong>n at ong>theong>

Cancun meetong>inong>g itself, trade

mong>inong>isters from developong>inong>g

______________________________________________

The "explicit consensus" language that had been

ong>inong>sisted ong>upong>on by a song>inong>gle developong>inong>g country at ong>Dohaong>

was presumably a tactical move ong>inong>tended ong>toong> pre-­‐empt

any attempt ong>toong> isolate a small groong>upong> or even a song>inong>gle

Member ong>inong> its opposition ong>toong> start launch negotiations on

ong>theong> Song>inong>gapore Issues.

______________________________________________

countries had actively worked ong>toong> cultivate ong>theong> narrative that a decision allowong>inong>g negotiations on

ong>theong> Song>inong>gapore Issues ong>toong> start would only be taken if ong>theong> entire membership was ong>inong> agreement

(which is what ong>theong> ong>WTOong>'s prong>inong>ciple of consensus means anyway). This was presumably a tactical

move ong>inong>tended ong>toong> pre-­‐empt any attempt ong>toong> isolate a small groong>upong> or even a song>inong>gle Member ong>inong> its

opposition ong>toong> start ong>theong>se negotiations, song>inong>ce under ong>theong> normal modus operandi of ong>theong> ong>WTOong> it is

17 For an ong>inong>terestong>inong>g expose on how ong>theong> issue emerged and how it was handled ong>inong> Cancun and ong>theong>reong>afterong> see ong>theong> film

documentary The Cotong>toong>n War, by TVEAPfilms available for download and viewong>inong>g at:

http://www.youtube.com/watch?v=l673CWNdGLc (visited on 26 July 2013).

18 This is particularly true for ong>theong> EU and Japan, who were perceived as beong>inong>g some of ong>theong> most ong>inong>transigent members ong>inong> ong>theong>

agriculture talks, which developong>inong>g countries cared about very passionately.

19 See ong>theong> account ong>toong>ld ong>inong> Blusteong>inong>, op cit., at ong>theong> botong>toong>m of p. 128.

10


ong>Lifeong> ong>afterong> ong>Dohaong> |

considered very poor form for one Member ong>inong> particular ong>toong> dig ong>inong> its heels and impede progress

when everybody else has agreed ong>toong> move forward. The explicit consensus language obviated

ong>theong> need for a song>inong>gle Member ong>toong> feel embarrassed about beong>inong>g obstructionist and ong>toong> allow itself

ong>toong> be strong-­‐armed ong>inong>ong>toong> goong>inong>g along. As it turns out, India was not alone ong>inong> its opposition ong>toong> ong>theong>

Song>inong>gapore Issues, song>inong>ce ong>theong> representative for Malaysia (Rafidah Aziz) also ong>toong>ok a strong stand at

Cancun. 20 Thus it was that, ong>afterong> ong>theong> tempers of developong>inong>g country delegates had been

ong>inong>flamed over cotong>toong>n and ong>theong> impasse over agriculture, many of ong>theong>m chose ong>toong> vent ong>theong>ir anger

on ong>theong> Song>inong>gapore Issues.

The Cancun Mong>inong>isterial ultimately collapsed when ong>theong> Mexican Foreign Mong>inong>ister Luis Ernesong>toong>

Derbez (ong>inong> his capacity as chairman of ong>theong> conference), seeong>inong>g ong>theong> lack of progress on ong>theong> Song>inong>gapore

Issues gavelled ong>theong> meetong>inong>g ong>toong> an unexpected and some would say premature end ong>inong> a green

room meetong>inong>g on 14 September, ong>afterong> 4 days of conflict-­‐ridden and ultimately fruitless talks.

Many blamed ong>theong> US for its unwillong>inong>gness ong>toong> come ong>upong> with any kong>inong>d of compromise on cotong>toong>n

besides tellong>inong>g ong>theong> Cotong>toong>n 4 ong>toong> diversify ong>theong>ir economies. Oong>theong>rs blamed ong>theong> EU for waitong>inong>g until

ong>theong> last day ong>toong> concede on ong>theong> Song>inong>gapore Issues, while yet oong>theong>rs blamed ong>theong> militancy of

developong>inong>g countries. ong>Someong> even saw Derbez's sudden desire ong>toong> end ong>theong> meetong>inong>g over ong>theong>

ong>inong>tractable stance of developong>inong>g countries vis-­‐à-­‐vis ong>theong> Song>inong>gapore issues as a way ong>toong> do so

without allowong>inong>g ong>theong> talks ong>toong> contong>inong>ue and ong>theong>reby risk ong>theong> prospect of ong>theong> US becomong>inong>g

isolated on ong>theong> cotong>toong>n issue. Eiong>theong>r way, it wasn't until ong>theong> followong>inong>g summer (2004), that ong>theong>

negotiations got back on track, largely thanks ong>toong> US and EU leadership. The Cancun talks, if ong>theong>y

had provided anythong>inong>g positive (discountong>inong>g ong>theong> accession of ong>theong> first two LDCs ong>toong> ong>theong> ong>WTOong>

Nepal and Cambodia), it was ong>theong> opportunity for developong>inong>g countries ong>toong> vent ong>theong>ir wrath, and

ong>toong> subsequently return ong>toong> ong>theong> negotiatong>inong>g table ong>inong> Geneva with a chance for cooler heads ong>toong>

prevail.

The July 2004 meetong>inong>g, which put ong>theong> ong>Dohaong> Round decidedly back on track -­‐ if only temporarily

-­‐ arguably owed its success more than perhaps any oong>theong>r facong>toong>r ong>toong> ong>theong> ambitions and tenacity

of USTR Bob Zoellick, who -­‐ workong>inong>g closely with ong>theong> EU chief trade negotiaong>toong>r at ong>theong> time

Pascal Lamy -­‐ managed ong>toong> achieve a level of productive and constructive progress ong>inong> ong>theong> early

months of 2004 concernong>inong>g ong>theong>se two countries' positions on agriculture, that it ong>inong>fected ong>theong>

broader ong>WTOong> membership and allowed for a sense of momentum ong>toong> take hold. Thus it was that

by ong>theong> end of July 2004, ong>WTOong> Members had coalesced around a framework document -­‐ ong>theong> July

package -­‐ that contaong>inong>ed a little bit of somethong>inong>g for everyone. 21 Consensus on ong>theong> key

20 See Bridges Daily Update, 14 September 2003, at: http://ictsd.org/i/wong>toong>/wong>toong>-­‐mc5-­‐cancun-­‐2003/bridges-­‐daily-­‐ong>upong>dates-­mc5/161118/

(visited on 26 July 2013).

21 See http://www.wong>toong>.org/english/traong>toong>p_e/dda_e/draft_text_gc_dg_31july04_e.htm.

11


agriculture text was reportedly achieved thanks largely ong>toong> ong>theong> New Zealand ambassador Tim

Grosser, who, ong>inong> his role as ong>theong> chair of ong>theong> Special Session on Agriculture, essentially seized ong>theong>

reong>inong>s from a hapless Song>upong>erchai Panitchpakdi ong>afterong> a series of ong>inong>decisive green room meetong>inong>gs

with ong>theong> maong>inong> protagonists simply repeatong>inong>g ong>theong>ir well-­‐known positions. 22

Ultimately, ong>theong> July package 23 rekong>inong>dled some hope among developong>inong>g country members, that

ong>theong>ir concerns had not simply been forgotten ong>inong> ong>theong> scramble ong>toong> make ong>theong> round about little

more than better market access for agricultural and non-­‐agricultural products, especially by big

developed countries and efficient emergong>inong>g market exporters. Thus, ong>theong> text on agriculture that

emerged from ong>theong> July 2004 meetong>inong>g ong>inong> Geneva specifically provided that developong>inong>g countries

"must be able ong>toong> pursue agricultural policies that are

song>upong>portive of ong>theong>ir development goals, poverty reduction

strategies, food security and livelihood concerns". 24 This

commitment was given more operationally effective character

ong>inong> ong>theong> July package by ong>inong>cludong>inong>g language, ong>inong> ong>theong> section on

market access, subject ong>toong> which developong>inong>g countries would be

permitted ong>toong> list a certaong>inong> number of tariff long>inong>es as sensitive

products, and ong>toong> exclude ong>theong>se products ong>toong> a large degree from

any liberalization. 25 In addition, and also under market access,

developong>inong>g countries were ong>toong> be given a special safeguard

mechanism by which ong>theong>y would be allowed ong>toong> raise tariffs on a

number of pre-­‐selected products above bound rates ong>inong> ong>theong>

event of an import surge. 26 , On cotong>toong>n, ong>theong> July package stated

that as a negotiatong>inong>g issue, it would be addressed "ambitiously,

expeditiously, and specifically" ong>inong> ong>theong> broader framework of ong>theong> agriculture negotiations, that at

least allowed some ong>toong> hope (as it turns out very forlornly) that a resolution on this issue might

come sooner raong>theong>r than later and might not be held hostage ong>toong> ong>theong> Song>inong>gle Undertakong>inong>g. Fong>inong>ally,

ong>theong> July package put ong>inong> writong>inong>g a commitment origong>inong>ally championed by Pascal Lamy that LDCs

would be released from any obligation ong>toong> make reduction commitments, ong>theong>reby givong>inong>g ong>theong>m

what some participants ong>toong>ok ong>toong> callong>inong>g "a round for free". 27

Song>upong>erchai Panitchpakdi, ong>WTOong> Direcong>toong>r

General from 2002; source: ong>WTOong>

22 This is at least how Blusteong>inong> recounts it, see Blusteong>inong>, op cit., at ong>theong> botong>toong>m of p. 92.

23 ong>Dohaong> Work Programme, Decision Adopted by ong>theong> General Council on 1 August 2004 (WT/L/579).

24 Ibid, Annex A, para. 2. It was believed that this language would give cover for excludong>inong>g politically sensitive agricultural

commodities ong>inong> ong>theong> production of which economically vulnerable farmers were engaged, from ong>theong> ambitious tariff cuts that

countries like ong>theong> US, Australia and oong>theong>r Cairns Groong>upong> countries were seekong>inong>g.

25 Ibid, Annex A, para. 41.

26 Ibid, Annex A, para. 42.

27 Ibid, Annex A, para. 43.

12


ong>Lifeong> ong>afterong> ong>Dohaong> |

To sum ong>upong>, ong>theong> mood of ong>theong> ong>WTOong> Members at ong>theong> end of ong>theong> July 2004 negotiations was ong>inong>

stark contrast ong>toong> ong>theong> despondency that had prevailed at ong>theong> end of ong>theong> Cancun collapse. In

press statements ong>afterong> ong>theong> July 2004 meetong>inong>g, Pascal Lamy was quoted as sayong>inong>g that ong>theong> ong>WTOong>

was now "well and ong>runong>nong>inong>g", while developong>inong>g country representatives such as Kamal Nath of

India went on record statong>inong>g "I thong>inong>k it was recognized here that ong>theong> developong>inong>g countries

cannot be taken for granted", and Argentong>inong>a's chief trade negotiaong>toong>r ong>inong> Geneva for ong>theong> meetong>inong>g

(Martong>inong> Redrado) qualifyong>inong>g ong>theong> progress made as "a tremendous advance". 28

2.2 Hong Kong (MC 6), Aid for Trade and Pork-­‐Barrel Commercial Diplomacy

It was quite early on durong>inong>g ong>theong> Hong Kong Mong>inong>isterial ong>Conferenceong> (13–18 December 2005) that

ong>theong> jockeyong>inong>g over a flurry of proposals on aid for trade started ong>toong> pick ong>upong> serious momentum,

begong>inong>nong>inong>g with a proposal circulated by Japan. 29 The thousands of developong>inong>g country

representatives ong>inong> Hong Kong rapidly became enthused with a new-­‐found sense of purpose and

excitement thanks ong>toong> ong>theong> Japanese

aid-­‐for-­‐trade proposal (and ong>theong>

oong>theong>rs that would ensue soon ong>afterong>,

startong>inong>g with ong>theong> EU, followed by

ong>theong> US 30 ), as it became clear ong>toong>

everyone that ong>theong>re was money ong>toong>

be made, and lots of it. One could

have been excused for thong>inong>kong>inong>g that

that ong>theong> meetong>inong>g had now been

allowed ong>toong> degenerate ong>toong> ong>theong> level

______________________________________________

Once ong>theong> aid-­‐for-­‐trade proposals started, it was clear

that ong>theong> meetong>inong>g had degenerated ong>toong> ong>theong> level of pork-­barrel

politics, so that henceforth, developong>inong>g country

demands for genuong>inong>e reform would be bought off ong>inong>

exchange for cash ong>inong>fusions from rich countries

unwillong>inong>g ong>toong> change ong>theong> status quo

______________________________________________

of pork-­‐barrel politics, and that from now on, many developong>inong>g country demands for genuong>inong>e

reform of ong>theong> tradong>inong>g system by cuttong>inong>g ong>theong> highest tariffs and elimong>inong>atong>inong>g ong>theong> most damagong>inong>g

forms of trade-­‐disong>toong>rtong>inong>g domestic song>upong>port would likely be considerably blunted (bought off) ong>inong>

exchange for cash ong>inong>fusions from rich countries unwillong>inong>g ong>toong> show ong>theong> necessary leadership ong>toong>

change ong>theong> status quo. 31

28 All of ong>theong>se quotes taken from a Washong>inong>gong>toong>n Post article dated 1 August 2004 entitled "Accord Reached On Global Trade;

Talks Aim ong>toong> Cut Farm Aid, Tariffs".

29 Bridges Daily Update on ong>theong> Sixth ong>WTOong> Mong>inong>isterial ong>Conferenceong>, at: http://ictsd.org/i/wong>toong>/wong>toong>-­‐mc6-­‐hong-­‐kong-­‐2005/bridges-­daily-­‐ong>upong>dates-­‐mc6/159002/

(visited on 30 July 2013).

30 See article ong>inong> ong>theong> Fong>inong>ancial Times dated 14 December 2005 entitled "Little progress at ong>WTOong> talks despite US aid offer".

31 This view was also shared by John Hilary of War on Want who went on record as sayong>inong>g "rich countries are tryong>inong>g ong>toong> buy off

opposition ong>toong> ong>theong>ir trade policies by means of a cynical bribe.", quoted ong>inong> Bridges Daily Update on ong>theong> Sixth ong>WTOong> Mong>inong>isterial

ong>Conferenceong>, at: http://ictsd.org/i/wong>toong>/wong>toong>-­‐mc6-­‐hong-­‐kong-­‐2005/bridges-­‐daily-­‐ong>upong>dates-­‐mc6/159002/ (visited on 30 July 2013).

13


It is probably fair ong>toong> say that, although ong>theong>re was a relatively strong sense of anti-­‐climactic let-­down,

ong>theong> Hong Kong meetong>inong>g brought neiong>theong>r ong>theong> sense of ong>toong>tal despair which followed ong>theong>

collapse ong>inong> Cancun, nor ong>theong> eong>upong>horia that seemed ong>toong> have gripped delegates ong>afterong> ong>theong> July 2004

meetong>inong>g ong>inong> Geneva. One important and largely overlooked concession was ong>theong> EU's offer ong>toong>

elimong>inong>ate all export subsidies by 2013. One participant at ong>theong> Hong Kong meetong>inong>g, a veteran of

several trade rounds goong>inong>g back ong>toong> ong>theong> Tokyo Round noted that if ong>theong> EU had made an offer like

that back ong>inong> ong>theong> 1970s or 1980s, many would have considered it significant enough ong>toong> conclude

negotiations and seal ong>theong> deal right ong>theong>n and ong>theong>re. 32 Unfortunately this was not ong>theong> sentiment

ong>inong> Hong Kong, and so wranglong>inong>g contong>inong>ued, particularly between ong>theong> US and ong>theong> EU. Also worth

notong>inong>g is that expectations had been severely drummed down ong>inong> ong>theong> ong>runong> ong>upong> ong>toong> ong>theong> meetong>inong>g,

with several negotiaong>toong>rs and Pascal Lamy -­‐ now appoong>inong>ted as ong>WTOong> Direcong>toong>r General -­‐ voicong>inong>g

ong>theong>ir opong>inong>ions that it might be necessary ong>toong> hold a follow-­‐ong>upong> meetong>inong>g ong>toong> ong>theong> Hong Kong

Mong>inong>isterial as early as March 2006 ong>inong> Geneva, just so that some real progress could be achieved

away from ong>theong> limelight, political poong>inong>t-­‐scorong>inong>g and posturong>inong>g that ong>inong>evitably accompanied high-­level

Mong>inong>isterial ong>Conferenceong> meetong>inong>gs. 33

2.3 Geneva 2008 – Much Ado about Special Safeguard Measures

If at least a dull shimmer of hope had imbued ong>theong> conclusion of MC6 ong>inong> Hong Kong, by ong>theong>

summer of 2008, ong>theong> ong>WTOong> was back ong>toong> deadlock and despondency with even Pascal Lamy's

optimism seemong>inong>g ong>toong> have faded as talks collapsed at ong>theong> end of a marathon 9-­‐day negotiatong>inong>g

session dubbed anoong>theong>r mong>inong>i-­‐mong>inong>isterial (21 -­‐29 July 2008). 34 Lamy had convened ong>theong> meetong>inong>g

for ong>theong> purpose of preparong>inong>g ong>theong> formal establishment of modalities ong>inong> agriculture and NAMA. 35

It was ultimately ong>theong> Direcong>toong>r General who ong>afterong> 5 days of talks that had seen only modest

convergence, seized ong>theong> ong>inong>itiative and ong>toong>ok ong>theong> raong>theong>r desperate measure of himself drawong>inong>g ong>upong>

a framework for compromise on many of ong>theong> issues that had eluded consensus ong>upong> ong>toong> that poong>inong>t,

such as ong>theong> magnitude of cuts ong>inong> domestic song>upong>port by developed countries, ong>theong> scope of tariff

cuts and thus market access commitments for both agricultural and ong>inong>dustrial goods. Lamy's

compromise text received mixed reviews but it was essentially viewed as a basis for contong>inong>uong>inong>g

talks. 36

32 This sentiment was expressed ong>toong> me by Gary Horlick.

33 See BBC News Article dated 22 November 2005 entitled "ong>WTOong> 'won't agree deal ong>inong> Chong>inong>a", available at:

http://news.bbc.co.uk/2/hi/busong>inong>ess/4461730.stm (visited on 30 July 2013).

34 See Blusteong>inong> at p. 275 who refers ong>toong> Lamy "chockong>inong>g ong>upong>".

35 Bridges Daily Update on ong>theong> Sixth ong>WTOong> Mong>inong>isterial ong>Conferenceong>, at: http://ictsd.org/i/wong>toong>/wong>toong>-­‐mong>inong>i-­‐mc-­‐geneva-­‐

2008/englishong>upong>dates/13365/ (visited on 30 July 2013).

36 See Blusteong>inong> at p. 264.

14


ong>Lifeong> ong>afterong> ong>Dohaong> |

Ultimately, ong>theong> July 2008 talks failed ostensibly over an issue that caused quite a bit of surprise

among many commentaong>toong>rs, namely a special safeguard measure (SSM) for developong>inong>g

countries that would allow ong>theong>m ong>toong> temporarily raise tariffs above bound rates ong>inong> ong>theong> event of

an import surge. 37 Article 5 of ong>theong> ong>WTOong> Agreement on Agriculture (AoA) already contaong>inong>s a

clause that affords ong>theong> right for some Members ong>toong> ong>inong>voke this measure (referred ong>toong> as an

"SSG"), provided ong>theong>y reserved ong>theong> right ong>toong> do so durong>inong>g ong>theong> Uruguay Round. 38 Song>inong>ce ong>theong>

conclusion of ong>theong> Uruguay Round, some countries have been forced ong>toong> rue ong>theong>ir failure ong>toong>

ong>inong>voke ong>theong> special safeguard on a number of agricultural tariff long>inong>es, thus limitong>inong>g ong>theong>m ong>inong>

prong>inong>ciple, ong>toong> ong>theong> regular ong>WTOong> safeguard action (under ong>theong> GATT Article XX escape clause) as ong>theong>

only legal option for fendong>inong>g off ong>inong>jurious import surges. This was ong>inong>deed ong>theong> oversight that was

behong>inong>d ong>theong> Korea Dairy dispute with ong>theong> EU ong>inong> from 1997-­‐1999, when Korea -­‐ unable ong>toong> ong>inong>voke

ong>theong> special safeguard under Article 5 of ong>theong> Agreement on Agriculture -­‐ imposed additional

duties on imports of skimmed milk powder ong>afterong> its market experienced massive import surges

ong>inong> this product which constituted a significant threat ong>toong> its own dairy ong>inong>dustry (or so it

claimed). 39 Korea lost that dispute, just like oong>theong>r countries would subsequently lose similar

disputes ong>inong>volvong>inong>g ong>theong>ir use of safeguards under ong>theong> ong>WTOong> escape clause. 40 Perhaps it was ong>theong>

fact that it had ultimately proven unexpectedly difficult ong>toong> legally impose safeguard measures

under ong>WTOong> rules that had led developong>inong>g countries ong>toong> ong>theong> conclusion that what ong>theong>y needed

was ong>theong> kong>inong>d of air-­‐tight policy space that a special safeguard measure very similar ong>toong> ong>theong> one

set forth ong>inong> Article 5 AoA afforded. Eiong>theong>r way, with ong>theong> benefit of hong>inong>dsight ong>afterong> a considerable

ong>inong>crease ong>inong> protectionism durong>inong>g and ong>afterong> ong>theong> fong>inong>ancial crisis and ong>theong> ensuong>inong>g global recession,

ong>inong> which countries demonstrated previously unmatched levels of ong>inong>ventiveness ong>inong> usong>inong>g and

abusong>inong>g existong>inong>g trade rules ong>toong> keep out imports ong>toong> shelter import-­‐competong>inong>g domestic

ong>inong>dustries (discussed immediately below), it seems surprisong>inong>g that it was somethong>inong>g as

mundane as a special safeguard measure that caused ong>theong> collapse of ong>theong> July 2008 meetong>inong>g ong>inong>

Geneva. 41

37 Bridges Daily Update on ong>theong> Sixth ong>WTOong> Mong>inong>isterial ong>Conferenceong>, at: http://ictsd.org/i/wong>toong>/geneva2008/englishong>upong>dates/15315/

(visited on 30 July 2013).

38 See Yong-­‐Shik Lee, Safeguard Measures ong>inong> World Trade: The Legal Analysis, Kluwer Law International, 2007, at p. 153.

39 See Korea – Defong>inong>itive Safeguard Measure on Imports of Certaong>inong> Dairy Products, Report of ong>theong> Panel, (WT/DS98/R) at para.

4.54.

40 It is generally recognized that ong>theong> difficulty ong>inong> imposong>inong>g safeguard measures under GATT Art. XX and ong>theong> Uruguay Round

Agreement on Safeguards is due more than anythong>inong>g ong>toong> ong>theong> causation and non-­‐attribution requirements set out ong>inong> Art. 4.2 (b) of

ong>theong> Safeguards Agreement, see: Douglas A. Irwong>inong>, Causong>inong>g problems? The ong>WTOong> review of causation and ong>inong>jury attribution ong>inong> US

Section 201 cases, ong>inong> World Trade Review, Vol. 2(3), 2003, pp. 297–325, at:

http://www.dartmouth.edu/~dirwong>inong>/docs/causal.pdf, (visited on 30 July 2013).

41 Meanong>inong>g it is surprisong>inong>g that what was allowed ong>toong> brong>inong>g ong>theong> talks ong>toong> an abrong>upong>t end was that a country such as India felt that it

absolutely and unequivocally needed ong>theong> extra policy space that a special safeguard would have afforded it; See J. Michael

Fong>inong>ger, A Special Safeguard Mechanism for Agricultural Imports: what experience with oong>theong>r GATT/ong>WTOong> safeguards tells us

about what might work, ong>inong>: World Trade Review, Vol. 9 (2), 2010, pp. 289 318, Cambridge University Press.

15


16


ong>Lifeong> ong>afterong> ong>Dohaong> |

2.4 The Global Economic Crisis and Subsequent Developments for ong>theong> DDA

ong>Someong> very traumatic events have rocked and ong>inong> many ways transformed ong>theong> global economy

song>inong>ce ong>theong> collapse of ong>theong> July 2008 mong>inong>i mong>inong>isterial meetong>inong>g ong>inong> Geneva. Easily ong>theong> most

important of ong>theong>se would have ong>toong> be ong>theong> onset of ong>theong> global fong>inong>ancial crisis, which was already

startong>inong>g ong>toong> take hold before ong>theong> July 2008 meetong>inong>g, but which got goong>inong>g ong>inong> full swong>inong>g with ong>theong>

collapse of Lehman Broong>theong>rs on 15 September 2008.

The crisis had a cripplong>inong>g effect on ong>inong>ternational

trade, both because of ong>theong> collapse ong>inong> demand as

well as because ong>theong> credit cong>runong>ch had a chillong>inong>g effect

on trade fong>inong>ance. 42 The crisis also led ong>toong> an ong>inong>crease

ong>inong> pressure on governments across both ong>theong>

developed and developong>inong>g world ong>toong> flout trade rules

ong>inong> various forms ong>inong> order ong>toong> prop ong>upong> domestic

economic ong>inong>terests. 43 In developed countries, most

measures were part of stimulus packages contaong>inong>ong>inong>g

bailout plans with massive cash ong>inong>jections for

domestic ong>inong>dustries, particularly ong>theong> auong>toong> ong>inong>dustry,

US Treasury Secretary Hank Paulson (L) and Federal

Reserve Chairman Bernard Bernake ong>inong> 2008; source:

Wikimedia Commons

but also clean technology, transport ong>inong>frastructure and various oong>theong>rs. 44 There was also a

correspondong>inong>g rise ong>inong> contong>inong>gency protection measures ong>inong> developed country markets such as

ong>theong> US and ong>theong> EU, as import-­‐competong>inong>g ong>inong>dustries turned ong>toong> ong>theong>ir governments for import

relief. 45

42 See article ong>inong> MoneyWeek dated 24 Ocong>toong>ber 2008, entitled "Is ong>inong>ternational trade grong>inong>dong>inong>g ong>toong> a halt?" at:

http://moneyweek.com/is-­‐ong>inong>ternational-­‐trade-­‐grong>inong>dong>inong>g-­‐ong>toong>-­‐a-­‐halt-­‐13909/ (visited on 31 July 2013); ong>Someong> economists question

ong>theong> role played by ong>theong> contraction ong>inong> trade fong>inong>ance, see e.g. Andrei A Levchenko et al, The Collapse of International Trade durong>inong>g

ong>theong> 2008–09 Crisis: In Search of ong>theong> Smokong>inong>g Gun, ong>inong> "IMF Economic Review" (2010) 58, pp. 214–253, at: http://www.palgrave-­journals.com/imfer/journal/v58/n2/abs/imfer201011a.html

(visited on 31 July 2013).

43 This trend has been documented and analyzed by a number of ong>inong>stitutions and ong>inong>dividuals, albeit perhaps none with as much

focus as Simon Evenett and his Global Trade Alert (http://www.globaltradealert.org). For a concise and easily digestible

overview of ong>theong> impact ong>theong> crisis had on trade policy ong>inong> a number of counties, see Simon J. Evenett and Martong>inong> Wermelong>inong>ger,

Chapter 1, A snapshot of contemporary protectionism: how important are ong>theong> murkier forms of trade discrimong>inong>ation, ong>inong>: Mia

Mikic with Martong>inong> Wermelong>inong>ger (eds), Risong>inong>g Non-­‐Tariff Protectionism and Crisis Recovery, Economic and Social Commission for

Asia and ong>theong> Pacific, 2010, at: http://www.unescap.org/tid/publication/tipub2587.pdf (visited on 31 July 2013); See also Crong>inong>a

Viju and William A. Kerr, Protectionism and Global Recession: Has ong>theong> Long>inong>k Been Broken?; ong>inong>: Journal of World Trade Vol 45 (3),

2011, pp. 605–628, Kluwer Law International BV.

44 For an ong>inong>-­‐depth account of ong>theong> US auong>toong> bailout, see: Steven Rattner, Overhaul: An Insider's Account of ong>theong> Obama

Admong>inong>istration's Emergency Rescue of ong>theong> Auong>toong> Industry, Houghong>toong>n Mifflong>inong> Harcourt, September 2010; For a detailed treatment

of ong>theong> 2009 US Stimulus Bill, see Michael Gong>runong>wald, The New New Deal: The Hidden Song>toong>ry of Change ong>inong> ong>theong> Obama Era, Simon &

Schuster. August 2012.

45 Chad P. Bown, Assessong>inong>g ong>theong> G20 use of antidumpong>inong>g, safeguards and countervailong>inong>g duties durong>inong>g ong>theong> 2008-­‐2009 crisis‖, ong>inong>

Simon J. Evenett (ed.), Unequal Compliance: ong>theong> 6th GTA Report, London, Centre for Economic Policy Research, pp. 39-­‐47.

17


In developong>inong>g countries, as job losses mounted and economic hardship began ong>toong> be felt,

governments also came under pressure ong>toong> provide import relief from domestic producers of

import-­‐competong>inong>g products, eiong>theong>r by usong>inong>g traditional means such as raisong>inong>g applied tariff

levels ong>toong> bound rates, ong>theong> application of contong>inong>gency protection measures or by resortong>inong>g ong>toong>

oong>theong>r protectionist impediments, such as technical barriers ong>toong> trade, sanitary and phyong>toong>sanitary

measures, import licenses and oong>theong>r similar ong>inong>struments. 46 In some developong>inong>g countries ong>theong>re

was also anoong>theong>r imperative behong>inong>d efforts ong>toong> restraong>inong> imports, namely ong>theong> need ong>toong> provide

relief ong>toong> deterioratong>inong>g balance of payments situations, and relieve pressure on already stretched

budget deficits.

As ong>theong> global economic crisis seemed ong>toong> abate, it was replaced with dogged unemployment and

stagnatong>inong>g consumer demand ong>inong> ong>theong> US, and ong>theong> onset of an austerity-­‐ong>inong>duced slowdown ong>inong>

several European countries. Developong>inong>g markets managed ong>toong> recover somewhat faster, with

India, Chong>inong>a and Brazil soon postong>inong>g healthy growth figures. In any event, although summit

meetong>inong>gs durong>inong>g ong>theong> and ong>afterong> ong>theong> crisis had regularly seen leaders produce declarations

unequivocally callong>inong>g for a swift conclusion ong>toong> ong>theong> ong>Dohaong> Round ong>inong> order ong>toong> revive ong>theong> global

economy, ong>theong>se statements were not translated ong>inong>ong>toong> action by ambassadors or trade mong>inong>isters

In Geneva or elsewhere. In fact, quite ong>theong> opposite, song>inong>ce it would seem that ong>inong> terms of

domestic political calculus, times of economic hardship, high unemployment and austerity are

ong>theong> worst possible moments ong>inong> which ong>toong> conclude sweepong>inong>g trade deals, ong>theong> distributional

_________________________________________

The two Mong>inong>isterial ong>Conferenceong>s that have taken

place song>inong>ce ong>theong> breakdown of ong>theong> 2008 talks, ong>inong>

December 2009 and December 2011, have both

been little more than song>toong>cktakong>inong>g exercise

_________________________________________

effects of which must ong>theong>n be "sold" ong>toong> a

sceptical and strugglong>inong>g elecong>toong>rate. 47

Song>inong>ce ong>theong> breakdown of ong>theong> 2008 talks,

ong>theong>re have been two furong>theong>r Mong>inong>isterial

ong>Conferenceong>s, both ong>inong> Geneva (MC 7 from

30 November ong>toong> 2 December 2009, and

MC 8 from 15 ong>toong> 17 December 2011). It's

hard ong>toong> say wheong>theong>r it was Pascal Lamy's tireless optimism and unfalterong>inong>g ambition or just ong>theong>

fact that Article VI.1 of ong>theong> Marrakesh Agreement mandates ong>theong>se meetong>inong>gs every two years

that were ong>theong> drivong>inong>g dynamic behong>inong>d ong>theong>se get-­‐ong>toong>geong>theong>rs. In any event, ong>theong>y both followed a

very similar course, which is ong>toong> say ong>theong>y were both essentially reduced ong>toong> little more than

simple song>toong>cktakong>inong>g exercises, with ong>theong> DG and Members as a whole keen ong>toong> avoid even ong>theong>

46 H.L. Kee, et al, Is Protectionism on ong>theong> Rise? Assessong>inong>g National Trade Policies durong>inong>g ong>theong> Crisis of 2008, World Bank Policy

Research Workong>inong>g Paper 5274, at: http://go.worldbank.org/Q2MKLTEIN0 (visited on 31 July 2009).

47 See Edward John Ray, "Changong>inong>g Patterns of Protectionism: The Fall ong>inong>" "Tariffs and ong>theong> Rise ong>inong> Non-­‐Tariff Barriers

"Symposium: The Political Economy of International Trade Law and Policy" ong>inong>: Northwestern Journal of International Law &

Busong>inong>ess, Vol. 8 (2), 1987, pp. 285 et seq., at p. 16 ong>inong> particular.

18


ong>Lifeong> ong>afterong> ong>Dohaong> |

whiff of anoong>theong>r high-­‐stakes collapse. Much of ong>theong> negotiatong>inong>g on ong>theong> truly troublesome issues

of agriculture and NAMA contong>inong>ued, primarily ong>inong> Geneva but ong>inong> ong>theong> months between Mong>inong>isterial

ong>Conferenceong> meetong>inong>gs. Thus we have seen ong>theong> focus shift ong>toong> more technical issues, such as

schedulong>inong>g approaches ong>inong> ong>theong> agriculture talks, and non-­‐tariff barriers ong>inong> ong>theong> NAMA

negotiations. 48 The agricultural talks ong>toong>ok a new tack ong>inong> 2012 as ong>theong> onus moved ong>inong> response ong>toong>

a submission made on food security by developong>inong>g countries. 49 By ong>theong> middle of 2012, Pascal

Lamy joong>inong>ed oong>theong>r ong>WTOong> Members (particularly ong>theong> US) that had ong>inong>dicated a strong preference

for ong>theong> Organization ong>toong> abandon ong>theong> Song>inong>gle Undertakong>inong>g and start makong>inong>g progress on any area

where positive outcomes might still be achievable, by negotiatong>inong>g ong>inong> plurilateral groong>upong>s or

"clusters". 50

There has also been some progress ong>inong> oong>theong>r areas, seemong>inong>gly far removed from ong>theong> squabbles

on subsidy and tariff cuts that characterised ong>theong> agriculture and NAMA negotiations for so

many years. This would ong>inong>clude most notably trade facilitation 51 , which, if anythong>inong>g, promises ong>toong>

be ong>theong> real deliverable as we head ong>toong>wards Bali. More limited progress has been made recently

ong>inong> talks on services, where agaong>inong> it seems as if ong>theong> Song>inong>gle Undertakong>inong>g has been relegated ong>toong> ong>theong>

hisong>toong>ry books (where it perhaps belongs ong>inong> an organization of 155 countries and separate

cusong>toong>ms terriong>toong>ries). Reform of ong>theong> Dispute Settlement Understandong>inong>g has also seen limited

progress and could possibly be anoong>theong>r bunch of low-­‐hangong>inong>g fruit that ong>theong> ong>WTOong> might be able

ong>toong> harvest at ong>theong> Bali meetong>inong>g. 52 As we get closer ong>toong> ong>theong> December meetong>inong>g and with ong>theong> "last

petrol song>toong>p on ong>theong> road ong>toong> Bali" havong>inong>g been passed ong>inong> July 53 (with reportedly adequate

progress 54 ), ong>theong> focus will need ong>toong> narrow on a few core issues were forward momentum can be

maong>inong>taong>inong>ed. The next section turns away from ong>theong> histrionics of ong>theong> ong>Dohaong> Round with ong>theong>

ong>inong>evitable speculation about what may or may not be achieved at Bali, and asks what ong>toong> do with

ong>theong> ong>WTOong>.

48 See Bridges Weekly Trade News Digest • Volume 13 • Number 16 • 6th May 2009, at:

http://ictsd.org/i/news/bridgesweekly/46289/ (visited on 31 July 2013).

49 See Bridges Weekly Trade News Digest • Volume 16 • Number 39 • 14th November 2012, at:

http://ictsd.org/i/news/bridgesweekly/149960/ (visited on 31 July 2013).

50 This was ong>inong>deed somethong>inong>g that had started beong>inong>g advocated as early as 2011, where some members, seeong>inong>g ong>theong> progress

made usong>inong>g this approach for an ong>upong>dated Government Procurement Agreement, also concluded it would be ong>theong> best way

forward ong>inong> oong>theong>r areas, ong>inong>cludong>inong>g ong>inong> particular services; See Bridges Weekly Trade News Digest • Volume 16 • Number 29 • 25th

July 2012, at: http://ictsd.org/i/news/bridgesweekly/139026/ (visited on 31 July 2013).

51 See Bridges Weekly Trade News Digest • Volume 16 • Number 29 • 25th July 2012, at:

http://ictsd.org/i/news/bridgesweekly/67633/ (visited on 31 July 2013).

52 See Bridges Weekly Trade News Digest • Volume 16 • Number 29 • 25th July 2012, at:

http://ictsd.org/i/news/bridgesweekly/99586/ (visited on 31 July 2013).

53 This was how Pascal Lamy put it, quoted ong>inong> Bridges Weekly Trade News Digest vol. 17 (20) 6 June 2013, at:

http://ictsd.org/i/news/bridgesweekly/165342/ (visited on 31 July 2013).

54 See "Lamy: 'Clearer' Road ong>toong> Bali Mong>inong>isterial, Though Work Remaong>inong>s", ong>inong> Bridges Weekly Trade News Digest vol. 17 (27) 25

June 2013, at: http://ictsd.org/i/news/bridgesweekly/173294/ (visited on 31 July 2013).

19


3 What ong>toong> do with ong>theong> ong>WTOong>

Song>inong>ce ong>theong> collapse ong>inong> July 2008, ong>theong>re has been a fair amount of navel gazong>inong>g by ong>theong> ong>WTOong> itself 55 ,

as well as helpful advice by outsider commentaong>toong>rs on how ong>toong> get ong>theong> Organization beyond its

current funk. 56 Not wishong>inong>g ong>toong> really add ong>toong> this debate, this chapter limits itself ong>toong> makong>inong>g three

poong>inong>ts, ong>theong> first beong>inong>g that ong>WTOong> Members do not necessarily need ong>toong> be engaged ong>inong> a perpetual

negotiatong>inong>g round for ong>theong> Organization ong>toong> survive (consolidation trumps negotiation -­‐ at least

for a while). This section also discusses ong>theong> fickleness of attempts ong>toong> turn ong>theong> ong>WTOong> ong>inong>ong>toong> just

anoong>theong>r carpet bagger ong>inong> ong>theong> global fraternity of economic development organizations (which is

ong>toong>tally at odds with its ong>inong>stitutional psychology). Fong>inong>ally it discusses a few thong>inong>gs that ong>theong> ong>WTOong>

has managed and is managong>inong>g ong>toong> do very well, and which ong>theong> Organization should be

encouraged and song>upong>ported ong>inong> doong>inong>g furong>theong>r.

3.1 Debunkong>inong>g ong>theong> Bicycle Theory

It seems ong>toong> be a fairly well rehearsed

aphorism ong>theong>se days that ong>theong> process of

trade liberalization is like a bicycle, which,

if it ever song>toong>ps movong>inong>g forward, will fall

over. Fred Bergsten is generally credited

with first coong>inong>ong>inong>g this phrase ong>inong> ong>theong>

1970s 57 , and USTR Zoellick also ong>inong>voked it

ong>inong> an op-­‐ed he wrote for ong>theong> New York

Times a few weeks before ong>theong> 2001 ong>Dohaong>

58

meetong>inong>g. Blusteong>inong>, ong>inong> his detailed

chronicle of ong>theong> ong>WTOong> coverong>inong>g ong>theong> period

from Seattle ong>toong> July 2008 also makes a

compellong>inong>g case for ong>theong> need for ong>theong>

Danish public bicycle; source: Wikimedia Commons

legislative function of ong>theong> ong>WTOong>, i.e. its

negotiatong>inong>g bodies (like ong>theong> Trade Negotiations Committee or TNC) ong>toong> constantly ong>upong>date ong>theong>

ong>WTOong> agreements so that ong>theong> Organizations' rules accurately reflect and govern ong>theong> issues and

55 See e.g. Panel on Defong>inong>ong>inong>g ong>theong> Future of Trade convened by ong>WTOong> Direcong>toong>r-­‐General Pascal Lamy, The Future of Trade: The

Challenges of Convergence, World Trade Organization, April 2013, at:

http://www.wong>toong>.org/english/ong>theong>wong>toong>_e/dg_e/dft_panel_e/future_of_trade_report_e.pdf (visited on 31 July 2013).

56 See e.g. Richard Baldwong>inong> and Simon Evenett (eds.), Next Steps: Gettong>inong>g Past ong>theong> ong>Dohaong> Round Crisis, Centre for Economic

Policy Research (CEPR), 2011, at: http://www.iadb.org/ong>inong>tal/ong>inong>talcdi/PE/2011/08348.pdf (visited on 31 July 2013).

57 See Fred Bergsten, Toward a New International Economic Order, Lexong>inong>gong>toong>n Books, 1975, as quoted ong>inong> Bachus (2003).

58 See "The Record Shows It's ong>theong> Open Traders Who Get Ahead" by Robert B. Zoellick, New York Times, 8 November 2001, at:

http://www.nytimes.com/2001/11/08/opong>inong>ion/08iht-­‐edrobert_ed3_.html (visited on 1 August 2013).

20


ong>Lifeong> ong>afterong> ong>Dohaong> |

tensions confrontong>inong>g ong>theong> world tradong>inong>g system. 59 It is almost certaong>inong>ly wrong ong>toong> assume that

because ong>theong> ong>Dohaong> Round has stalled, worldwide efforts ong>toong> liberalize ong>inong>ternational trade have

stalled with it. To be sure, efforts at achievong>inong>g greater market openong>inong>g and a reduction ong>inong> trade

barriers on a multilateral basis are currently on ice, but ong>theong> march of trade and ong>inong>vestment

liberalization is movong>inong>g on ong>inong> different forms and fora. After all, what is ong>theong> spaghetti bowl of

preferential tradong>inong>g arrangements that has swept ong>upong> so many ong>WTOong> Members if not an

unprecedented surge of energy ong>toong>wards ong>theong> reduction of trade barriers (albeit on a

discrimong>inong>aong>toong>ry and thus admittedly "third-­‐best" policy option basis 60 )? Many economists and

trade policy commentaong>toong>rs view ong>theong> pivot ong>toong>wards preferentialism as an alarmong>inong>g move ong>inong> ong>theong>

wrong direction. 61 Oong>theong>rs 62 prefer ong>toong> take a longer view, song>inong>ce, ong>afterong> all, was not ong>theong> 1948 GATT

first preceded by a slew of bilateral preferential trade agreements entered ong>inong>ong>toong> by Cordell Hull

under ong>theong> Reciprocal Trade Agreements Act of 1938? 63 Taken ong>toong>geong>theong>r, ong>theong> current two

preferential tradong>inong>g arrangements beong>inong>g negotiated under ong>theong> auspices of ong>theong> Transpacific

Partnership (TPP) and ong>theong> Transatlantic Trade and Investment Partnership (TTIP) will cover close

ong>toong> 80 per cent of global GDP 64 . The discrimong>inong>aong>toong>ry side effects of not beong>inong>g part of ong>theong>se

agreements will be felt by only a small number of countries, which wont ong>inong>clude most of ong>theong>

world's poorest nations, song>inong>ce ong>theong>se countries already benefit from duty free (and largely quota

free) access ong>toong> ong>theong>ir maong>inong> export markets under a variety of frameworks such as Everythong>inong>g But

Arms (EBA), ong>theong> African Growth and Opportunity Act (AGOA), ong>theong> Generalised System of

Preferences (GSP), and preferential access agreements like ong>theong> EU's extensive network of

Economic Partnership Agreements (EPAs).

Even lookong>inong>g beyond ong>theong> myriad of preferential tradong>inong>g arrangements, it is now possible ong>toong>

detect signs of trade liberalization at ong>theong> ong>WTOong>, even ong>inong> ong>theong> absence of movement under ong>theong>

ong>Dohaong> Work Program. This has proven true for an expanded agreement on government

59 See Blusteong>inong>'s musong>inong>gs ong>inong> Chapter 14 of Misadventures of ong>theong> Most Favored Nations, op cit.

60 The statement ong>inong> brackets assumes that ong>theong> "first best" policy option for liberalization is ong>theong> unilateral lowerong>inong>g or elimong>inong>ation

of trade barriers (desirable economically but not always achievable politically); ong>theong> "second best" policy option is multilateral

liberalization under ong>theong> ong>WTOong> or a similar framework; and that thus any liberalization undertaken ong>inong> ong>theong> form of preferential

tradong>inong>g arrangements is little more than a "third best" policy option.

61 Jagdish Bhagwati and Anne O. Krueger, The Dangerous Drift ong>toong> Preferential Trade Agreements, American Enterprise Institute,

1995.

62 Richard Baldwong>inong> and Patrick Low, Multilateralizong>inong>g Regionalism, Cambridge University Press, 2009.

63 Kenneth W. Dam, Cordell Hull, The Reciprocal Trade Agreement Act, and ong>theong> ong>WTOong>, Brookong>inong>gs, 2004, at:

http://www.brookong>inong>gs.edu/research/papers/2004/10/10globaleconomics-­‐dam (visited on 1 August 2013); for a more

hisong>toong>rically auong>theong>ntic source, see: Richard N. Gardner, Sterlong>inong>g Dollar Diplomacy, Oxford at ong>theong> Clarendon Press, 1956.

64 The TTIP and ong>theong> TPP are reported as each coverong>inong>g approximately 40 percent and 60 percent of global GDP, see: The

Washong>inong>gong>toong>n Post article dated 8 July 2009 entitled "Talks over a huge U.S.-­‐Europe trade deal start this week. Here’s what you

need ong>toong> know" at: http://www.washong>inong>gong>toong>npost.com/blogs/wonkblog/wp/2013/07/08/talks-­‐over-­‐a-­‐huge-­‐u-­‐s-­‐europe-­‐trade-­deal-­‐start-­‐this-­‐week-­‐heres-­‐what-­‐you-­‐need-­‐ong>toong>-­‐know/

(visited on 1 August 2013); see also USTR press release dated 25

September 2008 entitled "Trans-­‐Pacific Partners and United States Launch FTA Negotiations", at: http://www.ustr.gov/trans-­pacific-­‐partners-­‐and-­‐united-­‐states-­‐launch-­‐fta-­‐negotiations

(visited on 1 August 2013).

21


procurement, and is now lookong>inong>g ong>inong>creasong>inong>gly likely for trade ong>inong> services. In fact, ong>theong>re are a

number of areas where some sort of agreement is lookong>inong>g more than probable outside of ong>theong>

constraong>inong>ts posed by ong>theong> Song>inong>gle Undertakong>inong>g, such as trade facilitation, a South-­‐South

agreement on duty free and quota free access for LDCs, even reform of ong>theong> Dispute Settlement

Understandong>inong>g. Members, it seems, have ong>inong>creasong>inong>gly come ong>toong> see ong>theong> Song>inong>gle Undertakong>inong>g as a

debilitatong>inong>g straight jacket that must be thrown off if anythong>inong>g is ong>toong> be achieved ong>inong> Geneva.

As a piece of political-­‐economy orthodoxy, ong>theong> bicycle ong>theong>ory contends that where ong>theong> process

of trade liberalization ceases movong>inong>g forward, ong>theong> global tradong>inong>g system ong>inong>evitably succumbs ong>toong>

a rise ong>inong> protectionism and a

tendency for those

countries that had

traditionally shown

leadership ong>inong> trade

negotiations, ong>toong> become

ong>inong>creasong>inong>gly ong>inong>ward-­‐lookong>inong>g.

Although we have seen a

rise ong>inong> protectionism over

ong>theong> last few years song>inong>ce ong>theong>

economic crisis, this was

__________________________________________

Although a lot of liberalization now happens outside of ong>theong>

ong>WTOong> ong>theong>re is still forward momentum ong>inong> Geneva, such as an

expanded agreement on government procurement, and

possiblly also ong>inong> trade ong>inong> services. Consensus also lookong>inong>g

likely for an agreement on trade facilitation and review of ong>theong>

Dispute Settlement Understandong>inong>g.

______________________________________________

ong>inong>variably part of a broader, knee-­‐jerk reaction by policymakers and trade mong>inong>istry officials ong>toong>

ong>theong> domestic micro-­‐ and macroeconomic impacts of ong>theong> crisis, raong>theong>r than a sympong>toong>m of ong>theong>

failure ong>toong> achieve positive outcomes under ong>theong> ong>Dohaong> process.

3.2 The ong>WTOong> is not a Development Organization (at least not directly)

A little over a year ong>afterong> ong>theong> collapse of ong>theong> Cancun mong>inong>isterial meetong>inong>g ong>inong> September 2003,

when many people's faith ong>inong> ong>theong> development-­‐centricity of ong>theong> ong>Dohaong> Round was startong>inong>g ong>toong> fray

considerably, a very ong>inong>terestong>inong>g paper was published by Joseph Stieglitz and Andrew Charlong>toong>n,

entitled "The Development Round of Trade Negotiations In The Aftermath of Cancun". 65

Although this report contaong>inong>s a number of erroneous assumptions and naïve assertions 66 , its

65 Joseph E. Stiglitz and Andrew Charlong>toong>n, The Development Round of Trade Negotiations In The Aftermath of Cancun,

Commonwealth Secretariat, 2004, available at: http://www.policyong>inong>novations.org/ideas/policy_library/data/01132 (visited on 2

August 2013).

66 For example, ong>theong> paper asserts that ong>theong> need ong>toong> put ong>theong> ong>inong>terests of developong>inong>g countries' at ong>theong> center of ong>theong> negotiatong>inong>g

agenda was ong>theong> result of "a renewed spirit of collective responsibility for ong>theong> challenges faced by poor countries, and also as a

response ong>toong> ong>theong> perceived ong>inong>equities generated by previous rounds of trade negotiations" (p. 2). As Blusteong>inong> (op. cit.) has

convong>inong>cong>inong>gly laid out, ong>theong> focus on development was both an attempt by Mike Moore ong>toong> "rebrand" ong>theong> Organization ong>inong> ong>theong>

ong>afterong>math of Seattle, and a (somewhat cynical) negotiatong>inong>g tactic ong>inong> order ong>toong> get reluctant developong>inong>g countries ong>toong> abandon

ong>theong>ir ong>inong>sistence on focusong>inong>g on implementation issues and agree ong>toong> ong>theong> launch of a new round at ong>Dohaong>.

22


ong>Lifeong> ong>afterong> ong>Dohaong> |

value was and remaong>inong>s ong>theong> fact that it highlights, ong>inong> easily understandable terms, what ong>theong> ong>Dohaong>

Work Program would look like if developong>inong>g countries' ong>inong>terest were truly at ong>theong> heart of ong>theong>

agenda. By ong>theong> same ong>toong>ken, ong>theong> paper succeeded ong>inong> poong>inong>tong>inong>g out just how far from such an

agenda ong>theong> emphasis of ong>theong> ong>Dohaong> round had strayed. Thus it is, ong>theong>y argue, that if ong>Dohaong> were

genuong>inong>ely about ong>theong> ong>inong>terests of developong>inong>g countries, ong>theong>n its primary focus would be on

reducong>inong>g trade barriers ong>toong> exports of labour-­‐ong>inong>tensive goods (particularly textiles and processed

foods) as well as agricultural commodities. In ong>theong> area of services, a development round would

logically have ong>toong> prioritize ong>theong> movement of workers ong>inong> lower-­‐skilled vocations such as maritime

and construction, and provide easier access ong>toong> labour markets ong>inong> developed countries for

developong>inong>g-­‐country workers ong>inong> professions of obvious export ong>inong>terest ong>toong> ong>theong>m, such as

computer programmers, nurses, etc. 67 Surely by ong>theong> time of ong>theong> cotong>toong>n fiasco at Cancun and ong>theong>

emptong>inong>ess of ong>theong> commitments on this issue that emerged from ong>theong> July 2004 package, it

should have been obvious ong>toong> everyone that ong>theong> ong>Dohaong> Round was as little about genuong>inong>ely

addressong>inong>g ong>theong> needs of developong>inong>g countries as previous rounds had been. 68

This is admittedly not an ong>inong>dictment of

ong>theong> Organization itself, but raong>theong>r those

who contong>inong>ue ong>toong> misunderstand ong>theong> true

nature of ong>theong> ong>WTOong> and ong>theong> treaty

framework that preceded it, ong>theong> General

Agreement on Trade and Tariffs. It is

true that both ong>theong> preamble ong>toong> ong>theong> GATT

and ong>theong> Marrakesh Agreement

establishong>inong>g ong>theong> World Trade

Organization explicitly and deliberately

mention that one of ong>theong> objectives

pursued by ong>theong>se ong>inong>itiatives was and

contong>inong>ues ong>toong> be "raisong>inong>g standards of

livong>inong>g, ensurong>inong>g full employment and a

large and steadily growong>inong>g volume of

Delegates ong>toong> ong>theong> Eighth ong>WTOong> Mong>inong>isterial ong>Conferenceong> ong>inong> Geneva,

Switzerland from 15-­‐17 December 2011; source: ong>WTOong>

real ong>inong>come and effective demand". 69 It is equally true that ong>theong> preamble ong>toong> ong>theong> Marrakesh

Agreement goes even furong>theong>r by statong>inong>g "ong>theong>re is a need for positive efforts designed ong>toong> ensure

that developong>inong>g countries and especially ong>theong> least developed among ong>theong>m, secure a share ong>inong> ong>theong>

growth of ong>inong>ternational trade commensurate with ong>theong> needs of ong>theong> ong>theong>ir economic

67 See Stieglitz and Charlong>toong>n (op. cit.) at p. 3.

68 See for example, Timothy E. Joslong>inong>g, Stefan Tangermann and T.k. Warley, Agriculture ong>inong> ong>theong> GATT, MacMillan Press, 1996.

69 Second recital of ong>theong> Preamble ong>toong> ong>theong> GATT.

23


development". 70 Neverong>theong>less, this should ong>inong> no way be misconstrued by anyone as meanong>inong>g

that ong>theong> ong>WTOong> is ong>inong>trong>inong>sically geared ong>toong>wards achievong>inong>g development outcomes. After all, ong>theong>

preamble ong>toong> ong>theong> Marrakesh Agreement also speaks of "allowong>inong>g for ong>theong> optimal use of ong>theong>

world's resources ong>inong> accordance with ong>theong> objective of sustaong>inong>able development, seekong>inong>g both ong>toong>

protect and preserve ong>theong> environment" 71 , but nobody ong>inong> ong>theong>ir right mong>inong>ds would ever contend

that ong>theong> ong>WTOong> is an environmental organization. 72 Economic growth was always one of ong>theong>

ong>inong>tended benefits (perhaps even ong>theong> prong>inong>ciple objective) of both ong>theong> GATT and ong>theong> ong>WTOong>, and it

was always ong>toong> be achieved first and foremost by lowerong>inong>g trade barriers and elimong>inong>atong>inong>g

discrimong>inong>ation ong>inong> general (and not primarily for ong>theong> benefit of developong>inong>g countries). Wheong>theong>r

or not this process serves ong>theong> ong>inong>terests of developong>inong>g countries was always goong>inong>g ong>toong> be

contong>inong>gent on developong>inong>g countries ong>theong>mselves and how well ong>theong>y undersong>toong>od and effectively

managed ong>toong> co-­‐opt ong>theong> organization's processes and dynamics ong>toong> suit ong>theong>ir own ends. 73 This last

assertion might sound somewhat callous and probably ignores ong>toong> a certaong>inong> extent ong>theong>

distribution of power underlyong>inong>g how ong>theong> ong>WTOong> conducts its busong>inong>ess, but ong>theong> haphazard fashion

ong>inong> which many developong>inong>g countries approach ong>theong>ir membership of ong>theong> ong>WTOong> ong>inong> many ways

makes ong>theong>m ong>theong>ir own worst enemies.

Nobody should mistake ong>theong> fact that ong>inong>ternational economic policy and trade negotiations are a

contact sport. The ong>WTOong> is little more than ong>theong> referee. Those countries that allocate sufficient

_________________________________________

political capital, personnel, technical

expertise and monetary resources ong>toong>

Nobody should mistake ong>theong> fact that ong>inong>ternational

playong>inong>g this game seriously will do

economic policy and trade negotiations are a

better than those countries that do not.

contact sport. The ong>WTOong> is little more than ong>theong>

To be sure, many developong>inong>g countries

referee.

and LDCs ong>inong> particular are not ong>inong> a

_________________________________________ position -­‐ due ong>toong> considerable resource

constraong>inong>ts -­‐ ong>toong> pay proper attention ong>toong>

what is goong>inong>g on at ong>theong> ong>WTOong>, but this is not due ong>toong> some failure on ong>theong> part of ong>theong> ong>WTOong> as an

organization. Raong>theong>r this is just ong>theong> nature of ong>theong> world we live ong>inong>, where some people and

countries are endowed with more and oong>theong>rs have less. We do not bemoan ong>theong> fact that no

LDC has ever won ong>theong> World Cong>upong>, we just accept that this is probably due ong>toong> ong>theong> fact that oong>theong>r

70 Third recital of ong>theong> Preamble ong>toong> ong>theong> Marrakesh Agreement.

71 First recital of ong>theong> Preamble ong>toong> ong>theong> Marrakesh Agreement.

72 In fact many would (ong>inong>correctly) contend just ong>theong> opposite.

73 ong>Someong> would even argue that ong>theong> kong>inong>d of policy constraong>inong>ts imposed by ong>WTOong> rules are even ong>inong>imical ong>toong> ong>theong> process of

development; see for example, Ha-­‐Joon Chang, Kickong>inong>g Away ong>theong> Ladder: Development Strategy ong>inong> Hisong>toong>rical Perspective,

Anong>theong>m Press, 2002; or more recently, Joe Studwell, How Asia Works: Success and Failure ong>inong> ong>theong> World's Most Dynamic Region,

Grove Press, 2013.

24


ong>Lifeong> ong>afterong> ong>Dohaong> |

countries -­‐ ong>inong>cludong>inong>g large developong>inong>g countries -­‐ are just much better resourced and thus

better able ong>toong> consistently field strong teams. 74 Do we blame FIFA for this "ong>inong>justice"? Of course

not. Despite ong>theong>ir resource constraong>inong>ts, and ong>theong> myriad of more pressong>inong>g policy priorities that

developong>inong>g countries and LDCs face, ong>theong>re are arguably many ways for ong>theong>m ong>toong> be more

effective at ong>theong> ong>WTOong> than ong>theong>y have been before and durong>inong>g ong>theong> ong>Dohaong> Round. The haphazard

way ong>inong> which ong>theong> Cotong>toong>n 4 approached this issue is a glarong>inong>g example: If ong>theong>y had pursued a dual

track of litigation AND negotiation, ong>theong>y would arguably at least be hundreds of millions of

dollars richer by now, raong>theong>r than just disgong>runong>tled. 75

Havong>inong>g said this, it is important not ong>toong> conclude that ong>theong> ong>WTOong> is an organization that cannot

achieve development outcomes, song>inong>ce it can and often does. But it should be borne ong>inong> mong>inong>d

that development is only likely ong>toong> become ong>theong> ong>WTOong>'s primary focus once developong>inong>g countries

start writong>inong>g ong>theong> work programs for future negotiatong>inong>g rounds, raong>theong>r than lettong>inong>g developed

countries do this for ong>theong>m (which is what happened at ong>Dohaong>). Wheong>theong>r developed countries will

let developong>inong>g countries do this is anoong>theong>r matter entirely, and will of course depend on what

developong>inong>g countries are prepared ong>toong> give developed countries ong>inong> return. After all, ong>theong> ong>WTOong> is

nothong>inong>g if not a tit-­‐for-­‐tat organization, a negotiatong>inong>g forum, a place where countries exchange

concessions.

3.3 Thong>inong>gs ong>theong> ong>WTOong> Does Well

It should be relatively clear ong>toong> most observers that as ong>theong> former Direcong>toong>r General Mike Moore

liked ong>toong> repeat, ong>theong> dispute settlement system is undoubtedly ong>theong> jewel ong>inong> ong>theong> Organization's

crown. Compared ong>toong> ong>theong> gridlock that ong>theong> GATT system of dispute settlement succumbed ong>toong>

when ong>theong> US tried (unsuccessfully) ong>toong> use it ong>inong> ong>theong> 1980s ong>toong> pry open European agricultural

markets that had been closed by ong>theong> Common Agricultural Policy, ong>theong> ong>WTOong>'s dispute settlement

system is a remarkable piece of ong>inong>ternational treaty makong>inong>g and has served its purpose

surprisong>inong>gly well. Only a limited number of disgong>runong>tled elements would probably argue that ong>theong>

dispute settlement system needs a radical shakeong>upong> beyond a bit of tong>inong>kerong>inong>g at ong>theong> margong>inong>s, as

is currently goong>inong>g on ong>inong> ong>theong> negotiations on DSU reform. Although ong>theong>re have been a small

number of cases that have shown what ong>theong> limits of ong>theong> dispute settlement system are ong>inong>

forcong>inong>g countries ong>toong> make changes that are politically difficult for ong>theong>m, overall, it is probably

74 The FIFA World Cong>upong> has only ever been won by ong>theong> followong>inong>g eight national teams: Brazil, Italy, Germany, Argentong>inong>a, Uruguay,

France, Spaong>inong>, England; LDCs appear ong>toong> qualify quite ong>inong>frequently, but have started ong>toong> do so more commonly over ong>theong> last 2

decades; see: David Arscott , The World Cong>upong>, A Very Peculiar Hisong>toong>ry, Salariya, 2012.

75 Brazil doggedly litigated agaong>inong>st ong>theong> US cotong>toong>n subsidies and refused ong>toong> simply let ong>theong> US off ong>theong> hook, so that ong>inong> ong>theong> end, ong>theong>

US ended ong>upong> agreeong>inong>g ong>toong> pay USD 147.3 million ong>toong> Brazilian cotong>toong>n farmers, a most unusual remedy for ong>theong> ong>WTOong>; see: Randy

Schnepf, Brazil's ong>WTOong> Case Agaong>inong>st ong>theong> U. S. Cotong>toong>n Program, Congressional Research Service, 2010, at:

www.fas.org/sgp/crs/row/RL32571.pdf (visited on 2 August 2013).

25


safe ong>toong> say that ong>theong> consensus is certaong>inong>ly leanong>inong>g ong>inong> favour of preservong>inong>g and strengong>theong>nong>inong>g ong>theong>

dispute settlement function of ong>theong> ong>WTOong>.

Anoong>theong>r thong>inong>g that ong>theong> ong>WTOong> has proven exceedong>inong>gly useful for is moniong>toong>rong>inong>g how Members are

doong>inong>g ong>inong> terms of implementong>inong>g ong>theong>ir commitments. This happens under various ong>inong>struments,

ong>theong> most promong>inong>ent of which would have ong>toong> be ong>theong> Trade Policy Review Mechanism, which

subjects all ong>WTOong> Members ong>toong> a periodic review of ong>theong>ir trade regimes and ong>theong>ir compliance

with ong>WTOong> rules. Anoong>theong>r more recent ong>inong>novation ong>inong> this area has been ong>theong> trade moniong>toong>rong>inong>g

reports, one of which is performed by ong>theong> Secretariat alone and covers "trade-­‐related

developments coverong>inong>g ong>theong> whole ong>WTOong> membership and observers", ong>theong> oong>theong>r of which ong>theong>

ong>WTOong> does ong>inong> collaboration with ong>theong> OECD and UNCTAD, and which focuses on "trade and

ong>inong>vestment measures taken by G-­‐20 economies". 76 Fong>inong>ally, ong>theong> various committee meetong>inong>gs that

take place under ong>theong> specific mandates set forth ong>inong> different ong>WTOong> agreements are also a very

useful forum for Members ong>toong> moniong>toong>r and discuss trade related issues. One example of this

(among many) is ong>theong> Committee on Technical Barriers ong>toong> Trade, which meets regularly by virtue

of Art. 13 of ong>theong> TBT Agreement. At ong>theong>se meetong>inong>gs,

representatives from ong>WTOong> Members can raise trade-­related

concerns of activities by oong>theong>r Members who

have enacted or plan ong>toong> enact technical regulations,

standards or conformity assessment procedures that

threaten ong>toong> have a trade impact on exports of ong>inong>terest ong>toong>

ong>theong>m. Thus it was that at ong>theong> meetong>inong>g of ong>theong> TBT

Committee that ong>toong>ok place on 27-­‐28 November 2012,

Members discussed thirty-­‐six different new and

recurrong>inong>g trade concerns, ong>inong>cludong>inong>g a proposal ong>toong>

ong>inong>troduce plaong>inong> packagong>inong>g for ong>toong>bacco products ong>inong> New

Zealand, and import permit regulations for horticultural

products from ong>theong> Mong>inong>istries of Agriculture and Trade ong>inong>

Indonesia. 77 Thus moniong>toong>rong>inong>g is undoubtedly an

important function of ong>theong> ong>WTOong> that nobody would wish

ong>toong> see abolished.

Boeong>inong>g vs Airbus; one of ong>theong> costliest and bitterest

commercial rivalries that also culmong>inong>ated ong>inong> a ong>WTOong>

dispute over subsidies. Rules on subsidization are

best negotiated multialterally raong>theong>r than ong>inong> PTAs;

source: Vong>inong>tage Books

Anoong>theong>r area where ong>theong>re is arguably a large degree of consensus among economists, trade

lawyers and policy wonks is that a number of issues exist where negotiations only really make

sense when done at ong>theong> multilateral level and thus at ong>theong> ong>WTOong>, ong>theong> most important of which

76 See: http://www.wong>toong>.org/english/traong>toong>p_e/tpr_e/trade_moniong>toong>rong>inong>g_e.htm (visited on 2 August 2013).

77 See Committee on Technical Barriers ong>toong> Trade, Mong>inong>utes of ong>theong> Meetong>inong>g of 27-­‐28 November 2012 (G/TBT/M/58).

26


ong>Lifeong> ong>afterong> ong>Dohaong> |

would have ong>toong> be subsidies. After all, ong>theong>re's no reason ong>toong> negotiate reductions ong>inong> subsidies vis-­à-­‐vis

a song>inong>gle tradong>inong>g partner and ong>toong> make difficult political-­‐economy cuts ong>toong> such programs

when ong>theong>y will ultimately do little more than improve ong>theong> market access of anoong>theong>r subsidizong>inong>g

country not party ong>toong> ong>theong> same reduction commitments. The same is arguably true for rules on

ong>inong>tellectual property rights, prudential regulations, currency manipulation, trade-­‐related

environmental measures and myriad oong>theong>r economic policy areas that are susceptible ong>toong>

ong>inong>ternational arbitrage as economic acong>toong>rs seek out jurisdictions with ong>theong> lowest possible

compliance costs. On issues such as ong>theong>se, we need an ong>inong>ternational organization that can act

as a forum for negotiations that delivers enforceable outcomes, and we are ong>inong> fact lucky ong>toong>

already have one ong>inong> ong>theong> form of ong>theong> ong>WTOong> (at least for some of ong>theong>se issues).

Fong>inong>ally, ong>theong> thong>inong>g that ong>theong> ong>WTOong> does well is balancong>inong>g out (ong>toong> an admittedly limited albeit very

real extent) ong>theong> power asymmetries that naturally arise when big, economically powerful and

well-­‐organized countries come ong>toong> ong>theong> same negotiatong>inong>g table as small, economically weaker and

less well-­‐organized countries. Thong>inong>k of ong>theong> miss-­‐match ong>inong> economic strength and trade policy

expertise that is at play when a developong>inong>g country like ong>theong> Philippong>inong>es negotiates an economic

partnership agreement with Japan, or Columbia negotiates an FTA with ong>theong> Unites States. It is

arguably power imbalances such as ong>theong>se that allow ong>theong> EU ong>toong> get away with concludong>inong>g

preferential tradong>inong>g arrangements with many smaller tradong>inong>g partners that explicitly carve out

important areas like contong>inong>gency protection from ong>theong> dispute settlement provisions of ong>theong>se

agreements. The "vicong>toong>ry" that developong>inong>g countries scored over ong>theong> EU at Cancun, ultimately

forcong>inong>g Pascal Lamy ong>toong> abandon any of ong>theong> Song>inong>gapore Issues except ong>theong> one that developong>inong>g

countries were favourable ong>toong> would be unthong>inong>kable ong>inong> a more limited settong>inong>g where one or a

handful of developong>inong>g countries face off agaong>inong>st ong>theong> EU as ong>theong> sole hegemon ong>inong> ong>theong> room. The

ability of ong>theong> ong>WTOong> ong>toong> create a more level playong>inong>g field (an admittedly tired and over-­‐used cliché)

for developed and developong>inong>g countries has been analysed and documented ong>inong> a number of

articles ong>inong>cludong>inong>g a very ong>inong>sightful one by Cristong>inong>a Davis of Prong>inong>ceong>toong>n ong>inong> 2005, that compares ong>theong>

differences ong>inong> outcomes between Vietnamese catfish exporters (when Vietnam was not yet ong>inong>

ong>theong> ong>WTOong>) and Peruvian exporters of sardong>inong>es when faced with trade barriers ong>inong> rich-­‐country

export markets. 78 The ong>WTOong> undoubtedly still has its uses ong>inong> this respect and we cannot afford ong>toong>

do without it.

78 Christong>inong>a l. Davis, Do ong>WTOong> rules create a level playong>inong>g field? Lessons from ong>theong> experience of Peru and Vietnam, ong>inong>: John S.

Odell (ed.), Negotiatong>inong>g Trade, Developong>inong>g Countries ong>inong> ong>theong> ong>WTOong> and NAFTA, Cambridge University Press, 2006, pp. 219 -­‐ 256.

27


Conclusion

As ong>WTOong> Members shuffle hesitantly ong>toong>wards Bali, we remaong>inong> unsure as ong>toong> wheong>theong>r this will

fong>inong>ally be ong>theong> Mong>inong>isterial ong>Conferenceong> that draws a long>inong>e ong>inong> ong>theong> sand and thrusts a stake ong>inong>ong>toong> ong>theong>

heart of ong>theong> ong>Dohaong> Round, thus termong>inong>atong>inong>g it for good, or wheong>theong>r we are ong>inong> for more drama-­laden

histrionics and ong>theong> frustration of yet anoong>theong>r collapse, or wheong>theong>r this meetong>inong>g will be

used ong>toong> consolidate ong>theong> progress made ong>upong> ong>toong> now and put ong>theong> Organization back on a path

ong>toong>wards achievong>inong>g some modest albeit still positive outcomes. The truth is that nobody really

knows what awaits us at Bali, and ong>theong> language comong>inong>g out of Geneva, particularly ong>theong>

statements of ong>theong> US Ambassador Michael Punke, give one little enough reason for optimism. 79

It is not yet clear wheong>theong>r it has dawned on ong>theong> host country that ong>theong>y have unwittong>inong>gly

assumed a very important responsibility ong>inong> shepherdong>inong>g this very troubled round a little closer

ong>toong> its conclusion (or at least helpong>inong>g ong>toong> avoid

anoong>theong>r damagong>inong>g collapse). There are

probably no more than a very small handful of

people at ong>theong> Mong>inong>istry of Trade ong>inong> Indonesia

who are able ong>toong> discuss ong>theong> draft negotiatong>inong>g

texts ong>inong> much depth and would be able ong>toong>

pronounce ong>theong>mselves authoritatively ong>upong>on ong>theong>

reasons behong>inong>d ong>theong> different square brackets

(i.e. ong>theong> dynamics preventong>inong>g convergence

among ong>WTOong> Members on ong>theong> various issues).

In any event, those officials that are able ong>toong> do

this are certaong>inong>ly not predomong>inong>ant among ong>theong>

Mong>inong>istry's senior-­‐level management (at least

not for now). This is a lacuna that will need ong>toong>

be addressed goong>inong>g forward, and one that ong>theong> MOT is likely ong>toong> actively and enthusiastically

address once everyone has returned ong>toong> work ong>afterong> Eid (middle of August).

The ong>inong>comong>inong>g ong>WTOong> Direcong>toong>r General Roberong>toong> Azavêdo of Brazil;

source: Wikimedia Commons

To be sure, ong>theong> new Direcong>toong>r General Roberong>toong> Azavêdo is no Song>upong>achai Panitchpakdi and if

anyone can steer ong>theong> Bali meetong>inong>g and ultimately ong>theong> ong>Dohaong> Round ong>toong> a positive outcome, it is

probably him. It will be ong>inong>terestong>inong>g ong>toong> observe how Azavêdo uses ong>theong> limited time he will have ong>inong>

79 See Statement by U.S. Ambassador ong>toong> ong>theong> ong>WTOong> Michael Punke at a Meetong>inong>g of ong>theong> Trade Negotiations Committee at ong>theong>

World Trade Organization dated 11 April 2013 at: http://www.ustr.gov/about-­‐us/press-­office/speeches/transcripts/2013/april/amb-­‐punke-­‐statement-­‐wong>toong>-­‐tnc;

this statement was followed a coong>upong>le of months later

with one only slightly more optimistic, see Statement by Ambassador Michael Punke at a Meetong>inong>g of ong>theong> World Trade

Organization's Trade Negotiations Committee dated 22 July 2013, at: http://www.ustr.gov/about-­‐us/press-­office/speeches/transcripts/2013/july/amb-­‐punke-­‐ong>WTOong>-­‐tnc

(visited on 3 August 2013).

28


ong>Lifeong> ong>afterong> ong>Dohaong> |

office before ong>theong> Bali meetong>inong>g commences, but it will undoubtedly be a mixture of managong>inong>g

expectations while tryong>inong>g ong>toong> edge Members ong>toong>wards consensus. In many ways this is slightly

remong>inong>iscent of ong>theong> Tokyo Round, which also largely ong>toong>ok place through troubled economic

times and which failed ong>toong> achieve outcomes ong>inong> a few important areas, such as agriculture and

safeguards. Neverong>theong>less, GATT Contractong>inong>g Parties and ong>theong> GATT Direcong>toong>r General Olivier Long

were able ong>toong> snatch vicong>toong>ry from ong>theong> jaws of defeat and conclude ong>theong> round with some

noticeable successes. 80 It is more than remotely likely that hisong>toong>ry will repeat itself here, and

that Bali may just provide ong>theong> impetus needed ong>toong> fong>inong>ally put all of us out of our ong>Dohaong>-­‐related

misery.

80 See, Gilbert R. Wong>inong>ham, International Trade and ong>theong> Tokyo Round Negotiation, Prong>inong>ceong>toong>n University Press, 1986.

29


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31


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32

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