The Death of Doha…Finally?

The Doha Round of international trade talks collapsed (again) today.  It seems that the World Trade Organizations Director-General, Pascal Lamy, was a bit too ambitious in hoping that the countries would be able to hammer out a deal.  The Doha Round was supposed to be the “development round” of WTO talks.  Ironic, therefore, that the US is blaming the developing countries, especially India and China, for the collapse of negotiations.

So what really happened?  It seems that countries could not agree on new rules to cover agriculture.  It’s the same thing that’s held up the WTO for years. The United States and Europe refuse to cut agricultural subsidies to their farmers, India and China refuse to cut market protections for their farmers, and so on.  The influence of the domestic farm lobby in many countries is astounding.  Even after the US and Europe announced plans to trim subsidies (largely through a shell game which would mean few real cuts and leave open the possibility of subsidies doubling from current rates, as Alan Beattie notes) China accused US negotiators of hypocrisy in their demands to open markets in the developing world while protecting American cotton farmers through subsidies.  And India’s trade minister, Kamal Nath, accused the US of “self-righteousness”.  Not exactly the stuff of friendly trade talks.

So what remains?  Lamy is hopeful the talks may resume in the fall, but this seems unlikely given political developments in the United States and India and his upcoming reappointment to the WTO’s directorate.  More likely, I think, is an increase in bilateral and regional agreements like NAFTA.  Globalization lite, so to speak.

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