Trade Ministers Agree to Revisit Doha Round

Spurred by fears of a global recession, trade ministers from major trading powers, including the U.S., India, Brazil and the European Union, agreed Saturday...

DAVOS, Switzerland — Spurred by fears of a global recession, trade ministers from major trading powers, including the U.S., India, Brazil and the European Union, agreed Saturday to a proposal by the global trade chief to meet in late March or early April in Geneva to try and hammer out a breakthrough deal in the stalled Doha talks.

This story first appeared in the January 28, 2008 issue of WWD.  Subscribe Today.

World Trade Organization director general Pascal Lamy and trade ministers from major powers cautioned there were risks for the world economy — including a surge in protectionism, and the talks drifting endlessly for years — if they failed to broker a deal in 2008.

“We decided we will have a WTO ministerial meeting, probably in April,” said Doris Leuthard, Swiss economy minister, who hosted a luncheon with ministers from 16 countries and Lamy, on the sidelines of the World Economic Forum summit.

Lamy told WEF business leaders and trade ministers that conclusion of the Doha Round, launched in November 2001, “is doable.” But he also warned he’s not positive that ministers will do it, and stressed a failure in the talks would have adverse implications for world growth and also geopolitical consequences beyond trade.

Senior trade diplomats said new blueprints on how to lower subsidies and tariffs in agriculture and import duties for industrial goods are to be circulated to WTO members by the respective chairman of the talks in the first half of February.

Differences between rich and developing countries over how to proceed to lower trade barriers for agriculture and industrial goods, including textiles and apparel, led to the collapse of the talks in September 2003, and again in the summers of 2006 and 2007.

U.S. Trade Representative Susan Schwab said, “There’s a very clear commitment by the Bush administration to see conclusion of the Doha Round in 2008.” A deal would also have to deliver new trade flows, Schwab said, and added the only way to get that is to “cut into applied tariffs.”

Celso Amorim, Brazil’s foreign minister, said there was now a “window of necessity” to try and conclude a deal, and said failure “would give the wrong signals to the global economy. And this will be detrimental to everybody, most of all the developing economies.”

Similarly, European Union Trade Commissioner Peter Mandelson said if the round was not concluded this year, it would not be possible in 2009 or even 2010 because the caravan would have moved elsewhere.

He said European business executives are telling him to give the round “a decent burial” if it can’t be done in 2008.

Former U.S. Trade Representative Rob Portman said in an interview that concluding the Doha Round “is not only politically possible, but politically necessary. In my view, finishing the round is more likely to be successful with this administration.”

Similarly, Robert Zoellick, World Bank president, said in an interview, “I think from a global as well as a U.S. perspective, the U.S. should go ahead. There’s a good deal on the table. It should conclude the deal, and then it should press the Congress, even with its protectionist impulses, to take the step to support international commerce.”