Glimmer of hope

There is a faint glimmer of hope for a partial agreement in the Doha Development Round trade talks which have been in a stalemate for the last 10 years. There were virtually no negotiations after the talks broke down in 2007. But a recent proposal, endorsed by most member countries, has put forward a Plan B which can now be pursued. WTO director-general Pascal Lamy has called it an ‘early harvest’ package based on a three-speed process of negotiations. The talks have in the past failed over lack of agreement on important issues like the tariffs on industrial goods, intellectual property rights and farm subsidies.  All these are vital for the industrialised countries and strong emerging economies like India and China.

It will be difficult to reach a comprehensive multilateral trade agreement covering all these issues in the near future. So the present proposal is to finalise an agreement covering issues on which agreement can be reached. This will concern mostly issues which are specific to the least developed countries (LDCs), like duties on goods produced by them, terms of trade for certain services and subsidies for some commodities like cotton.

The idea is to ensure that the poorest countries are not kept waiting in the course of the haggling between the stronger ones. Lamy calls it an early harvest package because it will take up less contentious issues now. He envisages a three-speed process by which some issues can be fast-tracked and others dealt with at medium and slow paces in course of time. There is much to commend for the proposal because the all-or-nothing policy has not borne any fruit so far.

Major emerging countries like India, China and Brazil have welcomed the proposal. As in the earlier stages of negotiations it is the US which may create hurdles because cotton is an important commodity in that country. But it will be a pity if the world’s richest country can not consider making some concessions for the poorest countries, which are mostly in Africa.

The hope is that a partial agreement can be reached by December this year if serious negotiations start now. A comprehensive agreement may be years away, if at all it is possible, and even negotiations for that may not start before the next US Presidential election.