The Doha Round: No More Delays
Excerpt from "Why World Leaders Must Resist the False Promise of Another Doha Delay"

Another suspension of the Doha Round is the likely outcome of the upcoming meeting. This essay argues that such a failure is now more dangerous than ever. For domestic political reasons unrelated to trade, the US will be in no position to lead on international trade issues for some years. As the US is still the "indispensable nation" for WTO talks, this means 2011 is the last good opportunity for many years.

At this point, there is virtually no chance that governments will act to prevent another breakdown or suspension of the Doha Round at the 29 April 2011 meeting of the WTO's Trade Negotiating Committee. So I see little profit in reviewing the intricate details of why this is the case for each of the major areas-goods, services, agriculture, rules, etc. Or even why, as some have noted, there would be real benefits in salvaging less controversial pieces of the negotiating agenda.

The negative political implications of a failure or suspension

I would, however, like to point out some of the possible negative political implications, particularly with regard to the US political situation in coming years.

  • First, failure to reach some accommodation this spring will inevitably push off serious negotiations until 2013 at the earliest.

President Obama's Democratic Party remains deeply split on trade and globalisation issues, with labour unions, the foot soldiers of Democratic election armies, adamantly opposed to new "Bush era" trade agreements. Though WTO negotiations such as the Doha Round have traditionally not drawn the heavy fire attendant to free trade agreement negotiations, the White House will not risk further alienation of the leftwing of its party until the election next year. Its belated support for the Korea, Panama and Colombia agreements is as far as it will go.

  • Then in 2013 and for some years beyond, the US is in for a highly contentious and deeply divisive debate and battle over how to deal with the looming budget crisis and, ultimately, over the size and role of government; this holds regardless of which party wins the presidency or controls Congress.

While I doubt that the country will turn protectionist in a major way, the time and attention of both political leaders and the electorate are not likely to be focused on international economic and trade issues-barring the not remote possibility of another 2008-style financial crisis.

In addition, in this political scenario, there is no reason to believe that the major economic sectors and interest groups will change their unified position. Manufacturing, service, and agriculture all believe that what is on the Doha-Round table does not achieve even modest gains in market access (indeed, this have been the reality since the closing months of the Bush administration in 2008).

The bottom line is that failure to reach an agreement this spring means that the US may well be largely distracted and in no position to lead for some years to come. The US is still the "indispensable nation" for WTO negotiations, so if Doha does not get done this year, it will not get done for many years.

The China issue

One final point with regard to the other "indispensable nation" in Doha negotiations-China. Why World Leaders Must Resist the False Promise of Another Doha Delay

  • WTO members-Brazil, India, Indonesia, Argentina, Mexico, just to name a few-have suddenly become gun-shy when it comes to the industrial-goods tariff-cutting that is on the Doha negotiating table.
  • Behind the scenes, they candidly admit that fear of the consequences of major Chinese import competition and competition for third-country markets is causing them to pause and reconsider the consequences of further market opening.

Question to them: Do you really think the situation will improve in coming years in a WTO without further rules and obligations for reciprocal market access from China?

Claude Barfield is a resident scholar at AEI.

istock/Vasiliy Yakobchuk

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

Claude
Barfield
  • Claude Barfield, a former consultant to the office of the U.S. Trade Representative, researches international trade policy (including trade policy in China and East Asia), the World Trade Organization (WTO), intellectual property, and science and technology policy. His many books and publications include Swap: How Trade Works with Philip Levy, a concise introduction to the principles of world economics, and Telecoms and the Huawei conundrum: Chinese foreign direct investment in the United States, an AEI Economic Studies analysis that explores the case of Chinese telecom equipment maker Huawei and its commitment to long-term investment in the US.
  • Phone: 2028625879
    Email: cbarfield@aei.org
  • Assistant Info

    Name: Hao Fu
    Phone: 202-862-5214
    Email: hao.fu@aei.org

What's new on AEI

image The Census Bureau and Obamacare: Dumb decision? Yes. Conspiracy? No.
image A 'three-state solution' for Middle East peace
image Give the CBO long-range tools
image The coming collapse of India's communists
AEI on Facebook
Events Calendar
  • 21
    MON
  • 22
    TUE
  • 23
    WED
  • 24
    THU
  • 25
    FRI
Wednesday, April 23, 2014 | 12:00 p.m. – 1:30 p.m.
Graduation day: How dads’ involvement impacts higher education success

Join a diverse group of panelists — including sociologists, education experts, and students — for a discussion of how public policy and culture can help families lay a firmer foundation for their children’s educational success, and of how the effects of paternal involvement vary by socioeconomic background.

Thursday, April 24, 2014 | 12:00 p.m. – 1:30 p.m.
Getting it right: A better strategy to defeat al Qaeda

This event will coincide with the release of a new report by AEI’s Mary Habeck, which analyzes why current national security policy is failing to stop the advancement of al Qaeda and its affiliates and what the US can do to develop a successful strategy to defeat this enemy.

Friday, April 25, 2014 | 9:15 a.m. – 1:15 p.m.
Obamacare’s rocky start and uncertain future

During this event, experts with many different views on the ACA will offer their predictions for the future.   

No events scheduled today.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.