World Economy: Last Chance for WTO Negotiations in Geneva
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Geneva, 22 July 2008. The World Trade Organization (WTO) is facing its ‘moment of truth’, according to Pascal Lamy, WTO Director-General, as what could be last chance negotiations for the Doha round to strike a deal kick off in Geneva.
Geneva, 22 July 2008. The World Trade Organization (WTO) is facing its ‘moment of truth’, according to Pascal Lamy, WTO Director-General, as what could be last chance negotiations for the Doha round to strike a deal kick off in Geneva.
In 2001, the WTO began the Doha round of talks aimed at further liberalizing global trade. Now in their seventh year, the talks have run into numerous problems, coalescing around the views of the developed and the developing world.
The aim of the talks is a far-reached global trade agreement. There has been an in-principle agreement for developed nations to cut agricultural subsidies and so make it easier for developing nations to export – and in some cases sell locally – their farm produce. Tariffs on industrial products are also slated for reduction, while talks on services rules, customs procedures, fishing, anti-dumping and intellectual property rules are ongoing.
However the aim of the Geneva discussions is to reach agreement on agricultural and industrial tariffs only. The other deal points can only be structured once that is complete. Success could add as much as a trillion dollars to world GDP or Global World Product, according to WTO economists.
A deal is far from certain, with Mr Lamy putting the odds of success at under 70%. Developed and developing countries are still at odds over how much discretion the latter should have in being able to set some level of protective tariff. There are also lingering disputes over cotton and bananas.
With elections imminent in both US and India, two key Doha round players, and agendas likely to change as the world grapples with bursting bubbles and inflation, there may not be another chance to conclude this deal.
Jenny MacGraw, EconomyWatch.com
