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Young World
For free trade
C. RAMMANOHAR REDDY
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The WTO believes that one round of negotiations must quickly follow another, because otherwise the process of removing national barriers to world trade will slow down. That is why even before the 1994 agreements were fully implemented, some countries wanted a new round.
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A view of the WTO conference in session... at Doha last month.
There is a plain, grey building in Geneva which houses the offices of an institution whose very mention evokes controversy in many countries - the World Trade Organisation. The WTO is in the news again, this time for a meeting last month in Doha, the capital of Qatar. The final outcome of that meeting could eventually lead to international agreements that may well transform the way countries trade with each other.
First, a lot of history. Before 1995, the WTO was known as the General Agreement on Tariffs and Trade (GATT). The work of GATT was as mundane as its name was dull. From 1948 until the mid-1980s, it oversaw agreements between countries on what customs duties they would charge on each others' products. For more than three decades it did a good job of lowering customs duties, mainly in the developed countries, thereby encouraging world trade.
GATT's work was organised in periodic "rounds" of talks when Governments would negotiate with each on import duties. Things changed in 1986. That was when the Uruguay Round, so named because the meeting was held in the country's coastal resort of Punta Del Este, was launched. The developed countries, led by the U.S., Japan, Canada and what later became the European Union, decided that GATT should expand its responsibilities. They were keen that GATT introduce global rules that would make it easier for all kinds of products and services to be sold in countries around the world. No longer was GATT's work to be only about customs duties on products like clothes, toys and electronic goods. It was also about the rules for allowing global banks to establish branches around the world, about how governments could provide patents on everything from seeds to medicines, about what prices governments could give farmers for their crops and more. It was also decided then that the era of special concessions to developing countries would end.
The result was that a complex set of agreements was signed in 1994 which many countries are yet to implement and some are still trying to understand. But all agree that these agreements have radically enhanced the role of the WTO in the global economy and reduced the freedom of national governments in trade policy. This is why the organisation evokes so much distrust among the affected in rich and poor countries. The WTO, which succeeded GATT in 1995, believes that one round of negotiations must quickly follow another, because otherwise the process of removing national barriers to world trade will slow down. That is why even before the 1994 agreements were fully implemented, some countries wanted a new round which would further expand the organisation's powers.
Activists on the Greenpeace ship wanted the WTO to shelve talks on a new round of trade liberalisation until the U.K. ratifies the UN 1997 Kyoto accord on climate change.
After a failure in 1999, the Doha meeting in November was the next attempt to begin fresh global trade talks. The tussle was intense, because everyone knew that what was at stake was perhaps as important an outcome as what had emerged from the Uruguay Round.
In the end, all the 142 countries that are members of the WTO, agreed on an agenda for negotiations. The agenda is yet another long list of subjects of more than a dozen. Some are old like import duties, some are new like rules on environment and trade and some are on a slow boil like how much freedom individual countries should have in laying down the rules for foreign investors. At Doha they only decided on the agenda. The negotiations themselves are expected to be completed only in 2005, which is when new treaties will be signed.
Every country claims "a victory" at Doha. But the result of what some call the Doha Development Agenda, will depend on how governments are able to negotiate with their trading partners. In the WTO, every member-country is supposed to have the same rights as the other. But that is not how it works, since power comes from how big an exporting nation you are. So while the new round is supposed to have a "development" feel to it, the proof of the Doha pudding will be in its eating. This is one pudding which will see intense fights, which will take years to bake and which may in the end be bitter to taste for some, perhaps many, countries.
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