The coming trade ministers’ meeting in Bali, Indonesia, for concluding the Doha Round of talks under the World Trade Organisation (WTO) might finally yield positive outcome in some areas, though an agreement is far from reality, says WTO’s outgoing director-general, Pascal Lamy. In India for the Confederation of Indian Industry Partnership Summit 2013 in Agra, he talks to Nayanima Basu on the talks and other observations of his eight-year tenure. Edited interview:
WTO now has 157 members. Does this add a new dimension to the Doha Round?
Having more members is a great source of strength for the WTO. In becoming a truly global organisation, its legitimacy and credibility is enhanced. More voices, more perspectives and more points of view lend strength and diversity to our discussions and analysis.
This said, more actors on the stage can also make it more complicated to gain a consensus in complex and politically sensitive negotiations. But this is a price worth paying for greater inclusiveness.
What is the state of negotiations under the Doha Round of talks, entering its 11th year this November?
Since the December 2011 WTO Ministerial Conference, the negotiations have gained momentum, but selectively. At that meeting, ministers instructed their negotiators to look for those elements of the Doha Round where progress could be made and agreement was conceivable in the short term. This had led to progress and possible agreement in a range of issues such as trade facilitation, some elements of agriculture, issues of importance to least-developed countries, special and differential treatment for developing countries and reform of the dispute settlement system.
Many delegations have expressed a desire to be ready with a set of deliverables for the Bali WTO ministerial conference in December. It is not clear whether such an agreement can be reached or not but the last year has seen a much more constructive and productive approach to the Doha negotiations. Of course, the range of topics on which agreement is conceivable is only a segment of the overall package. We also need to work out how to deliver on the rest of the issues.
Do you see any hope in the Bali ministerial ? Since the talks have gone on so long, it seems countries do not have the same urge or zeal to open their markets any more.
Many governments have taken the position that we need a ministerial conference in Bali which delivers a substantive outcome. It is incorrect to say countries do not have the same urge or zeal to open their markets. If that were the case, how would you explain the negotiations going on in the Trans Pacific Partnership or launch of the Regional Comprehensive Partnership between Asean, India, Australia, China, Japan, Korea and New Zealand or the China-Japan-Korea trade pact? How would you explain the push to launch negotiations aimed at a transatlantic US-EU agreement?
No, there is no shortage of desire to negotiate trade agreements and this could lead to complications, particularly in the regulatory sphere. The question to ask is why would governments be prepared to open their markets and adopt new rules bilaterally or plurilaterally but not globally?
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For the first time in eight years you will not be spearheading the talks any more. How does it feel?
Eight years to run an organisation as important and complex as WTO is a long time. I have enjoyed it and learnt from it. But very soon it will be time for me to make a contribution in another way.
You have always been credited for keeping the spirit of negotiations alive. Do you think the talks will suffer a setback as you leave WTO? Do you also regret not being able to see a successful conclusion of the Doha Round under your tenure?
Of course, not being able to see the conclusion of the Doha Round is a disappointment. We were centimetres from reaching a deal in July 2008; but as you know, centimetres can be enough to circumvent an agreement.
This doesn’t mean we have not had negotiating successes. Since September 2005, nine countries have successfully negotiated membership to the WTO and two more will join next month. The government procurement agreement has expanded and covers an additional $100 billion in trade opportunities. Talks on trade facilitation and expanding the information technology agreement may yet yield accord. WTO has opened up to the stakeholders of trade, including civil society. It has been a driving force in helping understand better how trade opening works for welfare in today’s world as opposed to yesterday’s world.
In many ways, WTO as a multilateral system for opening trade fairly is stronger than before. I like to think I have contributed to these positive outcomes but we all know that the DG’s powers are limited. If countries want to negotiate and agree, a DG can facilitate such an outcome; if they don’t, then she or he cannot. As the saying goes, ‘You can lead a horse to the water but you cannot make him drink.’
During the trade negotiations committee meeting in Geneva last month, you had clearly said some of the main stumbling blocks remain and some tough decisions need to be taken in Bali. What are those?
There are two principal problems to reaching a deal and they are broad, far-reaching and go beyond the scope of the WTO. The first is the massive geopolitical shift underway for some 10 years now. Power is shifting from West to East and shifting quickly. Countries like India, China, Brazil and Indonesia would, quite rightly, like a great share in the management of world affairs. But those who have held power for many decades are ready to accept this only if the emerging countries also take a larger share of the burden.
The question remains, how large is “larger”? So far, negotiators have been unable to define the precise balance between obtaining more power and taking on more responsibilities. This situation has been further complicated by the fact that WTO members do not agree on what precisely does it mean to be a “developing country”. Never before have we had such large and powerful developing countries as India, China, Brazil, Indonesia, Mexico and South Africa.
The other major difficulty we have encountered is the economic crisis. It has had the effect of leading many major players to turn their political focus and energy inward. These two phenomena have made concluding the Doha Round far more difficult.