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By Philippe Legrain 10 COMMENTS

The WTO’s Doha Round has collapsed. After the failure of negotiators to break the deadlock in the world-trade talks over the weekend, the Round has been indefinitely suspended.

The WTO now risks going the way of the League of Nations in the 1930s and becoming an ineffective sideshow. There would be preferential trade instead of free trade, bilateral agreements rather than multilateral ones, free rein for protectionist actions rather than the discipline of international rules and impartial adjudication, the law of the jungle rather than the rule of law.

Shame on the narrow-minded mercantilists who have betrayed their countries’ interests and those of the poor by putting the profits of vested interests ahead of the people’s. They may come to rue this day.

Posted 24 Jul 2006 in Blog, Trade
  1. JohnHilaryBenn says:

    Your ‘Doha Breakthrough’ post earlier suggest that your expertise in trade negotiations is about as good as your expertise in world cup football…

  2. Philippe Legrain says:

    Fair point. I am genuinely astonished that the talks have collapsed so soon after the major economic powers threw their political weight behind clinching a deal.

  3. JohnHilaryBenn says:

    You misread the position of US congress and the USTR – you’re not alone there, most other G8 observers did. But Geneva watchers had money on this outcome – or a varient of – for the past couple of months.

  4. Philippe Legrain says:

    There I disagree. I have pointed out several times that a modest deal was unsellable in Congress. The issue is why, if they were unwilling to compromise further, the EU and India gave their backing to seeking an ambitious agreement at the G8. In retrospect, probably so they had cover to deflect blame for an eventual failure to reach agreement onto the US.

  5. Anonymous says:

    The EU and India didn’t give their backing to an ambitious deal at the G8, they gave their backing to push for a breakthrough and to show flexibility in negotiations. Both did, but the US didn’t.
    If you have been pointing out that a modest deal was unsellable in Congress then it was always odds on that a deal was unlikely to happen. [Of course both modest and ambitious have different meanings for the negotiators involved, but no great surprise there].

  6. Philippe Legrain says:

    Yes they did. The G8 statement on trade says: “We renew our commitment to pursue a high level of ambition in all areas of the DDA with a view to reaching a meaningful and balanced outcome. We commit ourselves to substantial improvement in market access for trade in both agricultural and industrial products and to expanding opportunities for trade in services.”
    Anyway, so much for that.

  7. JohnHilaryBenn says:

    The G8 statement on trade that you quoted was writen on the Sunday and endorsed by the G8 alone – India, Brazil, South Africa and China had nothing to do with it, as they only turned up on the Monday. They didn’t endorse any joint statements about ‘ambition’, as far as I’m aware, they listened to Pascal Lamy tell them of the need to be flexible and take tough political choices, which they agreed with. Back in Geneva they were prepared to be flexible, but the US wasn’t.
    The EU signed up to the G8 statement, but of course EU statements of intent on liberalising agricultural trade should always be taken with a pinch of salt.
    In fact taking any statement of intent from the G8 on trade policy as an indication of future action is the refuge of the terminally deluded optimist. Admirable positive thinking, but not much use in telling you what’s going to happen in negotiations.

  8. Philippe Legrain says:

    Brazil’s Lula is quoted as saying that “I am ready to instruct my minister responsible for the negotiations to show the necessary flexibility with a view to reaching an ambitious and balanced outcome”, while India’s foreign secretary Shyam Saran said: “While expressing the willingness to display flexibility in the coming negotiations he (Prime Minister Singh) pointed out nevertheless that the concept of special and differentiated treatment of developing countries is something that must considered and must be respected.”
    Anyway, with hindsight, it is obvious that I was too optimistic. But since you claim that the Doha Round’s dramatic collapse was in fact eminently predicable, please indicate where and when you predicted that it would collapse so soon after the G8 summit.

  9. JohnHilaryBenn says:

    I did an internal planning exercise a fortnight ago looking at what would happen by the end of July, and gave the ‘into the long grass / deep freeze / suspension’ option 7 out of 10 – the most likely outcome. Collapse I gave 2, movement towards modest deal came I think I gave 5, ambitious deal was somewhere near 3. In fact suspension is what we got (the Doha Round hasn’t ‘collapsed’).
    Predicting when and where a collapse would happen is always finger in the air stuff – but you could easily have said what the likely outcome was, and what the major obstacle was, over the past couple of months. Since the final weeks of Portman and the beginning of Schwab.
    The key factor determining this was the position of the US on agriculture – and whether its current position was a tatical one or a permanent obstacle. The speed of the collapse this week surprised me – partly because I expected the US to tough ball it out until the end of the week – but unless the US changed position a deal was never in the offing

  10. Huber says:

    I was as shocked as you when the talks collapsed. In fact I was so naive as to expect them to be resumed. Still…hope springs…

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