Pascal Lamy, the catalyst
Jose M. de Areilza
July 9, 2006
The Director General of the World Trade Organization (WTO) has some tough weeks ahead. He will spend all of his time engaged in shuttle diplomacy and mediation, in order to come up with a solution acceptable to the 149 WTO participants in the Doha round of trade negotiations. Well, Pascal Lamy has great experience acting as a broker on behalf of the European Commission, both as former Commissioner and chief of staff of Jacques Delors. May be his time to shine has come, in the same way that Arthur Dunkel saved the Uruguay round when it was about to collapse.
First thing Mr. Lamy has to do is create a sense of urgency. This round should finish before the end of 2006 and in any case before June 2007, when President Bush looses fast track authority to sign such a deal. The coming days and weeks might be crucial to forge a political compromise, that requires detailed and complex development in the form of “modalities” and “schedules” of lowering trade barriers.
Second thing Pascal Lamy must do is offer a broader picture of the negotiation potential gains to the top political leaders, so they can distance themselves from special interests. The most difficult political issue remains cuts in tariffs and agricultural subsidies in exchange for market access for industrial goods, a “chicken and egg” problem we have been suffering from in the last years of trade negotiations. (A US negotiator asked me recently, why does WTO always start with the most difficult problems first, unlike other rounds of multiple-issues negotiation? No good answer came to my mind.) It really does not make sense to let these special interests condition the whole the process, as if normal citizens or developing countries did not have a high stake in enhancing prosperity through fair trade. Joseph Stiglitz in his recent book “Fair Trade for All” offers a powerful suggestion for economic collective governance: all countries in the world would give completely trade acces to all the economies that were poorer per head than themselves. A bold liberalizing idea, based on the sound democratic principle of decision making under the veil of ignorance.
Finally, Pascal Lamy has to let President President Bush, the top European leaders and the Indian and Brazil presidents that they are not doing enough to save the Doha round. In the late June meetings in Geneva, the European Union and the US negotiators acted as if they did not have real mandates to accept further cuts in agricultural subsidies. EU commissioner Peter Mandelsson is continuously warned and contradicted by the French government, who does not want to weaken the EU deal on Common Agricultural Policy until 2013, so favorable for the Paris government. President Barroso should invest some of his political capital –in coalition with Chancellor Merkel and Prime Minister Blair- to push forward the WTO negotiations, even at the risk of further distance with France, which in any case is likely to be in political disarray until next years’ presidential elections.
3 Comments »
RSS feed for comments on this post. | TrackBack URI | bookmark on del.icio.us.
Leave a comment
Advertencia de Protección de Datos:
Los datos personales capturados con ocasión de la utilización del formulario de comentarios (nombre/apodo, dirección de correo electrónico, sitio web y dirección IP), serán incluidos en un fichero del propietario del sitio web y se publicarán (excepto su dirección de correo electrónico y su dirección IP) en esta página con la finalidad de permitir opinar públicamente al lector, así como para en su caso contestar al comentario o consultas que formule. Podrá ejercitar sus derechos de acceso, de rectificación, de cancelación y de oposición en lo referido a dichos datos personales dirigiendo un correo electrónico a la dirección: datos.personales@blogeuropa.eu.
----
Privacy notice:
Please be informed that by using the comments form, your personal data (name/nickname, e-mail address, website and IP address), will be included in a file owned by the website proprietor and published along your comment (except for your e-mail and IP addresses), in order for the reader to publicly comment, as well as -should that be the case-, to respond to any comment or query that readers may have made. You will be able to exercise your rights to access, rectify, cancel and oppose such personal data by sending an e-mail to the following address: datos.personales@blogeuropa.eu.
I hope the Doha round of the trade negotiations will end up with an agreement to lower tariffs. It is not just a matter of technicalities: it is a matter of justice. Simply it is not fair to block agricultural exports from Second and Thrird World countries to the richer part of the world. Let them compete! Let them participate in the markets without restrictive state measures!
I think the European Union ought to lower its tariffs on agricultural imports, even if no agreement is reached within the WTO. It will benefit European consumers, for international prices are normally lower than European ones. It will also help to curb inflation. Even if European agriculture suffers from it, it will be an incentive to focus on those products in which Europe has a competitive advantage.
For the well-being of the rural areas of the poorer part of the world, and for the well-being of Europeans as well, put down the tariffs!
Comment by Víctor Torre-Silva — July 10, 2006 @ 1:27 pm
I could not agree more. The fact that developed countries insist in protecting agriculture is a sign of “near-sight”. Governemnts are more preocupied with the next elections and with the array of public demonstrations of farmers than with the development of world economy (Farmers astonishingly enough still have electorate simpathy).
Is the old “carrot and stick”, if we do not give developing countries a natural and obvious source of income how can we have legitimacy to ask for anything concerning industry?
Europe should set the example.
Comment by Domingos Cruz — July 11, 2006 @ 2:08 pm
Thanks, Victor and Domingos, for your comments. Part of the problem, of course, is that farmers in rich countries are put in a win-loose situation by the WTO negotiations, i.e., they will not gain directly by market access for industrial goods of very developed countries. Hence, successful EU and national policies for “adaptation” of agriculture (meaning tranformation) are as important as subsidies cuts.
Latest news is that Peter Mandelson is ready to conclude bilateral agreements with countries specially in Asia (China, Korea, Thailand), whether WTO talks fail or not. It is a badly timed announcement for the credibility of WTO negotiations. Plus, negotiations for bilateral trade or regional agreements are always second best solutions to global arrangements.
Comment by JMA — July 11, 2006 @ 2:41 pm