APEC Trade Ministers Gather in Cairns to Try to Revive Doha

APEC Trade Ministers Gather in Cairns to Try to Revive Doha

By En-Lai Yeoh
July 3 (Bloomberg) -- Ministers responsible for half the world's trade meet in Australia this week to try to revive global talks some say are on their deathbed.
Trade ministers from 21 Asia-Pacific Economic Cooperation economies will come together in Cairns July 5 and 6, where they will attempt to resuscitate the so-called Doha round of trade liberalization negotiations.
Talks have stalled over the failure of the United States, the European Union, India, Brazil and China to open up agricultural and industrial markets and end subsidies.
``I think Doha's dead,'' said Manu Bhaskaran, Singapore- based partner for the Centennial Group, a Washington-based consulting company. ``It'll have to be regional, bilateral arrangements for now.''
Two weeks ago, talks between the U.S., EU, Brazil and India -- collectively known as G4 -- broke down in Potsdam, Germany, leaving this week's meeting as one of the last opportunities for top commerce officials to rescue Doha.
APEC Ministers will urge the opposing parties to show ``the necessary flexibility,'' and indicate the group's willingness to mediate between the factions to seal a deal before a year-end deadline, Japan's Kyodo News said June 29, citing a draft communiqué.
India, Brazil and the EU are not part of APEC, a 21-member group that accounts for 41 percent of the world's population and 56 percent of its GDP.
The WTO, EU, India and Brazil are all likely to be represented in Cairns, an APEC official said on condition of anonymity.
Doha Round
The 150-nation World Trade Organization has set a 2007 deadline for the Doha round. Ideally, the framework of a deal should be complete by early August.
Developing nations want the EU and the U.S. to scale back agricultural tariffs that protect their farmers. Europe and America are seeking more access to industrial and manufactured goods markets in countries like India and Brazil.
U.S. Agriculture Secretary Mike Johanns said both India and Brazil ``chose not to negotiate'' in Potsdam.
The ambitious and troubled Doha agenda, launched six years ago, is designed to open market access, add hundreds of billions of dollars in global commerce and lift millions of people out of poverty. It has stalled over a failure to reach deals on rice, poultry, bananas and manufactured goods, among others.
WTO rules require that all members agree to the agenda.
Market Access
``Unless and until there is sufficient new market access in agriculture and manufacturing and services, the Doha round will never meet its development promise,'' U.S. Trade Representative Susan Schwab said June 21 after the Potsdam meetings.
A week later, Schwab's office said it would complain to the WTO over the European Union's banana import restrictions, indicating that the divide was not merely between the developed and the developing world.
President George W. Bush's so-called fast track, or Trade Promotion Authority, expired at the end of June. It allowed trade deals to essentially bypass Congressional scrutiny --which could take months. A hostile Congress could pick apart any deal struck by Bush's negotiators and stall a deal beyond 2007.
``Without fast track authority, there's no way Congress will approve any deal,'' said Bhaskaran of the Centennial Group.
Difficult Numbers
``Frankly, I'm not so optimistic (on Doha),'' Malaysia's Trade Minister Rafidah Aziz told reporters June 29. ``The problem is we're now down to the numbers, and that's where the positions are very, very difficult.''
``Who are we to move giants?'' said Aziz. ``Unfortunately, we suffer in the process because nothing moves. I'm not optimistic.''
The World Bank said in 2005 a successful implementation of Doha could add as much as US$126 billion in real income gain and reduce extreme poverty by around 32 million by 2015.
``At the end of the day, the fate of a few hundred thousand politically important voting farmers in the West and Japan will matter a lot more than the poor in Africa and Asia,'' said Centennial's Bhaskaran. ``These people will have a lot to answer for.''
APEC includes Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Taiwan, Thailand, the United States and Vietnam.

To contact the reporter on this story: En-Lai Yeoh in Cairns, Australia at eyeoh1@bloomberg.net
Last Updated: July 2, 2007 23:21 EDT