Doha Round nearing death, says economist

AFTER years of trying to reach an agreement, a world-renowned economist issued a warning that the Doha Round of negotiations under the World Trade Organization (WTO) may never see completion.  In an interview, Columbia University’s Earth Institute Director Jeffrey Sachs said lack of leadership in the talks could send the Doha Round to its death.

“I think the problem is the kind of leadership that’s needed for these results really doesn’t exist right now. The United States, the European Union, China, Russia, India, all have big governance challenges,” Sachs added in an interview at the sidelines of the recently concluded Asian Development Bank (ADB) annual meeting (May 2-5) in Pasay City.

“I don’t think those constraints are compelling in the sense that they really mean that the national interest is to avoid agreement but it does mean that all these politicians are risk-averse, which is too little, and take few risks and go with the status quo. And so that’s why this agreement just looks farther than ever from coming right now, or ever,” he said.

The US right now, according to Sachs,  is going through a lot of economic challenges that have “paralyzed [it] politically,” while the European Union is still reeling from its debt crisis.

China, he said, is undergoing a difficult political transition while Russia is trying to cope with protests due to the re-election of Vladimir Putin as president. India, Sachs added, has a “complicated coalition government” that makes it difficult for the country to deal with change.

He said if the Doha Round “freezes over,” he expects a new agreement to come into view. This new agreement, however, may not be under the WTO and could take on different forms.

“Maybe something else will be invented to change direction, or to give it a new name or to give it a new impetus or a new focus. I’m not part of the negotiations day to day or month to month, but I don’t see any prospect of a treaty in the short term given this constellation of weak political actors and lack of global leadership,” Sachs, a renowned economist and senior adviser to the United Nations, added.

The new agreement, he said, could focus on just world food supply and global agriculture trade or an agreement between poor countries on trade and investment rules.

Sachs added that an initiative concentrated  on reform of international tax havens or possibly on money laundering is also essential in today’s world.

He said there could also be a possible initiative that links trade and the environment. The tie-up could be beneficial, especially with the need to focus on sustainable development and inclusive economic growth.

“I’m not predicting it, but if this trade round really freezes up, we have so many global challenges that need problem-solving that you could imagine another initiative coming. Maybe not even within the WTO exactly but around sustainable development, around agriculture, around energy, around the global crisis of tax evasion, ‘hot’ money, tax havens which are very serious problems where we need a global approach and these would be the kind of agreements that might side-step the existing round,” Sachs added.

The negotiations for the Doha Round began in 2001, after a ministerial meeting in Doha, Qatar. The Doha Round is of special interest to developing countries, particularly to the Philippines,  since its  “aim is to achieve major reform of the international trading system through the introduction of lower trade barriers and revised trade rules.” The round, whose work program covers about 20 areas of trade, is also known semi-officially as the Doha Development Agenda. It was officially launched at the WTO’s Fourth Ministerial Conference in Doha in November 2001.

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By | 2016-03-29T11:09:35+01:00 May 9th, 2012|News|Comments Off on Doha Round nearing death, says economist

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