Doha in the Capitals

Geneva - The fate of the Doha Development Agenda trade negotiations will depend largely on what happens in respective national capitals at this juncture, World Trade Organization Director General Pascal Lamy said yesterday, suggesting that there is little point in resuming the suspended talks without a material change in the negotiating positions (WTD, 9/27/06).

"Most of the trade negotiations will have to take place within respective capitals if there has to be a breakthrough in the difficult area of agriculture," Mr. Lamy told the delegates attending this year's annual United Nations Conference on Trade and Development's trade and development board meeting.

Taking account of the dual character of trade negotiations - which involve hard bargaining among trading partners in Geneva simultaneous with ongoing discussions between national governments and their domestic constituencies, the Director General noted that the current phase is now largely centered around national capitals.

(European Union Trade Commissioner Peter Mandelson meets with US Trade Representative Susan Schwab later today to discuss the round, but the USTR told reporters yesterday that she does not expect any new offer from the visit.) Mr. Lamy told the chairs of several DDA negotiating bodies on Monday that he will not convene a Trade Negotiations Committee meeting to coincide with the scheduled General Council meeting on October 10 and 11 because it would unnecessarily raise expectations. The WTO chief gave a clear indication that there has been no change as yet in the negotiating climate after talks were suspended on July 24. He also does not favor any ministerial meeting convened under the WTO banner - but did not rule out groups of ministers meeting on their own without involving the organization.

At the UNCTAD session, Lamy noted that the demand for resuming the negotiations came mainly from developing countries.

Space for Quiet Diplomacy

Mr. Lamy suggested it is better to provide the "space for quiet diplomacy, hard discussions and discreet bridge-building" at this juncture. The "heavy political lifting" has to be carried out in the national capitals, he added.

But work on the Aid for Trade initiative will be continued since it is not part of the Single Undertaking. Mr. Lamy suggested, however, that the amount of funding to be made available for the initiative will only be known once there is a full picture of the market access commitments stemming from the full negotiations.

UNCTAD chief Supachai Panitchpakdi said the continued suspension of the Doha negotiations will have adverse consequences for the multilateral trading system - in the immediate, medium and long terms. He said there are several systemic issues that need to be resolved soon because the WTO remains the central pillar of the global trading system. He expressed fears over the negative consequences in areas such as agricultural subsidies and rising trade disputes in the absence of trade negotiations.

European Union Ambassador Carlo Trojan said there has to be a proper "exchange rate" between reductions in the trade-distorting domestic support and cuts in tariffs. He said Brussels wants immediate resumption of talks as well as their quick conclusion. But, he added, much depends on others - not just Brussels and Washington - in resolving the most difficult issues.