A minor hiccup at WTO - Editorial

The World Trade Organisation’s director-general Pascal Lamy is known for many things, but being defeatist is not one of them. Cautious optimism 

and determination to persevere in the face of incredible odds have been his trade mark style. Even so, most observers were surprised when the ebullient WTO chief announced his desire to hold a mini-ministerial later this month to thrash out pending issues in the Doha Round. With the ongoing economic crisis spreading its tentacles and showing every sign of becoming deeper and more intractable, few governments have either the time or the inclination to address trade issues. Never mind that these might well be part of the solution that is evading the world economy in its bid to ward of a repeat of the 1930s’ Depression. 

Policy makers realise this full well. The resolution passed at the conclusion of the meeting of the G20 heads of governments in Washington in November underscored the “critical importance of rejecting protectionism and not turning inward in times of financial uncertainty”. Further, the assembled leaders promised to “strive to reach agreement this year on modalities that leads to a successful conclusion to the WTO’s Doha Development Agenda with an ambitious and balanced outcome”. More to the point, they called on trade ministers to work towards this objective, assuring them they (the leaders) stood “ready to assist directly, as necessary”. 

However, a lot has changed since then. The US is formally in a recession, as is much of the developed world. On paper, all countries recognise the greatest collective good can come only through greater global co-operation, including exchange rate policies that encourage re-balancing of trade and investment flows. But in practice, few are willing to look beyond their own national interest. And when the gulf between developing countries and the US is as wide as it is in the present Doha round, especially in agriculture, there is only so much the WTO chief can do. For now! What is important is not to lose heart or give up; there is too much at stake. In the WTO marathon, one ministerial less will not alter the outcome. The end goal is still worth pursuing.