Ray of hope flickers on the horizon for WTO
Plurilateral approach mooted as way for WTO to tackle issues hindering Doha Round at today's meeting, seen as the last chance for compromise
Anyone interested in international trade is accustomed to disappointment with the World Trade Organisation. The growing mountain of failed talks and missed deadlines in the Doha Round has strained credibility to breaking point.
The atmosphere of distrust in Geneva is pervasive. The viability of the institution is in the balance as never before. Those of us who kept the faith over the years, certain that common sense would ultimately prevail, are no longer so sure.
Institutions rarely die. They just become the ghosts of past glories and stumble on. This could be the fate of the WTO, one of the pillars of post-war prosperity.
But after a decade-and-a-half of missed opportunities for progress in the Doha Round, a ray of hope flickers on the horizon. Some WTO members are at last talking openly of a new approach.
WTO director-general Roberto Azevedo has publicly acknowledged that the days for business as usual are gone. The latest drama was triggered in July by India's refusal to stick to a deal on facilitating trade that was agreed to in Bali, Indonesia, in December. It was to have been an early harvest that would banish years of stalemate in the Doha negotiations.
The WTO convention of consensus decision-making made possible India's move to dash those hopes. Consensus can too easily become veto. India's position was barely supported by others. And it was not even about trade facilitation. It was hostage-taking on farm subsidies putatively linked to food security.
Many assumed that after the European summer break a compromise could be found. Some countries, not least the United States, searched for one, short of undoing the Bali package. But to no avail.
The Indian position remains firm. Some argue this is a bump on the road that traffic will flatten if progress can be made elsewhere. Others refuse to budge until the agreement to implement the trade facilitation deal is respected.
The reason this has all come to a head is that a meeting today of the WTO committee that oversees the negotiations has been tagged as a last chance for compromise. And compromise does not even look close. This week's gathering and a meeting next week of the WTO's highest sub-ministerial authority may well prove to be institutional turning points.
Enter the flicker of hope. An idea doing the rounds is to address the veto problem. Allow progress to be made by those who want it, unfettered by the protests of those who do not. This has been dubbed the plurilateral approach.
What many proponents of the plurilateral approach do not specify is whether they envisage arrangements that discriminate against non-participants. Or will the like-minded be obliged to progress without excluding others from the benefits of their efforts?
Unless one side or the other yields on the discrimination issue, pursuing plurilaterals is likely to hit the wall and extinguish that flickering hope. The crisis-inspired drive to find ways of saving the WTO should be broad-based.
Addressing veto abuse is essential, but perhaps a more systemic approach aimed at raising the costs of contemplating a veto could work.
Another idea is to find ways of bundling issues - not so much through searching for big-package trade-offs, but rather through offering a broader bargain in given areas.
Ironically, that is exactly what the so far still-born trade facilitation deal succeeded in doing. Material assistance was on offer for countries accepting commitments from which they and their trading partners would benefit. This was a creative first for the WTO, and more such efforts could keep the wheels of cooperation turning.
A third avenue of potential action would encourage more non-contractual and non-litigious exchanges among WTO members. Perhaps there are forms of cooperation that do not always need to be the subject of treaty-like obligations. Former director-general Pascal Lamy used to refer to the "missing middle" in trade governance.
Doubtless there are plenty of other ideas for fresh thinking. This is sorely needed even if by some miracle the current debacle were to be settled. The saddest part of all is that inaction will sink the WTO before the loss is properly understood.
