After a decade of arduous work by WTO Members, the Doha Round of multilateral trade negotiations is confronted with a crisis. The issue that sparked this crisis, as mentioned by WTO Director-General Pascal Lamy, is the "political gap" between WTO members on tariff cuts for products in certain specific industrial sectors, referred to as "sectorials", in the non-agricultural market access (NAMA) negotiations.
The United States, supported by the European Union and Japan, demand that Brazil, China and India (BCI) must participate in zero or close-to-zero tariff efforts in the chemical, industrial machinery, electronics and electrical products sectors, so as to equalize, or at least harmonize, their tariff levels in these sectors with those of the developed members. BCI, on the other hand, firmly believe that meeting this demand would fundamentally undermine their development objectives and that they are entitled to participate in sectorials on a non-mandatory basis as per the specific mandate agreed by all WTO members at the 6th Ministerial Conference in Hong Kong in 2005. NAMA negotiations have thus reached an impasse and are regarded as blocking progress in other areas.
However, according to the US ambassador to the WTO, while agreeing to the assessment of Lamy with regard to sectorials, the US "also believes the same is true of agriculture and services". This means that the sectorial issue will not be the only hard nut to crack in the Doha Round of negotiations.
Take agriculture for example, imbalance still exists between the offer by the US on trade-distorting domestic subsidies and its ambition for market access in developing member countries. Imbalances also exist between the considerable flexibilities provided to EU, Japan and some other developed members on market access, with no commitment made by Japan to tariff capping, on the one hand, and the insufficient, as well as difficult-to-be-used, flexibilities to be provided to developing members for their poor farmers and rural development on the other.
Whatever efforts the members or Lamy make, they should focus on the key to the problems. The key is the demonstration of a genuine political will by members, particularly the major developed members, to resolve the issues. Otherwise, these efforts will be in vain.
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