Monthly Archives: August 2008

Sensitive” farm quotas revealed

Details are start­ing to emerge of the expan­sion in import tar­iff-quo­tas in the EU that might have con­ced­ed includ­ed in a Doha deal. They are large num­bers by any mea­sure, because the EU now com­pris­es 27 mid­dle and high-income economies.

Differences over the ‘revival’ of WTO negotiations

While Pas­cal Lamy, the WTO Direc­tor Gen­er­al, rush­es around the world try­ing to revive an agree­ment he claims was ‘almost done’ and with­in Mem­bers’ grasp, the Chair­man of the Agri­cul­ture nego­ti­at­ing group Craw­ford Fal­con­er—who has been through the man­gle try­ing to squeeze con­sen­sus out of the Mem­bers over two years—has a more skep­ti­cal assess­ment of the chances of ‘revival’.

Over­all, there was a cred­i­ble basis for con­clu­sion on very many (and pos­si­bly one could have said “near­ly all”) issues. But even “near­ly all” is not all. And, as a mat­ter of plain fact, there was deci­sive dis­agree­ment on cer­tain mat­ters while oth­er very sig­nif­i­cant issues were not even dealt with. So there was no pos­si­bil­i­ty to put a judge­ment on the “oth­er” mat­ters to the final test.

That said, had the “out­stand­ing” mat­ters been resolved (and that would have been no small mat­ter), I do think the rest could have “fall­en into place”. But such a judge­ment is a func­tion of a very par­tic­u­lar sit­u­a­tion. That sit­u­a­tion was one where, at the time, Mem­bers were con­scious that there was a gen­uine endgame sce­nario. Mem­bers were, accord­ing­ly, pre­pared to accept com­pro­mis­es that were not gen­er­al­ly their pre­ferred options. That was a mind-set that applied as of yes­ter­day. As of today that remains at best moot. ”  extract from: Chairman’s report on July ‘pack­age’ (WTO doc­u­ment JOB(08)/95)

Next steps for agriculture agreements

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p>The WTO’s Doha Round of trade nego­ti­a­tions did not ‘col­lapse’; they failed. The fail­ure was not caused by the dis­agree­ment over the Spe­cial Safe­guard Mech­a­nism. The poor qual­i­ty of the pro­posed agree­ments reflect­ed much deep­er prob­lems that might also have caused the col­lapse of con­sen­sus. The Doha enter­prise had pri­or­i­ties that were no longer aligned with the com­mer­cial real­i­ties of world mar­kets and that had been by-passed by the polit­i­cal real­i­ties of the trad­ing sys­tem.

It is impor­tant to under­stand the lessons of the Doha Round’s col­lapse and not be mis­led by the hope that extend­ing its process­es still fur­ther (more ‘Chairman’s’ pro­pos­als) will cure its short­com­ings. Even if more tweak­ing could reveal the elu­sive ‘land­ing zone’ for con­sen­sus, agree­ment could only resus­ci­tate a fee­ble and most­ly irrel­e­vant result for the sake of clo­sure, rather than for the sake of sub­stan­tial progress on con­tem­po­rary trade prob­lems.

Rather than engage in ‘shut­tle diplo­ma­cy’, Pas­cal Lamy should be encour­ag­ing WTO gov­ern­ments to reflect on the sys­temic changes need­ed before return­ing to the project of mul­ti­lat­er­al mar­ket lib­er­al­iza­tion.

For­tu­nate­ly for Aus­tralia, some of the fac­tors that brought Doha to an end favor our mar­ket inter­ests and allow us time to under­take the research and the diplo­mat­ic work nec­es­sary to help re-con­struct a more effec­tive frame­work for mul­ti­lat­er­al trade agree­ments.

Australian food trade barriers revealed

The World Bank’s World Trade Indi­ca­tors (WTI) are a rel­a­tive­ly new, but very pow­er­ful, way of describ­ing glob­al trade poli­cies and reg­u­la­tions. Their sim­pli­fied met­rics help to reveal the ‘big pic­ture’ that emerges from a bliz­zard of trade and tar­iff data col­lect­ed by the UN and WTO. Their method is the­o­ret­i­cal­ly sound but—as always—has lim­its and per­spec­tives that need some inter­pre­tive care.

The lat­est (2008) results show world trade bar­ri­ers con­tin­u­ing to fall rapid­ly through 2007

Over the last decade, coun­tries have improved many aspects of pol­i­cy rel­e­vant for trade. World­wide, Most Favored Nation (MFN) aver­age tar­iffs have fall­en from 14.1 per­cent dur­ing 1995–99 to 11.7 per­cent dur­ing 2000-04 and fur­ther to 9.4 per­cent in 2007—a decline of more than 33 per­cent. In addi­tion, a sub­stan­tial amount of trade is con­duct­ed at a zero MFN tar­iff rate (MFN-0) or through pref­er­en­tial trade agree­ments… The most recent esti­mates indi­cate that all regions and income groups have wit­nessed sub­stan­tial real growth in trade dur­ing this time. In 2007, aver­age real growth in trade, 7.7 per­cent for the world as a whole, is with­in the 7–9 per­cent growth range of the last decade.

But one result that sur­pris­es is the very high lev­el of revealed non-tar­iff pro­tec­tion of Aus­tralian agri­cul­ture.

Glimpses of a micro reform program

Paul Keat­ing has a world-beat­ing tal­ent to sting. His descrip­tions of his suc­ces­sor as Prime Min­is­ter, John Howard, as a “dessi­cat­ed coconut araldit­ed to the seat” while his deputy Costel­lo was “all tip and no ice­berg”, are exem­plars of the jibe. But they’re spit­balls not barbs. They don’t wound because they’re often more-than-half boast­ful: in this case, a reminder that Keat­ing final­ly crushed Hawke’s coconuts after an 8-year part­ner­ship on the trea­sury bench.

Keating’s lat­est provo­ca­tion has irri­tat­ed his own side of pol­i­tics. Rudd’s gov­ern­ment, he says, lacks an ‘over­ar­ch­ing nar­ra­tive’. Rudd waved the crit­ic­sim away with typ­i­cal­ly fogey­ish phrase imply­ing Keating’s neu­roses are on show (“Paul’s some­times not an entire­ly hap­py chap­py”).

That works, up to a point—there’s some­thing pathet­ic about an ex-PM try­ing to reclaim his own myth—but the crit­i­cism was not far off-tar­get. After more than a decade of inat­ten­tion, by an essen­tial­ly idea-less con­ser­v­a­tive coali­tion gov­ern­ment there are seri­ous defi­cien­cies in our trans­port, port and telecom­mu­ni­ca­tions infra­struc­ture squeez­ing pro­duc­tiv­i­ty and trade per­for­mance (espe­cial­ly com­mod­i­ty exports). Com­mit­ment to a coher­ent and trans­par­ent agen­da of micro-reg­u­la­to­ry reforms is urgent. But the signs from the Rudd gov­ern­ment have not been encour­ag­ing so far.

There could be four

Hen­ry Gao asks a very per­ti­nent ques­tion about a devel­op­ment in the man­age­ment of WTO that might eas­i­ly be missed (unless you’re look­ing)

Will this ‘one coun­try, two can­di­dates’ arrange­ment work in the future?”  extract from: WTO and Chi­na Blog

Where our $70m went

The unnec­es­sary Rudd/Brubmy bribe to build ‘green’ cars in Vic­to­ria is less than 2% of their cur­rent prof­it

[Toy­ota] yes­ter­day announced net earn­ings of Y356.6 bil­lion ($3.57 bil­lion) for the three months to June 30 — the first quar­ter of the Japan­ese finan­cial year — and main­tained its full-year prof­it fore­cast at Y1.25 tril­lion.”  extract from: The Aus­tralian