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


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