A second Bush administration is very likely to have the same trade outlook as the first, although it will be managed by different people. The top priority for Bush bis is likely, again, to be bilateral agreements: particularly the stymied “Free Trade Agreement of the Americas”:http://quote.bloomberg.com/apps/news?pid=10000086&sid=aH.CDWWFiZIE. This will be, like all such regional trade agreements, essentially an expression of a political relationship. That was the “problem”:http://www.inquit.com/article/124/lsquofree-tradersquo-means-opening-markets-surprise in the first Bush administration when the Brazilians, in particular, showed muted enthusiasm for a US-led western hemisphere pact. Will things change now that Bush has four more years? Maybe. A second priority for Bush bis will be to conclude the Doha Round of WTO trade negotiations. The first Bush administration did not give the impression that it had any particular vision for the global agreement. One of the Adminisration’s finest moments was it’s decision to press for the launch at Doha only two months after the terrorist attack in New York and without negotiating authority from Congress. At that stage, it was important to get the negotiations going as a sort of demonstration that international trade remained one of the arts of peace in a time of potential global conflict and uncertainty. But the subsequent performance of the Bush Administration and USTR Zoellick was less impressive. The US resigned the leadership role it should have had after Doha by accepting from Congress the most expansive farm subsidies ever (in the 2002 Farm Bill); by pedantically opposing solutions to minor trade issues such as drugs patents and the impact of its cotton subsidies; by badly underestimating the confusion and antagonism that it’s joint agenda with Europe on competition policy, investment and trade facilitiation had created in developing countries, and; by confecting with Europe a transparent, self-serving ‘solution’ for the agriculture conundrums in the last month before the Cancún Ministerial meeting. It is possible that the Bush Administration bis could reverse this miserable record and re-establish the leaderhip of ideas and ideals that the US provided in GATT and WTO for many decades. But it’s more likely not, given that the President’s “trade negotiating authority”:http://www.tpa.gov/ due to expire on 1 June 2005 (although an extension to 1 June, 2007 is possible, subject to Congressional approval). The shorter-odds are on a strategy aimed a completing the WTO talks within the time-frame of the current negotiating authority, on terms that are, at best, non-prejudicial to protectionist interests in the USA. This group that now includes not only the “textiles and garments”:http://www.textileworld.com/News.htm?CD=5&ID=8067 industry but also sectors of US agriculture including sugar, cotton, peanuts that are insignificant economically but retain powerful political friends. “Here”:http://www.grandforks.com/mld/grandforks/10015369.htm, out of interest, is a report of cuddly VP Dick Cheney trying to win the hearts of Minnesota sugar farmers before the election. His promise to try to keep the issue mostly in the WTO is a means of soothing the audience’s fears that free-trade agreements with Latin America (the real Bush bis agenda) mean floods of sugar from places like Brazil. The WTO, they believe is a paper tiger by comparison. Well, “maybe not”:http://www.inquit.com/article/365/wto-rules-against-eu-sugar-subsidies any more.
Peter Gallagher is a leading Australian consultant on trade and public policy.[bio].
"I can help you with strategies for, and analysis of, international markets, law and regulations, trade agreements, export policies, import restrictions… I also offer reports, conferences and master-classes for government officials and industry associations on international trade research."
Email: Peter Gallagher