Two tracks out of the Doha wasteland?

The Doha negotiations are moribund because they’ve been poisoned by their own intestines. The guts of the deal is in the so-called ‘modalities’: now a knotty mass of rules for cutting barriers, rules for compensating the barrier cuts, rules for making exceptions to the barrier cuts, andprovisions adding exceptions to the exceptions. They add-up to hundreds of pages including gobbledy-gook so impenetrable that most governments have no idea what it will mean for actual imports and exports. That’s a major reason the talks have ground to a halt.

Worse, it’s not hard to see that in several ways this minutely-structured deal prolongs and consolidates the contagion of tailor-made protection that it was supposed to remedy.

A much more effective ‘two track’ solution would be to allow the WTO member countries to ‘self select’ into two groups. One group would bring together countries that wanted to open global markets open competition and higher growth with fewer government taxes and subsidies. They would try to negotiate a reciprocal deal to open markets on a non-discriminatory basis.

The other group, including many developing countries such as India that don’t want to open their markets and see the WTO rules as a protection for their trade autonomy (they are that, too), would not negotiate. But neither would they have the right to impose unwieldy, complex, recidivist conditions on the deal made by the first group.

I have recently been working on the outlines of just such a two-track deal using a non-discriminatory form of a kind of trade deal known as a ‘critical mass’ agreement. I’ve been modeling the outcomes of some possible deals and comparing them to a representation of what could come out of Doha as it is presently structured. As part of the modeling, I have constructed some lists of the developing country groups that have extracted various additional exceptions and concessions—beyond the ‘special and differential’ concessions made to the entire developing country group—including the right to make no changes to their trade barriers.

As an example of the bizarre contortions that these exceptions processes have included, note that the second-biggest economy in Africa and the biggest oil-producer on the African continent, Nigeria, has been offered the ‘small and vulnerable’ designation (footnote 11 of the current Agriculture ‘modalities’).

LDC
no cuts
Small& Vulnerable
much smaller cuts
Recently Acceded Members (RAMS)
smaller and postponed cuts
Very Recently Acceded
no cuts
AngolaAlbaniaAlbaniaSaudi Arabia
BangladeshAntigua and BarbudaArmeniaFYR Macedonia
BeninArmeniaBulgariaViet Nam
Burkina FasoBarbadosChinaTonga
BurundiBelizeCroatiaUkraine
CambodiaBoliviaEcuador
Central African RepublicBotswanaFYR Macedonia
ChadBrunei DarussalamJordan
CongoCameroonKyrgyz Rep.
DjiboutiCubaMoldova
GambiaDominicaMongolia
GuineaDominican Rep.Oman
Guinea BissauEcuadorPanama
HaitiEl SalvadorSaudi Arabia
LesothoFijiChinese Taipei
MadagascarFYR Macedonia
MalawiGabon
MaldivesGeorgia
MaliGhana
MauritaniaGrenada
MozambiqueGuatemala
MyanmarGuyana
NepalHonduras
NigerJamaica
RwandaJordan
SenegalKenya
Sierra LeoneKyrgyzstan
Solomon IslandsMacao, China
TanzaniaMauritius
TogoMoldova
UgandaMongolia
ZambiaNamibia
Nicaragua
Nigeria
Panama
Papua New Guinea
Paraguay
St Kitts and Nevis
St Lucia
St Vincent & the Grenadines
Sri Lanka
Suriname
Swaziland
Trinidad and Tobago
Uruguay
Zimbabwe

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