Another failure for the Doha Round

The World Trade Organization (OMC) currently has two major functions: on one side is responsible for investigating and indicate penalties for countries that do not follow what determines the organization, for another, It offers successive rounds of negotiations aimed at promoting the further liberalization of world trade waves.

The last of the attempts became known as the Doha Round (launched in 2001) and did not achieve the result sought. As this is an organization founded on the rule of consensus, all that was negotiated was lost when India and China opposed the deal. Although the commitments made during negotiations have lost meaning, They are important because they tend to support the minimum parameters under which a new round must be.

After the initial shock of the financial crisis that affected the world since the end of 2008 and better knowing the limits and potential of the US presidency, Barack Obama decided to return to talks. Ron Kirk, US Trade Representative two, He began acting in an attempt to resume the failed round.

Until here, everything normal. However, what is striking is that Kirk is not resuming the negotiations based on the commitments made at the time of the negotiations. Instead, It has put new bases reversing what was being discussed at the time.

Day 13 May Kirk said that emerging countries like Brazil, India, South Africa and China should strive more to open their markets to the round can be resumed. Basically Kirk believes that developed countries, especially the United States, have offered everything they could in terms of trade liberalization and the least developed countries should not suffer more, increasing its trade liberalization. Like this, left for the emerging countries to open up their markets, generating a new wave of investment and trade.

Interestingly Kirk ignored the great debate that led to the crisis of negotiations, which is the offer of agricultural subsidies by developed countries in exchange for opening for industrial products.

To modify the tone of the conversation, the US government can show national public opinion an important international role focused on the resumption of the strength of the US economy. The opening of emerging markets offer good conditions for increased sales and investments that could return significant profits to a tottering economy.

In the emerging world the response has been cautious. For a while, the diplomats are trying to better understand how to give the US move in the WTO. It is not clear yet whether this is just a rhetorical movement that seek to show a more active than Obama has seemed to be, or if it is effectively a new focus of US policy. If the idea is effectively resume talks this tone, probably few concrete results will emerge and will be Doha, once again, postponed.

Originally published in FinancialWeb

http://www.financialweb.com.br/blogs/blog.asp?cod=98