As if the cause of free trade has not absorbed enough in terms of insults and injury, yet another attack on it was launched by the World Trade Organization–this one, through inaction:
The World Trade Organisation has dropped plans to convene ministers to push for an outline deal in the troubled global trade talks – a further blow to world leaders’ promises to combat protectionism.Pascal Lamy, WTO director-general, said a meeting, originally planned for next week, “would be running an unacceptably high risk of failure which could damage not only the round but also the WTO system”.
The decision all but eliminates the chance of reaching a framework deal in the “Doha round” of trade negotiations before George W. Bush, president, leaves the White House, after which most officials expect talks to be put on hold for months.
And why will there be no effort to have a meeting to come up with a deal?
On Friday, Celso Amorim, Brazil’s foreign minister, blamed the stalemate in the Doha talks on the US for insisting on “sectoral” agreements that would open entire industrial sectors in big emerging markets to competition. “I think probably the most appropriate word to apply to that would be ‘greed’,” he said. “The one main reason resides in the excessive demands in relation to sectorals.”Trade officials said the US was almost entirely isolated in demanding sectoral agreements, with even the European Union prepared to soften demands.
So: During a period of global recession, we are going to tempt fate by dipping a toe–and then some–into Smoot-Hawley waters through our collective inaction in promoting the cause of free trade. We will witness a commensurate increase in protectionism as a consequence, of course. And we will do all of this because other parties in the Doha talks don’t want to have emerging countries open their industrial markets to global competition–thus reducing economic efficiency, industrial quality, consumer choice and lower prices.
I look forward to the day when news on the trade liberalization front will cheer me up instead of depressing me–as it now does so routinely. But that day appears to be a long, long, long way off.