The Real Cancun
BARFIELD, CLAUDE & GLASSMAN, JAMES K.
The Real Cancun What went wrong at the trade talks. BY CLAUDE BARFIELD & JAMES K. GLASSMAN TRADE TALKS in the Mexican beach resort of Cancun collapsed two weeks ago, after the United states and...
...Thus, Brazilian foreign minister Celso Amorim exulted: "We were able to show what a group of developing countries can do when they are united...
...to abandon its adamant position on the Singapore Rules and settle for further deliberations down the road...
...BY CLAUDE BARFIELD & JAMES K. GLASSMAN TRADE TALKS in the Mexican beach resort of Cancun collapsed two weeks ago, after the United states and Europe failed to reach an agreement with a group of 22 developing countries that insisted on aggressive cuts in farm subsidies but refused to take small steps to liberalize trade in their own countries...
...In fact, the Europeans are the villains of the trade story, blocking serious reductions in trade barriers and helping to impoverish Africans and Asians...
...environmental summit in Johannesburg last year...
...The reason isn't a threat to health—there isn't one, as even E.U...
...they could just make whatever points they suggested, argue and not offer and give...
...on its own, and far too late, did abandon these demands in the last hours of the talks...
...Having failed publicly to adopt a sympathetic stance toward the developing countries and jettison the E.U...
...Criticizing and threatening the leaders of trading nations in the two most obvious regions for new agreements—Asia and South America—is hardly an auspicious prelude to new negotiations...
...The E.U...
...Instead, the United States allowed itself to be dragged along in the E.U...
...Who was at fault for the breakdown at the ministerial conference of the World Trade Organization...
...The truth is that the immediate cause of the breakdown was the refusal of the least-developed African countries to budge on a couple of minor issues—compounded by the hasty action of the inexperienced Mexican host, foreign minister Luis Ernesto Derbez, in abruptly adjourning the talks without consulting other major trading nations...
...leadership, and the hopeless consensus rules for WTO negotiations...
...The smart move for the top U.S...
...Instead, European coalition governments are trying to appeal to their Green partners and trying, as well, to bar imports from poor countries, which can put biotech agriculture to profitable use...
...In the past, rich countries made deals behind closed doors without listening to the rest of the world," said Phil Bloomer of the British organization Oxfam...
...wake...
...There's truth in these contentions, but Zoellick's fit of pique will ill serve his own fallback strategy of "competitive liberalization," by which the United States substitutes a series of bilateral and regional trade agreements for the failed multilateral negotiations...
...Europe and the developing countries were at fault, but so, sadly, was the United States...
...The central focus of the Cancun talks was agriculture, and the United States favors—and had formally proposed—much deeper cuts in export subsidies, agricultural tariffs, and domestic supports than the Europeans, who have to contend with protectionist, and often violent, farmers in France and elsewhere...
...Oxfam opposes free trade, and, like other NGOs, it could only have been cheered by the collapse of the talks...
...Nonetheless, some leaders in developing nations applaud the result because it symbolizes the changed power dynamics within the WTO...
...As a result, the Doha Round, begun in 2001 with promises to help developing countries in large part by cutting agricultural barriers in rich countries, will not finish on time by the end of 2004—and indeed may be extended for some years after that...
...It never really defended and advanced its original bold proposal for agricultural liberalization, and it only halfheartedly pushed the E.U...
...negotiator, Robert Zoel-lick, was to make common cause with the poorer countries —as the United States did so effectively during the U.N...
...As Alan Oxley, a veteran Australian trade negotiator, put it on TechCentralSta-tion.com, "Developing countries have taken the most stupid international trade action since the U.S...
...Instead, Zoellick remained loyal to a fault to his European ally, Pascal Lamy, the European Union trade commissioner...
...Claude Barfield and James K Glassman are resident fellows at the American Enterprise Institute...
...A more sober judgment, however, is that this victory will come at a considerable price, since a successful conclusion of the WTO Doha trade round is the only hope for reducing the crippling effects of the $300 billion in agricultural subsidies lavished upon developed-country farmers...
...Europe, for example, maintains an absurd ban on imports of genetically modified foods...
...Of course, those poorer nations—especially their leaders, Brazil, China, and India—lack clean hands...
...But the United States could almost certainly have made a deal with them and portrayed the Europeans as the odd men out...
...studies have shown...
...In addition, the Europeans, in order to deflect attention from agriculture, were demanding broad new rules for foreign direct investment and the creation of an international antitrust regime—areas they knew were anathema to developing countries, which had neither the resources nor the expertise to manage them...
...In the end, there was plenty of blame to go around in Cancun...
...The rhetoric of the 'won't-do' overwhelmed the concerted efforts of the 'can-do.'" He later added, "A number of countries just thought it was a freebie...
...They are cynical protectionists in a number of areas...
...Glassman attended the World Trade Organization meetings in Cancun...
...The proper strategy in Cancun for the United States was to isolate Europe, to negotiate separately with the 22 developing countries on both agriculture and the so-called Singapore Rules for investment and antitrust policy...
...In statements that seemed aimed directly at leading members of the Group of 22, Zoellick asserted that the talks had failed because some countries used "rhetoric as opposed to negotiation...
...Ideological nongovernmental organizations (NGOs) blamed the developed world...
...But while the strategy of developing countries was in many ways self-defeating, the United States played its hand poorly...
...imposed the Smoot-Hawley tariffs in 1929...
...baggage, Zoellick compounded these errors by coming off as petulant and vengeful in interviews after the debacle...
...They tried it again in Cancun, but developing countries refused to sign a deal that would fail the world's poor people...
...But there were deeper causes for the failure as well: European obduracy and paralysis, inept U.S...
...This is disingenuous...
Vol. 9 • October 2003 • No. 4
