After seven years of intermittent negotiations, the Doha rounds collapsed in Geneva last week due to insurmountable differences between industrialized, developing, and emerging nations over agricultural tariffs. National Public Radio’s Adam Davidson explained why the World trade Organization (WTO) negotiations failed: “By most accounts, the talks were killed by a lack of courage and will on behalf of everyone involved.” As talks collapsed, WTO Director-General Pascal Lamy said, “No one is throwing in the towel.” Still, the WTO may now not see another round of talks until 2010.
As
Deutsche-Welle points out, the talks fell apart largely because of a
U.S.-India deadlock on protection tariffs for poor farmers. “We all lose," said Brazilian Foreign Minister Celso Amorim in an interview with Efe,
criticizing the failure of the talks and the probability that the United States will likely approve a law increasing farm subsidies. China, India, and Brazil were also intransigent in their demands. Brazilian officials also plan to file a WTO
complaint against the United States over the latter’s ethanol tariffs, which serve to protect American corn-based ethanol producers against cheaper sugarcane-based ethanol from Brazil.
For Brazil, the talks’ collapse brings mixed results and expectations for its future. In a Forbes.com Q&A, Global Insight's Jan Randolph counts Brazil as
one of the biggest losers in Doha's failure. On the other hand, Now recognized as a world player, Brazil is experiencing its strongest economic performance in three decades and has thus far remained fairly insulated from the U.S. credit crisis. The
New York Times profiles Brazil’s recent financial and social growth and highlights its successful development recipe of respect for open markets combined with targeted social programs.
On the sidelines of Doha, Brazil—in conjunction with Costa Rica and Colombia—
nailed down a treaty with the EU to lower their import tariffs for bananas. On the down side, Doha’s collapse may slow down Brazil’s meteoric financial ascension. The failure to access new markets for its
ethanol industry as well as for crops like soybeans and cotton could pose a challenge to growth. “Brazil will take twice as long to reach its goal,” said the former Governor of Brazil’s Central Bank Carlos Langoni when
interviewed by Reuters.
Free Trade Agreements (FTA)
may be the answer for Brazil and several Latin American countries in the face of no Doha deal. Bilateral deals could serve as a salve, with
Chile serving as a model of a country in active pursuit of such pacts. Chile has signed more than 50 agreements, including with the United States, Canada, the EU, South Korea, Japan, and Mexico. Hours after the Doha collapse, Chile
inked a deal with Australia that Chilean Foreign Minister Alejandro Foxley described as the most extensive of all of its trade agreements.
Following in Chile’s steps, Peru
beefed up negotiations and aims to get a new pact signed in November, when Chinese President Hu Jintao visits Lima for the Asia-Pacific Economic Cooperation (APEC) summit. Mexican President Felipe Calderón has also been traveling abroad recently,
in pursuit of agreements with China, India, and African nations.
AS/COA hosts its annual Latin American Cities Conferences in
Santiago on August 6 and in
Lima on September 4. The Lima conference will examines Peru’s role on the global stage, particularly as this year’s APEC host. An AS/COA
update takes a closer look at APEC Peru 2008.
At COA’s 2008 Washington Conference on the Americas, U.S. Trade Representative Susan Schwab
emphasized the importance of moving the Doha round forward.
