Over the past few days, trade ministers from scores of countries have spent hours flogging the long-dead horse that is the Doha round of global trade talks in Nairobi – and hardly anyone noticed. The World Trade Organisation, which convened last week’s conference, was once regularly targeted by protesters as the secretive, all-powerful puppet master of global capitalism.
Back in 1999, in the innocent days before the sub-prime crisis laid bare the sinister power of international finance, WTO talks in Seattle broke down amid clouds of tear gas, as anti-capitalist protesters expressed their fury at the rigged rules of the global marketplace, which, as they saw it, entrenched the wealth of the rich and excluded the poor. Yet last week’s gathering, attended by Britain’s Lord (Francis) Maude, barely registered with the world’s angry young radicals, who have turned their attention to bashing bankers – through the Occupy movement, for example.
As it became clearer in recent years that the Doha round was dying, the anti-poverty campaigners who once spent hours poring over the intricate details of cotton subsidies and sugar tariffs have moved on too.
Launched in late 2001, in the wake of the 9/11 attacks in New York, the Doha round was meant to open up new opportunities for developing countries to trade their way out of poverty and drive the next stage of what then seemed the unstoppable progress of globalisation.
But 14 years of talks have failed to yield an achievable deal; indeed, the issues dividing the main protagonists have barely shifted since negotiations collapsedacrimoniously in Geneva in July 2008. Back then, I watched US trade representative Susan Schwab lambast her Indian and Chinese counterparts for wanting to protect their farmers from cut-price imports. This issue of “special safeguards” was still being scrapped over in Nairobi.
The one-country-one-vote constitution that makes the WTO a more democratic institution than, for example, the International Monetary Fund, also makes negotiations cumbersome and decision-making clunky.Doha failed for many reasons, some more worrisome than others. It was probably always far too ambitious to try to tie up simultaneous deals across agriculture, manufacturing and services. The hope was that countries would give ground in some areas in return for concessions elsewhere, but this unwieldy, triple-track approach meant deadlock in one area led to comprehensive failure.
Political capital was another key challenge: lowering barriers to foreign competition is a tough domestic sell, especially in hard times when workers feel their jobs may be vulnerable. Optimists at the WTO’s Geneva headquarters hoped President Obama would swing his weight behind their efforts to improve the global trading system, but other priorities – not least the fraught passing of his healthcare reforms – have always seemed more pressing in Washington, where suspicion of unfettered free trade runs deep on both sides of Congress.
And most recently, a flowering of “plurilateral” deals, such as the Trans-Pacific Partnership between the US and Japan, has seen groups of like-minded countries – economic coalitions of the willing – sign up to liberalisation on their own terms.
Meanwhile, the nature of contemporary capitalism means the hot political issues are no longer import tariffs or agricultural subsidies but international taxation, financialisation and freedom of movement for migrant workers.
If Doha is dead, some noble aspirations will be buried with it. It was conceived as a “development round” – offering poor countries a stake in the global trading system to tackle poverty and prevent them from becoming recruiting grounds for terrorism. It became increasingly clear, though, that rich countries were unwilling, or politically unable, to offer much without a quid pro quo – and developing countries don’t have much to give.
Afghanistan became the WTO’s latest fully signed-up member in Nairobi last week. (This was one of the few concrete announcements to come out of the summit.) But it is joining a train that has been stuck in the station for more than a decade.So what began as an expression of the spirit of internationalism quickly descended into a series of cross-cutting mercantilist spats. And while trade liberalisation continues apace through plurilateral deals between powerful trading blocs, these rarely include the poorest countries.
The WTO still has a crucial role to play, as the policeman of the world’s trading system. But after 14 years of deadlock, the ideal of deepening economic relationships between rich and poor, north and south, in a way that would be mutually beneficial and to which all member countries could sign up has been extinguished.
Even protesters who once saw the WTO as the evil headquarters of capitalism red in tooth and claw might spare a moment to lament the fading of one-country-one-vote multilateralism it represented. (The Paris climate talks provided a heartening counter-example – albeit with few details as to how new emissions targets will be met.)
But for those on the left who dream of collective global solutions to the other pressing ills of modern capitalism, from tax avoidance to reckless financiers, 14 years of failure ought to give pause for thought.
