Doha Trade Deal Concluded

There has been a deal in the ‘Doha’ round of talks in the World Trade Organisation (WTO).  This is a sentence that seemed highly unlikely that would ever get written, and readers could be forgiven for forgetting that the talks were still even ongoing.  A breakthrough has been made possible by slimming the scope of the deal down.  Therefore, what has emerged is a ‘Doha-lite’.  The WTO prefers to call it an ‘early harvest’ deal – giving the impression that more will follow.  Given how hard it was to come to an agreement on this limited agenda, it is not clear that this will necessarily be the case.

The Doha round was named after the capital of Qatar where the trade talks were launched right back in 2001.  They have suffered serious collapses in Cancun in 2003 and, again, in Geneva in 2008.  Many commentators believed that, with over 150 members, each of whom has a veto, it would be almost impossible to get an agreement in the forum of the WTO.  This is why trade policy has shifted to bilateral and multilateral deals over the last few years – such as the EU-US trade talks.  If there had been another failure in the WTO at the latest meeting in Bali, Indonesia, the last rites may well have been said over the global negotiations. 

The most important part of the ‘Bali’ package is agreement on ‘trade facilitation’.  This is the reducing of the costs of trade by simplifying custom procedures for example.  It is estimated that this could boost the global economy by $400bn with developing countries benefiting the most.  But a WTO meeting would not be complete without an argument over agriculture.  The Bali deal includes measures to limit agricultural subsidies and provide greater access to rich-world markets for the less-developed countries.  India caused some last-minute problems with a requirement that its ‘food-security’ programmes be exempt from challenge in the WTO.  This, and various other concessions, were granted in order to secure a deal.

What this all means for EU and UK farming is currently unclear.  Europe has already largely opened-up its markets to the least-developed nations unilaterally.  It has also shifted much of its farm support into non-trade-distorting measures like the Single Payment, and lowered tariffs.  In the short-term, then, there is likely to be little direct effect from Bali.  Perhaps the most important point is that a deal has been done at all.  This gives fresh momentum to the WTO talks which may see a more comprehensive trade round concluded with greater effects on Europe’s farmers.  This still seems some way off, if it happens at all though.