The collapse of Doha

July 29, 2008 | by Alex Evans | More on Climate and resource scarcity, Cooperation and coherence, Economics and development, Global system | No comments

No-one quite wants to pronounce the patient dead just yet (US Trade Representative Susan Schwab: “This is not the time to talk about collapse … the US commitments remain on the table”; unnamed EU source: “It’s clearly not a success. But no one will want to say that it’s the end of the round”) - but it’s hard to see much sign of life either, especially after all of Pascal Lamy’s talk of this being the final, final, final deadline.

It’s ironic that at a point when all the talk is of how high food prices are, the issue on which the talks foundered was a mechanism designed to protect developing countries from low food prices.  ICTSD explains:

The ’special safeguard mechanism’ would allow developing countries to raise tariffs beyond bound levels, in principle to stall inflows of cheap imports that could displace farmers. The issue neatly splits the interests of import-sensitive developing countries and competitive farm exporters, including those in the developing world: the former want to have recourse to protection, the latter want predictable access to overseas markets.

One of the main sticking points has been whether, and by how much, countries should be allowed under the SSM to impose safeguard duties in excess of current (i.e., pre-Doha) tariff ceilings. The G-33 bloc of developing countries, which includes China, India, and Indonesia, insists that this may sometimes be necessary for safeguard duties to have the desired effect, i.e., protecting farmers.

Or there’s the pithier version from another unnamed official, this time in the IHT:

It risks becoming a totemic issue: subsistence farming versus commodity exports.

That is, in some ways, the long and the short of the issue that led to the talks’ collapse, though needless to say there were many other sticking points too - and it’s another illustration of how debates over agricultural trade are increasingly split into divergent schools of thought.  For fans of liberalisation - like the US - the logic is straightforward.  With food prices as high as they are, there’s never been a better time to get rid of import tariffs - so why the hell should China and India want to be able to raise them even higher than they were before Doha? 

China’s approach, on the other hand, is rooted in concerns about resilience and security of supply in a period of volatility and turbulence: hence its desire to maximise access to imports while at the same time protecting its internal agricultural sector, in which smaller farmers predominate.  (While smallholders are inevitably at risk from dumping, they can also be extremely productive in the right circumstances: IFAD cites the example of Vietnam, which has gone from being a food-deficit country to being the world’s second largest exporter of rice - largely thanks to development of the country’s smallholder sector.)

It looks like there will be no further talks until towards the middle of next year, after elections in the US and India - even then, things are likely to be tougher than now given rising protectionist sentiment around the world.  Also worth noting that the collapse of the talks - and in particular the acrimony between the US and the two key emerging economies - doesn’t exactly augur well for progress in climate talks. 

If you want the full play-by-play, Alan Beattie’s post-mortem is where to go, and ICTSD will have the full details up on their site tomorrow.

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1. Why Doha progress would mean even higher food prices
2. Dani Rodrik on food prices
3. Inequality: falling between countries, rising within them
4. Is poverty really falling?
5. What do rising food prices mean for Africa?

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