Things have, not quite unexpectedly, plunged at a level far below expectation at the just concluded ministerial conference of the World Trade Organisation (WTO) at Buenos Aires, Argentina. There were indications well ahead of the conference with virtually no clear route for the negotiations to take. Observers, optimists included, are now in a fix pondering on the future of multilateralism launched by the world trade body around two decades ago.
Failure to reach any trade deal or make progress in re-rolling the pending issues at the three-day conference poignantly highlighted the grim reality; multilateral trade relations are increasingly becoming fraught with uncertainty. The WTO's 164 members were not able to reach consensus on any of the major agendas it had set before the meeting. All they agreed to was on continuation of negotiation on agricultural and fishing subsidies and a definition of what constitutes illegal fishing. There were sharp divisions among member groups to blame for the deadlock. Its powerful members were highly critical of the way the WTO was functioning, particularly concerning its increasing importance on litigating trade disputes rather than on drafting policy frameworks of greater interest to the members. A decision on this is obviously not easy to arrive at since what is of interest to one bloc of the members is not at all the case to the others. What actually has led to the failure of the ministerial is clearly the lack of objectifying the interests of the member groups well in advance. And this has hugely facilitated the US to trigger caustic comments on what it has termed the deficiencies of the WTO.
One of the critical areas of divergence that has been blocking the WTO negotiations to come up with any worthwhile progress in the past ministerial meetings since the one at Doha is the negation of the basic principle of harmonising global trade regime. This is so, keeping in view the needs of the less advanced and poorer countries which constitute the overwhelming majority of the WTO membership. To this has lately been added the staunch stand of the US to go for bilateralism instead of multilateralism. At the Buenos Aires ministerial, there were talks about negotiations among 'like minded' groups which is clearly to favour reclusive rather than inclusive dialogue. While mentioning 'likemindedness', the US Trade Representative (USTR) left no scope for doubting the policy of his government. This, in other words, means-- not taking all on board.
If this situation explains the current state of world trading system, there are reasons to be anxious. The WTO Director General sounded totally distressed at the zero outcome of the ministerial. "We knew that progress here" as he said, "would require a leap in members' positions, but we didn't see that." In the concluding session, he referred to 'soul-searching', urging that members would do so to make the WTO forum more effective. Unfortunately, as things stand now, soul searching is rather too benign an expression to address the needs of the time.