Johannesburg — THE Doha round is on again. World Trade Organisation (WTO) director-general Pascal Lamy has set a date for trade ministers to meet between December 10 and 19 to try to thrash out a multilateral trade deal.
Joshua Setipa, WTO counsellor in the office of the director-general, confirmed yesterday that the meeting would take place in Geneva in mid-December. Developing countries in particular are anxious to see a global deal concluded, as fears mount that international trade could dry up in the face of the global financial meltdown.
Speaking on the sidelines of a conference of the South African Institute for International Affairs in Johannesburg yesterday, Setipa said the multilateral system was developing countries' "only insurance policy" as protectionist urges rose against a gloomy economic backdrop.
"The financial system is falling apart and the only system that is going to stand up is the one everyone has been criticising. The WTO is based on a mix of regulation and liberalisation. This will be countries' only insurance policy against increased protectionism," he said.
He was confident the WTO's 153 members would agree on the elusive modalities which would provide the framework for the trade pact. "It is amazing if you look at the progress that had been made. We really are 99% there."
Leaders of the Group of 20 called at a summit earlier this month for the outlines of a deal to be concluded by year-end as part of efforts to deal with the financial crisis.
Setipa said the WTO has made great strides to keep trade finance flowing. "There are fears that when the financial crisis kicks in liquidity will dry up."
The World Bank, through the International Finance Corporation, has announced a trebling of trade finance intended for developing countries. The additional funding would be available immediately.
Meanwhile, efforts to address outstanding issues still blocking the Doha round have begun, as informal talks -- known as green room discussions -- have resumed in Geneva. Yesterday was dedicated to sectoral matters, in particular tariffs on industrial goods. Today will be dedicated to sensitive products, and Wednesday will deal with preference erosion. Thursday will be dedicated to the special safeguard measure -- an instrument to shield subsistence farmers in poor countries from a surge in imports.
A mini-ministerial meeting in July, at which Lamy pushed members to conclude a deal, collapsed when India and the US could not agree on the issue of the safeguard measure.
Trade ministers think a multilateral deal could send a signal of confidence to businesses battered by the global credit crunch, by improving market access for goods and services.
A recent study by the International Food Policy Research Institute said failure to complete the round could put more than $1-trillion in world trade at risk. That includes $336bn in foregone trade from the cuts in subsidies and tariffs proposed under Doha, and $728bn in lost sales if countries raise tariffs to ceilings permitted under existing rules, but which are not yet in use.