The Doha Round of global trade talks aimed at promoting free trade may be on the brink of failure. Members of the World Trade Organization (WTO) seem increasingly gloomy about the prospects for a successful resolution in the current round of negotiations of the WTO. The Doha Round began in 2001, a time when China, Brazil and India were still considered emerging economies. Today, the European Union (EU) and the United States are more fearful of these powerful new rivals, who they argue are now less in need of developmental assistance. The Doha Round represents a comprehensive trade agreement that may have little chance of being fully accepted by all 153 WTO members. Discussions are increasingly turning to a “Plan B” option of a viable alternative to the full Doha Round that may be able to be concluded faster than attempting to reach agreement on all issues. The Plan B discussed this weekend in Geneva would likely eliminate contentious issues that have proved impossible to resolve during nearly 10 years of negotiations but would include issues on which there appears to be general consensus, including common customs standards and fishing subsidies.

QUESTIONS FOR DISCUSSION:

1. How is the legitimacy of the WTO as the referee of global trade undermined if all that can be accomplished after 10 years of negotiations is a very narrow agreement?
2. Which alternative is worse for the reputation of the WTO, a continued lack of progress on the Doha Round or agreement on a less comprehensive agreement?
3. The Director-General of the WTO, Pascal Lamy, has stated that a failure of the Doha Round “risks a slow, silent weakening of the multilateral trading system in the longer term.” To what extent is Mr. Lamy correct?
4. Analyze the benefits and dangers of creating a “Plan B” alternative that creates an agreement on only the issues on which the 153 member nations already generally agree.

SOURCE: Miller, J. W. (2011, April 28). Trade talk impasse prompts a Plan B. Wall Street Journal, p. A13. (Retrievable online at: http://online.wsj.com/article/SB10001424052748704099704576288872290977788.html)