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Countdown to global trade deadline marked by dire warnings

The World Trade Organization WTO logo is seen at the entrance of the WTO headquarters in Geneva April 9, 2013. REUTERS/Ruben Sprich
The World Trade Organization WTO logo is seen at the entrance of the WTO headquarters in Geneva April 9, 2013. REUTERS/Ruben Sprich

By Tom Miles

GENEVA (Reuters) - The World Trade Organization has about 20 working days left to stitch together the first global trade deal in two decades, but even the faster tempo of talks under new chief Roberto Azevedo may be too little, too late.

The proposed deal is far less ambitious than the Doha talks that the WTO pursued in vain for 12 years; but it would still add hundreds of billions of dollars to the world economy by some estimates and would open the way to much wider trade reforms, enabling the WTO to re-write its rules for the internet era.

"It's clear we can succeed if we want to. The only question is - what future do we choose for the WTO? The competing scenarios are stark but clear," U.S. Trade Representative Michael Froman told a WTO conference in Geneva on Tuesday.

Azevedo said on Monday he would send a letter to trade ministers from each of the WTO's 159 member countries, asking them to try to see the bigger picture and make a deal happen.

"But more importantly, as I have repeatedly stressed, at stake is the credibility of the multilateral trading system itself," Azevedo told WTO ambassadors.

Azevedo put Geneva's trade negotiators on a tough regime when he took over last month, starting meetings on time, limiting comments to 60 seconds, pressing ahead with discussions even if some ambassadors were absent, and cutting meetings short if no progress was being made.

He has told ambassadors to be on call 24 hours a day.

"This is shock treatment to get people to realize that this is crunch time," he said after the first round of talks.

Froman said Azevedo had given the WTO a chance to succeed, but noted that the WTO has consistently failed to agree any new global trade deal since it was founded in 1995.

Azevedo wants the bare bones of a deal in place by the end of October, to give enough time for a reform package to be finalized and signed by trade ministers at a conference in Bali in early December.

The hoped-for agreement covers several areas, the largest of which is trade facilitation - a global standardization and simplification of customs procedures that, by some estimates, would cut trade costs by 10 percent for developed countries and by 14 percent for developing countries, Froman said.

One element, already agreed, is that all governments will post their customs procedures and importing rules on the WTO website. But that won't happen without a deal in Bali.

Trade facilitation is about connecting farmers and businesses to the global economy and was a central goal of every African government he had met, Froman said.

"In Geneva, trade facilitation is too often a bargaining chip in the great game of multilateral trade negotiations, a pivot point for tactical maneuvering," he said.

Another part of a deal would be on food security, allowing developing countries to break the agreed WTO limits on agricultural subsidies while stockpiling staple crops.

That element is also still under discussion, with much focus on what Froman called a "restraint mechanism" to stop the measure distorting the global market.

Success in Bali would allow the WTO to start updating the rest of its rulebook, which predates the internet. But failure would effectively put an end to attempts at global trade reform.

"If we fail in Bali, we will lose the opportunities currently on the table," said Froman. "If we fail in Bali, many offers of flexibility for this package will disappear, for an indeterminate period of time. No nation will leave its hand open once these offers are finally slapped away."

(Reporting by Tom Miles; editing by Ralph Boulton)

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