The lack of topics beyond the existing issues at the WTO ministerial meet provided trade representatives from developing countries a platform to discuss the likely fallout of the forthcoming Doha talks and evolve strategies like the deal they had at the end of the meet. However, China’s absence in signing the agreement was conspicuous since the country has vented similar concerns as that of the other developing nations over Doha discussions until recent past.

The Doha Round was launched in late 2001 with a paramount aim of helping poor countries to prosper by removing all trade barriers. However, the aftermath of global economic meltdown has forced developed countries not to budge from subsidies to tariffs as it is feared to create losses to their farming, manufacturing and service sectors.

After several missed deadlines, the WTO members have set a new deadline for concluding the negotiations in 2010. But the recently concluded ministerial summit, appear to have made little progress, reinforcing skepticism that the 2010 target would be out-stretched as it had happened in the past.

The Washington-based International Food Policy Research Institute observed the global trade and the global economy had changed profoundly since 2001. It further added that a study showed that commodity market strains and environmental pressures were not part of the original Doha agenda then.

Lately, many countries are getting into individual FTAs and PTAs to ward off the likely trade talk failure at Doha Rounds next year. This week alone witnessed the launch of feasibility studies on PTAs between China and Switzerland, and between India, the Mercosur group of Argentina, Brazil, Paraguay and Uruguay, and the SACU.

The countries participating in the agreement are Algeria, Chile, Cuba, Egypt, India, Iran, Indonesia, Malaysia, Mexico, the Southern Common Market (MERCOSUR) nations – Argentina, Brazil, Paraguay and Uruguay – Morocco, Nigeria, North Korea, Pakistan, South Korea, Sri Lanka, Thailand, Vietnam and Zimbabwe. The agreement provides special treatment for Iran and Algeria, which are yet to become WTO members. The details of the tariff reduction will be made available by the end of September 2010 after extensive negotiations in the coming months.

The 22 countries represent a market of 2.6bn people accounting for 13 percent of world GDP, 15-18 percent of trade, 43 percent of farm and 16 percent of industrial production. Supachai Panitchpakdi, secretary-general of the UN Conference on Trade and Development who was instrumental in materializing the deal said it was estimated that the tariff cut would bring an additional trade of $8bn for these countries.

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But today international trade is at the cross roads, beset with varied issues, including climate change, ever rising prices of essential commodities and energy, etc. And for all the ills emanated from globalization, World Trade Organization (WTO) is pilloried by most critics, as usual without providing viable solution. WTO was persistently blamed for its failure to make suitable changes to the needs of the times. WTO policies delved deep into politically sensitive domestic regulations and delayed the process of striking an early inevitable solution. It has had to withstand the pressures of different internal government differences, protectionism and even, anti-market NGO’s. The initial carrots offered by developed nations, during the early stages of globalization, turned out to be a steroid treatment for rabbit economies which transformed themselves into predators, which gradually devoured the lion share of the market pie. In the process WTO was left high and dry, clueless about its road ahead.

Before losing its core competency, WTO should wake up to the challenges of 21st century to live up to the expectations of its very existence. It has to accept that lopsided trade agreements have no place in the world today since every country can afford and has the intelligence to rope in expert international negotiators for favorable trade agreements. If it could provide ample scope for domestic products and services, to equally succeed in the world business arena, the organization will be able to fulfill its goal.

Preferential Trade Agreements (PTA) or any such are still designed for developed economies, flouting the laws of level playing field. Such deals should address the needs in a partner-specific manner and there by should facilitate the interests of both parties evenly. The pacts signed in a hurry, in future, may have to spend years in courts for implementation, due to domestically ever changing political scenario and other unexpected issues. Accords with complex and discriminatory regulations cannot expedite the process of implementation in present circumstances. Besides, red tapism and high gestational business costs also could be prevented, if proper care is given while signing deals. Businesses engaged in global supply chain, need simple, transparent and non-discriminatory models to derive the best out of tailored pacts.

At this juncture, WTO is with grievous limitations, if repair measures are not made quickly, perhaps it will lose its relevance. Most of the developing countries of Asia and South America have already latched on to the unilateral liberalization programs. China, the unilateral engine of free trade has started this way back in 1990 before joining WTO. Other East and South Asian nations are engaged in replicating China model to supersede the international institution to gain larger clout, and for doing more business. It is high time for a trade policy to be less of a foreign policy, and it should be solely the one which is attached within the framework of domestic economic needs. Therefore, the global trade body must give utmost care to address these needs in subsequent rounds of negotiations to avoid unnecessary stalemate.

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