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Agriculture has always been the deal-breaker or deal-maker in world trade talks at the World Trade Organisation.  Ministerial trade talks have often collapsed, because governments have not been able to agree.  Unlike other Ministerial meetings, WTO talks are real, between contracting parties, backed up by a binding disputes system, and agreements need to be ratified by Parliaments.  That’s why skilful drafting texts that can mean all things to all people, like leaders’ summits, don’t pass muster, as useful as they are.

The headlines roared, ‘Agriculture Stopped Agreement in Seattle ”, when that Ministerial meeting collapsed in a spectacular fashion.  I was complicit in this spin.  Not the full story, we had major differences in other areas too, but it was better to send Ministers home as heroes for defending their angry agricultural interest.  We lived to fight and win another day at Doha , when we launched a new trade round.

These talks are, as always, at a critical stage.  The question being asked now in Geneva is, “Are we close enough to risk a Ministerial meeting to wrap it all up?”  Insiders know that the deal in agriculture is almost ripe for acceptance.  Why, how?  Because the present package is so modest, ambition so dangerously low, that most are almost in agreement.  It’s a big call.  Do you bank what’s on the table and come back in 10 years?  The last negotiation, the Uruguay Round, was very weak on agriculture, we were promised more progress later.  Didn’t happen, that’s why we had to launch a new round.  Yet it was the first time agriculture was even on the agenda, because when the GATT/WTO was created, the issues were post-War were food security, not trade in food.

In the WTO, nothing’s agreed to until everything’s agreed.  Ambitions, alas, have been dropped in agriculture but demands in other areas have not dropped.  Wealthy countries are major cuts in tariffs and market openings in industrial and service sectors.  Many developing countries find the speed and depth of these cuts and openings too tough to digest, especially if they can’t point to large gains  in agriculture.  Despite the fact that these openings are good for them and everyone else.

If you are doing well, as India and China are, one way to throw sand in the gearbox and stall the present, finely balanced talks, is to over-ask for deals in the movement of labour, migration.  That is skilled and unskilled workers being able to move more freely.  This is dynamite, it’s actually good and is happening now, but oversold, it’s very difficult politically.

This, in WTO-speak, is Mode 4, the movement of natural persons.  Why we use these words, I will never know, what are unnatural people?  A telecom agreement also lacks ambition for some and is too ambitious for others.  One of the reasons the IT industry has boomed and generated wealth and efficiencies everywhere, is that it’s been largely open, due to the WTO, perhaps it was new and we had no Minister of Services in the 1980’s to complicate things.  Not many existing privileges to beat up politicians and seek protection.

Work continues on a fishing agreement.  The subsidies here are US$30 billion annually, or the value of 25% of the world’s catch.  75% of the world’s fishing population is either over-exploited, fully exploited, or significantly depleted.  The global fishing fleets’ capacity is now 250% greater than what is needed to catch, and the world’s oceans sustainably produce. 

Other than the fish, who are the biggest losers?  Poor countries.  Subsidies are always a battle between which country has the biggest treasury.  With all this money slopping about, a terrible moral hazard exists where governments are offered easy dollars for their fishing rights, to a bank of their choosing.  An example of this evil is poor Mauritania where local fishermen are put out of business by the trading of fishing rights to the highest bidders.  Subsidised fishing fleets never have an incentive to fish sustainably, in fact their incentives are to do the opposite.  Locals have to compete with ships from Russia , Spain and China , who have their fuel bills paid by their governments, 340 foreign vessels are licensed to fish in Mauritania ’s s overeign waters.  This is a classic case of government subsidies being used ruthlessly to out-compete family fishers, and tempting governments with easy money.  The Greens should be in the streets protesting, calling for the deal to be done.  No wonder it’s hard to complete the Doha Development round, it was hard, impossible, I was told, to even launch the round.    

As a great US trade negotiator said when an earlier round was in trouble, “It’s time to cut bait and fish,” or as President Johnson said even more graphically, “It’s time to

--it or get off the pot.”  I just hope that politicians and bureaucrats, who have a short shelf life in many places, don’t agree to a weak deal to satisfy personal egos because we may not get another chance to do this thing for another generation.

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