Doha round concludes
The WTO's Bali ministerial finally concluded successfully with an agreement which would be called 'Bali Package'. The package is a watered down version of what started very ambitiously with Doha round of talks around twelve years ago. The talks went through extremely bad patches in 2003 and 2008 when it was almost declared dead. People had started talking about moving beyond WTO, and indeed, countries had started working out regional agreements. So, not much was looked forward to in the Bali ministerial, and I thought it would wash out with India's resistance on food security clause (link), but it survived. Cuba made some noise, along-with India, on different issue altogether, but all came on-board to agree on this mediocre agreement. Mediocre when compared to what started out at initial Doha rounds.
The main point in this package is something called 'trade facilitation'. It's a relatively harmless topic to agree upon. To cut down on unnecessary costs in terms of procedural delay and documentation requirements is something that's a no-brainer. In the words of WTO site, this measure would work out this way:
The benefits to the world economy are calculated to be between $ 400 billion and $1 trillion by reducing costs of trade by between 10% and 15%, increasing trade flows and revenue collection, creating a stable business environment and attracting foreign investment
I take the figures above with a pinch of salt. However, it would put pressure on developing countries to improve their processes and systems.
The objectives are: to speed up customs procedures; make trade easier, faster and cheaper; provide clarity, efficiency and transparency; reduce bureaucracy and corruption, and use technological advances. It also has provisions on goods in transit, an issue particularly of interest to landlocked countries seeking to trade through ports in neighbouring countries.
Part of the deal involves assistance for developing and least developed countries to update their infrastructure, train customs officials, or for any other cost associated with implementing the agreement.
The above is ambitious. India would have to put in money and efforts. Initiatives such as e-BRC will be the way to go for procedural and documentation simplification. Ports, airports, customs stations need upgradation, as well as DGFT, inspection, testing and certifying agencies and so on.
India managed to have it's way in the end. I had blogged about India's concern here. India held the talks to ransom till the demand of food security clause being extended indefinitely was agreed upon.
You can read more here and here. It was a personal triumph for Mr Roberto Azevedo, the new Director General of WTO. He has the momentum now. If he can capitalize on it, he might prevent WTO from fading into irrelevance. However, my personal feeling is that the easy agreements are all over. Only thorny issues such as agriculture subsidies, food security, market access etc remain from Doha rounds. They are difficult to handle and reaching agreements on them is challenging.