The WTO in suspense is medieval decision-making part

The WTO in suspense: is medieval decision-making part of the problem? Robert Wolfe WTO Public Forum September 26, 2006

Medieval WTO? n WTO Members q q n vastly different levels of development political and legal systems based on divergent premises unequally penetrated by social and economic forces of globalization Overlapping regulatory domains WTO universe plural if not medieval q process for making legitimate decisions inevitably untidy. 2

Negotiation analysis approach NOT does WTO handle the right issues, or provide good policy advice n NOT political economy of a compromise Ø Is institutional design appropriate? n n q does WTO facilitate understanding the issues? does the process facilitate agreement? Was this round doomed from start? In sum, does WTO need reform? 3

Suspension non-issues n n n Will evolutionary action be displaced to dispute settlement system? No Are regional negotiations an alternative? No Is it all down to the EU and the U. S. ? No q n But power still counts Is there a democratic deficit? No q But much has changed since Seattle, and institutional design matters 4

WTO decision rules n Consensus q n WTO never takes votes Single Undertaking q Nothing is agreed until everything and everybody is agreed n Bottom up on the rocks? n Members want a bottom-up process with content coming from them: Chairpersons should reflect consensus, or where this is not possible, different positions on issues. q Death by [square brackets]? Also problems with reciprocity, modalities, meetings q 5

1) Modalities complexity n n Negotiating “development” agenda a conceptual minefield “Rules” inherently multilateral, especially behind the border, but applicability varies widely Services modalities don’t work No more Request-Offer for market access q n “principal supplier” favours large over small Formula approach elegant, multilateral, confusing q q coefficients remove ambiguity Equal rates = disparate nominal cuts: “fair”? 6

2) The tangled web of bargains Past and present n n N N (reciprocal) N S (non-reciprocal demanded) S N (resisted as illegitimate) S S (ignored? ) Arrows indicate direction of “concessions” Future? v N S (ODA) v N BRICSAM (reciprocal) v BRICSAM S (nonreciprocal? ) 7

3) Reaching a consensus, with 149 Members n n Ministerial Conferences Formal (for the record) q q q n General Council TNC Negotiating groups Informal (where the work is done) Mini-ministerials q Senior officials q Coalitions q Bilaterals q “Friends of…” Ø Hundreds of meetings in and out of Geneva: groups help manage the chaos… q 8

Austria Belgium Cyprus Czech R Denmark Estonia Finland France Germany Greece Hungary Ireland Italy Latvia Lithuania Luxembourg Malta Netherlands Poland Portugal Slovakia Slovenia Spain Sweden UK EU G-25 G-20 Solomon Islands Mexico India China Venezuela Indonesia Pakistan Philippines Armenia Bulgaria FY Rep Macedonia Romania G– 90 LDCs Bangladesh Cambodia Chad Maldives Burkina Faso Myanmar Burundi Togo Nepal Central African Rep Djibouti DR Congo Mali Gambia Guinea Bissau Lesotho Malawi Mauritania Niger Sierra Leone Rwanda Gabon Ghana Haiti Namibia Benin Madagascar Senegal Uganda Botswana Tanzania Zambia Cuba Cameroon Congo Côte d’Ivoire Kenya Mozambique Chile Brazil Bolivia Uruguay Australia Thailand Canada Paraguay Colombia Argentina Costa Rica Guatemala Malaysia N Zealand Cairns Group Albania Croatia Georgia Jordan Moldova Oman USA G– 1 S Africa Source: ICTSD and WTO Nigeria Zimbabwe Mauritius Angola Swaziland Egypt Tunisia Morocco African Group ACP Recent new Hong Kong, Ch Saudi Arabia El Salvador Macao, Ch Singapore Kyrgyz R Dominica Qatar Fiji UAE Papua New Guinea Brunei Kuwait Belize Bahrain Barbados Ecuador Antigua/Barbuda Dominican Rep Grenada Guyana G-33 St Vincent/Grenadines Trinidad/Tobago Honduras Jamaica Suriname Mongolia St Kitts/Nevis Nicaragua St Lucia Panama Peru Sri Lanka Turkey R Korea Iceland Israel Japan Liechtenstein Norway G-10 Switzerland Ch Taipei

The evolving logic Diverse issues and Members = Single Undertaking n Single Undertaking = consensus, not voting n Consensus = seeking compromise informally in a bottom-up process n Overlapping interests = multiple small groups for each Member n Many Members = “Green Room” (small informal) Ö Green Rooms = red flags n [G-6 finished? ] 10

Does it need fixing? Two approaches: 1. How interests are aggregated changes outcomes 2. Deliberation aids learning, which changes outcomes 11

If it’s all about interests n Agenda an institutional design choice: q n Doha initial agenda too broad q n May now have contracted too much for OECD Are less-than-universal agreements appropriate? q q n What must be in the Single Undertaking? “critical mass” in NAMA, plurilateral in services differentiation among developing countries: round for free? But beware of temptation to cherry pick q The package matters 12

If learning also matters Collective decision engaging all Members requires: n 1. 2. 3. Consensual understanding of problems and “interests” Deliberation that makes effective bargaining legitimate Domestic resonance Learning incomplete at home and in Geneva? n 1. 2. 3. Negotiation by communiqué impedes “mixed” strategy? Do negotiators understand implications of changing roles of developing countries, both BRICSAM and bottom billion? Do negotiators (both Delhi and Washington) have the public understanding that provides room to maneuver? 13

Reform needed? WTO changes through practice Ø Journey not the destination n Ø Doha about learning to negotiate in a truly multilateral way, with many more, and more disparate, Members Ø If WTO is medieval, it’s because the world is too 14