The Doha Round after Hong Kong

POLICY BRIEF 06-2

The Doha Round after Hong Kong

by Gary Clyde Hufbauer, Peterson Institute for International Economics
and Jeffrey J. Schott, Peterson Institute for International Economics

February 2006

Trade ministers from member countries of the World Trade Organization (WTO) convened in Hong Kong in December 2005 to jump-start the flagging Doha Round of multilateral trade negotiations. The ministerial accomplished more in spirit than in substance and placed more emphasis on negotiating process than on policy reform. The industrial countries offered up kernels of subsidy reform and development assistance, but all the big-ticket items were studiously deferred to future meetings. Progress on nonagricultural market access and services was microscopic. Without substantive offers in these areas, the United States and European Union will not be able to augment their offers on farm reforms. Developing countries are skeptical that the European Union will up the ante in agriculture even if they offer concrete reforms on goods and services trade. In any event, most developing countries are reluctant to lower their own market access barriers. So neither side moves. Trade ministers do not have the political authority to break this "Alphonse and Gaston" routine and approve reforms in sensitive areas that are needed to produce a comprehensive package of accords acceptable to all WTO members. To succeed, the Doha Round needs a political jolt. A trade summit involving heads of state of countries whose policy reforms are crucial to the success of the WTO talks must be convened to break the impasse.

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