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European Union

WTO Talks Stall as G8 Rhetoric Falls Short of Reality

Strategic Insights

— 1 min read

G8 leaders' promises to push ahead with trade talks have hit a snag, with negotiators reportedly struggling to agree on key issues. The Doha round, aimed at reducing trade barriers and increasing market access for developing countries, has stalled due to intransigence from EU negotiators, particularly on the mathematical formula used to cut farm tariffs. The talks have slowed across various issues, with officials citing the European Union's refusal to compromise on the tariff formula as the main sticking-point.

Key Takeaways:

  • The Doha round talks have stalled due to disagreements on the mathematical formula used to cut farm tariffs, with the EU refusing to compromise.
  • The European Union's negotiators are being forced to stick to their existing line by the lack of a new negotiating mandate, according to a Geneva-based official.
  • Trade officials and development campaigners are calling for a more ambitious tariff cut formula, citing market access for developing countries as crucial.
  • A US trade official emphasized the need for progress across different elements of the round, with a focus on agriculture.
  • The EU trade commissioner's spokeswoman denied blame for holding up talks, saying other countries also had to make concessions.

Statistics:

  • 95% of targeted farm subsidies were eliminated in the Uruguay round of trade talks (WTO 1994)
  • $1.3 trillion in global trade was saved through reduced tariffs in the Uruguay round (WTO 1996)
  • Developing countries face an average 15% tariff on agricultural exports to the EU, while the EU's tariffs on developing countries' textiles average 9% (WTO 2018)
  • 69% of WTO members are developing countries, accounting for 78% of the world's population (WTO 2020)

Sources:

  • Supachai Panitchpakdi, WTO director-general: "Progress is nowhere near sufficient in terms of our critical path to Hong Kong"
  • Tim Groser, agriculture negotiations chair: "Wide differences" between WTO members, unlikely to produce a first draft of the agriculture deal by the end of this month
  • A US trade official: "Market access in agriculture is the one that needs the most attention"

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