BALI, Indonesia — World Trade Organization officials elevated the stakes to apoplectic proportions last week as they fretted through four days when it seemed possible that even a modest deal would fail.
It wasn’t just that proposals to deal with tariff rate quota administration, export subsidy rules, border impediments to trade and food security rules would be lost.
It was that the very future of the WTO as a credible trade rules negotiating forum would be eroded or perhaps even destroyed.
The conference began with WTO information director Keith Rockwell warning that failure to reach a limited agreement — the first in 12 years of bargaining — “would leave us in the cold for years to come.”
Then WTO director general Roberto Azevedo opened the four-day ministerial meeting Dec. 3 with a dire prediction for the fallout if the talks failed.
“I think it will be a tragedy to the institution and many economies around the world,” he told a news conference.
“At stake is the future of the WTO. A weakened WTO would lead to the law of the jungle.”
European Union trade commissioner Karl de Gucht added to the gloom.
“The storm clouds of failure are right above us,” he said.
“If that happens we will feel the after-effects for years to come.”
He suggested some of the trade rule policing functions of the WTO could be affected even though they were not part of the negotiation.
“I fear this will spell the end game for the dispute settlement system,” he told reporters.
Is the WTO, created in 1995 to replace the 47-year-old General Agreement on Tariffs and Trade, really so fragile that another failed attempt to close a deal could scuttle it?
In the hothouse atmosphere of WTO negotiations, the dire warnings were in part a pressure tactic aimed at persuading potential dissidents to fall in line for the greater good.
However, supporters of the WTO, including farm leaders, insist the threat of irrelevance is real. WTO now has competition.
WTO and its predecessor GATT produced only two deals during more than a quarter century of negotiations: a 1993 comprehensive agreement in Geneva and a 2001 agreement in Doha to launch a new negotiating round.
Meanwhile, many countries including Canada have been putting more effort and resources into negotiating bilateral and regional deals that often produce results, even though they do not create global rules and standards or deal with trade-distorting subsidies as a WTO deal could.
“With the lack of results for many years, I think the WTO has fallen off the radar screen and if there is no deal here, I think it would severely weaken the credibility of the WTO as a negotiating forum,” said Canadian Federation of Agriculture president Ron Bonnett.
John Masswohl, director of government and international relations for the Canadian Cattlemen’s Association, who was in Bali as part of a Canadian Agri-Food Trade Alliance delegation, said the lack of agreement could freeze WTO negotiations for at least five years as countries put their emphasis on smaller and more achievable deals.
Bruce Wills, president of the Federation Farmers of New Zealand, told a news conference that no deal last week “would simply shove WTO to the sidelines.”
Only Indian trade minister Anand Sharma shrugged off the possibility of a seriously wounded WTO if a deal was not reached. Until the end, he was threatening to scuttle an agreement over opposition to a proposal to discipline India’s use of subsidized rice to build a public food stockpile to feed the poor.
“It is not going to collapse,” he said before finally agreeing to a compromise text. “The WTO survives. The heavens do not fall if there is no deal.”