You know that estimating the possible economic benefits of last week’s world trade deal is not an exact science when estimates range from several hundred billion dollars to a trillion.
It was dubbed a “limited package” for agriculture, and in the context of the broader Doha Round dreams, that is true.
Still, it was a significant accomplishment after 12 years of failure at the World Trade Organization to complete a deal.
An interesting underpinning of the story is why trade and agriculture ministers were able to seal a deal in Bali that had eluded their predecessors for a dozen years.
Previous ministerial meetings in Geneva and Hong Kong produced little but wishful thinking. In 2005, ministers who met in Hong Kong agreed to end agricultural export subsidies by 2013.
Wait, that’s now. Has there been an end to export subsidies? Nope.
The reason is that the important commitment made by ministers could be implemented only when the rest of the expansive Doha Round agenda was implemented. “Nothing is agreed until everything is agreed” has been the WTO mantra.
Reason number one for the Bali success was that it changed the all-or-nothing rule.
Instead, it presented delegates with a bite-sized package of what are referred to as low-hanging fruit: benign proposals such as less import obstruction at borders, a notional agreement to end export subsidies, an endorsement of rules for food security programs and a more sensible regime for managing import commitments under tariff rate quota trade agreements.
Who could object?
Well, many did on different items, but in the end the small package could be managed.
New WTO director general Roberto Azevedo sensibly said Dec. 7 that making a package smaller does not necessarily make it more acceptable to members.
Still, it is impossible to argue that agreeing to one proposition that comes true only if various other propositions are accepted by others — say a return flight from Winnipeg to Regina that is valid only if an Alaskan cruise is also endorsed sometime in the future and by other people — is a hard sell.
So veering for the first time from the “nothing is agreed until everything is agreed” rule was key to the progress.
The other reason is the changed style that Azevedo brought to the discussion.
The veteran Brazilian trade negotiator is a conciliator and a listener who heard people out during the intense week and then convinced them to accept the final agreement.
His style is in sharp contrast to the imperial “I know better” approach of his unsuccessful predecessor, Pascal Lamy, who presided over the WTO for a decade but scored no negotiating successes.
Azevedo’s performance since he took the reins in Geneva earlier this year illustrates that skilful leadership is a key to organizational success.
At the closing news conference for the WTO Bali meeting Dec. 7, Indonesian trade minister and conference chair Gita Wirjawan, said some credited progress to the soothing “Bali effect” on delegates.
“It’s not the Bali effect,” he said. “It is the Azevedo effect. He shows faith and patience.”
So chalk up the Bali success in good part to a manageable stand-alone agenda and a skilful leader.