Global Policy Forum

By Charlotte Denny

In the view of one cynical observer, it was America's war on terror that launched the Doha round of trade talks. When trade ministers met in November 2001 in the tiny emirate which has now become the headquarters for America's attack on Iraq, the shadow of terrorism lay heavily over the meeting. Participants flinched whenever a plane flew over the lush grounds of the Sheraton hotel. US officials, preoccupied with knocking over the rotten Taliban regime, told reluctant countries that failure to agree to a new round would be a further blow to the already fragile world economy.

Fifteen months on it appears that the war on terror could spell the death of the new round. Negotiators at World Trade Organisation headquarters in Geneva missed another deadline last week when they failed to agree a framework for cutting farm subsidies. If Doha marked a high point in the Bush administration's commitment to multilateralism, the attack on Iraq was definitely a nadir. In Geneva, negotiations are frozen. The price of a hastily stitched-up deal is becoming clear.

Three issues are blocking progress: agriculture, access to cheap medicines and adapting the WTO's rules for poor countries. These are crucial areas for poor countries, which were promised in Doha that this would be a development round. But to get a deal the west fudged the negotiating parameters for the most important issue in the new round for poor countries - agriculture. Members countries committed themselves to significant cuts in domestic support, to improving market access and phasing out export subsidies. But to appease the French they added at the last minute the weasel words "without prejudicing the outcome of the negotiations". While the British were spinning that Doha marked the end of the common agricultural policy, Paris told its farmers that nothing had changed.

Even as the last details of the new round were being thrashed out, it was becoming clear that the American military machine did not need allies on the battlefield. The hawks who were gaining the ascendancy in Washington took their successes in Afghanistan as a sign that America could go it alone. The comprehensive trashing of multilateral institutions from the UN to Nato in the run-up to the attack on Iraq is the most obvious indication of this new imperial arrogance. As is Washington's reluctance to compromise in the negotiating rooms of the WTO in Geneva.

In Doha, America's top trade official, Robert Zoellick, was willing to make big concessions. Since then, Washington has shown disregard for the negotiations, enraging its trading partners by slapping tariffs on steel imports, blocking a deal on access to cheap medicines in order to protect its pharmaceutical industry and enacting a multibillion dollar programme of farm subsidies. Add to that European obstinacy over reforming its own wasteful system of farms subsidies and the next meeting of trade ministers in Cancun, Mexico this September promises to be a disaster.

Trade rounds have always appeared to be on the brink of collapse. In the Uruguay round, which staggered to a conclusion in 1993 three years after its deadline, agriculture was sorted out only at the last minute. What is different this time is the sense that America, always the strongest supporter of trade liberalisation, doesn't care. Washington was prepared to spurn the UN and go it alone in Iraq, and it appears to be approaching trade negotiations in the same way. If multilateralism doesn't work, go it alone with bilateral deals.

This is bad news for the rest of the world. One-to-one negotiation with the world's largest economy is far from a level playing field for a small country. A tiny bit of access to America's vast market is worth so much that countries are forced to give up a huge amount in return. Chile and Singapore recently agreed deals which forbid them from imposing capital controls. Other developing countries have been forced to adopt patent standards even stricter than the WTO's agreement, barring imports of cheap copycat medicines.

America's imperial arrogance may eventually be curbed by its economic costs. Running empires is expensive even if you impose unequal trade treaties on colonies, as Britain discovered in the 19th century.

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