Ups and downs on road out of Seattle

By Greg Ansley

Between the lines


Did protesters really kill off the World Trade Organisation in Seattle?

No, according to senior OECD and Australian officials at a Canberra conference this week. They regard the demonstrations as an inconsequential byplay to a surprisingly normal ministerial summit.

Three of the six ministerial summits dating back to the General Agreement on Tariffs and Trade in Geneva in 1982 failed to reach agreement, yet the Uruguay Round and the WTO itself were the result.

And even if a comprehensive round eluded Seattle, negotiations have begun on agriculture.

But, say Gerard Viatte, the OECD's food, agriculture and fisheries director, and David Spencer, the Australian official responsible for the WTO, there are significant difficulties.

First, the underlying cause of the summit collapse - the clash of interests between the developed and developing world - will not easily disappear.

While Seattle drew more countries than ever, indicating the concept of a world trading system is gaining currency, there needs to be greater sensitivity to the concerns of developing countries.

These include the linking of trade to investment, the environment, competition and labour. But these difficulties are not insurmountable and new factors may help sway even such reluctant players as the European Union.

French agricultural imports, for example, are mainly of processed foods. The restrictions and costs linked to trade in these are giving consumers and the food industry a voice to rival that of French farmers.

And the Uruguay Round, which for the first time included agriculture, gave participants much greater room for manoeuvre.

Spencer says a comprehensive round allows Japan, Europe and other big players to secure gains in industrial tariffs and services access, rules issues and some newer areas - offsetting the political pain of tramping through such sensitive territory as agriculture.

Even without a comprehensive round, new agreements on agriculture are crucial. A halving of agricultural protection would lift global incomes by more than $US50 billion.

And there is a pressing need to recoup gains from the Uruguay Round. In effect, farm support was switched from the mechanisms pruned under the Uruguay Round to other forms of assistance, and returned to mid-1980s levels.

In addition to steps to deal with this, the base requirements for a new farm agreement embrace more open and freer market access, more cuts in subsidised exports and revamped domestic support programmes.

And, Mr Viatte says, farm policies will increasingly need to be integrated with environment and rural development. "One may ask," he says, "whether there will still be an agriculture policy in 10 or 20 years."