WTO in for a big fix: best of luck, Mike

By BRIAN FALLOW

Between the lines

Make no mistake, New Zealand is worse off today than it was before the weekend and the collapse of the Seattle world trade talks.

And not just because it is a setback to our hopes of progress on agricultural export subsides and tariffs on fish and forest products, though that is bad enough.

Much worse is the fact that it raises questions about the future of the World Trade Organisation and the process of global trade negotiations itself.

Why should we care? World trade would carry on and carry on growing without the WTO and its arcane and fractious processes.

But the WTO's role is to bring some law and order to international trade. A world without it, where might is right, is one the unmighty like New Zealand should dread.

Despite the abject outcome of Seattle, it is too early to pronounce last rites over the WTO as gleeful protesters have done.

Negotiations on agriculture and services will begin in the New Year. They were mandated by the Uruguay Round five years ago. But without the trade-off room provided by a wider set of negotiations, they are hobbled from the start.

The director-general of the WTO, Mike Moore, now has the twin tasks of building a consensus on how the organisation's processes need to change and bridging the gaps over the agenda for a new round.

That needs to start by reflecting on the fact that the WTO is what its name says it is - a world organisation and a trade organisation.

Seattle's failure lay partly in a mounting sense among the developing countries, which make up most of the 135 countries represented there, that they were being elbowed aside and their concerns marginalised as the five sets of parallel negotiations went to the wire.

Just as damaging were the attempts of the Americans and the Europeans to broaden the agenda to include issues both deeply divisive and only tangentially to do with trade, like labour standards and investment rules.

The WTO is not an embryonic world government. It is not its role to address every evil on the planet from the exploitation of child labour to the destruction of rain forests.

Some challenges it cannot avoid, like the implications of genetic engineering and food safety concerns on agricultural trade or the explosive growth of e-commerce.

But as the "blame game" gets under way many of the recriminations will end up at the door of the White House. Entangling trade rules with issues of labour standards inevitably alarms developing countries, smacking as it does of protectionism, however well it plays to domestic US constituencies.

If Mike Moore can lead the WTO out of this mess we will have cause to be not only vicariously proud, but profoundly grateful.