The Failed WTO Negotiations at Cancún
It was said that the failed World Trade Organization (WTO) negotiations at Cancún in September 2003 have plunged the WTO into crisis. Given the aim of this round of negotiations at taking stock of progress of the Doha Development Agenda (DDA) launched at the fourth WTO Ministerial Conference in Doha, Qatar, in November 2001, the breakdown in Cancún was said to be the final blow to the credibility of a multilateral trade system embodied by the WTO unless negotiations get back on track, posing certain impact on the globalization strategies of multinational enterprises (MNEs). Coming into existence in 1995 from the Uruguay Round of negotiations, the WTO is the successor to the General Agreement on Tariffs and Trade (GATT) established in 1947 with the purpose of liberalizing trade and negotiating trade concessions among member countries. Simply put, the multilateral trading system that was originally set up under GATT has been well over 50 years old.The inauguration of the WTO in 1995 marked a new phase in the evolution of the post war economic system. A new "triangular division of authority" among the IMF, the World Bank and the WTO was enabled (Michel Chossudovsky, Professor of Economics at the Univ
As the conference chairperson, Mexican Foreign Minister Luis Ernesto Derbez said, 'Agreement is needed in order to give the world economy a boost, and if the meeting fails the only winners will be the enemies of the trading system. Developing countries have been dissatisfied with the EU and US agricultural subsidies and dumping as they posed devastating effect on their agricultural sectors. All the negotiations are to end by 1 January 2005, if not before. 'An agreement on transparency in government procurement is thus a first step towards ensuring that all goods and services purchased by governments are subject to international bidding. Throughout the recent decades, they have tried hard to pursue globalization in order to enhance the international integration of markets for goods services, technology, ideas, financial and other capital and labour. The developing countries were particularly unhappy as the revised agriculture text issued during the conference did not address their concerns. Another alliance of poor countries, mostly from Africa, was also worried about the issue. Should negotiations cannot get back on track, change of globalization strategies of MNEs is expected in the coming decade in view of the proliferation of bilateral and regional deals as well as the intensified divergence between the developed and developing countries. After 5 days of negotiations on agriculture, non-agricultural market access (NAMA), development issues, 'Singapore' issues (competition and investment, trade facilitation and transparency in government procurement) other issues (include the TRIPS registry for geographical indications for wines and spirits, TRIPS non-violation, trade and environment, and other topics) and cotton initiative, the Cancún Ministerial Conference ended in deadlock as agreement could not be reached between the developed and developing countries, particularly on the 'Singapore' issues. 1 (Fall 1998) )'GATT and the WTO have helped to create a strong and prosperous trading system contributing to unprecedented growth. Though it is hard to say the failure at Cancún lead to the demise of WTO, the efficacy of its multilateral trade system is definitely in question after this round of negotiations. The US has since announced FTA agreements with numerous nations including Chile and Singapore. Moreover, developing countries also worried that 'instead of addressing competition issues of concern to them - such as activities of the international grain cartels - a WTO agreement on competition policy would undermine their ability to give preference to local firms. They believe that if they are not given the right to offer preference to local firms in supplying goods and services to government authorities, their local firms will suffer severely as they depend very much on government contracts for building up their capacity.
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