Will the World Trade Organization Reach a Deal in Bali?

source: http://www.flickr.com/photos/gsfc/

The latest round of talks between members of the World Trade Organization may yield substantial progress, Reuters reports. Gathering in Bali to discuss negotiations that have been stalled for years, few expected that this year’s round of talks would produce any real results. Looking to prove skeptics wrong, Roberto Azevedo, the chief of the World Trade Organization, has worked tirelessly to get countries on the same page with respect to trade guidelines. At stake is not only the economic future of many people across the world, but also the legitimacy of the WTO, which, of late, has come across as little more than a symbolic organization.

The so-called Doha round of talks, now many years old, had shown promise to making advances in trade regulations on a global level, but they have generally been abandoned as members drifted away from the guidelines established in Qatar. The scene of international trade is currently dominated by talks between limited sets of countries, such as ongoing negotiations between China and the European Union, the EU and the United States, and the U.S. and the Pacific Rim nations.

What the WTO has been trying to do for years is to standardize regulations and develop a comprehensive package designed to give favorable terms of trade to struggling countries across the globe. As can easily be imagined, though this cause is laudable, it is by no means easy to get everyone in the world on board with such an initiative.

At the meeting in Bali, only one obstacle remains to Azevedo’s proposal for sweeping reforms. Ironically enough, that country is India, a nation that has been one of the biggest supporters of trade policies aimed at helping developing nations in the past.

India’s bone of contention is with a part of the agreement that would limit agricultural subsidies to 10 percent of production. This would go against a platform of India’s government in a portion of its reform package, which is a central plank of its reelection campaign. India has claimed that, without the increased subsidy, not only will its farmers suffer, but its government may risk losing support because it will have to default on its promise to deliver the change in policy.

A compromise proposed by the United States would simply have delayed the 10 percent rule until 2017, giving India some time to enact and then alter their subsidy program, but so far the Indians have rejected any form of the deal. With time ticking down, it may fall on Azevedo’s shoulders to broker some sort of last-minute deal on the final day of talks in order to push through a new set of trade regulations. Many countries are hoping that the problem can be circumvented so that outdated policies can be replaced on a global level with respect to international trade.

Don’t Miss: Around the World in 25 Days: International Christmas Traditions.

More Articles About:   ,  

More from The Cheat Sheet