World Trade Organisation negotiators will meet in Geneva on Friday April 29 to consider whether the much-delayed Doha Development Agenda can be reignited, while preserving the objectives and values of the round, which was first initiated in November 2001.

The meeting follows a recent statement by WTO director-general Pascal Lamy in which he conceded that a successful conclusion was “at serious risk”, adding that differing views on market access for industrial products were “not bridgeable” at this stage.

“This is a grave situation for the Round and for all of the efforts and aspirations it embodies. It is our reality, however, and we must face it squarely in order to try to find a way forward together,” he commented in a cover note for documents issued by negotiating chairpersons, who had been given an Easter deadline for producing draft texts.

South Africa’s Trade and Industry Minister Rob Davies has long questioned the likelihood of a conclusion to the round in 2011, stating that if it were concluded, it could be at a great cost for South Africa and other developing countries in general, as developed nations were not willing to make the sacrifices necessary to sustain the round’s developmental character.

Davies said that WTO member States would need to ask profound questions on whether or not the round was “dead”, and whether or not there were alternative ways of moving forward, should consensus not be achievable.

He added, though, that South Africa’s Department of Trade and Industry (DTI) had not started constructing alternative scenarios, but that it might have to start thinking about doing so.

SA BUSINESS COMPLACENT

Although the government has played a major role in the negotiations on South Africa’s behalf, there has been a significant lack of comment on the Doha Round by South African business, giving the impression of indifference. Faith, and interest in the Doha Round was weak, particularly because the multilateral negotiations had dragged along for ten years.

DNA Economics MD Matthew Stern told Engineering News Online that, unless businesses saw something specific emerging that could impact on their bottom lines, the private sector was unlikely to intensify the engagement.

He noted that there were a few industries that were exceptions, such as clothing and the motor industries, as these have a strong vested interest in what happens in the global and South African trade environment. They, thus, tended to be far more proactive.

The lack of progress on WTO reform was disappointing, because South African businesses could realise potential gains. “The WTO does have the potential for real change – which is partly why it has become deadlocked. The changes that were required from developing countries in terms of industrial tariffs and services, and the changes that may have been required from the US and the European Union (EU), especially in agriculture, were substantive, and would have had substantive effect,” Stern said.

That said, most of the tariffs currently confronting South African businesses were not from the US or the EU, but from other developing countries. However, South African commodities, which make up the bulk of the country’s exports, were also not subject to particularly detrimental tariffs.

Under the Doha Round, developing-country industrial tariffs could be trimmed reasonably quickly, which could improve market access for manufactured goods. “So from an export perspective, we would have lost an opportunity to gain access to key developing markets,” said Stern.

Similarly, South Africa also escapes the need to make further tariff cuts, but in all likelihood, stated Stern, those cuts would not have been extreme, as the Southern African Customs Union would get special treatment, under a prior agreement.

“On the other hand, in many of the areas where cuts would take place, some reform and some competition may be a good thing,” added Stern.

Countries that were proactive in trade negotiations (bilateral and multilateral) were usually supported by very active business chambers and companies and were good at pushing views that were aligned to their industries.

The DTI has continuously, and extensively tried to engage with business, at multiple forums and events.

Therefore, Stern believes that the lack of concern over global multilateral negotiations from the South African business community was more a reflection of a business community that was complacent and happy with the status quo, and actively protecting its own turf, instead of seeking out new opportunities abroad.