Notwithstanding the seductive academic merits of free trade, real world multilateral trade agreements are all about power and power politics. Negotiations cover items further and further away from simple trade and tariffs (eg. TRIPS, TRIMS, and the Singapore issues) pressing more and more concessions on poor countries without giving them what they really want and need: open access to rich country markets in agriculture, textiles and footwear (I know the multifiber agreement has expired, but what did the US and the EU do? Impose sanctions on "temporary surges" as allowed under the successor to the MFA). I for one have never understood why poor countries have continued with this process.
Last month I was at a conference and was opining that this time the poor countries would stick to their guns and scuttle the deal if no true agricultural opening was forthcoming. A fine gentleman named Rorden Wilkinson politely begged to differ and referred me to his excellent book: The WTO: Crisis and the Governance of Global Trade. The book argues that ministerial collapses and apocalyptic rhetoric are common throughout the history of GATT/WTO negotiations and often serve to advance, rather than deter, progress towards a conclusion satisfactory to the great powers. Even though I still think there will be no major trade deal, I highly recommend the book.
The sad thing is the continued presence of mercantile language in trade. If poor countries do not unilaterally lower barriers (to help themselves), they can at least open free-trade zones with each other. Less crushing competition, more chance to improve things for consumers. Oh yes, the trade agreement should be one sentence: “individuals and firms from these countries can trade with each other as if in one.”
Or, The Who, I should write.
Please come to shadow of legend Gold money, we will give you a great surprise.
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