Brazil wants a broad deal in the long-running Doha round to open up world trade to be concluded before U. S. President-elect Barack Obama takes office in January.
Foreign Minister Celso Amorim told Reuters Nov. 5 that reaching a deal in the trade talks would send a powerful counter-cyclical signal to a world economy bludgeoned by the financial crisis.
Concluding an outline deal, known in trade jargon as modalities, would spare Obama from having to deal with complex trade issues on his inauguration in January, he said.
“It will facilitate things for President-elect Obama if we are able to finalize the modalities by the end of this year. It would relieve him of very difficult choices at the start of his government,” Amorim told Reuters during a visit to Geneva.
“It would be only fair to complete the job.”
Brazil, an emerging agriculture superpower, and leader of the G20 group of developing country farm exporters, is one of the most enthusiastic proponents of a deal in the World Trade Organization’s (WTO) Doha round, launched seven years ago.
Trade experts say the trade talks could drop down the political agenda if there is no outline deal by the time Obama takes over, and that an incoming administration might be tempted to unpick some of the points already agreed.
Amorim, hailing Obama’s victory as the triumph of hope over prejudice, dismissed the idea that a Democratic administration in the United States would be more protectionist than the Republicans, and so less likely to conclude a trade deal.
“I don’t think that holds anymore. This has more to do with manufacturing than with the agricultural problems we are facing, and the Democrats are also more multilateralist,” he said.
Both Amorim and Australian Trade Minister Simon Crean said the Nov. 15 summit of major developed and developing countries in Washington on the financial crisis needed to send a strong concrete message to negotiators to complete the Doha talks in the coming weeks.
Even though that meeting is hosted by the outgoing U. S. administration, Crean – another keen supporter of a deal – said he was sure that Obama would support an early outline trade agreement as part of the solution to the financial crisis.
“What the global financial crisis does is to give us the capacity to raise to a leadership level… the importance of the relationship of trade to helping the macro-policy setting and the economic stimulus that all world leaders are committed to finding at the (Washington) meeting,” Crean told Reuters while visiting Geneva.
Both Amorim and Crean acknowledged that negotiators in Geneva grappling with the technicalities of the trade talks were not optimistic an outline deal could still be clinched this year after ministers narrowly failed to reach a breakthrough in July.
But South Africa’s Deputy Trade Minister Rob Davies, speaking before the result of the election was known, said Obama’s trade policies were unclear, and South Africa in any case did not favour another meeting of ministers this year.
“There are too many differences, too many issues that remain unresolved and it would be better for a much more profound reflection on the reasons why we didn’t finalize a deal in July,” he told Reuters in Cape Town.