The WTO's Bali Package

The WTO meeting at Bali passed an agreement known as the Bali Package last December which is the first significant agreement in years on the Doha Round of negotiations. Here are some new articles that discus the package

The WTO Bali Package by Carlos A. Primo Braga at IMD: This is the clearest  explanation of the Bali package and the negotiations leading to it that I could find. This is worth a thorough read.

Trade: the real cost of red tape by Caspar van Vark at The Guardian: van Vark discusses the of border thickness that the trade facilitation part of the package seeks to address.

Analysts of cross-border trade commonly refer to the "thickness" of a border. The more red tape and documentation required to move goods across a border, the thicker it is. Lack of co-ordination between customs directorates, poor IT infrastructure and corruption all add to this, and developing countries tend to have the thickest borders.

These burdens all add to the cost of trade and therefore encumber economic growth in developing countries. According to a report by the World Economic Forum, if every country improved just two key supply chain barriers – border administration and transport and communications infrastructure and related services – even halfway to the world's best practices, global GDP could increase by US$2.6tn (£1.6tn).

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One of the key areas of negotiation in Bali will be on the second section of the draft agreement, which sets out the basis for special and differential treatment for developing countries and for the technical assistance and capacity building needed by them for the implementation of the agreement.

Unusually, the agreement proposes that developing countries stagger their commitments in a self-selected way across three categories of commitment: A for obligations that can be implemented immediately, B for obligations that require longer time frames, and C for obligations that need both longer time frames and technical assistance.

This menu-driven approach means that individual countries will have their own tailor-made form of special and differential treatment, which one speaker pointed out was uncharted territory for the World Trade Organisation. At the same time, developing countries are also facing a level of commitment which was described as being "against the spirit of the Doha Round", the negotiations that started in 2001.

Anti-poverty groups condemn WTO pact as big business boost by Philip Inman at The Guardian: As is often the case there is the criticism that the WTO negotiations are biased towards the interests of developed countries and their corporations.

Why farming subsidies still distort advantages and cause food insecurity at Poverty Matters blog: The blog post goes into some detail about the issues at stake in the agricultural policy negotiations:

Since the WTO's Agreement on Agriculture took effect in 1995, world trade patterns have changed, and there are forces distorting food trade that are not being adequately addressed. Subsidies that wealthy countries give their farmers and agribusinesses are mostly classified as "non-distorting" measures, and remain high. A few multinational agribusinesses have increased their domination of global trade and food distribution. Speculation in commodity futures markets is creating volatile price movements that do not reflect true changes in demand and supply.

All this is bad for small producers, who do not benefit from price increases and lose out when prices decline with import surges. It is also bad for poor consumers, who face much higher prices for their food. In many developing countries this has created two linked problems: food insecurity because of high and volatile food prices, and livelihood insecurity of food producers because of rising costs and uncertain supply. 

In the meantime, developing countries must find some way to ensure their citizens' food and livelihood security. Many countries try to do so by introducing measures to make food affordable for low-income consumers or by encouraging domestic food production, particularly through supporting small farmers.

The trouble is that such measures sometimes come up against existing WTO rules. Thus, India's recent law that seeks to provide food security to one of the largest undernourished populations in the world has been challenged by the US in the WTO, even though India's scheme would cost a fraction of what the US provides in food subsidies.