Times Live | Mar 26, 2011
Doha failure could spark regionalism
By JANA MARAIS
SA is considering bilateral trade agreements with Japan, Turkey and New Zealand, but a preferential trade agreement with India, currently under negotiation, is enjoying priority, said Brendan Vickers, a chief director at the department of trade and industry.
There are fears that the Doha round of multilateral negotiations, which has been dragging on since 2001, may not be concluded this year, and this will be a big blow to the multilateral trade system.
While Doha will not bring much benefit to SA, participants at the conference expressed fears that a failure would encourage a further explosion in regional and bilateral trade agreements. This may leave SA locked out of favourable trade agreements with major global markets.
Speaking at a trade conference hosted by the South African Institute of International Affairs, Vickers said SA would consider bilateral agreements case by case. He said the country needed to be "creative" about agreements, focusing for example on supply chain agreements, and not necessarily World Trade Organisation (WTO)-compatible agreements.
SA has just one significant operational bilateral trade agreement with a main trading partner, the European Union . Its trade relationship with the US, its second largest export market, is governed uniformly by the US through the Africa Growth and Opportunity Act , which is due to expire in 2015.
Plans to negotiate a preferential trade agreement with China, its largest trading partner, have been shelved.
Joshua Setipa, an official at the WTO in Geneva, said the success of Doha would depend on China and the US.
"The deal will be done between the US and China. Until they engage on numbers and sectors and begin to exchange concessions, and see what the Chinese can offer, and how far the US will be able to make concessions in services in particular without hiding behind homeland security, there won’t be a deal," said Setipa.
Agreements on reforms of the cotton market would also be crucial for Doha’s success, said Setipa.
Four major cotton-producing countries, Benin, Burkina Faso, Chad and Mali, have been fighting US and EU subsidies for several years.
Setipa said SA had missed an opportunity to fight for better market access for its own agricultural goods. Yet it is expected to fight for higher tariffs on certain clothing and textile lines, as it attempts to assist the struggling sector.