archives: WTO InfoTrade Talks Collapse Deals Blow to Lamy
Mon September 15, 2003 12:00 AM ET
By Patrick LanninCANCUN, Mexico (Reuters) - European Trade Commissioner Pascal Lamy was grim-faced after world trade talks collapsed Sunday, a failure that dealt him a personal blow and could hurt the European Union's long-term economic hopes.
Lamy, 56, had been one of the most fervent backers of the trade negotiations, launched at the end of 2001 in the Qatari capital, Doha.
"I wouldn't say the Doha round is dead, but it certainly needs intensive care," the Frenchman said at a news conference, keeping a wry sense of humor even as the talks he had helped launch and had hotly pursued went seriously off track.
The 15 members of the EU, expanding to 25 next year, had hoped that market openings offered by successful negotiations would boost their economies, which have tended to limp along behind the United States.
The meeting of trade ministers in the Mexican resort of Cancun was a halfway stop along the road of the Doha negotiations, which aimed to finish at the end of 2004.
After days of acrimonious discussions on demands by poor nations that rich countries slash farm subsidies, the meeting finally foundered when African and Asian states refused to consider new rules on cutting the bureaucracy and backhanders that hurt trade.
This and three other sets of new rules, on foreign investment, competition and the award of government contracts, had been among a top priority for Lamy and many EU members.
After encountering implacable opposition to the plan from developing countries, Lamy won permission from the 15 EU governments to drop demands on investment and competition.
But that was not good enough for many poor states.
The talks collapsed, leading some diplomats to question whether the usually sure-footed Lamy had misjudged the mood and offered his concessions too late to make a difference.
"This is not only a severe blow for the World Trade Organization, but also a lost opportunity for all of us, developed and developing countries alike. We would all have gained. We all lose," Lamy said.
The economy of the EU stagnated in the second quarter of this year. The 12 members that launched the euro single currency at the start of 2002 did even worse; their collective gross domestic product shrank in the same period.
Part of the bloc's gameplan to make itself more of an economic powerhouse was to sell more of its goods and services abroad, thanks to the new markets that successful trade talks would bring.
"We don't have to beat about the bush. Cancun has failed," Lamy said.
That failure is galling for Lamy personally. A marathon runner, the ascetic workaholic's commission mandate runs out late next year. As he acknowledged, the chances that the talks will have finished by then are slim.
And Lamy, a moderate socialist, knows conservative French President Jacques Chirac is unlikely to reappoint him and give him another chance to steer the talks to success.
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