Shouting into the Wind: Examining the Structural Weakness of Developing Countries in the Global Trading Order Michael Smith Department of Political Science, Columbia University [email protected] IPES Conference, November 15, 2008
Dec 19, 2015
Shouting into the Wind: Examining the Structural Weakness of Developing
Countries in the Global Trading Order
Michael SmithDepartment of Political Science, Columbia University
[email protected] Conference, November 15, 2008
LDCs and the WTO: Newfound Voice
Seattle Ministerial, 1999: Dozens of unmet LDC demands leads to mass exodus
Doha: Well organized and coherent expression of LDC interest in negotiations
Research Question
Is this new voice indicative of a greater power in the GATT/WTO regime?
LDCs and the WTO: Newfound Power?
Democratization leads to a new interest in free trade (Milner and Kubota)
LDCs and the WTO: Newfound Power?
Democratization leads to a new interest in free trade (Milner and Kubota)
Efficiency rationale: International regimes allow states to overcome domestic barriers to free trade (neoliberal institutionalists)
LDCs and the WTO: Newfound Power?
Round DatesNumber of Member
Countries
Geneva 1947 23
Annecy 1949 33
Torquay 1950 34
Geneva 1956 22
Dillon 1961 45
Kennedy 1962-7 48
Tokyo 1973-9 99
Uruguay 1981-94 117
Doha 2001-pres. 147
LDCs and the WTO: Newfound Power?
Democratization leads to a new interest in free trade (Milner and Kubota)
Efficiency rationale: International regimes allow states to overcome domestic barriers to free trade (neoliberal institutionalists)
New coalitional bargaining strategies allow LDCs to effectively press their demands in WTO negotiations (Narlikar and Tussie)
But…
New coalitional bargaining strategies made possible by institutional changes in GATT/WTO that allow for trade-related coalitions
But…
New coalitional bargaining strategies made possible by institutional changes in GATT/WTO that allow for trade-related coalitions
If structural change in the GATT/WTO empowered the global south, why did this structural change occur in the first place?
But…
New coalitional bargaining strategies made possible by institutional changes in GATT/WTO that allow for trade-related coalitions
If structural change in the GATT/WTO empowered the global south, why did this structural change occur in the first place?
Analysis of evolving GATT/WTO regime requires a role for power
But…
New coalitional bargaining strategies made possible by institutional changes in GATT/WTO that allow for trade-related coalitions
If structural change in the GATT/WTO empowered the global south, why did this structural change occur in the first place?
Analysis of evolving GATT/WTO regime requires a role for power
Expression of voice by developing countries doesn’t correspond theoretically or empirically to increased power
Bringing Power Back In
Gruber’s ‘go-it-alone’ power: dominant powers seeking efficiency gains from international cooperation can change status quo in system through creation of self-serving agreements and compel other states to join
Bringing Power Back In
Gruber’s ‘go-it-alone’ power: dominant powers seeking efficiency gains from international cooperation can change status quo in system through creation of self-serving agreements and compel other states to join
Extended to GATT/WTO example: core coalition of dominant cooperating states can exercise structural power. A kind of ‘go-it-together’ power
Bringing Power Back In
Gruber’s ‘go-it-alone’ power: dominant powers seeking efficiency gains from international cooperation can change status quo in system through creation of self-serving agreements and compel other states to join
Extended to GATT/WTO example: core coalition of dominant cooperating states can exercise structural power. A kind of ‘go-it-together’ power
When agreement is reached between dominant powers, developing countries feel compelled to join
Expressions of Power
Structural: Draws in Outliers
Expressions of Power
Structural: Draws in Outliers
Rule Setting: Defining Institutions
Expressions of Power
Structural: Draws in Outliers
Rule Setting: Defining Institutions
Agenda Setting: Content of Votes and Declarations
Expressions of Power
Structural: Draws in Outliers
Rule Setting: Defining Institutions
Agenda Setting: Content of Votes and Declarations
Exit: But Fruitless
Hypotheses: When Agreement?
Core Coalition
?
Structural Power
Rule Setting Power
Agenda-Setting Power Agreemen
t
Yes Yes Yes Yes Yes
No No No Yes (though ineffectual)
No
Expectations
Small-n agreements driven by efficiency concerns
Expectations
Small-n agreements driven by efficiency concerns
For an agreement to grow it must be between states with large structural power
Expectations
Small-n agreements driven by efficiency concerns
For an agreement to grow it must be between states with large structural power
Where a core coalition exists, GATT/WTO rules will be changed as needed
Expectations
Small-n agreements driven by efficiency concerns
For an agreement to grow it must be between states with large structural power
Where a core coalition exists, GATT/WTO rules will be changed as needed
Agenda setting may coexist with any form of coalition but only leads to agreement when forwarded by core coalition
Evidence
GATT/WTO negotiations considered as four cases:1. Havana to the Kennedy Round2. Tokyo Round3. Uruguay Round4. Doha Development Round
Havana to Kennedy
GATT founded as UK-US-France coalition
More development-friendly ITO rejected
Substantive agreements represent northern interest: agriculture kept off the table
Tokyo Round
US/EC division over agricultural liberalization stalls progress until US concedes agricultural products as special goods
Developing world makes fails to gain desired removal of safeguards proposal despite agreement with US: EC achieves maintenance of selective safeguards
Global South largely avoids signing agreements; agitate in alternative but ineffective UNCTAD
Uruguay Round
Developing countries compelled to return to negotiations despite prior exit
US/EC dispute over agriculture stall negotiations; resolved when US threat of retaliatory tariffs compels EC to accede
New institutional framework of WTO meets blueprint of Dunkel Draft – a US and EC drafted document
Passage of round as single undertaking: for South, take it or leave it
Doha Development Round
Seattle 1999: Enduring US-EU-Japan disagreements over accelerating agricultural liberalization in addition to North/South arguments over discussing Uruguay’s implementation. Walkout.
Cancun : G-22 forms, fight for lowered agricultural subsidies and Northern market access. Maintain coherence until re-introduction of Singapore issues forces an impasse; again, walkout.
Geneva July 2008: Inclusion of China, India and Brazil in writing draft text. Breakdown over efforts by China and India to protect farmers
Conclusions and Questions
Voice does not mean power: in trade rounds, the existence of a core coalition is required for progress.
How do changes in the international economy affect this?
Does inclusion of China, India and Brazil in Green Room talks indicate a change in the core coalition?