World Trade Organization trade officials have released an "unofficial" guide explaining why the Doha Round of trade talks broke down late last month. The guide indicates the dispute is with a new mechanism for agricultural safeguards. A part of that mechanism would allow developing countries to raise tariffs temporarily to deal with import surges and price falls. The blockage in the July 2008 talks was only about import surges, and a particular instance of that. The blockage in discussions focused on the situation where the mechanism raises tariffs above commitments countries made in the 1986—94 Uruguay Round - the "pre-Doha Round bound rates." In the case of new members, that means commitments made in their membership agreements. The blockage is often described as one between the U.S. versus India and China. This is only partly true. All three were among the small group of seven delegations trying to reach an initial settlement - Australia, Brazil, China, the EU, India, Japan, and the U.S. - before taking the issue to larger groups and eventually the full membership. The blockage was within that group of seven. Bottom line: there are two different and unresolved views. The first being, the process should be freer and easier to use, with smaller triggers and bigger tariff increases. The second view is that use should be more restricted, and related to cutting tariffs from pre-Doha Round levels.
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