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2004 G8 Pre-Summit Conference
Security, Prosperity and Freedom: Why America Needs the G8
June 3–4, 2004
Indiana University, Bloomington, IN

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Effective or Defective?
The G8 and Multilateral Trade Negotiations:
Challenges for the Sea Island Summit

Heidi Ullrich
London School of Economics and Political Science
Draft: May 19, 2004

Abstract

The G7/8 have consistently supported the role of the General Agreement on Tariffs and Trade (GATT), and since 1995 its successor, the WTO, in monitoring trade agreements, ensuring the openness of the trading system and as a forum for negotiations. With respect to multilateral trade negotiations, summits serve to: 1) call for new rounds; 2) shape the negotiating agenda; 3) break impasses through increasing pressure on individual member governments to offer concessions; and 4) serve as useful deadlines for negotiators. Their impact on multilateral negotiations has been the source of the term ‘Rambouillet effect’ that describes the G7/8’s ability to bring about incremental progress during negotiations by having the leaders make the critical political decisions.

However, this effect has not been visible at every summit. The G7/8 have rightly received much criticism due to their lack of positive impact on the negotiations. This paper argues that the G8 must provide more effective leadership in the area of multilateral trade and specifically during multilateral trade negotiations. Thus, the aim of this paper is to examine the history of G7/8 summits regarding effectiveness in providing leadership in the area of multilateral trade liberalization with a focus on the current Doha Development Round. It concludes that effective summits for the promotion of trade liberalization, specifically the support of multilateral trade negotiations, have been characterized primarily by: 1) an agreed agenda prior to the start of the summit. This often requires the issue having been discussed at a previous summit or at the earlier OECD Ministerial; 2) the existence of a viable negotiating framework; 3) personal commitment of the leaders; and 4) public political pressure. The paper also examines the challenges and opportunities of this year’s G8 summit that will take place 8-10 June in Sea Island, Georgia.

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Introduction

This paper argues that the Group of Eight (G8) [1] must provide more effective leadership in the area of multilateral trade and specifically during multilateral trade negotiations. Therefore, the aim of this paper is to examine the leadership provided by the G7/8 [2] summits during the Uruguay Round and the current Doha Development Round. It concludes with the challenges and opportunities facing the G8 at the 2004 Sea Island Summit.

The G7/8 and Multilateral Trade Negotiations

Since the first Western Economic Summit took place in Rambouillet, France in 1975, the leaders have voiced their support for an open trading system. In words that still hold true almost 30 years after they were first written in the 1975 Rambouillet Declaration, the G7 stated:

We must seek to restore growth in the volume of world trade. Growth and price stability will be fostered by maintenance of an open trading system. In a period where pressures are developing for a return to protectionism, it is essential ... to avoid resorting to measures by which they could try to solve their problems at the expense of others, with damaging consequences in the economic, social, and political fields (Rambouillet Declaration. Pt. 8. 1975).

The G7/8 have consistently supported the role of the General Agreement on Tariffs and Trade (GATT), and since 1995 its successor, the World Trade Organization (WTO), in monitoring trade agreements, ensuring the openness of the global trading system and as a forum for negotiations.

With respect to multilateral trade negotiations, summits serve to: 1) call for new rounds; 2) shape the negotiating agenda; 3) break impasses through increasing pressure on individual member governments to offer concessions; and 4) serve as useful deadlines for negotiators. Their impact on multilateral negotiations has been the source of special negotiating terminology including the ‘Rambouillet effect’ that describes the G7/8’s ability to bring about incremental progress during negotiations by having the leaders make the critical political decisions (Bayne; 2000: 21).

However, this effect has not been visible at every summit. The G7/8 have rightly received much criticism due to their lack of positive impact on the negotiations. This is particularly due to the apparent inability or unwillingness of the leaders to fully implement their communiqué pledges once they have returned home. Summit communiqués called for the completion of the Tokyo Round every year from 1975 through 1978, urged progress in the Uruguay Round from 1990 through 1993, and have expressed support for the current Doha Development Round. In the case of the Tokyo and Uruguay Rounds stalemate occurred due to bilateral issues between Europe and the United States. In the current Doha Development Round, continuing stalemate has been due to divisions between developed and developing countries. Given these deep divides, the G8 perhaps should not be faulted for their lack of success in providing effective leadership within the negotiations but rather commended for their continued determination in bringing about an eventual agreement. In fact, Bayne has observed that:

The summits do not achieve results by flashes of prescient, inspirational decision-making, sparked by the personal chemistry between leaders. There are a few examples of this, but they are very rare. Nor do they often achieve, at the first attempt, a definitive settlement of issues which can then be handed on to other institutions. Nearly always their achievement comes from dogged persistence, a sort of “worrying away” at the issues until they have reached a solution (1999: 25).

Effective summits for the promotion of trade liberalization, specifically the support of multilateral trade negotiations, have been characterized primarily by: 1) an agreed agenda prior to the start of the summit. This often requires the issue having been discussed at a previous summit or at the earlier OECD Ministerial or among the Quadrilateral Group of Trade Ministers (Quad).[3] 2) the existence of a viable negotiating framework; 3) personal commitment of the leaders; and 4) public political pressure.

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Varying Effectiveness of Summits

The following section reviews the factors that may create both effective and ineffective summits. Examples are drawn from the G7 summits that dealt with the Uruguay Round as well as the G8 summits that took place immediately prior to and during the Doha Development Round. The summits covered are:

Uruguay Round
1985 Bonn — Members divided on new round (-) [4]
1986 Tokyo — Political impetus for new round (+)
1990 Houston — Political re-commitment (+)
1993 Tokyo — Market access breakthrough due to political pressure (+)

Doha Round
1998 Birmingham — Focus on anniversary of GATT, not on new round (-)
1999 Cologne — Members divided on new round (-)
2000 Okinawa — Lack of political leadership and personal commitment (-)
2001 Genoa — Pledges of personal commitment, need for transparency and incorporation of developing country concerns (+)
2002 Kananaskis — Only brief re-statement of need to resist protectionism; no new initiative (-)
2003 Evian — Lack of personal commitment and accountable leadership (-)

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Uruguay Round

Since the 1980s, G7 summits have been used as platforms by individual leaders in calling for new multilateral trade talks. At the 1985 Bonn Summit, US President Reagan issued a strong call for an early start to a new trade round. However, the leaders were divided, with France refusing to accept a start date of early 1986. Thus, the communiqué read “Most of us think (that the starting date of a new round) should be in 1986” (Bonn Economic Declaration; Pt. 10. 1985). The US, especially Congress, felt rebuffed and initiated protectionist legislation such as the Export Enhancement Program. However, it has been noted that this summit was exceptional for its lack of cohesiveness and that the Bonn Summit is one of only two Western Economic Summits which Putnam and Bayne view to have “exacerbated international tensions”.[5]

In contrast to the weak and divisive position G7 leaders took in Bonn, the 1986 Tokyo Summit gave political impetus to the UR through issuing a strong and cohesive statement in support of a new round. In fact, the leaders even suggested which issues should be included in the negotiations by stating: “The new round should, inter alia, address the issues of trade in services and trade related aspects of intellectual property rights and foreign direct investment” (Tokyo Economic Declaration. Pt. 12. 1986). There was an additional paragraph dedicated to the contentious issue of agriculture. The Tokyo summit was effective in that the leaders agreed on a common and detailed statement regarding the Uruguay Round. They also provided the political pressure necessary for certain GATT members to agree to a September start date and pledged to stay involved in the GATT process to ensure the round was successfully launched.

As the host of the 1990 Houston G7 Summit, the United States was eager to make progress on the Uruguay Round negotiations, especially the difficult agricultural discussions. In fact, so critical was the successful outcome of the agricultural negotiations to the heads of state and the representatives of the European Community (EC) [6], that the topic “dominated proceedings ahead of aid to the Soviet Union; the issue of reform of the Common Agricultural Policy (CAP) forced itself above the end-game to the Cold War” (Kay; 1998: 64).[7]

The final G7 Communiqué sent a clear and firm message to the negotiators that the political leaders had placed the conclusion of the Uruguay Round at the top of their agenda. They pledged to “take the difficult political decisions” as well as to “maintain a high level of personal involvement” (G7 Communiqué: 11 July 1990: Pts 19 and 23). The immediate impact of the Houston Summit on agriculture was minimal due to the EC’s back-peddling on their pledges. However, the long-term impact was more significant as it provided many summit innovations. It was the first time that the leaders had provided negotiators with detailed advice on moving the trade negotiations forward. A critical factor that qualifies the Houston Summit as being effective regarding trade was that for the first time the leaders pledged to become personally involved in the negotiations. This has proven to be a key element in the G7/8 leaders having a positive impact on negotiations both at and between summits.

The expiration of United States fast-track authority on 15 December 1993 provided a critical deadline for the Uruguay Round. Therefore, immense political pressure was placed not only on the host country of the 1993 Tokyo Summit but also the other members of the Quadrilateral Group of Trade Ministers, the United States, EC and Canada. It was reported that in the run up to the Tokyo Summit, the Quad trade ministers “zig-zagged across the world — from Toronto to Paris to Tokyo, back to Toronto and to Tokyo... in an attempt to hammer out agreement” (The Independent, 8 July 1993).

After marathon talks and a surprise concession from Japan on whiskey and brandy, a significant breakthrough was achieved on 7 July in the form of a substantial market access package. The next day the G7 were able to announce the deal at their summit. A press report stated:

In what could well end up as the biggest surprise and most important accomplishment of the G7 summit meeting, trade representatives of the world’s major economies appear to have succeeded in what some had thought impossible. On (7 July) they gave a new lease on life to moribund world trade negotiations and a boost to the idea of free trade at a time when the concept is under attack by word and deed (International Herald Tribune; 8 July 1993).

Following the summit, the other GATT contracting parties discussed the Quad’s agreement in Geneva. At the same time, the US and EC held several months of intense bilateral negotiations, primarily over agriculture but also financial and audiovisual services. On 6 December 1993, the US and EC announced that they had reached an agreement on agriculture. Japan also agreed to allow foreign rice to be imported. On 14 December Peter Sutherland, the Director General of the GATT announced that “the gavel has fallen on most of the Uruguay Round agreement” (FT; 14 December 1993). The Quad/G7 initiative had clearly paved the way for the successful conclusion to the Uruguay Round.

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Doha Development Round

The summits leading up to the planned launch of the Doha Development Round have shown surprising lack of effective leadership among the G7/8. Their failure to offer solid proposals on contentious issues such as trade and the environment and trade and labor contributed to the difficult and frustrating discussions among WTO ambassadors in Geneva in the last few months before the 1999 WTO Seattle Ministerial that was meant to launch a new round of trade talks.

The 1998 Birmingham Summit took place one week prior to the 1998 WTO Ministerial held in Geneva marking the 50th anniversary of the establishment of the GATT. Thus, the Birmingham CommuniquŽ focused on a general reaffirmation of the merits of continued liberalization. As they had done in Lyon in 1986 and in Denver in 1997, the leaders again called for greater participation by developing countries within the multilateral trading system. However, no new initiative was proposed. Notably, the G8 did not address the need for new trade negotiations.

In 1999 at Cologne, the G8 leaders failed to reach a consensus on the agenda of the planned new Millennium Round. This was a significant failure as it gave their trade ministers no shared political direction in the critical period before the Seattle Ministerial. The main points discussed were: 1) pursuing an ambitious new trade round; 2) involving developing countries more widely into the negotiations; 3) increasing the input of civil society; 4) incorporating environmental and labor concerns into future trade negotiations; and 5) biotechnology. However, the US and the EU/European Commission failed to come to an agreement on various elements of the proposed round. While the EU insisted on having an ambitious comprehensive round, the US favored a more limited agenda. There was also disagreement on the extent that trade-related environmental and labor issues should be discussed.

In the end, the Cologne Communiqué pleased no one by weakly calling for “a new round of broad-based and ambitious negotiations with the aim of achieving substantial and manageable results”. More critically, compared to the 1996 Lyon Summit that offered considerable detail for the upcoming WTO Singapore Ministerial, in Cologne the leaders offered little in the way of specific suggestions for Seattle.

Following the failure of the WTO Seattle Ministerial to launch the a new round of multilateral trade negotiations and the weak trade statements coming out of the G7/8 summits in previous years, Okinawa was a critical summit for the issue of trade. In particular, strong political leadership regarding the launch of the Doha Development Round was needed.

While there was no meeting of the Quad immediately prior to the Summit, trade was high on the agenda at the EU-Japan Summit on 19 July 2000. Japanese Prime Minister Mori and EU leaders, including French President Chirac, who held the six-month rotating European Council Presidency, and Commission President Prodi, stressed their commitment to launch the next round “during the course of this year” and that it:

should be designed as a single undertaking and, beyond the negotiations in the built-in agenda on agriculture and services, be comprehensive in that it should reflect the varied interests and priorities of all WTO members in a balanced way” (The Daily Yomiuri; 20 July 2000: 3).

At a press conference in Tokyo on the same day, United States Trade Representative Charlene Barshefsky stated the US position:

...consensus for a new round should be sought and achieved at the earliest possible opportunity including this year. Every country has politics. Every country has elections. The United States is concerned that a vacuum not develop, and that the process of trade liberalization move forward. But the key to the launch of the new round will be the substance. And when that substance will be achieved, whether this year or next, a new round will be able to launched (Washington File; 19 July 2000).

Barshefsky’s statement hinted that, while the US strongly supported a new round, it would be hesitant to fully support a launch before the agenda was clarified. Therefore, the Okinawa summit began without a clear consensus, at least among three members of the Quad.

During discussions on the second day of the Summit, all G8 participants at one point reportedly expressed their strong support of launching a new round by the end of 2000.[8] However, the leaders agreed that it be left to the sherpas to prepare the final communiqué language.

Similar to Cologne, the Okinawa Summit communiqué resulted in a relatively weak statement due to a lack of both consensus and of political leadership. In words identical to those issued after the EU-Japan Summit, the communiqué stated the leaders pledge to “intensify our close and fruitful cooperation in order to try together with other WTO members to launch such a round during the course of this year (G8 Communiqué; 23 July 2000: Pt. 36 and EU-Japan Summit-Joint Conclusions; 19 July 2000. Emphasis added).

However, while the G8’s call for a new round was disappointing, the Okinawa Summit did include other current issues relating to the multilateral trading system. The leaders addressed the ‘legitimate concerns’ of the WTO’s developing country members to be better incorporated into the multilateral system. Additionally, the G8 recognized the need for communicating with their citizens on the issue of trade. They stressed the importance “to establish a constructive dialogue on the benefits and challenges of trade liberalization” (G8 Communiqué, 23 July 2000: Pt. 37).

In Genoa at the 2001 Summit, the communiqué was stronger than in past years on the issue of trade, but there were still critical omissions that served to weaken its overall impact on the multilateral trading system. Regarding a new round, the G7 leaders issued a statement on the first day of the summit in which they agreed to “engage personally and jointly” in launching an ambitious new round at the WTO Ministerial meeting scheduled to take place in Doha, Qatar later in the year. In addition to calling for a balanced agenda, the leaders also stated the need for increased WTO transparency and interaction with civil society as well as more effective Dispute Settlement Procedures. The G7 addressed the need for the new trade talks to better incorporate developing countries including increased market access to developed countries, capacity building and technical assistance. Nonetheless, many of the more contentious issue areas such as agriculture or the new issues were not addressed. However, the personal and political engagement of the G7/8 leaders was evident in Doha in November where the Doha Development Round was successfully launched, albeit with last minute compromises in language that left many somewhat unsure of what exactly had been agreed.

The 2002 Kananaskis Summit, rather than producing the regular communiqué, resulted in a brief Chair’s Summary with trade only mentioned in passing. The leaders were extraordinarily concise in announcing that they had “agreed to resist protectionist pressures and stressed [their] commitment to work with developing countries to ensure the successful conclusion of the Doha Development Agenda by January 1, 2005” (Kananaskis Summit Chair’s Summary; 27 June 2002).

Given that the 2003 Evian Summit took place only four months prior to the Cancún Ministerial, it was of utmost importance that the G8 show solidarity and accountable political leadership in acting to ensure that the Doha negotiations were put back on track. Leading up to the summit, there were indications that Evian had the potential to be strong on trade. Two out of the four characteristics that generally lead to effective summits for the promotion of trade liberalization, and specifically the support of multilateral trade negotiations, seemed to have been met. However, two key elements were not accomplished.

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An agreed agenda prior to the start of the summit.

This often requires the issue having been discussed at a previous ministers’ meeting or at the OECD Ministerial immediately prior to the summit. Chirac placed trade and the strengthening of the global economy high on the Evian Summit agenda. At the April 2003 meeting of the G7 Finance Ministers and Central Bank Governors stated that they:

underscore the importance to global growth and poverty reduction of successful Trade liberalization through the timely implementation of the Doha Development Agenda, notably in financial services (Statement of G7 Finance Ministers and Central Bank Governors; April 2003).

Additionally, the Chairman of the OECD Trade Committee highlighted the need for responsibility and cooperation among OECD members at the OECD Ministerial in late April:

This year’s Trade Message to the OECD Ministerial Council Meeting is being delivered at a time of general uncertainty about prospects for the world economy and, more broadly, about the international environment for peace and security. In such a context, it is the special responsibility of OECD Members to show leadership and to act decisively to ensure the successful conclusion of the Doha Development Agenda (DDA) and thereby help underpin international cooperation, stability and economic integration “ (Trade Policy Message to Ministers from the Chairman of the Trade Committee — Luzius Wasescha; 29-30 April 2003).

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Public political pressure

The Heads of the WTO, IMF and World Bank, who met with the leaders at Evian, issued a joint statement in May directed at the G8 urging political leadership:

We appeal to heads of Government at the forthcoming G8 Summit to provide the political guidance that is needed to allow the trade negotiations to move forward again before the WTO Ministerial Conference in Cancún in September. Political opinion in the G8 needs to appreciate fully the value of liberalising world trade, particularly in agriculture — a sector of critical importance to development. Trade is vital not only for the direct benefits it brings, but also for increasing the flows of financial and real investment resources to developing countries which generate the income growth and job opportunities that help raise people out of poverty and make economies more resilient to shocks. Bold action now to reinforce long-term growth fundamentals through freer trade will boost confidence and help to strengthen the emerging economic recovery. (WTO; Joint Statement by WTO/IMF/IBRD: 13 May 2003).

Additionally, interest groups and civil society groups were vocal in emphasizing the need for a successful conclusion of the Doha Round and the necessity of G8 leadership. Representatives of the International Chamber of Commerce (ICC), an active proponent of trade liberalization representing thousands of corporations and business associations from more than 130 countries, presented President Chirac with a statement to the G8. It stated in part:

Our key message, now that the war in Iraq is over, is to urge governments to put their divisions behind them and commit themselves to renewed multilateral cooperation for the vital purposes of rebuilding business and consumer confidence and reinvigorating a weak global economy (News International; 9 May 2003).

This statement was followed shortly by a letter signed by the directors of the Canadian Council of Chief Executives, Japan’s Nippon Keidanren Business Association, the European Round Table of Industrialists, the European Employers Confederation and US Business Round Table, and the ICC calling on the G7/8 to make a “strong commitment” to the Doha Negotiations (Financial Times; 21 May 2003).

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The existence of a viable negotiating framework

The Doha Declaration provides the framework for the Doha Development Agenda negotiations as well as established a series of deadlines for several of the issues being negotiated. However, many of the key deadlines ha been missed. This resulted in the WTO Cancún Agenda being dangerously overloaded making the established negotiating framework less viable. The key issues that needed to be agreed at Cancún included:

Agriculture — At the Doha Ministerial Members agreed to:
comprehensive negotiations aimed at: substantial improvements in market access; reductions of, with a view to phasing out, all forms of export subsidies; and substantial reductions in trade-distorting domestic support” (Doha Ministerial Declaration; 2001: para. 13).

However, given the extremely contentious nature of agriculture liberalization, to date Members were been unable to meet the set deadlines. In late December 2002, Stuart Harbinson, the Chair of the Agriculture Negotiations Committee, circulated a draft ‘overview paper’ on the status of the agricultural negotiations including formulas for reducing support and modalities (scope and approach), the Members were unable to agree on the modalities by the mandated deadline of 31 March 2003. This slowed the negotiations, and it was critical that Members reached agreement in Cancún.

Services — Negotiations on services are placed within the General Agreement on Trade in Services (GATS) and include such areas as financial services, business services and construction. Members were to submit initial market access requests on a bilateral basis by 30 June 2002. However, Members continued to submit their requests throughout 2002. A deadline of 31 March 2003 was set by which Members were to respond the requests. This deadline was missed. The Doha Declaration states that Ministers will be a take stock of the services negotiations during the 5th. Ministerial meeting in Cancún.

New Issues — The New Issues, also referred to as the Singapore Issues due to first being addressed at the 1996 WTO Ministerial in Singapore, include competition policy, investment, transparency in government procurement and trade facilitation are extremely contentious due to developing countries wishing to fully implement the liberalization requirements agreed to in the Uruguay Round. The Doha Ministerial Declaration established that these issues would only be placed on the negotiation agenda following agreement at Cancún “on the basis of explicit consensus”. Much work has been done in reviewing the trade implications of these issues, but much opposition remained.

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Personal commitment of the leaders

Despite several of the countries of the G8 supporting further liberalization within the framework of the Doha Development Round, recent summits, including Evian, failed to show significant personal commitment and engagement by the leaders. Such political support is a critical element as it directly impacts the work of their respective trade ministers. Given that the G8 leaders were to meet with several leaders of key developing states immediately prior to the summit, a joint statement of personal commitment from both developed and developing leaders would have provided a show of solidarity as well as a much-needed political boost to the Doha negotiations.

At Evian, the G8 managed only to produce a general statement on trade that failed to offer the leadership, political will, or personal commitment necessary to place the Doha negotiations back on track before the Cancún Ministerial. Rather than offering progress on such critical issues such as agricultural support and market access, the G8 merely agreed:

We will promote the multilateral system by providing leadership in the ongoing negotiations so that improved access to markets for all WTO members is realized, particularly for the poorest, to ensure their integration into the multilateral system, and their development more broadly. We are therefore committed to delivering on schedule, by the end of 2004, the goals set out in the Doha Development Agenda, and to ensuring that the Cancún Ministerial Conference in September takes all the necessary decisions to help reach that goal (Co-operative G8 Action on Trade; Pt. 2: 2003).

Additionally, rather than showing accountable leadership on the issue of participation within the Doha negotiations, the G8 glaringly acted in their own interests. In their declaration on Fighting Corruption and Improving Transparency, the G8 stated their intention to “commence negotiations aimed at achieving an inclusive multilateral agreement on transparency in government procurement” at the WTO ministerial in Cancún (Fighting Corruption and Improving Transparency; Pt. 5.2: 2003). This statement is worrying due to WTO members agreeing at the previous WTO ministerial in Doha in 2001 that “negotiations will take place after the Fifth Ministerial on the basis of a decision to be taken, by explicit consensus...” (Doha Ministerial Declaration; Pt. 26: 2001. Emphasis added). Many developing country members of the WTO feel that any negotiations on this issue are premature. Therefore, the apparent agreement among the G8 to commence negotiations at Cancún indicates a lack of not only commitment to full participation and in the WTO but also the concerns of many developing country members.

The Evian Summit was a lost opportunity for the G8’s leadership in trade as well as for the multilateral trading system. The stalemate that has occurred within the Doha Development Agenda following the failure of the Cancún Ministerial has resulted in the negotiations being “in need of intensive care” (EU Trade Commission Pascal Lamy as quoted in the Financial Times, 16 September 2003: 21).

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The Sea Island Summit

According to the agreed upon schedule of the Doha Development Round, the 2004 Sea Island Summit will be the final meeting of the G8 leaders during this round of multilateral trade negotiations. This summit will be critical in terms of showing whether in providing leadership in the area of multilateral trade, the forum of the G8 is effective or defective.

There are indications that the US hosts have recognized the crucial opportunity that the Sea Island Summit represents for the Doha Development Round. Firstly, of the three themes for the summit — prosperity, freedom, and security — prosperity seems to indicate that the health of the world economy and trading system may figure prominently on the agenda. Additionally, the growing importance of the economy in the 2004 US Presidential campaign may indicate that President Bush will encourage the other leaders of the G8 to pledge their personal commitment to bringing the Doha Round to a successful conclusion.

Secondly, in January USTR Robert Zoellick sent a letter to the other members of the WTO suggesting frameworks for negotiations in the stalled Doha Development Round be developed by mid-year and that another WTO Ministerial meeting be held by late 2004. He stated “The Doha negotiations will require a commitment to work toward effective and productive compromises by all WTO Members, and the United States recognizes its responsibility to help push towards our mutual success” (USTR; 8 February 2004). Zoellick followed this statement with a whirlwind visit to key capital cities in order seek a way forward. Given this evidence of increasing discussion between developed and developing WTO Members, notably on the sidelines of the OECD Ministerial in mid-May, there is the possibility that viable negotiating frameworks could exist around the time of the Sea Island Summit.

Thirdly, on 26 February WTO Director General Supachai Panitchpakdi gave a key speech at the National Press Club in Washington, D.C. in which he argued that US leadership is “indispensable” to the success of the world trading system. He pointed out that progress in the Doha Development Round should be a key objective of the US given the great extent to which the US is integrated into the world economy as well as that a healthy world trading system would contribute to winning the war on terrorism (WTO; 26 February 2004).

However, even if the Bush Administration can overcome the growing protectionist voices in the domestic trade debate, US leadership is only a start. With 146 WTO Members, in order for progress to be made in the Doha Development Round, leadership must be provided at the highest political levels of both key developed and developing countries. The G8 has the potential to serve as a key leadership forum. As argued by the heads of the WTO, International Monetary Fund, and the World Bank:

By pulling together in a multilateral context the G8 will help to maintain the momentum of structural economic reform over the longer term in developed and developing countries alike. (WTO; Joint Statement by WTO/IMF/IBRD: 13 May 2003).

Continued political pressure from the heads of international organizations may lead to the G8 place the Doha Development Round high on its agenda. However, within the Doha negotiations, developed and developing countries are increasingly recognizing that they often may gain through forming alliances that bridge the traditional North/South or developed/developing country distinctions. One single sector example of this is the “Friends of Fish” group that support the reduction of fishing subsidies. This relatively new development, first seen with the establishment of the Cairns Group during the Uruguay Round, points to the need of the G8 leaders to reach out to and work with the heads of states of other key countries to provide the necessary political leadership for the successful conclusion of the Doha Development Round.

As the WTO and world trading system become increasingly politicised, leadership as can only be provided by heads of state and government will become ever more critical. The Sea Island Summit provides the G8 with a final opportunity to ensure that such leadership place the Doha Development Round on the path to a successful conclusion.

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Conclusion

This paper argued that the G8 must provide more effective leadership in the area of multilateral trade and specifically during multilateral trade negotiations. Through examining the history of G7/8 summits during the Uruguay Round and Doha Development Round, it was shown that effective summits for the promotion of trade liberalization, specifically the support of multilateral trade negotiations, have been characterized primarily by 1) an agreed agenda prior to the start of the summit; 2) the existence of a viable negotiating framework; 3) personal commitment of the leaders; and 4) public political pressure.

Given the lack of consistent leadership within multilateral trade negotiations, the G8 leaders must ensure that the 2004 Sea Island Summit provides strong political direction in the current Doha Development Round. Given its lack of leadership during earlier summits within the Doha Round, the Sea Island Summit offers the G8 a critical opportunity to show that it can be effective rather than defective.

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Notes

[1] The G8 are: Canada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United Kingdom. Additionally, the European Union (EU) is a participant. The European Commission represents the EU in the G8, especially the non-G8 members of the EU, and in the WTO.

[2] Despite the G7 expanding to the G8 in 1998 with the addition of Russia, between 1998 and 2002 it was the G7, joined by the EU, which discussed trade at the annual summits since Russia was not a member of the WTO. However, with the accession of Russia to the WTO imminent, the 2003 Evian Summit was the first to discuss all topics as the G8.

[3] The Quad was established in 1982 with the support of the G7.

[4] A ‘–’ symbol indicates a G7/8 Summit which had little, or negative, impact on multilateral trade negotiations, while a ‘+’ symbol indicates a positive impact.

[5] I thank Nicholas Bayne for bringing this point to my attention.

[6] The EU was known as the European Community prior to when the Treaty on European Union went into force on 1 November 1993.

[7] The Bush Administration welcomed the conveniently released GATT document known as the De Zeeuw text as a basis for further discussion on agriculture. The De Zeeuw compromise text was agreed by all Summit participants as the “means to intensify the negotiations” (G7 Communiqué: 11 July 1990: Pt. 23). However, less than one week later, the EC’s General Affairs Council declared that the De Zeeuw Report was only “one way to intensify” the agricultural negotiations (Agence Europe; 18 July 1990: 6). The EC retreat was due to the Council feeling the European Commission, which speaks for the 15 member states of the EU on matters relating to trade, had gone past its negotiating mandate.

[8] As stated by a UK spokesman during a press briefing at the Okinawa Summit.

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