A ticking clock can focus minds, but it may also leave too little time to resolve difficult choices. Either outcome is possible as negotiations on several big trade deals reach their final weeks.
In February, the United States announced plans for an ambitious Trans-Atlantic Trade and Investment Partnership with Europe. Its name is an echo of the Trans-Pacific Partnership, a planned tie-up among Pacific-rim economies that grew in importance when Japan joined the talks in March.
More encouraging still was the revival of the Doha round of multilateral trade talks at the World Trade Organization. These had collapsed in 2008 but resumed last year with an eye toward completion of a deal this year.
The bad news is that many of these negotiations have hit rough patches. That is partly a function of deadlines: both Trans-Pacific Partnership and Doha are due to conclude next month, so the trickiest details can no longer be put off. Yet recent glitches also suggest that politicians overestimated political support for big new deals.
The threat of failure in the Doha round is most serious. The WTO's members have not agreed on any broad cuts to trade barriers since its inception in 1994. This month, trade ministers will meet in Bali, Indonesia, in theory to sign a deal.
Agriculture, as ever, is a problem: "food security" is the biggest stumbling block. After recent rises in food prices, many developing countries adopted new agricultural subsidies to encourage farmers to grow more. Such arrangements are likely to break WTO rules.
Regional deals face problems of their own. As the Trans-Pacific Partnership deadline approaches, opponents are mobilizing in the United States. Nearly half the members of the House of Representatives have signaled reluctance to grant trade-promotion authority, which would ensure an amendment-free vote, without various assurances. Many on the left, for example, are calling for an extension of "trade-adjustment assistance," which provides funding for training and relocation to workers harmed by trade.
Copyright 2013 The Economist Newspaper Limited, London. All Rights Reserved. Reprinted with permission.
