Negotiating Trade Liberalization at the WTO

Domestic Politics and Bargaining Dynamics

By: Eugnia da ConceioHeldt

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Hardcover | 15 December 2010 | Edition Number 1

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'This important book addresses a question of utmost relevance for academics and policy-makers alike: Why is it that multilateral trade negotiations are so protracted even though trade liberalization benefits everybody in the end? Eugenia da Conceição-Heldt argues that domestic political institutions and the lack of time pressures combine to produce inefficient results. A must-read for anybody interested in trade negotiations!' Thomas Risse, Free University Berlin, Germany

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Published: 1st January 2011

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List of Tables	p. xi
List of Figures	p. xii
Preface and Acknowledgements	p. xiii
List of Abbreviations	p. xv
Introduction	p. 1
Overview of the argument	p. 3
Case studies	p. 4
Methodology: selection of the units of analysis	p. 6
Domestic institutions	p. 6
Economic importance of the EU, US, Brazil, and Australia in the WTO	p. 8
Actors' positions on agricultural trade liberalization	p. 10
Sources	p. 11
Chapters' overview	p. 12
Setting the Stage
Framework for Analysis of Negotiations	p. 17
Two-level games literature and trade policy: an overview	p. 17
International-level explanations	p. 18
Domestic-level explanations: society- and state-centred approaches	p. 19
Domestic institutions	p. 22
Executive-legislative relations	p. 24
Number of veto players	p. 25
Link between parties and interest groups	p. 27
Domestic constraints and international negotiations	p. 28
Integrative and distributive bargaining	p. 28
International level: the time dimension of negotiations	p. 29
Time dimension and concession rates	p. 29
Time pressure: elapsed time and concession rates	p. 30
Best alternative to a negotiated agreement	p. 33
Repetitive games and tough bargaining strategies	p. 34
Conclusion	p. 34
Multilateral Agricultural Trade Regime	p. 36
Introduction	p. 36
Evolution of international trade cooperation	p. 36
Uruguay round negotiations 1986-94	p. 38
Inclusion of agriculture in the negotiating agenda	p. 38
First negotiating phase: 1986-8	p. 39
Second negotiating phase: 1989-90	p. 40
Final negotiating phase: 1991-3	p. 41
Agreement on agriculture of the Uruguay round	p. 42
Market access	p. 42
Export subsidies	p. 43
Domestic support and the system of boxes	p. 44
Impact of the agreement on agriculture on domestic support	p. 45
Conclusion	p. 46
Domestic Institutions
US Trade Politics	p. 51
Introduction	p. 51
Power delegation in US trade politics	p. 53
Reciprocal Trade Agreements Act of 1934 and beyond	p. 54
Failure to ratify the International Trade Organization charter	p. 54
Trade Expansion Act and Trade Adjustment Assistance of 1962	p. 55
Enactment of fast track negotiating authority in 1974	p. 57
Strengthening congressional oversight in the 1980s	p. 58
Current provisions of fast track negotiating authority	p. 59
Ex ante congressional oversight procedures	p. 60
Ex post control mechanisms	p. 62
Link between parties and campaign contributions of interest groups	p. 62
Campaign contributions of farm organizations	p. 64
Campaign contributions of commodity producer groups	p. 65
US agricultural subsidies and international trade	p. 67
US veto players 1999-2006	p. 70
Conclusion	p. 70
EU Trade Politics	p. 73
Introduction	p. 73
Institutional structure of the EU political system	p. 75
Evolution of EU trade politics	p. 78
Delegation of power and control mechanisms	p. 79
Ex ante control mechanisms: the negotiating mandate	p. 80
Control mechanisms at locum: the 133 Committee	p. 81
Ex post control: voluntary and involuntary defection	p. 82
Actors' positions on agricultural trade liberalization	p. 83
Member states	p. 83
European Commission	p. 85
Farmer and business groups	p. 86
Domestic-level institutions in France	p. 87
Structure of the executive	p. 87
Link between parties and farmer groups	p. 88
The Common Agricultural Policy and international trade	p. 90
Conclusion	p. 92
Brazilian Trade Politics	p. 94
Introduction	p. 94
Brazilian trade politics	p. 95
National economic development model 1930-45	p. 95
Trade politics under democratic governments 1946-64	p. 95
Protectionist industrialization model 1964-85	p. 96
Adoption of a more liberal trade policy after 1985	p. 97
Decision-making process in trade policy	p. 98
High party fragmentation	p. 99
Link between parties and interest groups	p. 102
Veto players in Brazil 1999-2006	p. 103
The Brazilian agricultural sector	p. 106
Conclusion	p. 106
Australian Trade Politics	p. 109
Introduction	p. 109
Australian trade politics	p. 110
Australia's trade dependence on Great Britain until 1956	p. 110
Trade policy of Liberal-Country governments 1956-72	p. 110
First tariff reductions of the Labor government 1972-5	p. 111
Increasing protection under Liberal-National governments 1975-83	p. 112
Multilateralism under Labor governments 1983-96	p. 113
Bilateralism under Liberal-National governments 1996-2007	p. 114
A 'Westminster-inspired' democracy	p. 115
Decision-making process in trade policy	p. 116
Link between parties and interest groups	p. 117
Veto players in Australia 1999-2006	p. 118
The Australian agricultural sector	p. 120
Conclusion	p. 120
Negotiating Trade Liberalization
Seattle Ministerial Conference 1999	p. 125
International-level negotiations	p. 125
Identification of issues and the initial negotiating positions of the actors	p. 125
Deep divisions and no time pressure to make concessions	p. 125
Domestic institutions	p. 128
United States	p. 128
Failure to renew fast track negotiating authority under a divided government	p. 128
Position of interest groups	p. 129
European Union	p. 130
1999 CAP reform and WTO negotiations	p. 130
European Commission's negotiating mandate	p. 131
Council-Commission relationship	p. 131
Position of interest groups	p. 132
Brazil	p. 133
Informal consultations in trade policy	p. 133
Parliamentary discussion on the Brazilian negotiating position	p. 133
Position of interest groups	p. 134
Australia	p. 135
Anti-globalization campaign of the One Nation Party	p. 135
Position of interest groups	p. 135
Conclusion	p. 136
Doha Ministerial Conference 2001	p. 139
International-level negotiations	p. 139
A first assessment of actors' negotiating positions	p. 139
Doha ministerial conference 9-14 November 2001	p. 141
Doha ministerial declaration on agriculture	p. 142
Time framework for the Doha round	p. 143
Domestic institutions	p. 143
United States	p. 143
Congressional negotiations on new trade and farm bills	p. 143
Major provisions of the 2002 Trade Promotion Authority bill	p. 146
Positions of major interest groups on the new trade bill	p. 147
European Union	p. 147
Council-Commission relationship	p. 147
Brazil	p. 148
Parliamentary discussion on trade liberalization	p. 148
Australia	p. 148
Establishment of the WTO Advisory Group	p. 148
Conclusion	p. 149
Cancun Ministerial Conference 2003	p. 152
International-level negotiations	p. 152
Presentation of detailed negotiating proposals	p. 152
The Harbinson text: trying to find a middle ground	p. 153
EU-US joint proposal and the emergence of the G-20	p. 155
Cancun ministerial meeting 10-14 September 2003	p. 157
Domestic institutions	p. 159
United States	p. 159
The 2002 farm bill: increasing domestic support	p. 159
Implications of the 2002 farm bill for WTO negotiations	p. 159
Congressional reaction to the G-20 coalition	p. 160
Position of major agricultural groups with respect to the G-20 demands	p. 160
European Union	p. 160
Modification of the Commission's negotiating mandate	p. 160
The 2003 CAP reform: decoupling direct payments from production	p. 161
Reaction of major agricultural groups to the CAP reform	p. 163
Implications of the CAP reform for WTO negotiations	p. 163
Brazil	p. 164
A new heterogeneous governing coalition	p. 164
Lula da Silva's trade policy	p. 165
Workers' Party position on trade liberalization	p. 165
Parliamentary discussion on the Brazilian negotiating position	p. 166
Divisions within the governing coalition on the G-20	p. 167
Australia	p. 167
Shift towards bilateral trade agreements	p. 167
Free trade agreement with the US	p. 168
Farmers' organizations position on the free trade agreement	p. 170
Conclusion	p. 170
Hong Kong Ministerial Conference 2005	p. 173
International-level negotiations	p. 173
US and EU initiatives to move negotiations forward	p. 173
The July 2004 framework for agriculture	p. 174
Informal meetings and impasse in negotiations	p. 176
Presentation of new detailed negotiating proposals	p. 176
Hong Kong ministerial conference 13-18 December 2005	p. 180
Settlement of new deadlines	p. 182
Domestic institutions	p. 182
United States	p. 182
Signature of the Central America Free Trade Agreement	p. 182
Congressional discussions on the US negotiating position	p. 183
Positions of farmer groups on the US negotiating position	p. 184
European Union	p. 186
Member states' reaction to the Lamy-Fischler initiative	p. 186
Nomination of a new European Commission	p. 186
Conflictual Council-Commission relationship	p. 187
Brazil	p. 188
Enlargement of the governing coalition	p. 188
Economic policy and corruption scandals	p. 189
Australia	p. 190
Reaction of farmer groups to the Hong Kong meeting	p. 190
Conclusion	p. 191
Geneva Informal Meeting 2006	p. 194
International-level negotiations	p. 194
New deadlines and the shadow of transatlantic trade disputes	p. 194
Six weeks of intensive negotiations without any breakthrough	p. 196
The Falconer draft text on hundreds of outstanding issues	p. 198
Rejection of the '20-20-20' formula and breakdown of negotiations	p. 199
Reaction of major players to the temporary suspension of negotiations	p. 200
Major players' best alternatives to a negotiated agreement	p. 201
Domestic institutions	p. 202
United States	p. 202
Congressional and farm groups' opposition to further concessions	p. 203
European Union	p. 203
Divisions within the Council on further concessions	p. 203
Moving towards bilateral and regional trade agreements	p. 204
Brazil	p. 204
Pressure from interest groups	p. 204
Australia	p. 205
Reaction from interest groups and the Labor Party	p. 205
Addendum: attempts to revive the Doha round after July 2006	p. 206
Conclusion	p. 207
Conclusion	p. 209
WTO negotiations so far	p. 209
Summary of results	p. 213
Time pressure and best alternatives to a negotiated agreement	p. 213
Executive-legislative relationship	p. 215
Number of veto players	p. 224
Link between parties and interest groups	p. 225
Limitations of the study and avenues for further research	p. 229
Notes	p. 231
References	p. 238
Index	p. 263
Table of Contents provided by Ingram. All Rights Reserved.

Negotiating Trade Liberalization at the WTO

Domestic Politics and Bargaining Dynamics

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