After more than a decade, the Doha round of global trade talks finally produced a deal. The package agreed in Bali on Saturday is significantly less ambitious than what the representatives who convened in Qatar in 2001 had in mind. Its symbolism, however, should not be understated. The hope is that this success will breathe new life into multilateral deals that have benefited the world economy since the 1947 General Agreement on Tariffs and Trade.
The approach behind the weekend’s accord is politically astute. With developing and rich countries at loggerheads over sensitive topics such as agricultural duties, the World Trade Organisation built around a package of “trade facilitation” measures that could be more smoothly agreed upon. Easing the flow of goods through borders will spur global trade, which has grown at a snail’s pace since the financial crisis. It will also boost global output by as much as $1tn, according to some estimates, with the largest gains accruing to emerging markets.
The breakthrough helps to restore the reputation of the WTO as a dealmaker. Never in its 18-year-old history had the Geneva-based body successfully negotiated an agreement among its 159 members. Another failure would have also weakened the WTO’s authority in its other role as an umpire of global trade disputes. This is essential for the enforcement of existing rules.