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Analytical Gains of Geopolitical Economy

Uneven and Combined Development in the Doha Stalemate


Mehdi Abbas
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UNEVEN AND COMBINED
DEVELOPMENT IN THE DOHA
STALEMATE

Mehdi Abbas
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ABSTRACT

This paper analyses the stalling of the Doha Development Agenda


(DDA) and its systemic and institutional consequences through a geopo-
litical economy approach that integrates the French school of interna-
tional economic relations and Régulation Theory. These approaches put
states and their economic roles at the fore, correcting dominant free
trade approaches to world trade. The paper also avoids monocausal
explanations for trade talk deadlocks and aims to provide a comprehen-
sive approach on the co-evolution of world trade patterns and its
institutions. In this approach, the DDA stalemate is traced to an institu-
tion-structure mismatch in how states articulate their accumulation
strategies and institutions (competition, state regulation, adhesion to
international regime) to the World Trade Organization (WTO) regime
occasioned by the emergence of new trade powers. This has given rise to
three distinct conflicts in how member states navigate between the main
parameters of the multilateral trading system (non-discrimination,
reciprocity and balance of power) and their national accumulation

Analytical Gains of Geopolitical Economy


Research in Political Economy, Volume 30B, 127 160
Copyright r 2016 by Emerald Group Publishing Limited
All rights of reproduction in any form reserved
ISSN: 0161-7230/doi:10.1108/S0161-72302015000030B005
127
128 MEHDI ABBAS

strategies: the erosion of non-discrimination and reciprocity; the failure


to build an operational compromise between development and ‘globaliza-
tion’, that is, between multilateral openness and new trade and power
balances; and the difficulty in reaching a compromise between historical
and emerging capitalisms. The outcome of these conflicts will determine
the institutional configuration of the post-Doha WTO agenda.
Keywords: Institution-structure mismatch; state preferences;
competitive multilateralism; special and differential treatment;
emerging economy; multilateral trade governance
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INTRODUCTION

The Doha Development Agenda (DDA) of the World Trade Organization


(WTO) was many things at once.1 The fourth WTO Ministerial Conference
from November 9 to 14, 2001, that launched it took place in the shadow
of the September 11, 2001, attacks and the international community put on
a show of consensus by highlighting the renewal and improvement of
North South relations as its key goals. Spurred on by Robert Zoellick, the
then executive connected the Trade Promotion Authority to issues of
United States security and world leadership. To Zoellick’s statement that
‘terrorism should be countered by trade’, the executive added that ‘the
international market economy of which trade and the WTO are vital
parts offers an antidote to this violent rejectionism’ of globalization and
‘by promoting the WTO’s agenda, especially a new negotiation to liberalize
global trade, these 142 nations can counter the revulsive destructionism of
terrorism’.2 Pascal Lamy, European negotiator at Doha and later Director
General of WTO (2005 2012) stated that ‘[…] the world is clearly search-
ing desperately, and even more of course since the tragic events of 11
September, for the good economic news that launching new negotiations
would bring’, adding that, ‘Particularly in the post-11 September environ-
ment, we need to use all the multilateral tools at our disposal if we are to
make real progress towards sustainable development’.3 The DDA was also
a response to the crisis in WTO legitimacy following the failure of the
Seattle Ministerial Conference in November December 1999. Finally, it
offered a way of connecting multilateral trade negotiations (MTN) to the
United Nations Millennium Development Goals.
Promoting development as a priority in trade negotiations meant
correcting the imbalances of the Uruguay Round Agreements (URA)
Uneven and Combined Development in the Doha Stalemate 129

(1986 1994), which penalized economies of the South and the DDA
marked a new departure. After decades during which development issues
disappeared from the agenda and international financial institutions
imposed their ‘stabilize, privatize and liberalize’ mantra, the DDA began
by trying to reinterpret the form, substance and objectives of WTO agree-
ments with regard to their relevance to the issue of development. But gra-
dually this effort reverted to focusing on market access and dismantling
non-tariff barriers (domestic support and subsidies) and led Winham
(2007) to conclude that DDA had a ‘contracting agenda’. The WTO’s ninth
ministerial conference (December 3 6, 2013) was presented as a success
because it was the first in almost 20 years that multilateral trade compro-
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mise had been reached. But, in fact, the ‘Bali Package’,4 which represented
no more than one-tenth of the original Doha deal, consolidated the ten-
dency to reduce development to an issue of market access.
The Doha round was to have concluded by January 2005. However,
MTN have been protracted, and several ministerial conferences since 2001
have ended in deadlock while in other states reached only partial agree-
ments often related to new member accession (20 accessions since 2001). In
July 2006, negotiations were temporarily suspended and broke down again
at the end of July 2008. More than 15 years after the DDA was launched,
it seems necessary to ask why it stalemated so badly.
We aim provide an answer that goes beyond existing explanations. One
is simply the large number of members. This reductionist view focuses
attention on issues internal to the WTO: its governance and decision-
making procedures. Merely making them more transparent and efficient
would, in this view, lead to progress.5 These ‘inward looking’ analyses
(Pauwelyn, 2008, p. 561) focus on the behaviour of countries, formal deci-
sion-making processes or the governance mechanisms of the WTO (Cottier
& Elsig, 2011; Hoeckman, 2012) and confine debate about DDA deadlocks
to issues of institutional design, technical management of the negotiations,
‘good’ governance of WTO or negotiators’ bargaining strategies
(Conceiçao-Heldt, 2006; Ehrlich, 2007; Odell, 2009).
We argue instead that the DDA stalemate hinges on production and dis-
tribution-related conflicts embedded in the geopolitical economy of today’s
multipolar capitalism and that trade relations lie at the core of its dialectic
of uneven and combined development (UCD) (Desai, 2013). We approach
capitalism as an ‘overall social fact’, to borrow Marcel Mauss’s apt expres-
sion, in which the totality of societies and their institutions are at play.
UCD as the dialectic of plurinational capitalist accumulation generates
productive and distributive contradictions that its most powerful agents,
130 MEHDI ABBAS

classes and states must address and regulate (Desai, 2015b). As the WTO is
one of the institutional frameworks of capitalism aiming at regulating its
national and international contradictions, the DDA stalemate appears as a
result of the ‘work of crisis’ (de Bernis, 1988b, pp. 101 105) generated by
the contradictions of UCD and their implications for the constitution of a
new international trade regulation.
Our approach is therefore more substantive than the ‘number’ or the
‘managerial-good governance’ theses that pay no attention to the accumu-
lation process and its regulation. We aim, instead, to provide an analytical
framework that puts the political and geopolitical economy of production
at the centre of the unfolding drama of the WTO. This work constitutes a
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first step in a renewed approach to international trade institutions, focusing


on both the ‘P’ and the ‘I’ in International Political Economy (IPE), and
paying more attention to the geopolitical and structural processes under-
pinning the political economy (Desai, 2013; van Apeldoorn, Bruff, &
Ryner, 2011). It concentrates on the articulation between these dynamics
and those of capitalist accumulation in framing state negotiating strategies.
Our analytical framework is drawn from the concepts and proble´matique
of the French school of international economic relations, particularly the
work of Perroux (1961, 1973, 1982), Byé (1965), Weiller (1965, 1989) and
the French Theory of Régulation (FTR).6 Both approaches see the nation
state as the ‘unite´ active’ (active unit) in IPE.7 Perroux and his followers,
Byé and Weiller, sought to build a structuralist alternative approach to
international economic relations in which international inequalities, the
dynamics of the ‘domination effect’ and relational asymmetries8 were
central. In line with classical political economy, they stressed production
rather than exchange and in line with UCD, productive conflicts rather
than some international economic equilibrium and ‘comparative advan-
tage’. Perroux’s thought is thus linked to geopolitical economy through
two of its key tents: UCD and the materiality of nations.
The FTR, in which states are also central, sees them as more than
economically interventionist: they secure social cohesion and underwrite
specific ‘accumulation strategies’ (Jessop, 1990),9 specific spatiotemporal
and institutional arrangements that help to consolidate an accumulation
regime within a given economic space (Jessop & Sum, 2006, p. 331).
Inserting FTR in geopolitical economy allows us to understand the multi-
lateral trading system (MTS) and its evolution in terms of confrontations
between state accumulation strategies and the complex economic interde-
pendencies produced by national and social contradictions in the global
accumulation process. FTR and geopolitical economy of capitalism also
Uneven and Combined Development in the Doha Stalemate 131

converge on two points. First, both approaches deny the neoclassical con-
ception of international economy as a-historical, a-political and a-social
framework. Secondly, the three key tenets of FTR’s grenoblois approach,
which focuses on the international economic dimension of regulation, are
directly related to the conceptual framework of geopolitical economy:
(i) the world economy is a hierarchy of national and plurinational accumu-
lation processes with their own specific modes of regulation and their own
crises, (ii) national modes of accumulation adhere to or are excluded from
international institutions and processes depending on their upward and
downward movement in the international economic hierarchy and (iii)
there are complementarities as well as conflicts among national modes of
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accumulation.
Approaching international trade relations through geopolitical econ-
omy, Perroux and FTR, it becomes clear that the Doha round stalemate is
about the confrontation of various national accumulation strategies in a
historical context witnessing a growing number of key actors able to set, or
at least influence, the ‘rules of the game’ within which all national econo-
mies are embedded. It is the manifestation of institutional inadequacy
between national accumulation strategies and the WTO regime’s mode of
societalization,10 that is, the hegemonic pattern of institutional integration
between national mode of growth (Jessop, 1997) and the way its regime
deals with international interdependencies and complementarities.
The paper is divided into four sections. Having presented the analytical
framework and the main hypotheses above, we go on to analyze the limits
of the WTO regime in relation to systemic shifts in the international econ-
omy. The section ‘Openness versus Development’ focuses on the ‘globaliza-
tion’ development issue. The Section ‘The Complex Task of Building
Compromise between Historical and Emerging Capitalisms’ is devoted to
the rise of new global trading nations and the implications for the MTS.
We conclude by outlining the main results.

AN ANALYTICAL FRAMEWORK FOR THE


GEOPOLITICAL ECONOMY OF TRADE RULES

The ‘conflits-coope´rations’ (cooperation and conflicts) (Perroux, 1961)


between unequal actors, with heterogeneous, sometimes even antagonistic
preferences, are a structural property of geopolitical economy. This is not
unlike Brenner (2001, 2006), who cites Marx’s argument about anarchic
132 MEHDI ABBAS

capitalist production, to consider international competition between produ-


cers (inter-capitalist competition) the main driving of the capitalist world’s
dynamics (Desai, 2013). Similarly, Radhika Desai invokes Marx’s comment
on Carey: even if, and it would have been a big if for Marx, social relations
in a capitalist society were characterized by harmony, it ‘… ends with the
most complete disharmony of these relations on the grandest terrain where
they appear, the world market, and in their grandest development, as
the relations of producing nations’ (Desai, 2013, p. 41, quoting Marx
1858/1973, pp. 886 887). She conceives of the dynamic of international
relations in capitalism as a complex dialectic of UCD in which ‘dominant
states seek to preserve existing uneven configurations of capitalist develop-
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ment which favour them, including through formal and informal imperial-
ism (…) [and] contender states (…) accelerate capitalist, and in some cases
such as the USSR, communist, development to contest imperial projects of
dominant states’ (Desai, 2013, p. 2).
Whether seen as conflits-coope´rations or UCD, these substantial rela-
tions of capitalist states and economies are key variables in the MTS and
the intersubjectivity of the collective actions of WTO member states (Cox,
1983, 1987) constitutes an integral part of it. After all, state strategies and
preferences do not only express the balance of power and prosperity.
Norms, ideas and institutions, social practices of actors as well as their
perceptions and projects are also important. So (re)production entails capi-
talist production itself and the conditions created to maintain and promote
the material and ideological hegemony of capitalism at a national and
global level.

Conceptualizing the Neoliberal International Accumulation Regime

Regulation theory developed a distinctive approach to domestic accumula-


tion, the conditions for its existence, its various forms, crisis and impact on
broader social relations and international economic interdependence. Its
concept of the ‘regime of accumulation’ refers to the ways in which the
social product is systematically distributed, the reproduction of the long-
term conditions for production in various sectors is guaranteed, and final
consumption is organized.
Another key Regulationist concept is the ‘mode of regulation’, the
institutional or structural forms, institutionalized compromises, laws, rules
and norms that support the accumulation regime securing compatibility
and effective articulation between the dynamics of the productive system
Uneven and Combined Development in the Doha Stalemate 133

and social demand, the distribution of income between wages and profits,
on the one hand, and consumption and investment, on the other hand.
Capitalism operates effectively when a system of mediation, or mode of
regulation, is set up to ensure that distortions and contradictions created
by competition and the accumulation of capital remain within limits
compatible with social cohesion and growth in each nation state. Five main
institutional forms shape accumulation regimes: the state, wage relations,
money, competition regime and the international regime. Among these
institutional forms, the state is the structural institutional form that secures
the overall complementarity of different institutional forms (Boyer, 1990;
Lordon, 2002). It performs three functions: guaranteeing economic and
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extra-economic preconditions for profitable operation of capital, securing


the economic and extra-economic conditions for reproducing labour power
and coordinating global flows with national labour markets and addressing
the resulting contradictions.11 This last function is assumed by the adhesion
to international regimes, which should not be confused with the concept of
international regimes developed by advocates of orthodox IPE.
According to Mistral (1986), an international regime in FTR consists
of three elements: a regime of accumulation serving as a model, a config-
uration of economic space and complementarity relations between
those spaces. Mistral therefore postulates the need for ‘solid institutional
frameworks capable of changing international differentiations into
stable principles of actions for private agents and into imperative rules of
cohesion for state intervention’ (Mistral, 1986, p. 170). These frameworks
are ‘structural forms of international regulation’, comprising norms, rules,
constraints and principles that channel and constrain national actions,
though they do not suppress national differences marked by uneven devel-
opment (Boyer, 1990; Palan, 1998).
Nation states adhere to international regimes depending on how produc-
tive power is distributed in the international economy and on international
societalization. Thus, internationally, the state is ‘a crucial instrument in
the organization of rival plurinational regimes in their inter-imperialist
struggle for economic resources and power’ (Byé & de Bernis, 1987,
pp. 915 924). Since ‘the processes of global restructuring are largely
embedded within state structures and institutions, politically contingent on
state policies and actions, and primarily about the reorganization of the
state’ (Alnasseri, Brand, Sablowski, & Winter, 2001, p. 186), this means
that, rather than anything like ‘globalization’, what ultimately determines
the character of world capitalism is how states manage the interplay
between the set of international institutions and their accumulation regime
134 MEHDI ABBAS

(Vidal, 2002). The precise nature of this interplay will still vary from coun-
try to country as the nation state remains the locus of social struggles.
Petit argues that one dominant structural form provides the core princi-
ple that organizes any accumulation regime (Petit, 1999, 2005). Boyer
(2000, p. 291) adds that the dominant institutional form must impose struc-
tural constraints on the configuration of the other institutional forms. The
neoliberal international accumulation regime is a particular socially con-
structed and historically specific institutional configuration of capitalism.
Calling it an international accumulation regime does not mean that it is a
stable regime that has succeeded Fordism. Rather, it is best understood as
constituting a series of international attempts by neoliberal powers to regu-
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late the ‘long crisis’ of Fordism on their terms (Desai, 2015a). Within the
neoliberal international accumulation regime, two institutional forms have
become dominant: competition and international regime. This new hierar-
chy of institutional forms has been driven and enabled by changes in the
institutional form of the State, which do not amount to a ‘retreat of the
state’ (Strange, 1996) but to the transformation of its intervention modal-
ities in ways that favour capital mobility and economic extraversion more
one-sidedly than before. In the absence of a ‘world state’, international
institutions are configured by the confrontation of state preferences in a
hierarchical world order. This confrontation is not a functionalist (global
governance theory), management-oriented (international regimes theory),
guided by a concern for economic efficiency (market globalization theory)
or yet directed by the will of a benevolent leader or imperial power (hege-
monic stability and empire theory). It is the outcome of interstate conflicts
over production and distribution inherent in capitalism and its regulation.
This is why we consider the evolution of the hierarchy of the institutional
forms as an issue of geopolitical economy.

The Geopolitical Economy of the WTO

Countries operate within a structured and institutionalized framework that


shapes the way the national economic space is integrated into the interna-
tional geopolitical economy. Far from being a set of rules aiming at redu-
cing transaction costs or improving economic efficiency of free markets, the
MTS is a structure dialectically produced by the contradictions of inter-
capitalist competition and dedicated to their regulation within limits
described by a given international balance of power.
Uneven and Combined Development in the Doha Stalemate 135

Thus, we interpret the process of trade negotiations as reflecting some of


the dynamics of UCD as dominant states seek to formalize the regulation
of the neoliberal international accumulation regime and contender states
seek to change them in order to improve their own positions in it (Abbas,
2013). In this process, there is always a mismatch between international
institutions and the accumulation structures of any set of countries. This
mismatch relates to the changing hierarchy of institutional forms that
governs interstate competition (competition, international regime, State)
and its articulation to the core parameters of the MTS.
Two different but interdependent structural changes have taken place
during the DDA. The first one is the new geography of wealth and power
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within geopolitical economy which started with China’s entry to the WTO
in 2001 followed by a re-equilibration favouring emerging economies. The
new geography of power is simultaneously the cause and consequence of a
new geography of wealth and a new international division of labour. The
relative position of the emerging economies in the world economy was rein-
forced by a second change: the recession following the financial crisis of
2007 2008, which lasts until today. These two changes have made the
MTS less asymmetrical than the Quadrilateral structure,12 which domi-
nated it throughout the neoliberal era, and have initiated a transition to
more pluralistic MTS.
Three keys parameters have been constitutive of the MTS since its origins
as an arena for settling matters among its members: non-discrimination
(most favoured nation clause, national treatment principle), reciprocity and
balance of power. The WTO remains, despite all the ‘globalization’ fanfare
about its supranational character in the 1990s, like its predecessor, the
GATT, a bargain- and member-driven organization. Therefore, asymme-
tries between the active units of the MTS and the pattern of conflict and
cooperation to which they give rise play a key role in the definition of the
form and substance of the trade regime and changes in it. Thus, the dead-
lock in the Doha round results from an ‘institution-structure’ mismatch,
one between the hierarchy of the institutional forms included in the
WTO Agreement (primacy of competition and non-discrimination in the
national international regime articulation as the structural dominant institu-
tional forms) and the new more multipolar structures of world geopolitical
economy.
As an interstate forum where states try to manage their trade conflicts,
the WTO and its multilateral trade policy processes are conflictual because
they are central to how national economies regulate themselves and, in
particular, to how they seek to externalize or internalize the consequences
136 MEHDI ABBAS

of capitalism’s contradictions, particularly overproduction (Desai, 2015c).


Any change in the international balance of power is more or less immedi-
ately transmitted to a bargain- and member-driven organization like the
WTO. Balance of power is the principle that organizes the actors’ societali-
zation regarding non-discrimination and the perceived equilibrium of the
reciprocity of concessions. Thus, recent changes in the balance of power
have led three critical conflicts to emerge at the WTO. Firstly, the ongoing
shift to a new power equilibrium has changed member states’ understand-
ing of non-discriminatory competitive trade openness as a way to manage
their productive interests and interdependencies. Secondly, the principle of
a multilateral trade policy founded on non-discriminatory treatment of
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Southern countries pits the established powers’ insistence on an open econ-


omy against that of the emerging powers on development. Lastly, these
two conflicts lead to a third, related to states’ changing perceptions of the
links inherited from URA between non-discrimination principles and reci-
procity: the conflict between historical and emerging capitalisms regarding
trade concessions and improving market access. We move now to a detailed
analysis of these three conflicts.

THE FAILURES OF COMPETITIVE


MULTILATERALISM
The DDA’s lack of progress can only be understood in relation to the
URA in which the non-discrimination principle corresponded to a specific
structure of the world economy. The URA was an attempt to build a com-
petitive multilateralism (see ‘The New Trade Regime’ below). Since that
has now changed quite dramatically, the WTO’s multilateralism is harder
to operationalize (see ‘The DDA Stalemate: Contradictions of Competitive
Multilateralism’ below).

The New Trade Regime

The URA created a new international organization, which was meant to


perpetuate and extend the neoliberal international regime of accumulation
into the indefinite future and entrench it in the domestic regulatory struc-
tures of all national capitalisms. This assessment stems from three sets of
interrelated factors.
Uneven and Combined Development in the Doha Stalemate 137

Firstly, WTO agreements do not only cover border protections, they


also involved beyond-the-borders and regulatory measures, and addressed
‘third-generation trade barriers’ (Cottier, 2006).13 Multilateralism was there-
fore transformed from negotiations on tariff concessions to negotiations on
domestic policy and internal regulatory issues (competition policies, invest-
ment restrictions, government purchasing, industrial standards, etc.). These
novel features constituted a big shift in the functional focus of MTS, and
they were, in turn, reinforced by rising concerns about the ‘“Trade and …”
agenda’: trade and intellectual property, trade and investment, trade and
competition, trade and environment, trade and technical standards and, in
the future, trade and climate change. Because instrumentality and objec-
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tives are interlinked and can reinforce each other over time (Barton,
Goldstein, Josling, & Steinberg, 2006), WTO trade rules were effectively
rules of domestic regulation (import restrictions for public health, plant
and animal health, skills qualifications for migrants, right of establishment
for foreign firms, labour regulations).
Secondly, WTO agreements contain provisions designed to enhance the
‘international contestability of markets’ (Baldwin, Nelson, & Richardson,
1992; Graham & Lawrence, 1996). Market contestability is now concerned
with a gamut of non-trade-regulatory policies whether relating to the
environment, competition policies and standards for the protection of intel-
lectual property or qualitative barriers to trade (Krugman, 1997; Subedi,
2006). Such an MTS aims to liberalize and establish common market stan-
dards ostensibly designed to ‘level the playing field’ but actually tilting it in
favour of transnational corporations and global financial actors.
Thirdly, the WTO agenda has thus not sought to achieve ‘greater har-
monization and mutual recognition of members’ regulatory system’
(Footer, 2006), it now includes a new set of rules aimed at ensuring that
governments enhance the contestability of their national markets14 requir-
ing changes to ‘the institutional infrastructure of the economy’ (Ostry, 2005).
WTO obligations for services, intellectual property, technical and sanitary
standards require that countries bring their regulations in line with com-
mon standards, which effectively means standards that are in place in
developed countries.
This set of transformations was supposed to amount to ‘the constitution
of a single global economy’ (R. Ruggiero, the first WTO Director General,
1995 1999), one in which competition and competitive and non-
discriminating adhesion to the international regime are the two dominant
principles. This URA legacy of competitive multilateralism is built on the
central hypothesis that nation state capacity, autonomy, authority and
138 MEHDI ABBAS

normative power has to be constrained by the structural power of markets.


The primacy of global market (competition and non-discriminatory adher-
ence to international regime institutional forms) denies any pluralistic insti-
tutional configuration among nation states. The DDA’s deadlock is the
outcome of the geopolitical economy of the conflict between these princi-
ples and the structural changes in world economy since 2001.

The DDA Stalemate: Contradictions of Competitive Multilateralism

The dominant interpretation of the dysfunctions of the WTO regime are


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‘institutional inertia’ (Wilkinson, 2001) or even ‘uncertainty within the


negotiation process’ (Narlikar & Van Houten, 2010). However, these diag-
noses have to be understood as a concrete and contextualized expression of
UCD: the contradictions between the WTO’s competitive multilateralism
and national accumulation strategies, particularly those of emerging
economies.
The URA pursued neoliberal aims by extending non-discriminatory
market access to questions of competition, foreign direct investment, gov-
ernment procurement policy and trade facilitation (the so-called Singapore
issues). To this, a drive to reduce distortions was also added in WTO
jargon, reducing public intervention in TRIMS, TRIPS and safeguards.
Development, in this framework, was chiefly a matter of greater market
access for trade in industry and services for developing (DCs) and less
developed countries (LDCs), and in return, they were supposed to liberalize
agricultural markets, internally and externally. This approach to non-
discriminatory market access would run into two limitations.
Firstly, the shift in the general distribution of power away from indus-
trial countries has eroded non-discrimination and reciprocity. This explains
the stagnation of multilateral negotiations and the rise of preferential and
bilateral trade agreements. It can no longer be argued that competitive mul-
tilateral trade liberalization is a sustainable response to the challenges of
the new geopolitical economy of multipolarity let alone critical new issues
such as food security, climate change, labour security and livelihood and
sustainability concerns. This brings us to the second limitation: core capi-
talist states have not anticipated the complexity of a ‘development’ round
with major productive implications for their own accumulation strategies
and, moreover, for those of rising powers (Brazil, China, India, Russia).
The opening national space to competition through internationally
developed regulatory procedures means that whole areas of public policy
Uneven and Combined Development in the Doha Stalemate 139

are or could be regulated without any allowance for the social, economic
and institutional diversities of nation states. Moreover, the WTO dispute
settlement mechanism permanently exposes countries to the risk of com-
plaints and it gives WTO the power to select and validate productive and
regulatory standards taking into account only their effects in enhancing
competition. The WTO jurisdiction over state’s regulatory actions restricts
their discretionary power in organizing and framing policies which pre-
viously fell within their sovereignty (sanitary and phytosanitary policies,
research and development policies, industrial subsidies, environmental
policy, land use, industries sectoral organization).
This is why the neoliberal international accumulation regime that struc-
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tures the URA is no longer sustainable. Whereas the WTO is still based on
the idea that states engage in negotiations to expand and deepen trade lib-
eralization through reciprocal exchange of market access concessions
according to Member state ‘comparative advantages’ (Hoeckman &
Kostecki, 2009), the UCD dynamic mirrors the conflictual trade relations
between unequal and rival nation states that are a far cry from the fallacy
of comparative advantage, markets getting prices right and general equili-
brium of the neoclassical international economy.
The negotiations on agriculture illustrate this situation. In 2001, the
Doha mandate sought to solve the problem of overproduction and falling
prices by substantial reductions of domestic support subsidies, elimination
of export subsidies and by enhancing competition among DCs for market
access. Reacting to this EU US agenda, the G20 coalition of DCs pro-
posed to enhance the development dimension of the round by including
protection of the rural poor, demanding the liberalization of US and EU
agricultural markets, linking industrial and agricultural goods negotiations
and by differentiating between developed and developing market liberaliza-
tion. In the aftermath of the 2007 2008 food crisis, some developing and
net-food importing countries, led by India, called for another reconsidera-
tion, which put emphasized food security, production diversification and
special safeguard mechanisms to protect uncompetitive agroproducers and
the poor rural. This involved major revaluations of state intervention
and market liberalization. The failure of the July 2014 WTO summit was
precisely related to the issue of agricultural stocks for food security.
India only lifted its veto after a bilateral agreement with the United States
recognizing its strategic food security policy was reached in early December
2014.
Some attribute the failure of WTO to its state-centricity which, they
argue, runs counter to the increasing role of international production
140 MEHDI ABBAS

networks, characterized by cross-border unbundling of production stages


over recent decades (Orefice & Rocha, 2011). Baldwin (2014) thus proposes
a ‘WTO 2.0’. This is, however, mistaken. Not only was a full-blown revi-
sion of this sort never possible, any WTO 2.0 would be only part of the
solution which would require a Bretton Woods 2.0, which would also
address international coordination in macroeconomic policy among the
major trade deficit and surplus economies. But the even greater difficulty
with this type of analysis is that it imagines an International Economy
without nations and a State submissive to neoliberal market rules or acting
only as a market corrector (Bagwell & Staiger, 1999). Built on the classical
but fallacious separation of politics and economics (State and markets or
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public and private), it ignores that the market-based capitalist system has
always been dependent on states actively to create and maintain the condi-
tion for its reproduction. Without state-sponsored regulation, capitalism
could not exist (Besson & Bell, 2005; Desai, 2013; Heilbroner, 1985;
Perroux, 1961).
Precisely, because DDA impacts state accumulation strategies and
involves North South relations, the second step in analyzing the institution-
structure mismatch relates to the failure of building an operational compro-
mise between development and trade openness.

OPENNESS VERSUS DEVELOPMENT

This section deals with the DDA’s deadlock resulting from the impossibil-
ity of operationalizing two inherent elements of the MTS: the new balance
of power, that is, the differentiation between economic trajectory of coun-
tries in the South, and non-discrimination or multilateral competitive trade
openness. This concerns small- and medium-sized developing economies,
those that do not have the ‘policy space’15 to build proactive national accu-
mulation strategy (see ‘Uneven Distribution Of Trade Gains within the
South’). This has prompted DCs to take an interest in renegotiating WTO
Special and Differential Treatment (S&DT) provisions with a view ‘to
strengthening them and making them more precise, effective and opera-
tional’ (Doha Ministerial Declaration, para. 44).16 However, defining a new
policy space for development is a conflictual issue opposing not only
North South but also emerging and non-emerging DCs as we saw in the
failure of the Cancun (2003) and Geneva (2007) ministerial conferences (see
‘Reframing S&DT in the Era of Emerging Economies’). These repeated
Uneven and Combined Development in the Doha Stalemate 141

intra-South conflicts prompted emerging DCs to move away from S&DT


negotiations to focus on substantive issues such as agricultural and indus-
trial products market access and TRIPs.

Uneven Distribution of Trade Gains within the South

The DDA was launched with the specific aim of improving S&DT, which is
the way the WTO regime organizes North South relations, that is, the
confrontation of national institutional forms. The new focus on ‘develop-
ment’ means that states have decided to correct the negative impacts of the
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strengthening of unevenness which characterized international economic


relations since the imposition of IMF’s structural adjustment programme
and at the beginning of the 1980s. This implies, however, a renegotiation of
the privatization liberalization deregulation mantra of the Washington
consensus consolidated in the WTO and was easier said than done thanks
to the double birth defect of the DDA. Not only did it fail to clearly estab-
lish the ‘development’ purpose of the round, it also lacked clear and agreed
criteria for determining whether or not an agreement was ‘good’ for devel-
opment. That means that WTO member states failed to achieve a new com-
promise different from the non-discriminating opening and export-led
growth, which held the international division of labour in place. This obser-
vation hinges on two arguments.
Firstly, with some countries standing to gain more than others in the
so-called development round, there were few incentives to engage in a com-
promise. This is what happened during the Cancun (2003) and Hong Kong
(2005) ministerial conferences. Starting from initial projections that esti-
mated that the negotiations would increase global income by $520 billion,
the World Bank revised its estimates to show that the gain would be $287
billion, of which only $90 billion would go to DCs (Hertel & Winters,
2005). In 2005, the Bank produced a new estimate of the ‘benefits’ of these
negotiations amounting to $100 billion, with only $18 billion going to DCs
(Anderson, Martin, & Van der Mensbruggle, 2006). Other studies indicate
that expected trade gains amount to $99 billion, while admitting that their
calculations do not take into account the costs of liberalization and the sig-
nificant investments that will be needed in DCs for these gains to be rea-
lized (Finger, 2009; Minor & Tsigas, 2008). Decreux and Fontagné (2009)
stress that the development aid decided in Hong Kong would yield a poten-
tial gain of $100 billion. But this result is also conditioned by substantial
investment in capacity building not accounted for by the DDA. Moreover,
142 MEHDI ABBAS

the countries that would benefit most from an agreement were Argentina,
Brazil, China, India, Mexico, Thailand, Turkey and Vietnam. As much as
90% of the gain from agro-liberalization would benefit just Brazil, Mexico,
Thailand and the Philippines (Polski, 2006). The weakness and uneven dis-
tribution of trade gains illustrate the contradiction between, on the one
hand, the negotiating parameters focusing on liberalization, market access
and reduction of state regulation (agriculture and trade facilitation issues),
and, on the other hand, the institutional forms likely to allow DCs and
LDCs to enhance their productive capacities.
Secondly, since the Hong Kong ministerial conference of December
2005, the DDA has entered an ‘era of diminishing returns’ (Abbas, 2005)
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with its transformation to a traditional trade negotiation centring on mar-


ket access issues. The negotiators have failed to operationalize one of the
core concepts enshrined in the Doha Declaration: less than full reciprocity.
Since the 2005 ministerial, the proposals by developed countries on liberali-
zation of manufacturing and services in DCs have been seen as shrinking
the policy space for effective development policy (Gallagher, 2013; Mehta,
Kaushik, & Kaukab, 2012). The ‘Bali Package’ confirmed this, with its
emphasis on three topics: (i) a political commitment to reduce both export
subsidies in agriculture and obstacles to trade when agricultural products
are imported through quotas, (ii) trade facilitation which relates to cutting
red tape and speeding up port clearances and (iii) duty-free quota-free
access for LDC exports and simplified preferential rules of origin in import-
ing countries the so-called ‘development issue’. But what catches the eye
is that it refocuses S&DT on LDC at the expense of DCs a category
never clearly defined in WTO agreements.

Reframing S&DT in the Era of Emerging Economies

The obvious conclusion of the negotiation deadlock is that the DDA did
not live up to its promise of development in addressing the asymmetries
inherited from URA. Four issues organized ‘development’ in the original
DDA: (i) S&DT: the DDA has added nothing to the discussion of the
1980s; (ii) implementation: DDA attention to implementation has declined;
(iii) aid for trade: the Aid for trade Task force concluded that the WTO
would only have a bureaucratic role; (iv) trade facilitation: the issue has
been blocked because it attempts to place a legal obligation on developed
countries to assist their developing counterparts.
Uneven and Combined Development in the Doha Stalemate 143

This shows the failure of ‘globalization’ as a process of market integra-


tion designed to maximize market efficiency in the interest of development
and DCs. This is partly due to the fact that advanced industrialized econo-
mies, which constituted the motor of ‘globalization’, are unable to integrate
DCs and LDCs in the structural transformation process. Turning away
from a ‘globalization-development’ agenda, from 2003 onwards, with the
North abandoning the Singapore issues at the WTO Cancun meeting, was
a step in the right direction, but it was nevertheless not enough to reorga-
nize institutional forms. Furthermore, scepticism regarding free, competi-
tive multilateral trade feeds on the success enjoyed by Asia’s Newly
Industrialized Countries (NICs), China and India, which is not due to their
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applying of S&DT principles.


This explains that DCs and LDCs need improvement of the S&DT
regime. But instead of substantial changes, core capitalist countries
oriented the issue toward reframing the country categories. They argued
that the country-specific transitional periods for implementing the URA
were no longer warranted because the DCs category was no longer homo-
geneous.17 However, merely redefining these categories is unlikely to mod-
ify DCs’ and LDCs’ marginalized status without a profound modification
of the liberal modalities of adhesion to the international regime and state
intervention. The fact is that national accumulation strategies of emerging
countries lead to structural differentiation between developing economies.
This leads to the refusal of WTO dealmakers to open their own market
indiscriminately and without reciprocity to DC exports. By doing so, his-
torical capitalisms seek to reinforce a given configuration of unevenness as
the emerging capitalisms undertake combined development to undermine
it. This result of the UCD explains that the Trade Facilitation Agreement,
which is part of the Doha single undertaking and contemplates a novel way
to approach S&DT. Commitments and their implementation are to be
related to implementation capacities of DCs and LDCs, including their
ability to undertake investments in the required trade facilitation infra-
structure. There is no exemption ex ante implementation is related to
capacity where capacity is lacking, assistance is to be provided.
Countries have to notify the WTO about their schedule of implementation
and also provide information on their specific needs and the technical and
financial assistance required within a given period of time. Linking imple-
mentation to the provision of assistance where needed addresses DCs’
concerns about adjustment costs and lack of capacity to adopt rules and
procedures that are norm elsewhere, provided the adoption of these rules
are to their benefit.
144 MEHDI ABBAS

Since trade rules are critical in defining the policy space for development
available to DCs and LDCs and constrain their accumulation strategies, a
development-led negotiation means building a new coherence between
competition, state regulation and the international regime aiming, not at
enhancing non-discriminatory openness, but at increasing DCs’ capacity
for formulating and implementing development policies. History teaches us
that development is more complex than either the good governance of
MTN or greater participation in WTO activities.
This brings us to the third major argument of institution-structure
mismatch, namely the conflict in establishing an operational compromise
between developed and emerging capitalisms.
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THE COMPLEX TASK OF BUILDING COMPROMISE


BETWEEN HISTORICAL AND EMERGING
CAPITALISMS

With the rise of the emerging economies, the MTS is less asymmetrical now
(Figs. 1 and 2). The present section hinges on emerging capitalist economies
(China, Brazil, India, Russia, Asian NICs) and their relation to the histori-
cally established capitalisms. A less asymmetrical trading system involves
reconsidering the way member states build the relation between the
exchange of trade concessions (reciprocity) and the ongoing shift in the
balance of power (see ‘Reconsidering the Reciprocity-Leadership Nexus’).
Why is a reappraisal of this sort necessary? Because state-led capitalism in
emerging countries contributes to reorganize both interstate competition
and adhesion to the neoliberal trade regime. Thus, the hierarchy and
content of our three main institutional forms (competition, State regulation
and international regime) are subject to reorganization (see ‘The
Multilateral Trading System at a Crossroads: Coalition Model or
Hegemonic Transition?’).

Reconsidering the Reciprocity-Leadership Nexus

To start with, it is a complex task to achieve a compromise between histori-


cal capitalist economies and emerging ones precisely because the nature of
trade agreements has evolved over time. As we showed in the second sec-
tion, regulating property rights, financial services, state-owned enterprises
Uneven and Combined Development in the Doha Stalemate
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Fig. 1. Share of selected economies in world GDP at purchasing power parity (2000 2012, percentage).

145
146 MEHDI ABBAS

20,000
Developed G20 developing LDCs Other developing 17,881 17,930
18,000
15,806
16,000 14,897

14,000
12,242 9,542 9,290

12,000
10,236 9,059
8,178
10,000
7,024
8,000
6,279 6,296
6,000 5,022 4,767 4,931

3,744
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3,843
4,000 4,212
2,948
3,593 2,156
2,000 1,018 3,368 3,504
678 2,836 2,142 2,713
1,701
727 1,013
0
1995

2000

2005

2008

2009

2010

2011

2012
Fig. 2. Evolution of world merchandise exports by level of development
(1995 2012, US$ billion). Source: WTO (2014).

and technical standards gives rise to more disputes than opening markets
to goods. The MTS is affected by the emergence of new productive speciali-
zations the new international division of labour and by the tipping of
the global economic centre of gravity towards Asian economies, or in a
broader perspective, toward the Pacific economy. The current round is
witnessing the dwindling importance of the Atlantic economy and its corol-
lary the transatlantic compromise as the driving force in trade agree-
ments.18 The ‘natural order’ of the GATT has expired. The DDA bid
farewell to a certain configuration of power in the world economy and a
certain way of doing business in trade negotiations. This is the result of the
dynamics of combined development, which leads to a new hierarchy of
industrial accumulation.
The emergence of new trading powers is driving a twin process trans-
forming the content and hierarchy of institutional forms. The content refers
to the centrality of states in emerging economies organizing their internal
regulation and adhesion to the international regime with a view to increas-
ing production capacity. The form refers to the resulting conflict with com-
petitive non-discriminatory market access as the structural institutional
form of WTO agreements.
This is why the rise of new powers challenges the MTS dynamic in
three ways. Firstly, it questions the three keys parameters of WTO regime
Uneven and Combined Development in the Doha Stalemate 147

(non-discrimination, reciprocity and balance of power). Over and above


the fact that it throws doubt on its leadership, the reciprocity principle loses
its relevance, as we have seen in the two preceding sections. It is no longer
a principle for organizing North South economic relations in a context in
which countries lay claim to the status of DCs, while possessing trading
capacities that make them able to compete with some historical capitalisms’
exports. The latter are no longer prepared to accept compromises based on
differentiated treatment for the benefit of emerging economies.19 Secondly,
it questions the competitive multilateralism hatched by the URA. The
state-centred or Westphalian-driven reading of the WTO regime is possible
because emerging economics typically feature national development strate-
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gies combining state intervention and commercial expansion, extraversion


and non-tariff barriers. Their status as rising powers able to influence
geo-institutional balances is allowed by WTO institutional proprieties. This
is why the Global South Brazil, China, India, South Africa see the
WTO as a relevant forum for the expression of their trading preferences
(Yusuf, Nabeshima, & Martin, 2007). Finally, doubt has been cast on the
relevance of the link between trade and development enshrined in the
DDA. To build on their success, these countries have moved away both
from the old models of import substitution and from the precepts of
the Washington consensus, while at the same time taking advantage of the
interventionist approach advocated by the former and the latter’s spirit of
competitive integration in the global economy.
The way the DDA has evolved shows that emerging capitalisms act firstly
as capitalisms: their strategies within the MTS are driven by the rise of their
export-oriented sectors. Certainly, their interests are being packaged and
advanced through a discourse of policy space for development, equity and
the political economy of the North South divide (Hopewell, 2015). But this
discourse is closely associated with a state-centred vision of multilateral
regulation: it does not amount to a common solidarities position.

The MTS at a Crossroads: Coalition Model or Hegemonic Transition?

The conflicts between historical and emerging capitalisms throw light on


the institution-structure mismatch in two principal ways.
Firstly the mastery of ‘insider activism’ (Kahler, 2013, p. 712) demon-
strated by emerging economies means that it is no longer possible for a
small club of established powers to control decision making in the MTS.
Combined development produces geopolitical multiplicity. The DDA
148 MEHDI ABBAS

marks WTO’s transition from a club to a coalition model in which coali-


tions, which change in their composition depending on the issue, are now
required for any agreement and, as they come to these agreements, they
change the institutional and structural dynamics of the MTS. The WTO
Secretariat lists 26 coalitions, only 2 are composed exclusively of developed
countries and 16 of only DCs. This is quite a contrast with the six coali-
tions of the URA.20 The DDA’s more numerous coalitions are a manifesta-
tion of the new geo-institutional balance and of the ability of like-minded
DCs to define their common interests and act collectively in pursuing
them. The DDA’s evolution from the original six coalitions to the present
plethora including the NAMA-11, the G20, the G99, the G33 or
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LDCs represents a major discontinuity in the patterns of power and con-


flict (Andersson, 2012; Bernal, 2011; Chakrabotry, Banerjee, & Sengupta,
2008) giving rise not only to unprecedented forms of North South conflict
but also South South trade conflicts (Bown, 2013). Among the countries
frequently engaged in disputes in the WTO between 1995 and 2014, we can
now number, in addition to the developed countries (the United States, the
European Union, Canada and Japan) Argentina, Brazil, China, India,
Mexico and South Korea. The latter are targets of 55 disputes launched by
other DCs and have launched 120 disputes as complainants.
While it is true that the coalitions phenomenon raises the cost of collec-
tive action as credibility and coherence become harder to achieve, risk of
coalition collapse is greater and distributive issues are more complex and
make integrative bargains more difficult (Narlikar & Van Houten, 2010),
this technical points needs to be completed by a geopolitical economic one.
It is not coalitions per se that explain the stalemate, but the combined
development pursued by DCs: not only is it in direct opposition to the pres-
sures for openness generated by the established powers through which they
seek to maintain the configuration of unevenness that privileges them, but
it also puts pressure on the accumulation strategies of the established
powers. Historical capitalisms react to this by attempting to co-opt the ‘big
DCs’ Brazil, China, India21 so as to arrive at a successor to the
Quadrilateral. While this strategy gave rise to the FIP (Five Interested
Parties: United States, European Union, Australia, Brazil and India) and
the G7 (Australia, Brazil, China, European Union, India, Japan and
United States), the DDA is far from having a country or group of countries
able to mobilize participants, determine rules, fix negotiation modalities
and above all, assume the operating costs of the WTO’s competitive multi-
lateralism as the Quadrilateral once did. No single member state or coali-
tion can shoulder the cost of leadership.
Uneven and Combined Development in the Doha Stalemate 149

The emerging economies’ stance is a particularly interesting one. They


are endorsing and not contesting the WTO regime, but only as long as
it serves their accumulation strategy. Neither counter-hegemonic powers
nor upholders of the status quo, they realize that their economic success
is owed at least partly to their ability to take advantage of the WTO
regime. They also realize that the mercantilist WTO regime22 facilitates
their national ‘exportist accumulation regime’ (Jessop & Sum, 2006,
pp. 162 165). So they have adopted a strategy of change within the regime
rather than rejecting it altogether, giving rise to a transition toward a more
pluralistic and fragmented MTS, rather than one to the ‘hegemony’ of
another power or set of powers (Abbas, 2015).
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The second way in which conflicts between the established and emerging
powers is reflected in the evolution and stalemate of the DDA is seen in con-
flicts over different views on the centrality and character of states’ economic
roles. There is no procedural solution capable of resolving the substantive
differences over such heterogeneous preferences. Within the WTO, consen-
sus building is the historical way to reconcile divergent preferences.
However imperfect it may be, the principle of consensus makes allowance
for the preferences of all the MTS players. Those who believe that the prin-
ciple of consensus no longer works only because of the ‘won’t do countries’
or ‘paralyzer countries’ (Bello, 2005; Taylor, 2007) misunderstand the
causes of deadlock. The deadlock has been caused rather due to the ‘single
undertaking’, which is not itself a core principle of the regime but only a
preference of the established powers. It is a throwback to the one-size-fits-all
approach, which characterized the URA. And it will have to go. State-led
combined development in emerging economies is here to stay. Allowance
for the heterogeneity of institutional forms between leading member states,
now including both established and emerging economies, seems to be driving
multilateralism towards a yet-to-be-defined form of minilateralism or plurila-
teralism. Deciding when to use which could depend on the topic of negotia-
tions. With plurilateralism now recognized under the WTO regime as in
agreements on trade in civil aircraft, on information technology, on govern-
ment procurement or the forthcoming TISA, the WTO could become a
‘club-of-clubs’, with many plurilateral deals ultimately subsumed by it
(Lawrence, 2006). This converges with Pauwelyn’s thesis (2008), which sees
the WTO as a ‘stabilizer’ and ‘clearing house’ where countries can notify,
bind or secure the market openings that they enacted unilaterally, plurilater-
ally or even regionally. If the WTO conforms to these expectations it will
have come a long way indeed from its beginnings as an attempt by estab-
lished powers to impose a neoliberal regime on emerging and other DCs.
150 MEHDI ABBAS

But this option is still hypothetical. For the time being, ever since the fail-
ure of the 2008 ministerial conference, the number thesis and its paralyzer-
country corollary have enabled the historical capitalisms primarily the
United States to make progress with their agenda of mega-regional
agreements (the Trans-Pacific Partnership, the Trans-Atlantic Trade
and Investment Partnership, the Regional Comprehensive Economic
Partnership, the EU-Japan Free Trade Agreement), which aim to bypass
the more problematic emerging economies, particularly China. Through
these agreements, the historical capitalist countries are to open markets
and establish common business practices and harmonize the competitive
regulation of individual markets within the same sort of overarching frame-
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work which the WTO was originally expected to impose (Evenett & Meier,
2008). The negotiation of these WTO + or WTO-extra agreements also put
pressure on the DCs and LDCs’ to conclude the Bali package. Let us not
lose sight of the fact that as long as the DDA is not concluded, the URA
rule the MTS. This is why the ‘transatlantic intransigence’ (Young, 2010,
p. 123) and not the emerging countries or LDCs’ strategic behaviour
explain the DDA stalemate.

CONCLUSION

This essay is a modest contribution to the larger enterprise of exploring


conceptual bridges between three schools of political economy: François
Perroux’s approach of international economic relations, the FTR and
geopolitical economy. It aims to construct a comprehensive problematic of
the political economy of the MTS.
It sought, firstly, to analyze the geopolitical economy of the DDA stale-
mate as a key institutional manifestation of a transformation, still under
way and also a ‘work of crisis’, in the world order and its balance of power.
The geopolitical economy of multipolarity will generate a less asymmetrical
MTS. We use the expression of an institution-structure mismatch to
describe the effects of UCD’s dynamics on the WTO institutional frame-
work and generate a comprehensive, multicausal analysis of the DDA stale-
mate which yields three results.
The first one shows that the DDA stalemate is not due to a problem
with WTO governance but to a geopolitical economy of the confrontation
of states’ accumulation strategies. Precisely because of the acuity of
this confrontation with the historical capitalisms aiming to impose
Uneven and Combined Development in the Doha Stalemate 151

a neoliberal regime on the rest of the world and the contender nations con-
testing precisely that as the only way to continue their growth what pur-
port to be talks on trade are in fact negotiations on national production
models. Our analysis of the WTO shows how geopolitical rivalities of the
21st century manifest themselves institutionally and could be a useful basis
for future application of UCD analysis.
The second result concerns characterization of the political economy of
conflict. It hinges on the content and hierarchy of three institutional forms
on which the DDA has a retroactive impact: State models, competition
regimes and adhesion to the international regime. The deadlock gripping
the DDA is due to the mismatch between the changes in the world order in
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this century and the institutional forms inherited from the last. This institu-
tion-structure mismatch is apparent in three groups of conflicts: within
WTO competition multilateralism, in the development trade openness
nexus and between historical and emerging capitalisms. Interaction between
these three conflicts and their relations with the principles of the multilat-
eral trading regime constitutes the political economy of the multipolar
trading system.
The third result is to refute binary analysis which puts economic effi-
ciency and rationality against politics, state against markets and North
against South. We have highlighted the problems of institutional consis-
tency and complementarity confronting states at a time of structural
changes in the neoliberal accumulation regime. What is at stake is no
longer a matter of more globalization or less state, greater market access or
more development; what is needed is to build institutional consistency cap-
able of solving the productive and distributive contradictions between
nation states at the current stage in the development of capitalism.
As a project for renovating North South relations and for correcting
asymmetries inherited from the URA, the DDA is over. For diplomatic
reasons, sooner or later, these negotiations will be concluded and Doha
package will be ratified. Does this mean that the contradictions revealed by
the DDA will be removed? Will the future MTS be able to deal with the
diverse and contingent models of capitalism that operate in the new geopo-
litical economy? Only the praxis of states can provide an answer to the
question of whether the MTS can cope with normative pluralism, heteroge-
neity and the rebalancing of power at work within it. The trading system
will remain hierarchical and asymmetric due to the inequality of its active
units and its institutional path influenced by conflicts over production and
distribution. In the forthcoming stage of IPE, the issue of social and ecolo-
gical embeddedness is at stake. This, again, directly refers to the question
152 MEHDI ABBAS

of institutional forms, hierarchy and complementarity. But now and


increasingly so for the future, the diffusion of wealth, global gentrification
and demographic growth all cast doubt on the viability of historical capit-
alisms’ insistence in openness.

NOTES

1. See the Doha WTO Ministerial Declaration available at: http://www.wto.


org/english/thewto_e/minist_e/min01_e/mindecl_e.htm
2. See Countering Terrorism with Trade (September 20, 2001), http://www.
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washingtonpost.com and The WTO and New Global Trade Negotiations: What’s
at Stake? (October 30, 2001), http://www.ustr.gov
3. See Plenary speech to the 4th Ministerial meeting, Doha, November 10, 2001.
4. The Bali Package included the Trade Facilitation Agreement along with a set
of decisions relating to DCs (on cotton, preferential rules for LDCs, monitoring
mechanism on special and differential treatment) and agriculture (relating to public
stockholding for food security purpose and export competition).
5. See Krueger (1998), Porter (2001), WTO (2004), Cass (2005), Petersmann
(2005), Warwick Commission (2007), Steger (2010).
6. For an introduction to the methods, concepts and analytical tools of the
FTR, see Boyer (1990, 2000) and Boyer and Saillard (2002). For a synthetic presen-
tation of the FTR, see Jessop (2001) and Jessop and Sum (2006).
7. For François Perroux unite´s actives especially the nations were groups
pursuing internal and external aims, with access to the relevant resources and
founded on a collective identity fashioned by history. They could be state, firms or
NGOs. We focus in this contribution on the nation defined by Perroux as a ‘group
of groups coordinated and integrated by the State’.
8. For a synthetic presentation of Perroux’s approach of international economic
relations, see Beaud (2003).
9. We write ‘State’ when we refer to the institutional form as defined by the
FTR (the institutionalized compromise between capital and labour, forms of state
intervention) and ‘state’ when we refer to the unite active (political economy actor
and WTO member).
10. On ‘international societalization’ as developed by Grenoblois school of FTR,
see de Bernis (1988a). On the way changes in interstate competition has prompted
more interest in ‘international societalization’, see Hirsch (1997) and Alnasseri,
Brand, Sablowski, and Winter (2001).
11. We focus here on the real and international trade dimensions of the State as
an institutional form. For a presentation of State function related to wage relations
and money, see the second part of Boyer and Saillard (2002).
12. Quadrilateral refers to the informal group of industrialized countries
(Canada, European Union, Japan and United States) created in 1983 to review the
world trading scene and trade policy issues. At the 1981 G7 Summit in Ottawa, the
Uneven and Combined Development in the Doha Stalemate 153

leaders formed what would become the key like-minded group in the building of
global trade policy for the next 20 years. The launch of the URA and creation of
the WTO were the most significant initiatives promoted by the Quadrilateral (Cline,
1983; Cutler & Zacher, 1992).
13. The first and second generations related to tariffs and to non-tariff barriers.
The third generation relates to national and sovereign control systems. The most
common non-tariff barriers to trade are technical measures, administrative rules
and procedures, standard and expertise procedures, quantitative and regulations
restrictions on imports, internal taxes, restrictions on competition and freedom of
circulation and labelling requirements.
14. See sections 2.2 and 2.4 of the Agreement on Technical Barriers to Trade, 3.3
and 5 of the Agreement on Sanitary and Phytosanitary Measures, Articles VIII and
X of GATT 1994. Furthermore, the WTO regulates the use of exemptions for non-
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commercial reasons (Articles XX and XXI of GATT and XIV of GATS).


15. On the concept of policy space, see Hamwey (2005) and Mayer (2009).
16. S&DT provisions pursue three aims: (i) to promote North South trade;
(ii) to allow for domestic development policies which may be trade restrictive;
(iii) to increase South South trade. The WTO lists six substantive categories
of S&DTs: (i) provisions aimed at increasing the trade opportunities of DC
members; (ii) provisions under which WTO members should safeguard the interest of
DC members; (iii) flexibility commitments of actions and use of policy instruments;
(iv) transitional time periods; (v) technical assistance; (vi) provisions relating to
LDC members. The S&DT provisions are not written in the style of a contract of
obligations between DC members and their less developed counterparts.
17. This approach of the S&DT is a derivation of the ‘number thesis’.
Hoeckman, Michalopoulos, and Winters (2004) suggest that an ‘LDC + group’
would encompass the countries that need special and differential treatment.
Stevens (2002) suggested applying S&DT to relevant economic factors and
criteria. Prowse (2002) suggests ‘country-specific audits’ to determine a tailored
mix of temporal exemptions and technical assistance for each developing WTO
member. These proposals are ‘business as usual’ is dealing with DCs international
integration.
18. The contrast is therefore striking compared to the URA concluded on
December 15, 1993, by the Blair House Agreement, after a ‘handshake’ between the
United States and European negotiators and presented to the whole membership as
a fait accompli.
19. The Bali Package reflects the geopolitical economy on UCD; the Trade
Facilitation Agreement refers to the interests of developed economies plus China;
the four decisions on agriculture are related to the interests of emerging countries
(G20, India and Brazil more specifically); the four issues relating to development
concern only the LDCs.
20. Which are: Cairns Group, Café au Lait Group and De la Paix Group (agri-
culture), G10 and G9 (services), Victims Group (anti-dumping), Friends of
Intellectual Property. For the composition of each of this coalition, see: https://
www.wto.org/english/tratop_e/dda_e/negotiating_groups_e.htm. For a synthetic
analysis of DCs coalition bargains, see Narlikar (2003).
154 MEHDI ABBAS

21. As Russia became a WTO member only in 2008, it was not involved in major
WTO coalitions and negotiations strategies that took place during the DDA.
22. The GATT-WTO rounds are based on mercantilist bargaining with participat-
ing countries offering to bind or reduce tariffs protecting the home market in return
for improvement in access to foreign markets. Krugman (1992) expresses the
‘GATT-think’ in a tryptic: (i) exports are good; (ii) imports are bad; (iii) other things
being equal, an equal increase in imports and exports is good. This constitutes what
he called the ‘enlightened mercantilism’ of the multilateral trade negotiations.

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160 MEHDI ABBAS

APPENDIX: LIST OF ACRONYMS

DCs Developing countries


DDA Doha Development Agenda
FSR French school of Regulation
GATS General Agreement on Trade in Services
GATT General Agreement on Tariff and Trade
LDCs Least Developed Countries
Multilateral trade negotiations
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MTN
MTS Multilateral trading system
NIC New industrialized countries
S&DT Special and differential treatment
TISA Trade in Service Agreement
TRIMs Trade related investment measures
TRIPs Trade related intellectual property agreement
UCD Uneven and combined development
URA Uruguay round agreements
WTO World Trade Organization
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