1. NS3040 Summer Term 2018 US/WTO Doha Round
Federal Reserve Bank of Chicago, Strong Dollar Weak Dollar

2. U.S. and the Doha Round
Jeffrey Schott, “What Should the United States Do About Doha?” Peterson Institute for International Economics
Doha round remains stalled
Major nations have not revised their positions enough to propel new negotiations on agriculture, manufactures and services
Little chance for signing in near future
Schott wants to clarify policy options and then make a recommendation over course of action
He wants this to be consistent with:
near-term political constraints and
the objective of advancing world trade and economic development

3. Doha Round: U.S. Options I
Options fall in three broad categories:
First option – declare victory and sign the deal “on the table”
Idea is to avoid at all costs stigma of a failed round – the first one ever
Deal endorses formula for tariff cuts plus reductions in agricultural subsidies
Problems:
Prospective gains are too small and skewed towards too few countries
Gains for the U.S.
$7.6 billion in increased exports
$14.3 billion in increased imports.
GDP rises by$9.3 billion

4. Doha Round: U.S. Options II
Problem – overall gains relatively small
For some producers loss of protection or subsidy would hurt – would strongly lobby Congress against signing.
China the big winner at expense of most other trading nations
Second option -- pull the plug. Declare the round a bust and go home.
Recognizes the lack of political will and leadership and considers further efforts a waste of time
Problem – Doha’s failure might make it very difficult to begin another round in the future
Might also take a toll on the WTO dispute settlement process -- countries might see this as de-facto rule setting.

5. Doha Round: U.S. Options III
Third Option – recognizes that talks cannot conclude in current environment and that Doha round needs a “time-out.”
Avoids blame for killing the round while recognizing that in current political climate, an agreement is unlikely
Main problem – talks might go into hibernation and never wake up.
Need to make it clear what needs to be done and the benefits associated with an agreement.
Schott feels the U.S. needs to keep open the multilateral option while accelerating bilateral and regional initiatives
The former requires making a down payment (in the form of provisional implementation of specific reforms) on a future Doha package
Specifically U.S. and other major trading nations need to make a down payment on a future package of WTO accords that is more balanced and ambitious than what is currently on the table
Provides list of specifics.