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Failed talks: Assessing the fallout
Why the collapse of WTO negotiations in Geneva spells uncertainty across the globe.
Last Modified: 30 Jul 2008 01:42 GMT

The deal's collapse is set to have repercussions across the world [GALLO/GETTY]

Analysts and Al Jazeera correspondents from across Latin America examine the impact of the collapse of WTO talks on the region.

Franc Contreras, Al Jazeera, Mexico City, Mexico

"It may take months before we know that kind of real effects it could have on people's lives in Mexico"

Franc Contreras, Al Jazeera

People here in the Mexican capital were not even aware that the World Trade Organisation (WTO) talks were talking place, much less that they had collapsed. 

They are aware though that their own prices for food are rising dramatically.

Prices for example of fruit have gone up more than 30 per cent in recent months.

So the Mexican people are looking to their government to create some kind of solution.

Felipe Calderon, Mexico's president, has gone abroad recently, looking for stronger trade relations.

He travelled to Beijing, for example, to shore up trade pacts with that giant economy.

Mexico is also looking for trade ties with India, Africa and anywhere else that would like to trade.

Mexico is known for the trade it does with the US. More than 90 per cent of all goods now go north to that economy.

So when the US economy starts to slow down, people here definitely start to feel it.

For that reason, Mexico is looking elsewhere, hoping that it can create better ties and trade with countries around the world.

For now though, the collapse of the WTO talks and the kind of impact it will have here is uncertain.

It may take months before we know the real effects it has on people's lives in Mexico.

Gabriel Elizondo, Al Jazeera, Rio de Janeiro, Brazil

Here in Brazil we were actually told the talks were on the verge of breaking down last week, but that at the last minute Brazil stepped in and broke away from India, China, and Argentina and sided with Europe and the developed countries.

Now why would Brazil do this? Two reasons.

Number one, as the biggest economy in Latin America, there is added pressure on Brazil's shoulders to act as a mediator, to see these talks through to the end.

Number two, Brazil has ethanol. And that is the big wild card in all of this.

We were told that last week, in exchange for siding with Europe, Brazil was given promises from the US and Europe of lower tariffs on Brazilian ethanol in those markets.

That is all Brazil needed to hear.

At that point Brazil made the strategic decision to go out on a limb, to take a huge risk, push the talks through by siding with Europe and break away from other developing countries, hoping it was a gamble that would pay off with a big trade agreement that would benefit the world and, particularly, Brazil.

Clearly, that gamble did not pay off.

JP Singh, Professor, Georgetown University, Washington DC

India's farmers would have been hurt by a surge in imports [AFP]
It has been touted as a development round, but the success would have actually given a lot of positive benefits to developing countries, especially those like India, China and Brazil, which have huge gains to reap from liberalisation.

So, it is a pity that it collapsed.

It would have helped countries like India, because it also exports a lot of industrial goods, as well as services.

India especially is emerging as a services powerhouse. You can see why India may not gain from this because it is one of those few countries which gains from services exports but is harmed by farming imports.

In terms of the total numbers, you can compare the numbers of trade versus the numbers in terms of the farmers.

Farmers could be adversely affected by it, except that the trade deal which was on the table, which Pascal Lamy worked out last Friday, might have actually worked to India's benefit if the US side also had been willing to give in a little.

At this time, despite all the hackles being raised about the financial services in the US, financial services are pretty much liberalised the world over.

On Saturday when they met in Geneva to talk about services, the signals that the developing world gave to the developed world were, "yes, we will do it".  So, really the talk was about agriculture, not services.

We do not have unfettered markets in agriculture, we do not have them in services and we do not have them in industry.

What this deal would have done is tried to affect compromises for the developing world, and also the developer, whereby the farm exporters get something, and the farm importers also get something.

Where they broke down was you could not reconcile the interests of farm importers like India, Indonesia and China versus the farm exporters, countries like Uruguay and Paraguay.

So, there is no one developing world in this, there are several developing worlds - those who gain from farm exports and those who are harmed by farm imports.

Source:
Al Jazeera
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