The Uruguay Round North–South bargain: Will the
WTO get over it?
J. MICHAEL FINGER
My thesis: mercantilist economics was good enough for the GATT, but it is not good enough for the WTO. Failure to notice the difference has stuck us with a North–South bargain that is politically troubling and economically inane. The international community so far has seen the WTO as the instrument to find the way out of this situation. I doubt the WTO can take on the necessary economics. The economics on the developing country side of the Uruguay Round “Grand Bargain” (as Ms. Ostry, 2001, labels it) is economics that the international community has usually asked the World Bank to do, but the World Bank has not done a lot. My conclusion: the WTO can't, the World Bank won't.
The Uruguay Round bargain
The overall North–South bargain struck at the Uruguay Round was that the developing countries would take on significant commitments in “New Areas” suchasintellectualpropertyandservices, wheredevelopedcountryenterprisessaw opportunities for expanding international sales. The developed countries, in exchange, would open up in areas of particular export interest to developing countries: agriculture and textiles/clothing.1
When the score is totaled, a developing countries' “surplus” on market access is not apparent.2 Looking first at non-tariff barriers (NTBs), the deadline set by the Uruguay Round Agreement for elimination of all quantitative restrictions (including voluntary export restraints), except those sanctioned by specific WTO____________________