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In the aftermath of the failed talks, the profound issue confronting policymakers around the world is whether globalization has been fundamentally redirected, slowed or possibly thrown into reverse.

India has been defensive and obstructionist in the Doha round, though less so than in previous rounds. It needs to exercise true leadership in an inner core of five members to set the WTO on its legs again. For that it must become more pragmatic, in line with its unilateral reforms post-1991, and more like China in the WTO. At the same time, India should clean up its PTAs and refrain from negotiating new dirty PTAs. Above all, it should revive unilateral liberalisation and regulatory reforms to boost competition. That

The aims of the Doha Development Agenda negotiations were to liberalise trade rules and make them more fair, to give developing countries a bigger slice of the global trade pie.

The indefinite suspension of the talks means trade rules will remain as they are.

SO who killed the Doha round? Like the murder on the Orient Express, everyone had a hand in it. The European Union (EU) should have offered deeper cuts in farm tariffs. The US should have signalled compromise on farm subsidies earlier, and should not have changed trade representative mid-stream. India and other developing countries should not have insisted on huge loopholes in their tariff reductions.

"If the US Congress does not renew the US negotiating mandate beyond mid-2007, the negotiations are dead"- Lamy

What are the risks resulting from the seeming failure, at least temporarily, of the Doha round of world trade liberalization talks? Several.

Given the complexity of protectionism -- its tariffs, regulations, currency manipulation, and so on -- assertions that the collapse of the Doha Round of world-trade talks are a disaster are a bit much. There are many limits to what you can negotiate even in the most successful trade talks, and the law of unintended consequences frequently applies anyway.

From 1948 forward, the world has slowly but steadily opened up to freer trade as countries negotiated rules governing the flow of goods, services and investment. Now this entire order is in question, after last week's collapse of global trade negotiations

"The WTO negotiations expired much as they survived for five years--in mutual acrimony about who was at fault for the lack of progress. Europe, Japan, India and Brazil lay the blame for the failure of the talks squarely on the U.S. because it was unwilling at the 11th hour to offer more concessions. The U.S. returned the blame. This ignominious end reflects a joint failure of political will at a critical moment."

U.S. Trade Representative Susan Schwab and Brazil Foreign Minister Celso Amorim said that developed and developing countries must make further compromises on agriculture tariffs and market access for talks to be possibly revived in five to seven months.

Pascal Lamy will talk to Gordon Brown this week about an aid-for-trade package to be agreed at September's IMF meeting in Singapore that will help the poorest countries build up the capacity to do business with the rest of the world. This may have some positive benefits, but it is small beer. As one development expert put it: it's like writing off your Porsche and celebrating because you got a few quid for the scrap.

In the aftermath of the failed talks, Multilateral, free trade is clearly the loser, protectionism a Pyrrhic winner. In the absence of any agreement, a partiality for bilateral trade agreements between countries outside the framework of the WTO will increase. A total of 200 such agreements have been signed since after World War II.

Biswajit Dhar: "As far as agriculture is concerned, India's concerns go far beyond trade - it's a question of the country's food security and the livelihoods of hundreds of millions of farmers here."

Susan Schwab: "We don't know whether we're even going to be able to ... get to ‘yes’ on Doha or will we get to ‘yes’ on Doha in three months, in six months or three years."

The WTO talks are almost dead. The United States and the European Union could not agree on agriculture. The 25-nation EU was unwilling to make the deep average tariff cuts, as much as two-thirds of their current rates, that the Americans demanded. And the EU insisted on even deeper cuts in U.S. subsidies, well aware that in 2002 the Americans announced they would hike their farm aid to $190-billion (U.S.) over six years. On the other hand, Brazil and India insisted the agriculture deal should come first.

The ruling General Council of the WTO “took note” of a report by Lamy, in which he reaffirmed his recommendation, made on Monday, to freeze the faltering negotiations. By doing so, the body effectively endorsed his view.

Lamy: "What now, Trade Ministers?"

An open letter from World Trade Organization chief Pascal Lamy to the trade ministers who have contributed to the collapse of the Doha development round.

Dear trade minister,

The trauma generated by the collapse of global trade talks may not yet register on the streets of New York, Paris or Tokyo. But for cotton growers in West Africa, rice farmers in Thailand and beef producers in Latin America the reverberations are already being felt.

Should the breakdown on Sunday transform into a failure to resume the talks, there would be no winners. All of us would pay. We would pay through lost opportunities to expand trade, increase economic growth and boost development efforts in poor countries. We would pay too, through a weakening of the multilateral trade system in favor of far less effective bilateral trade deals. Moreover, the breakdown in negotiations would be cause for great celebration within the protectionist ranks.

Yes, we would all pay for this failure, but it is the poorest and weakest among you who would pay the most. The Doha round was launched nearly five years ago as a means of better integrating poor countries into the global economy. Trade can be a powerful tool for development and has been instrumental in lifting hundreds of millions of people out of poverty in countries like China, India, South Korea and Malaysia.

Many other countries would like to follow this example and derive the benefits of export-led economic growth. But current rules tilt against them because in those areas of production where they are most competitive trade is restricted by a variety of import barriers.

This is particularly true in agriculture. The sudden collapse of the talks has been a shock to many, but the fact that agriculture has been its root cause has surprised no one. No deal was possible without substantially reducing tariffs - which severely curtail farm trade - and those subsidies, which hurt farmers in poor countries by encouraging their rich-country counterparts to dump surpluses on global markets.

The debate that has clogged the arteries of this negotiation for some time centers on the proportion of those respective cuts. Those who favored deep cuts in subsidies were less ambitious on opening their markets, while those seeking far greater market opening were not prepared to pay the price of further farm- subsidy cuts. And in the meantime little attention has been paid to tariffs on industrial goods or services which represent over 90 percent of world trade!

As a result, the Doha development round is in dire straits and negotiations have been stopped. We have called time-out so that all of you can cool off and reflect.

The most obvious consequence of this is that we will certainly not conclude the round this year as we had agreed to in Hong Kong last December. We do not have time to complete our work in agriculture and industrial goods and many other important sectors of the negotiations, including services, fishing subsidies, antidumping and the environment, have been held in abeyance as members awaited an outcome in agriculture.

The pity in all of this is that what is on the table now constitutes greater progress in rolling back farm subsidies and tariffs than anything seen before in global negotiations.

Even the least ambitious proposals would have cut trade distorting farm subsidies by two to three times the previous round of talks. Export subsidies would have been eliminated. For the first time members would have limited fishery subsidies, which contribute to the depletion of our oceans.

The vast majority of exports from the very poorest countries would have faced no barriers to trade, and practices that had crippled African cotton farmers would have been substantially reformed.

Powerful tariff-cutting formulas that were on the verge of agreement would have opened global markets as never before. And the services negotiations held the promise of new business opportunities in sectors like express delivery, banking, insurance, computer services and communications.

Can this considerable foundation be retained?

This depends very much on you, minister. There are clear signs that the failure this week has already given rise to two phenomena that threaten the multilateral system: a shift in priorities to bilateral or regional agreements that all concede fall far short of a global deal both in the depth and scope of their coverage, and a surge in threats to achieve through our highly effective dispute settlement system what could not be achieved through the negotiations.

Bilateral agreements offer neither the geographic coverage nor the broad range of negotiations needed to address damaging trade distortions. Poor and small countries will be overlooked and agricultural subsidies will never be adequately addressed in such forums. We all agree that agriculture has been the biggest obstacle to an agreement here.

To those who favor regional or bilateral agreements I ask the following question: What is the difference between a bilateral and a multilateral farmer?

Many of you, frustrated by the lack of progress, may also turn increasingly to the WTO dispute settlement system, which you have every right to do. But there is a danger that in shifting priority away from negotiations and to litigation we could damage the fragile balance that exists between interpreting existing rules and creating new and more relevant WTO agreements.

Our efforts aimed at creating a more equitable and relevant trading system have been dealt a severe blow and the future that we face is uncertain. All countries, particularly the largest and most influential, must now make every effort not to make a bad situation even worse.

As you ponder the way forward, I would ask you to consider the broader consequences of your inability to strike a deal. I would ask you not to take from the table those offers they have made and to cease the vitriolic attacks that render a return to the negotiating table more difficult.

Finally, I ask you to look at the big picture, beyond a narrow defensive one, and consider those living in poverty who saw in these negotiations a hope for a better life.

At this time of serious political turmoil, the WTO has the possibility to contribute to making this world fairer and more stable. Please think about that during this time-out.

Pascal Lamy is director general of the World Trade Organization.

Pascal Lamy has made it clear that he would not call negotiators back to Geneva without some closing of the gaps between key players on cuts to farm tariffs, farm subsidies and manufacturing tariffs.

"World trade does not grind to a halt when Geneva-based negotiations run aground. Neither does the messy business of trade negotiation–with all of its potential environmental, social, and consumer ramifications–go on hiatus.

National teams may switch playing fields, moving from a single multilateral stadium to myriad bilateral arenas, but the games will go on."

"(The talks) haven't ended, the round is not dead, they're suspended so a few players can reflect on positions" - Mark Vaile, Australian TRADE Minister.

As the US, the EU, Japan, Brazil, India and Australia took turns to blame each other after the failed talks, it's worth asking who will suffer as a result and whether anyone, anywhere, stands to benefit.

Several trade experts say it is unlikely that there will be much movement on the Doha agenda for two or three years.

WTO chief Pascal Lamy is determined to press ahead in the global trade hot seat despite failing to pull a tariff-cutting treaty out of the hat less than a year into the job.

WTO sees development agenda slip from its grasp .

While the 20-member Common Market for Eastern and Southern Africa (COMESA) feels that its time to look beyond its traditional trading partners, South African Foreign Minister Nkosazana Dlamini-Zuma remains positive about WTO talks.

U.S. Trade Representative Susan Schwab and Brazilian Foreign Minister Celso Amorim will meet Saturday in Rio de Janeiro to discuss the way forward from the failed WTO talks.

The collapse of the World Trade Organisation's Doha round leaves just one glaring question: what is the point of the World Trade Organisation (WTO) if it can't reach any agreements?

Suspending the Doha Round does not mean the end of the WTO. There is still a strong development case for a multilateral system, even if it is as flawed as that of the WTO. Australia and other richer countries should resist the temptation to try to get what they want through a series of bilateral trade agreements. Apart from creating complex and incoherent trade relationships, these deals usually involve developing countries losing more than they gain because of their weak negotiating position.

The collapse of world trade talks this week could turn out in the long run to be as important - and maybe as tragic - as the violence currently raking the Middle East.

As missed opportunities go, this one is colossal. Gone for the near future - and maybe much longer - is the chance to raise incomes and living standards in the world's poorest countries.

Desaster für die WTO (German)

Kein schneller Neustart der Welthandelsrunde zu erwarten (German)

According to C. Fred Bergsten, director of the Institute for International Economics in Washington,"It's Europe and India, in large part on agricultural policy, that have been naysayers that have caused the breakdown. At the end of the day, everybody's going to have to come back with better proposals to get a package on the table that will enable the negotiations to get going again."

Two international business groups fear increase in protectionism and trade disputes, and expressed their disappointment. Meanwhile, civil society activists celebrated the collapse of the WTO talks.

Politicians are not willing yet to pronounce the multilateral talks dead, largely because the potential economic gains from a global agreement would outstrip the effects of regional deals that include only a few countries. But given the stalemate in the global talks, regional agreements are likely to become a more important motor of trade liberalization in years ahead

With WTO talks in stalemate, the developed bloc, particularly the US may resort to the tactics of pressurising developing countries to open up their markets. Already at the behest of US, India has recently relaxed duty and quality norms for import of wheat and sugar, even though there is no shortage of these two commodities.

According to US trade negotiator Susan Schwab, the US was committed to a robust, ambitioned and balanced round. "Unfortunately things became clear (on Sunday) that Doha-lite seems still to be the preferred option of some of the participants".

By Doha-lite, the US trade negotiator was implying others weren't prepared to offer meaningful concessions in the latest talks. They, in turn, are very keen to point out that the Bush administration is very reluctant to surrender this particular pork barrel.

"As a starting point, we should extract from the rubble of the negotiation a significant development package"- EU trade commissioner Peter Mandelson.

He explained the EU would put forward a number of development measures such as the aid for trade package and duty-free and quota-free access for the world's poorest countries.

President Bush has been addressing the crisis in Iraq this week, and Secretary of State Condoleezza Rice has been dealing with Lebanon. In a decade, their efforts may well be historical footnotes. It was U.S. Trade Representative Susan Schwab — ever heard of her? — who was left to deal with the failed WTO talks in what could turn out to be the more lasting tragedy.

WTO Director-General Pascal Lamy recommended the suspension of the negotiations after talks among six major members broke down on Sunday 23 July. Ministers from Australia, Brazil, the European Union, India, Japan and the United States had met in Geneva to try to follow up on instructions from the St Petersburg Summit on 17 July.

Teleconference with Susan Schwab, Ambassador and Mike Johanns, Secretary of Agriculture - Geneva

Fiasco de Doha frustra o Brasil (Portuguese)