The WTO ministerial conference held in Hong Kong, China, from December  13–18, 2005, was the sixth since the establishment of the WTO in 1995. Formally launched at the fourth WTO ministerial  conference in Doha, Qatar, in November 2001, the negotiations are the  latest in a series of global trade talks (negotiating rounds) dating back  nearly six decades. To avoid  another failed meeting, such as at the last ministerial in Cancún, Mexico,  expectations for the Hong Kong ministerial were lowered. Some Technical Progress Achieved but Key Milestones Missed

In early 2005, at a mini-ministerial meeting in Davos, Switzerland, and  subsequently at a February meeting among all WTO members, WTO  members agreed that the goal of the Hong Kong ministerial was to set the  stage for the final phase of the Doha negotiations, which would enable the  round to conclude in 2006. Other U.S. priorities, however—  notably services and NAMA—made little progress at the ministerial. In doing so, they agreed to a new deadline  for completing the round by the end of 2006 and interim deadlines under a  compressed schedule by which to reach agreement on the difficult issues  that had eluded them thus far. For example, they set April 30, 2006, as the  deadline for WTO members to agree on modalities for cutting tariffs and  subsidies for agricultural and nonagricultural goods. According to the EU, these would  restore needed “balance” among the key players’ market access interests. The draft  commitment schedules in agriculture and NAMA are to be completed by  July 31, 2006. The agreement itself must be entered into  before July 1, 2007. No results in the round. Concluding the round with modest results within TPA’s timeframe. Other experts warned that hard  decisions were necessary and time was short if an outcome living up to  Doha’s promises were to be achieved. Progress in 2005 through the Hong  Kong ministerial, however, was considerably less than WTO members  hoped. With nearly all tough decisions put off until 2006, the tension  between members’ original high ambitions and the TPA time frame has  become acute. U.S.  officials often call the Doha Round a “once in a generation opportunity”  because the last global trade round took a decade to launch and complete  and another decade to implement. With just over a year left to produce an agreement that qualifies for TPA, it  remains unclear whether the WTO can create an environment where  members perceive it is in their interest to make the significant changes in  their current positions, and other decisions, that cumulatively would fulfill  the vision of the Doha Development Agenda. Objectives, Scope, and Methodology

In this report, we (1) provide the status of the Doha negotiations on the eve  of the Hong Kong ministerial, (2) review the outcome of the Hong Kong  ministerial, and (3) discuss the prospects for concluding the Doha Round  before U.S. Trade Promotion Authority (TPA) expires in July 2007. To assess the status of the Doha negotiations before Hong Kong, we met  with a variety of U.S. government agencies, including the Office of the U.S.  Trade Representative (USTR) and the Departments of Agriculture,  Commerce, and State, to obtain information on progress on the  negotiations and on the issue areas and factors affecting the negotiations.
Why GAO Did This Study

U.S. officials often call the World Trade Organization's (WTO) Doha Development Agenda or "Round" of global trade talks, launched in Doha, Qatar, in November 2001, a "once in a generation opportunity" to expand trade. President Bush has identified their success as his administration's top trade priority. Due to various U.S. notification and consultation requirements, concluding the negotiations in 2006 is essential for a Doha agreement to qualify for congressional consideration under U.S. Trade Promotion Authority (TPA), which expires July 1, 2007. A ministerial meeting among the WTO's 149 members was held on December 13-18, 2005, in Hong Kong, China, to make decisions needed to advance the talks. Given the importance of the WTO Doha Round to the United States, GAO was asked to provide an update on the status of the negotiations. In this report, the latest in a series on the negotiations, we (1) provide the status of the Doha negotiations on the eve of the Hong Kong ministerial, (2) review the outcome of the Hong Kong ministerial, and (3) discuss the prospects for concluding the Doha Round before TPA expires in July 2007.

What GAO Found

WTO members made little progress in 2005 toward their goal of completing the steps needed to set the stage for finalizing the Doha Round of global trade talks. The key milestones for progress through July were missed. Despite new proposals on agricultural subsidy and tariff cuts submitted in October 2005, it was clear by November that key players were too far apart to achieve the major decisions planned for the December ministerial. To avoid a failure, members agreed to lower expectations for the meeting. The Hong Kong ministerial resulted in modest agreements on a narrow range of agricultural and development issues. Ministers made little progress on the broader Doha negotiating agenda, including two other U.S. priorities--services and nonagricultural market access. Nevertheless, WTO members renewed their resolve to successfully conclude the Doha Round by the end of 2006 and set new interim deadlines under a compressed schedule to meet that goal. Critical decisions that will determine each member's cuts in tariffs and other barriers were due April 30 and July 31, 2006, but the April 30 deadline will be missed. WTO members continue to profess commitment to accomplish the ambitious agenda set at Doha. However, with nearly all tough decisions put off, the tension between members' original high ambitions and the U.S. TPA timeframe has become acute. Since the Hong Kong ministerial, members have taken concrete steps to help build consensus. Yet, the ongoing impasse on core areas such as agriculture, and the difficult political decisions needed to resolve it, cause many experts to be skeptical. Numerous time-consuming steps still must be completed in the little more than a year left before TPA expires. While holding out hope for an agreement that lives up to Doha's promise, experts say outright collapse, substantial delay, or modest results are all possible outcomes.