The deadline for the definition of the trade modalities to reduce tariffs on NAMAs (non-agricultural market access), services and agriculture is due on April 30. Just a short while ago, an informal meeting in Rio de Janeiro, which sought to push forward the commitments made at the Hong Kong Conference and was attended by the US, the EU and Brazil, failed to produce any concrete agreement, with a new round of meetings scheduled to be held in Geneva.

The deadline for the definition of the trade modalities to reduce tariffs on NAMAs (non-agricultural market access), services and agriculture is due on April 30. Just a short while ago, an informal meeting in Rio de Janeiro, which sought to push forward the commitments made at the Hong Kong Conference and was attended by the US, the EU and Brazil, failed to produce any concrete agreement, with a new round of meetings scheduled to be held in Geneva.

Few still expect anything concrete might develop. The US and the EU are pushing developing countries to make some concessions in services and NAMAs, while the latter, led by the G-20, insist on reciprocity to open their agricultural markets. The key question, as always, is that the industrialized countries have no intention of making concessions in this area, signaling to a Doha Round in December this year without any substantive agreement.

This is derived, in the first place, from the fact that world trade this year should grow by 7% on average, based on forecasts of a world mean GDP growth of 3.5%, regardless of the outcome of the Doha Round. Second, the US is placing its bets on bilateral negotiations rather than the WTO. And lastly, the political atmosphere in the US and France makes it very difficult for these governments to cut agricultural subsidies, while the Trade Promotion Act (TPA) expires next year and any agreement struck now would barely stand a chance of being approved by the American congress in such a short time.

A summit meeting between the US and China is scheduled for April 20. Both presidents, Bush and Hu Jintao, will discuss bilateral relations mainly in the economic and trade fields. The US seeks to convince China to appreciate its currency, the yan, to reduce the American trade deficit and China wants to keep good relations in order to secure annual GDP growth rates at 7.5%. (Read more).

In early April the Board of Governors of the Inter-American Development Bank (IDB) convened a meeting in the Brazilian city of Belo Horizonte. Several themes were discussed, in particular, the priorities and conditionalities of its loan portfolio, private sector included.

A poignant theme was the proposal to pardon the USD 3.5 billion debt that the poorest countries of the continent, Haiti, Honduras, Nicaragua, Guyana and Bolivia, have with the bank. All parties agreed to the proposal provided the bank recovers the money in some other way, for instance, with additional contributions from developed countries.

Strictly speaking, every time the subject is brought up for discussion, whether at the IMF, G8 or IDB, the outcome is always the same: either there is a deadlock over who foots the bill or the conditions imposed on poorer countries are so draconian that they fail to meet them. Brazil is the second largest IDB stockholder and could play an important role in this decision. The Brazilian government itself has taken similar unilateral initiatives before, by pardoning Mozambique’s debt.

Clearly if the intention is to pardon a debt, those who pardon should not expect to receive.