Tuesday, January 5, 2021

Hopewell, Kristen. "Different Paths to Power: The rise of Brazil, India and China at the World Trade Organization". Review of International Political Economy, Vol.22, No.2 (2015): 311-338.

Hopewell, Kristen. "Different Paths to Power: The rise of Brazil, India and China at the World Trade Organization". Review of International Political Economy, Vol.22, No.2 (2015): 311-338.


  • The international institutions developed after WWII here based heavily on US power, reflected in the fact that the WTO, IMF, and World Bank have been dominated by the interests of the US and other wealthy industrial states. This system has typically excluded developing nations from the decision-making process (312).
    • As developing countries like China, Brazil, and India grow richer and more powerful, they have gained influence in international economic institutions. The G20 was recognized as a major body for coordinating responses to the 2008 financial crisis, the voting rules at the IMF and World Bank are being reformed to give developing countries more influence, and all three countries have emerged as major players in WTO negotiations (312).
  • In discussions of the growing power of developing countries, China is normally viewed as a the central player and main power. Brazil and India are also part of this transformation, but they are secondary players to China. This is a reflection of the fact that Indian and Brazilian economic growth rates have typically been lower than Chinese ones and their economies both remain a fraction of the size of the Chinese economy (313).
  • Brazil and India have exercised new international power in distinctly different ways than China. Whereas China's economic power has allowed it to emerge as an independent international actor, India and Brazil have both exercised considerable international influence in the WTO through their positions as leaders of coalitions of other developing countries. Moreover, Brazil and India had a far more significant historical influence in the WTO than China in terms of breaking the US-led hegemony of developed states (314-316).
    • Whereas Brazil and Indian were extremely active during the Doha Round and sought to build coalitions, strategize, and outmaneuver developed countries, China only reacted to initiatives by developed countries and actively sought to diminish its leadership role in the negotiations (332).
  • The realist school of IR theory predicts that international institutions will reflect the current balance of power in the world. The institutionalist school disagrees with this, contending that international institutions also change the power relations between states, allowing weaker states -- like India or Brazil -- to create coalition to exert greater influence (315).
    • The author demonstrates that the examination of the role of India and Brazil versus China in the Doha Round demonstrates the inaccuracy of the realist view of power in international institutions and supports the institutionalist school on this issue, as state behavior within the institution seems both unrelated to actual power and dependent upon state action within the framework of that institution (332-333).
  • In the wake of the Uruguay Round of trade talks that led to the establishment of the WTO, developing countries were dissatisfied with their gains in negotiations and the unequal decision-making process. Pressure to redress these grievances led to the calling of the Doha Round in 1999, at which a new coalition of developing countries emerged (316).
    • At the state of the Doha Round, negotiations were still centered around Japan, Canada, the USA, and the EU. This only began to change at the 2003 Ministerial in Cancun, when India and Brazil worked together and established an coalition of developing countries to oppose the decisions of 'the Quad' of developed nations (318).
      • Prior to the Cancun Ministerial, the USA and EU created a joint proposal about agriculture, which would force developing countries to lower their tariffs without developed countries making similar concessions. This was similar to the Blair House Accord that had shaped the outcome of the Uruguay Round of talks (318).
      • Fearing a failure similar to the Uruguay Round, Brazil proposed to the Indian delegation a plan to collectively oppose the USA-EU plan. The two countries succeeded in forming a coalition of developing countries that constituted half of the global population and 2/3 of all farmers, and got this coalition to back a Brazilian proposal that would have slashed US and EU farm subsidies (318-319).
      • Although other developing country coalitions existed at the Cancun Ministerial -- the G33, the Cotton-4, the Core Group, the ACP Group, the Least-Developed Countries group, and the SVE group -- the fact that the G20, led by Brazil and India, came to the meeting with a proposal flipped the power relations at the meeting and led to the failure of the meeting, marked by the decisive rejection of the US-EU plan (319).
    • The ability of the G20 to both take the agenda-setting initiative from the Quad and block the US-EU proposal fundamentally changed the dynamics of the WTO, making gaining the assent of India and Brazil a necessary step in reaching any future deals; this change was marked by the replacement of Japan and Canada with Brazil and India within the Quad (319).
      • The original dynamic of the Doha Round was supposed to be disputes between the USA trying to force the EU and Japan to reduce their agricultural subsidies. Instead, the US found itself defending its subsidy schemes against the G20 group led by Brazil and India (319-320).
    • Brazilian-Indian cooperation continued at the 2005 Hong Kong Ministerial, when the two countries collectively led the G110 coalition of developing countries in opposition to the changes proposed by the wealthy industrialized countries (324).
    • The relationship between Brazil, India, and other developing countries began to degrade during the 2008 Geneva Ministerial, when other developing countries objected to Indian and Brazilian concessions during Green Room meetings (327).
      • China was first invited to Green Room meetings in 2008, on the initiative of the USA, who wanted to include China so that access to the lucrative Chinese market could be discussed specifically. They also believed that China would side with the USA and EU, thus alienating India, whom the US viewed as the major impediment to progress with the Doha Round (329-330).
      • The US strategy to break Indian opposition by including China in the Green Room meetings failed. Rather than backing the USA, China defended the interests of its large peasant population by opposing US agricultural plans and siding with India. China also resolutely refused to concede on any of the liberalization plans specifically directed at its market. The Geneva Ministerial ended in unmitigated failure (331).
    • The Doha Round was officially declared a failure in 2011, with another Bali Ministerial being held in 2013 to salvage the deal by signing agreements on the small number of marginal issues that countries had actually been able to agree on (331-332).
  • The WTO, and its predecessor the GATT, function through series of talks between countries until consensus is reached. These voting structures are remarkable compared to the IMF and World Bank, which had weighted voting systems and reserved veto powers for the USA (317).
    • Despite its democratic voting structure, the varied economic weight of different countries has empowered a small number of countries to create a fait accompli, then forcing other countries to accept the decision. A small number of states, usually led by the USA, the EU, Canada, and Japan, conduct 'Green Room meetings' until they come to a consensus, then force the rest of the GATT or WTO to accept this decision (317).
      • This arrangement of Green Room meetings meant that for most the GATT and WTO, developing countries have been excluded from the decision-making process. Accordingly, agreements were weighted in favor of developed nations (317).
    • The voting structure in the WTO changed considerably during the Doha Round, as by 2003, Brazil and India became parties to the Green Room meetings, while Japan and Canada were largely excluded. In 2008, China joined these meetings as well (318).
  • The alliance between Brazil and India during the Doha Round was unexpected because they have conflicting policy positions on agriculture. As one of the world's largest agricultural exporters, Brazil has sought to open up new agricultural markets, particularly seeking to destroy protectionist measures in the developed world, winning two landmark cases against US cotton subsidies and EU sugar subsidies. India, on the other hand, has a very weak agricultural sector and has sought to prevent WTO negotiations from opening agriculture or any other new sectors to global competition (320-321).
    • Knowing that its position in favor of liberalizing agricultural markets was opposed by both the developed and developing worlds, Brazil sought to ally itself with other developing nations to conceal the fact that its proposals were against their economic interests (321-322).
      • Brazil agreed to compromise on its wish for developing countries to open their agricultural markets to Brazilian exports, understanding that this demand would undermine the coalition. Brazil instead focused on attacking the protections of agricultural markets in developed countries (326).
    • India had been left isolated in previous GATT and WTO negotiations, often being the lone objection to US proposals, eventually causing it to cave under diplomatic pressure. India strongly opposed the beginning of the Doha Round and sought allies so that it would not suffer losses in the Doha Round similar to the Uruguay Round (322).
      • There was little trust underpinning the G20 coalition, as a previous coalition -- the G10 -- had collapsed during the Uruguay Round, as all countries expect India, including Brazil, defected. India thus sought to develop other alliances besides the G20, in case Brazil against defected (323).
      • India was the main country behind the creation of the G33, a group of 46 developing countries that specifically sought to prevent the opening of agricultural markets during the Doha Round. Through the G33 group, India secured the inclusion of special exemption on agricultural goods as part of the final Doha Round deal (323).
        • The G33 was actually instrumental in the failure of the 2013 Bali Ministerial, as US opposition to the legalization of emergency tariffs on foodstuffs led to a breakdown in the meetings (324).
      • India also has a lead member of the Core Group, which was organized to oppose the expansion of WTO regulations to cover state procurement, investment, and competition laws. Using the Core Group, India forced the removal of these issues from the agenda at the Cancun Ministerial (324).
    • Brazil and India have also previously cooperated with South Africa to force the US and the EU to exempt essential medicines, like the AIDS anti-retroviral medicine, from standard WTO intellectual property laws (324).
    • Brazil and India were both key members of the NAMA-11 coalition, which sought to secure additional flexibility in tariffs on both manufactured and agricultural good for developing countries (324).
  • Coalitions of developing countries had existed during the Uruguay Round, but they had never come to agreement on core issues of economic policy among themselves and were thus vulnerable to being bought off with specific concessions (325).
    • Brazil and India sought to create a strong coalition during the Doha Round by focusing on their common interests, in this case the elimination of developed countries' protections on agriculture, which harmed both India and Brazil. By seizing the initiative in creating their own proposal, they also forced developed countries to defend their agricultural subsidies in terms of free trade and liberalization, which they could not do (325-326).
    • A weakness of developing countries at previous GATT and WTO negotiations had been that they lacked the staff and technical resources to effectively argue positions. To prepare for this, India and Brazil assembled two of the largest delegations for the Doha Round, making sure they knew and could explain what policies would be in their interests and which would not be (326).
  • The involvement of Brazil and India in coalitions of developing countries was absolutely essential. Diplomats at the meetings stated that India and Brazil only received the attention they did from the US because they were at the head of powerful coalitions of developing nations (327).
  • China only joined the WTO in 2001, after 15 years of difficult negotiations requiring a significant number of domestic reforms. Despite becoming a member right before the Doha Round, China did not actively participate in the trade negotiations (327-328). 
    • Although China was a member of the G20 and G33, China deliberately took a backseat position during the negotiations. China sought to hide its true interests and avoid taking a leadership position in negotiations (328).
    • As one of the world's largest exports of manufactured goods, China has a major incentive to open other markets to its exports, while still retaining some domestic protections. The Chinese leadership believes that endorse this radically liberal position could scare markets and alienate other countries, so China seeks to remain quiet in negotiations, benefiting from liberalization, but not making enough noise to be specifically targeted by liberal reforms (328-329).
    • After being directed involved in Green Room meetings in 2008, China sought to return to its previous inconspicuous place within the WTO. This has been largely unsuccessful due to US concentration on Chinese markets, but oh boy does China keep trying (331).

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