WTO´s Doha Development Round in crisis: Squaring the“triangle of issues” July 2006 Three areas of the Doha Development Agenda (DDA) hold the key to the successful completion of the whole Round, i.e. agricultural domestic support, agricultural market access and non­agricultural market access(NAMA). Pascal Lamy, Director-General of the World Trade Organization (WTO) called them the“triangle of issues”. Mem­bers had failed to meet the deadline set by the Hong Kong Ministerial Declaration to establish modalities in these areas by the end of April. 1 The ensuing process of continuous negotiations pro­ceeded only sluggishly. Since the decision needed was rather political than technical, a high-level meeting of some 60 ministers(“Mini-Ministerial”) was arranged to break the deadlock. The negotia­tions took place from 28 June to 1 July in Geneva and were fairly inclusive, transparent and bottom­up. Group meetings, such as of the G-6 group of key players(Australia, Brazil, EC, India, Japan, US) and of countries with common interests, such as the G-20 group of major developing countries or the African Group alternated with Ministerial meetings. The latter occurred in various forms, including“green room” meetings, where about 30 ministers participated, representing all key players, as well as regional and interest-based country groupings. They were followed by infor­mal Trade Negotiations Committee(TNC) meet­ings and a final TNC meeting, comprising the entire WTO membership. On 1 July, however, Lamy had to concede the failure of negotiations, stating at the informal TNC meeting:“I will not beat about the bush. We are now in a crisis.” 1 See Grammling, Steffen: An update on negotiations of WTO´s Doha Development Round: Another mis­sed chance or business as usual?, FES Fact Sheet, May 2006. What was at the core of the June“Mini­Ministerial”? The clearly stated purpose of the“Mini­Ministerial” was to establish modalities in agricul­ture and NAMA. Modalities comprise the formu­lae and figures to cut tariffs and subsidies, as well as the flexibilities and exemptions granted to de­veloping countries. Full modalities are needed to allow WTO members to translate them into legally binding reduction commitments for their thou­sands of tariff lines and subsidies accordingly; this process is known as“drafting schedules” and will take – together with the ensuing verification pro­cess by all WTO members – no less than six months. To provide the basis for the ministers to bargain over numbers, the Chairs of the Agricul­ture Negotiation Group and the Negotiation Group on Market Access circulated texts, which contained the state-of-play in these negotiation areas(“draft modalities”). The major stumbling blocks for modalities are well known: the EU should improve its offer on agricul­tural market access; the US should improve its offer on reductions of agricultural domestic sup­port and scale back its demands on agricultural and non-agricultural market access; and the G-20 should agree to deeper cuts in industrial tariffs. To facilitate the finding of a“second wind” in nego­tiations, Lamy came up with a proposal to achieve real subsidy cuts and new trade flows in agricul­ture and industrial products. He thereby referred to the“magic number 20”, which means: the adoption of the G-20 proposal to cut EU average agricultural tariffs by 54% compared to its pro­posal on the table of 39%; the ceiling of US$ 20 billion for US´ overall trade-distorting agricultural