“Cautious optimism” is perhaps the term best suited to describe the mood amongst trade negotiators and outside
observers. With the July 2004 agreement, WTO members have brought the Doha Round back on track and managed to overcome the animosities that marked the failed Cancún Ministerial in August 2003. Yet, one should not forget the fact that many of the problems that bedevilled the Seattle and Cancún meetings remain relevant to this day. Reasons for optimism The Geneva meeting of July brought about a milestone agreement in evolving the guidelines for future negotiations. The most important negotiating principles have finally been shaped. As regards agriculture, all forms of export subsidies must be ended by a date, which is yet to be fixed. Trade-distorting domestic transfers to farmers are to be substantially reduced, only minor exceptions will be tolerated. The permissible volume of slightly distorting support measures will be limited to 5% of national agricultural output.

In the first year, after the Doha Agreement is implemented, the support payments to farmers everywhere will have to be cut by at least 20%. Tariffs of developed countries will have to be slashed to a much lower level. In cases where products are highly protected, such as Japanese or Korean rice, current quotas on imports will have to be boosted substantially. The protectionist countries will have to make greater commitments than others. By contrast, the developing countries will be granted long transitional periods and soft liberalization duties.