Clay Risen writes in the current issue of The New Republic as follows:
“The most significant challenge [to the liberal economic order, and to U.S. power], arising from the slow collapse of the Doha trade negotiations, is Venezuela's plan to replace the international trade structure with a series of trading blocs. Many of its efforts have been the banal sort of bilateral deals that would go unnoticed--if they weren't with an eyebrow-raising set of partners: Vietnam, Nicaragua, Russia, Libya, and other countries at the edges of the liberal economic order. Just days before his U.N. appearance, Chávez signed some 20 trade accords with Iran, totaling more than $200 million. Iranian tractors are already under production in Venezuela, and the Iranian national oil company has spoken of investing up to $4 billion there. Chávez has promised a $500 million oil refinery in Uruguay, a country the United Stateshas been courting for its own trade deal. And he has pursued countless oil-related deals with China--with the expressed goal of disengaging his country's oil sector from the United States. . . .
Alongside his bilateral efforts, Chávez has pursued a set of multilateral trade agreements with the intention of displacing American economic hegemony in the western hemisphere. In 2005 Cuba
and Venezuela created the Bolivarian Alternative for the Americas (ALBA), also known as the People's Trade Agreement, which sets up zero-tariff trade among members. The ALBA has since expanded to Bolivia, and Nicaraguan presidential candidate Daniel Ortega has promised to join if he wins in November. Chávez has also signed onto Mercosur, the pact among several South American countries designed to challenge NAFTA and the EU. Mercosur is, for now, a fairly innocuous group, but Chávez has spoken frequently of transforming it into an anti-U.S. regional bloc. Trading blocs such as these, especially in light of the Doha collapse, not only undermine the structure and spirit of the liberal trading regime, but they also push the world back to the era in which politics, rather than growth-oriented national interest, determined trade policy, with all the economic and political instability that went with it. “
Perhaps I should not be surprised at the strong political take on international trade negotiations . . . . But it seems that many things that seemed settled just a few years ago are now up for grabs. I suppose I should not be too shocked to see non-trade politics driving decisions about the WTO: several U.S. senators have recently announced that they want to block Russia's WTO accession over Russia's assistance to Iran with respect to a nuclear power plant.
