<mark>future cooperation. However, there is much greater shared interest and scope for giveand-take between the old and new powers in an agenda that addresses the new concerns.</mark> Achieving successful multilateral cooperation will nevertheless be a challenge.

<mark>This paper is structured as follows. In section II, we discuss the Doha agenda and its implications. Section III elaborates on the issues that threaten security, their implications for international integration, and how multilateral cooperation would help. Section IV then identifies the new actors who could shape and drive this agenda. Section V considers</mark> the structure of, and fora for, international cooperation. Section VI concludes.

# **<mark>II. Doha’s Focus</mark>**

A lot of effort has been expended in negotiations under the Doha Agenda to help realize outcomes that would have minimal trade effects both in goods and services. Look first at the broad experience of trade in goods in the last 15 years (Chart 1). Since the mid-1990s, world trade has grown rapidly at about 6 percent a year, outpacing by a factor of two the growth in world output. During this period bound tariffs—the commitments that countries make in the WTO—have remained stagnant. In other words, trade flourished even while the multilateral trade process languished.<sup>2</sup> Governments have indeed liberalized their goods and services regimes. The tariffs on imports of goods that governments actually impose (“applied tariffs”) have come down from an average global level of above 25 percent to less than 10 percent (Chart 1). Similarly, across most services sectors, there has been considerable liberalization. As Charts 2a and 2b from a recent IMF study demonstrate, whether it be financial services, telecommunications or electricity, there has been significant opening of markets.

This liberalization of actual policy owes little, however, to the multilateral process, especially in developing countries. In the Uruguay Round, there was not much incremental liberalization in either goods or services (Subramanian and Wei, 2007 and Hoekman, 1996).<sup>3</sup> Market opening offers in the Doha negotiations provide an even starker illustration of what the multilateral process would have achieved had it been successful. Table 1 shows this for the case of trade in goods. For example, applied rates in agriculture in the richer developing countries would have remained unchanged at about 13 1⁄2 percent; in manufacturing, their applied rates would have declined from 6.4 to 5.6. Tariff cuts would have been slightly higher for the high income countries but from already low levels except in agriculture.

Chart 3 depicts the same for trade in services. Even though there would have been cuts in the policy commitments, Doha would have resulted in limited incremental liberalization

> 2 This is not to deny that the WTO’s rules and procedure, underpinned by an effective dispute settlement system, has a lot of value, which needs to be preserved. Historically, the WTO also had an important role to play in liberalizing trade (see Subramanian and Wei, 2007). But then too, the WTO was more effective in liberalizing industrial country trade policies than those of developing countries. Indeed, in Subramanian and Wei (2007), the positive trade effects of WTO membership are strong only for industrial countries. 3 Countries that acceded to the WTO after the conclusion of the Uruguay Round, such as China, did, however, make commitments to liberalize their trading regimes.

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