The WTO administers rules for international trade, provides a mechanism for settling disputes, and offers a forum for conducting trade negotiations. Such negotiations periodically involve comprehensive “rounds,” with defined beginnings and ends, in which a large package of trade concessions among members is developed and ultimately agreed on as a single package. A total of eight rounds have been completed in the trading system’s 56-year history. Each of the last 3 rounds cut industrial nations’ tariffs by about one-third overall. WTO membership has increased since the organization’s creation in 1995 to 146 members, up from 90 contracting parties of the General Agreement on Tariffs and Trade (the WTO’s predecessor) when the Uruguay Round of negotiations was launched in 1986. WTO membership is also diverse in terms of economic development, consisting of most developed countries and numerous developing countries. The WTO has no formal definition of a “developing country.” However, the World Bank classifies 105 current WTO members, or approximately 72 percent, as developing countries. In addition, 30 members, or 21 percent of the total, are officially designated by the United Nations as “least developed countries.” The ministerial conference is the highest decision-making authority in the WTO and consists of trade ministers from all WTO members. The outcome of ministerial conferences is reflected in a fully agreed-upon ministerial declaration. The substance of these declarations is important because it guides future work by outlining an agenda and deadlines for the WTO until the next ministerial conference. The WTO General Council, made up of representatives from all WTO members, implements decisions that members adopt in between ministerial conferences. Decisions in the WTO are made by consensus—or absence of dissent—among all members rather than on a majority of member votes, as it is in many other international organizations. At the fourth ministerial conference in Doha, Qatar, in November 2001, WTO members were able to reach consensus on a new, comprehensive negotiating round, officially called the Doha Development Agenda. The Doha Round is the first round of global trade negotiations since the conclusion of the Uruguay Round in 1994. The Doha Declaration sets forth a work program for the negotiations on agriculture, services, nonagricultural market access, and other issues. In addition, the work program emphasizes the development benefits of trade and the need to provide assistance to developing countries to help them take advantage of these benefits. The Doha Declaration also sets forth a structure and series of interim deadlines for the negotiations. Specifically, it established a Trade Negotiations Committee (TNC) open to representatives from all WTO members to oversee the negotiations, as well as several subsidiary bodies. In addition, it laid out several deadlines and other milestones through the next ministerial conference by which time negotiators were to make decisions on issues under negotiation. In the months following Doha, WTO members agreed that the next ministerial conference would occur in Cancun, Mexico, in September 2003. Figure 1 presents key milestones through the Cancun Ministerial Conference. The Doha Declaration also set several general goals for the next (Cancun) ministerial conference, namely, to take stock of progress at midpoint of the Doha negotiations, to provide necessary political guidance, and to make decisions as necessary. However, at their fifth ministerial conference held in Cancun, Mexico, from September 10 to 14, 2003, WTO ministers were neither able to achieve these goals nor bridge wide differences on individual negotiating issues. They concluded the conference with only an agreement to continue consultations and convene a meeting of the General Council by mid-December 2003 to take actions necessary to move toward concluding the negotiations. The Cancun Ministerial Conference provided an opportunity for both symbolic and practical progress in the Doha Round of negotiations. These opportunities were of heightened importance because negotiators had by their own admission failed to make sufficient progress to meet interim deadlines set out in the Doha Declaration, at least in part because members were awaiting the results of the agricultural reform efforts in the EU. Consequently, real give-and-take did not truly begin until the final weeks before the ministerial, leaving little time to bridge the substantial differences that existed on key issues. The September 2003 WTO Ministerial Conference held in Cancun, Mexico, had symbolic and practical importance for the Doha Round of negotiations. On the symbolic level, several WTO officials we met prior to the meeting noted that the Cancun Ministerial Conference might be a means to regain the momentum needed to bring the Doha Round to a successful conclusion. The Doha Round promised to be the most comprehensive round of global trade negotiations yet, involving a commitment to further liberalize trade, update trade rules, and further integrate developing countries into the world economy. The Cancun Ministerial Conference occurred at roughly the midpoint in the 3-year negotiations. However, based on our meetings with country delegations and WTO officials in Geneva and public statements by WTO officials, on the eve of the ministerial there was a sense true negotiations had not really begun. In particular, although WTO member governments had succeeded in actively submitting and discussing many proposals to achieve the general goals laid out at Doha, they had been less successful in narrowing their differences on these proposals or coming up with workable plans for developing specific national commitments (or schedules) to lower trade barriers. WTO members held differing views on the symbolic importance of the Cancun Ministerial Conference. For instance, U.S. and some other member country officials, as well as WTO officials, expressed hope that the Cancun Ministerial Conference would create the political will to achieve a meaningful and ambitious agreement by the deadline that would benefit all participants. WTO officials we spoke with, for example, stressed that Cancun needed to provide a “boost” of fresh momentum to the flagging talks. Other members planned to use the meeting to focus on the centrality of agriculture reform. However, some members downplayed the symbolic importance of the ministerial and viewed it merely as an opportunity to take a mid-point assessment of the negotiations. At a practical level, Cancun was viewed as critical to provide negotiators with direction in key areas that had thus far eluded consensus, according to WTO and member country officials. With just 16 months before the agreed-upon deadline of January 1, 2005, for concluding the negotiations, working-level progress in resolving outstanding issues was effectively stalled. Breaking the logjam hinged upon receiving clear ministerial direction in several key areas. For example, guidance was needed on the specific goals and methods that would be used to liberalize trade in agriculture. Progress on narrowing substantive differences in advance of the Cancun ministerial proved slow. As late as July 2003, observers and participants in the negotiations noted that WTO members were simply restating long-held positions on key issues and had yet to engage in real negotiations. For instance, in July 2003, the WTO Director General said that negotiators had been waiting to see what others are willing to offer without showing flexibility themselves. The chairmen of some of the negotiating groups repeated this sentiment in their statements to the July meeting of the Trade Negotiations Committee. (See app. II for a discussion of significant events in the WTO negotiations before and during the Cancun Ministerial Conference.) A key factor hindering the progress of Doha Round talks had been the pace and extent of reform of the EU’s Common Agricultural Policy (CAP). Agriculture was considered by many WTO members to be a linchpin to achieving progress in all other areas of the Doha negotiating agenda. After considerable internal debate, on June 26, 2003, the EU agreed to CAP reform. Among other things, the reform would ensure that for many agricultural products, the amount of subsidy payments made to farmers would be independent from the amount they produce. Yet even after the EU CAP reform was announced, other members stated that they were still waiting to see the EU’s internal reform translated into a significantly more ambitious WTO negotiating proposal. The EU resisted making a new WTO proposal, arguing that in effect it was being forced to pay for reform twice by reforming its internal policy once and then being asked by WTO negotiators to reform again to be able to conclude an agreement. Another factor hindering overall progress was perceived linkages between various negotiating topics.The Doha Round’s outcome is to be a “single undertaking,” meaning a package deal involving results on the full range of issues under negotiation such as agriculture, services, and nonagricultural market access. As a result, trade-offs are expected to occur among issues to accomplish an overall balance satisfactory to all members. Thus, it is difficult to make progress on one issue without achieving progress on other issues. For example, many developing nations consider agriculture their number one priority and have been unwilling to make offers to open up their services markets until they see more progress on agricultural reform. On the other hand, the EU and Japan, who expect to make concessions on agriculture, wanted a commitment at Cancun to begin negotiations on several issues that were new to the trading system--investment, competition (antitrust), government procurement, and trade facilitation— which are collectively known as Singapore issues. By our mid-July meetings in Geneva it was clear that expectations for Cancun were being scaled back because of the overall lack of progress. Instead of issuing “modalities,” (numerical targets, timetables, formulas, and guidelines for countries’ commitments), for example, WTO officials and country representatives we met with suggested that “frameworks,” or more general guidance on what types of concessions each participant would make, might be a more appropriate goal for Cancun.