The success of the Uruguay round helped make the Doha round larger and more complex: more member countries to reach agreement among, more scope for conflicts of interest between the developed and developing countries, and more arguments over agriculture and services trade, not just manufactures.

It's the obvious need to reduce agricultural protection and farm subsidies that has proved the biggest stumbling block, particular Europe's extreme reluctance to begin dismantling its Common Agricultural Policy.

But against these barriers to success there are some factors favouring it. One is the knowledge of all countries that they would each gain from increased trade. Another is the approach of a deadline of sorts. Many countries would like to get a deal done this year before the complication of a change of administration in the US, as would President George Bush.

For our part, Crean has made no secret of the importance the Government attaches to the round.

"A successful conclusion to Doha is the Government's most important trade negotiations priority and it will strengthen the multilateral trading system," he said recently.

Such a system "has been, and will continue to be, vital to Australia's future trade interests". The system the WTO runs is "rules-based", which offers "certainty, predictability and stability" and so is "one of our most valuable global institutions".

One of the key rules is the "non-discrimination principle" - you don't give your mates a better deal than you give everyone else.

"Imagine our world without the non-discrimination principle as the foundation of international trade relations," he said.

"It would be a world built around preferential trade blocs, further favouring large powerful nations at the expense of smaller ones. Small countries would be locked out of deals with major trading partners and left to languish outside the mainstream bilateral trade deals.

"It would be a world where the benefits of trade are not shared widely, where trade is heavily distorted, and where the economic performance even of major trading nations is constrained by reduced opportunities to exchange goods and services."

Australia is a middle-level power. Even so, we fear we could be left out of trade blocs and so are convinced a strong, rules-based, non-discriminatory trading system is in our best interests.

Instead, as progress in the Doha round has faltered - and the first attempt to get another round going failed spectacularly at Seattle in 1999 - countries, led by the US, have turned increasingly to the discriminatory bilateral deals posing as "free-trade" agreements.

The Howard government joined the bilateral fashion, producing the discriminatory agreement with the US. Crean says the Rudd Government isn't against bilateral free-trade agreements or regional free-trade agreements.

"We are negotiating bilateral free-trade agreements with Japan, China, Chile, Malaysia, the Gulf Co-operation Council and - jointly with New Zealand - the Association of South-East Asian Nations. Negotiations on the Pacific Area Closer Economic Relations Plus are also pending."

But, Crean says, the Government's approach is to "recalibrate" the focus of our negotiations by putting multilateralism back at the centre. This means setting the framework to develop regional deals and bilateral agreements in ways that enhance multilateralism rather than detracting from it.

The World Bank estimates that by freeing trade in goods (including agriculture and clothing and textiles) of import tariffs and eliminating subsidies we could boost global income by up to $300 billion by 2015. It estimates that about 45pc of these gains would flow to developing countries. The gains would be greater if reforms to trade in services were taken into account.

You may think that's not a very high share. After all, the developing countries account for far more than 45pc of the nations of the world and far more than 45pc of the world's population.

But these calculations are based on the economic theory that, because protection stunts economic growth, countries that reduce their protection - in this case, particularly agricultural protection - gain more than the countries that get to sell them more stuff (which would be the developing countries, and us).

Be that as it may, there's not much doubt that the opening up of world trade brought about by the first seven negotiating rounds under the GATT contributed significantly to the postwar Golden Age of protracted economic growth.

The developed countries were the first to make big gains, but then we saw a succession of Asian countries benefiting from export-oriented growth, culminating with China.

We'll see if the logic of capitalism again prevails over the instinct to protect against foreigners.

* Ross Gittins is the Herald's Economics Editor.

SOURCE: Sydney Morning Herald.