In order for Astana to be formally welcomed into the global trade body by December, the Working Party (WP) tasked with the talks would need to accelerate its work so as to conclude the negotiations by July, according to WP chair Vesa Himanen of Finland.

“The process is now at a very advanced stage,” Himanen told the Working Party last Thursday, according to sources familiar with the discussions. However, he noted that “rapid decision-making by the acceding government is needed” if Astana aims to conclude the negotiating process this year.

Sources said that the US and EU echoed these sentiments at last week’s Working Party meeting, warning that there are many open issues remaining.

In an effort to resolve some of these outstanding issues, plurilateral meetings were also held last week to address differences relating to sanitary and phytosanitary (SPS) measures - which involve food safety and plant and animal health- and agriculture. Another area of concern is trade-related investment measures (TRIMS), in particular regarding the length of the transition period that Astana would be granted for eliminating all measures that are inconsistent with the WTO’s TRIMS Agreement.

Any accession to the WTO hinges on a unanimous agreement among all current members, which reached 159 in number after Tajikistan joined earlier this month. Once members sign off on Astana’s accession terms, the country will still need to ratify the accession package domestically and then undergo a 30-day waiting period before its membership becomes final.

Russia likely to make tariff adjustments, officials say

One dimension of the trade negotiations that has complicated matters is Kazakhstan’s customs union with neighbours Russia and Belarus - an initiative launched in early 2010 that was intended as the first step toward a broader economic alliance of former Soviet states, fashioned similarly to the EU.

Before Russia formally joined the WTO last August, the three countries had considered seeking membership as a group. However, due to the lack of any precedent for a customs union bid to the WTO, as well as any framework for such proceedings, that method of accession was ultimately abandoned some months later. (See Bridges Weekly, 21 October 2009) Russia is now the only one of the three customs union members to be part of the WTO.

Earlier this month, Andrey Slepnev - who serves as the trade minister for the Eurasian Economic Commission, the custom union’s governing body - told Bloomberg that Russia will cut some import tariffs to somewhat approximate those that its partner Kazakhstan is likely to accept in its accession protocol.

“We suggested a formula which allowed to adjust the level of the common tariff on the goods in accordance with the share of markets of these goods,” Slepnev explained, adding that it would be a “fair deal” involving Russia making some concessions to fellow WTO members. He also noted that nearly all of the regional group’s tariff lines and regulations are now in line with WTO rules.

Next steps

Himanem has urged WTO members to continue working on an ambitious schedule, sources told Bridges. The goal, the Finnish official said, would be to hold two more working party meetings - followed by a meeting by October, at the latest, in order to sign off on the package ad referendum - so that Kazakhstan’s accession can be included on the December ministerial’s agenda.

ICTSD reporting; “Russia to Reduce Import Duties to Match Kazakhstan’s WTO Pledges,” BLOOMBERG, 4 March 2013.

The 159-member organisation is hoping to clinch a small package of deliverables from the long-running round of Doha trade talks, which were formally declared at an impasse in December 2011, in time for the upcoming Bali gathering.

Activity in Geneva has ramped up in light of an unofficial Easter stocktaking deadline, sources say, especially given that a meeting of the WTO’s Trade Negotiations Committee - tasked with the Doha Round negotiations - is currently scheduled for mid-April. The TNC gathering has been deemed by many to be a useful date for testing whether a Bali agreement is indeed likely - particularly given the few months between now and December.

The global trade body’s outgoing Director-General, Pascal Lamy, has already warned that the membership must “run faster” if they hope to achieve results in Bali and avoid another “housekeeping ministerial.” (See Bridges Weekly, 27 February 2013)

Chair: Trade facilitation talks moving too slowly

The proposed centrepiece of any Bali deal is an agreement on trade facilitation, which deals with topics such as easing customs procedures and cutting times at border crossings. Trade facilitation negotiators met in Geneva last week in an effort to advance these talks forward, only for several brackets - numbering well over 600 - ultimately remaining unresolved in the trade facilitation draft text.

Following the five-day meeting, Ambassador Eduardo Ernesto Sperisen-Yurt of Guatemala, who chairs the trade facilitation talks, warned members that the negotiations are not advancing fast enough. “Based on our existing progress, we will not make it by December,” he said, according to sources familiar with the meeting.

While delegates speaking to Bridges confirmed that talks were moving slowly, with many contentious issues remaining on the table, some still expressed optimism that an outcome might be possible in time for the Bali ministerial.

Consultations on trade facilitation have lately been held under a “facilitator-led process,” involving facilitators from 17 WTO members that have been reviewing the text section by section in order to find areas of agreement. In an effort to move the process forward, the chair suggested last week that members change tactics - specifically, by appointing four “friends of the chair” to supplement the facilitator method that has been used to date.

These four “friends of the chair” would be Michael Stone of Hong Kong, already a facilitator, along with Ambassador Mario Matus of Chile, Ambassador Remigi Winzap of Switzerland, and Ambassador Yonov Frederick Agah of Nigeria.

The four “friends of the chair” would be tasked with consulting with members on the main points of contention in the trade facilitation draft text, under the guidance of Sperisen-Yurt, with the hopes that looking at the text more broadly might help in whittling down the 650-plus remaining brackets.

Sources told Bridges that the “friends” could also consider whether some sort of emerging consensus on what members seek to achieve is being properly reflected in the text’s current draft.

In his remarks, the chair reportedly stressed that these four will not be tasked with preparing any sort of Chair’s or Friends of Chair’s text. Rather, these four “friends of the chair” will be required to hold open-ended meetings with members, together with any other consultations that they deem useful; any findings from these various consultations will ultimately be brought back to the full negotiating group. The process will remain member-driven, he said, according to sources familiar with the meeting.

However, even with the new process, there is “still much to do, to see if we make progress in this area,” one developing country delegate commented to Bridges.

A new consolidated trade facilitation draft text is expected to be released in the coming days, reflecting revised language on areas such as publication, penalties, appeals, separation of release, e-payment, and perishable goods, which were adopted via the facilitator’s process. The next meeting of the trade facilitation negotiating group is currently scheduled for 21-24 May.

Agriculture

Meanwhile, trade officials have come to the end of a month’s intensive discussions on food stockholding schemes, as part of an attempt to understand how best to respond to a negotiating proposal on this question that was tabled ahead of the Bali conference. (See Bridges Weekly, 20 February 2013) The proposal was first submitted by the G-33 group of developing countries with large populations of smallholder farmers.

The chair of the WTO’s negotiating group on agriculture - New Zealand ambassador John Adank - is set to convene a meeting next Wednesday to discuss progress so far in the talks. However, with differences in approach emerging among the countries that co-sponsored the stockholding proposal, it remains unclear how members will seek to move ahead. (See Bridges Weekly, 6 March 2013)

A number of developed countries remain concerned that the proposal could open a significant loophole in WTO rules on farm support, by allowing some developing countries to expand the amount of trade-distorting support they provide to farmers when purchasing food stocks. Many developing countries, including some of the original proponents of the initiative, have also questioned whether the stocks could actually distort global markets and undermine food security for their own producers.

However, trade sources told Bridges that delegates are ready to engage in talks on the G-33’s submission. “Most delegates said ‘yes, we’re ready for a substantive discussion on the proposal’,” said one.

Also hanging in the balance is a separate proposal for easing farm imports under tariff rate quotas, which was tabled in October by the G-20 developing country group that favours farm policy reform in the developed world. (See Bridges Weekly, 3 October 2012) Delegates told Bridges that members were still due to discuss this, along with another proposal on agricultural export competition, as part of the pre-Bali preparations.

Developing, LDC issues

The third section of a planned Bali package would likely involve issues of interest to developing and least developed country (LDC) members. The Special Session of the Committee on Trade and Development has been meeting every couple of weeks in an open-ended format during the first part of this year, with the latest one reportedly being held last Friday.

Sources familiar with the talks in this area note that the 28 Cancún proposals - part of a group of 88 proposals aimed at strengthening the special and differential treatment (S&DT) provisions in the various WTO agreements that were agreed, but not harvested, ten years ago - are still being discussed in this setting, as is the so-called Monitoring Mechanism, which would review the functioning of provisions in WTO rules for S&DT treatment in favour of developing countries and potentially suggest improvements.

Topics related to the WTO’s Agreement on Sanitary and Phytosanitary Measures are also being reviewed, delegates familiar with the talks noted to Bridges.

The question of which LDC-specific issues - such as duty-free quota-free market access, rules-of-origin, and cotton - might be included in a December package is also expected to emerge again ahead of MC9, sources say. These topics had also generated substantial discussion ahead of the last ministerial, only for the planned “LDC-plus” package for the 2011 conference to ultimately fall through.

ICTSD reporting.

The 159-member organisation is hoping to clinch a small package of deliverables from the long-running round of Doha trade talks, which were formally declared at an impasse in December 2011, in time for the upcoming Bali gathering.

Activity in Geneva has ramped up in light of an unofficial Easter stocktaking deadline, sources say, especially given that a meeting of the WTO’s Trade Negotiations Committee - tasked with the Doha Round negotiations - is currently scheduled for mid-April. The TNC gathering has been deemed by many to be a useful date for testing whether a Bali agreement is indeed likely - particularly given the few months between now and December.

The global trade body’s outgoing Director-General, Pascal Lamy, has already warned that the membership must “run faster” if they hope to achieve results in Bali and avoid another “housekeeping ministerial.” (See Bridges Weekly, 27 February 2013)

Chair: Trade facilitation talks moving too slowly

The proposed centrepiece of any Bali deal is an agreement on trade facilitation, which deals with topics such as easing customs procedures and cutting times at border crossings. Trade facilitation negotiators met in Geneva last week in an effort to advance these talks forward, only for several brackets - numbering well over 600 - ultimately remaining unresolved in the trade facilitation draft text.

Following the five-day meeting, Ambassador Eduardo Ernesto Sperisen-Yurt of Guatemala, who chairs the trade facilitation talks, warned members that the negotiations are not advancing fast enough. “Based on our existing progress, we will not make it by December,” he said, according to sources familiar with the meeting.

While delegates speaking to Bridges confirmed that talks were moving slowly, with many contentious issues remaining on the table, some still expressed optimism that an outcome might be possible in time for the Bali ministerial.

Consultations on trade facilitation have lately been held under a “facilitator-led process,” involving facilitators from 17 WTO members that have been reviewing the text section by section in order to find areas of agreement. In an effort to move the process forward, the chair suggested last week that members change tactics - specifically, by appointing four “friends of the chair” to supplement the facilitator method that has been used to date.

These four “friends of the chair” would be Michael Stone of Hong Kong, already a facilitator, along with Ambassador Mario Matus of Chile, Ambassador Remigi Winzap of Switzerland, and Ambassador Yonov Frederick Agah of Nigeria.

The four “friends of the chair” would be tasked with consulting with members on the main points of contention in the trade facilitation draft text, under the guidance of Sperisen-Yurt, with the hopes that looking at the text more broadly might help in whittling down the 650-plus remaining brackets.

Sources told Bridges that the “friends” could also consider whether some sort of emerging consensus on what members seek to achieve is being properly reflected in the text’s current draft.

In his remarks, the chair reportedly stressed that these four will not be tasked with preparing any sort of Chair’s or Friends of Chair’s text. Rather, these four “friends of the chair” will be required to hold open-ended meetings with members, together with any other consultations that they deem useful; any findings from these various consultations will ultimately be brought back to the full negotiating group. The process will remain member-driven, he said, according to sources familiar with the meeting.

However, even with the new process, there is “still much to do, to see if we make progress in this area,” one developing country delegate commented to Bridges.

A new consolidated trade facilitation draft text is expected to be released in the coming days, reflecting revised language on areas such as publication, penalties, appeals, separation of release, e-payment, and perishable goods, which were adopted via the facilitator’s process. The next meeting of the trade facilitation negotiating group is currently scheduled for 21-24 May.

Agriculture

Meanwhile, trade officials have come to the end of a month’s intensive discussions on food stockholding schemes, as part of an attempt to understand how best to respond to a negotiating proposal on this question that was tabled ahead of the Bali conference. (See Bridges Weekly, 20 February 2013) The proposal was first submitted by the G-33 group of developing countries with large populations of smallholder farmers.

The chair of the WTO’s negotiating group on agriculture - New Zealand ambassador John Adank - is set to convene a meeting next Wednesday to discuss progress so far in the talks. However, with differences in approach emerging among the countries that co-sponsored the stockholding proposal, it remains unclear how members will seek to move ahead. (See Bridges Weekly, 6 March 2013)

A number of developed countries remain concerned that the proposal could open a significant loophole in WTO rules on farm support, by allowing some developing countries to expand the amount of trade-distorting support they provide to farmers when purchasing food stocks. Many developing countries, including some of the original proponents of the initiative, have also questioned whether the stocks could actually distort global markets and undermine food security for their own producers.

However, trade sources told Bridges that delegates are ready to engage in talks on the G-33’s submission. “Most delegates said ‘yes, we’re ready for a substantive discussion on the proposal’,” said one.

Also hanging in the balance is a separate proposal for easing farm imports under tariff rate quotas, which was tabled in October by the G-20 developing country group that favours farm policy reform in the developed world. (See Bridges Weekly, 3 October 2012) Delegates told Bridges that members were still due to discuss this, along with another proposal on agricultural export competition, as part of the pre-Bali preparations.

Developing, LDC issues

The third section of a planned Bali package would likely involve issues of interest to developing and least developed country (LDC) members. The Special Session of the Committee on Trade and Development has been meeting every couple of weeks in an open-ended format during the first part of this year, with the latest one reportedly being held last Friday.

Sources familiar with the talks in this area note that the 28 Cancún proposals - part of a group of 88 proposals aimed at strengthening the special and differential treatment (S&DT) provisions in the various WTO agreements that were agreed, but not harvested, ten years ago - are still being discussed in this setting, as is the so-called Monitoring Mechanism, which would review the functioning of provisions in WTO rules for S&DT treatment in favour of developing countries and potentially suggest improvements.

Topics related to the WTO’s Agreement on Sanitary and Phytosanitary Measures are also being reviewed, delegates familiar with the talks noted to Bridges.

The question of which LDC-specific issues - such as duty-free quota-free market access, rules-of-origin, and cotton - might be included in a December package is also expected to emerge again ahead of MC9, sources say. These topics had also generated substantial discussion ahead of the last ministerial, only for the planned “LDC-plus” package for the 2011 conference to ultimately fall through.

ICTSD reporting.

The trade chief spoke in more detail to members at an informal meeting of the Trade Negotiations Committee (TNC) - which is tasked with the Doha Round negotiations - last Friday, sources say. At the TNC, Lamy told WTO members that the current state of play - while showing some movement - is still not advancing quickly enough, urging them to “shift to a higher gear.”

The 158-member organisation - which will see Tajikistan join its ranks on Friday - is currently aiming to conclude a small package of deliverables from the Doha Round of trade negotiations in time for its ninth ministerial conference - or MC9 as it is known in trade shorthand - in Bali, Indonesia.

The Doha negotiations, launched in September 2001, were formally declared at an impasse during the last WTO ministerial in December 2011, in an event that has since been called a “housekeeping exercise.” Lamy cautioned on Friday that a repeat of that “will not be in line with the need to strengthen the multilateral trading system” - a sentiment that has also been repeated by members.

In the works for the upcoming ministerial is a package that would - if completed - likely feature a trade facilitation agreement, a few agriculture-related components, and some provisions aimed at addressing developing country and least developed country (LDC) issues.

With just nine months until Bali - and less than 20 working weeks until the summer break - members plan to take stock of progress toward this three-pronged mini-package at the next TNC in April.

Trade facilitation: Political work in capitals key, Lamy says

An agreement on trade facilitation - which deals with easing customs procedures and cutting time at border crossings - would be the centerpiece of a Bali package. The current draft text on trade facilitation, while advanced, still has various brackets remaining, sources confirmed to Bridges.

“There are some real technical issues around customs cooperation that look like they’ll be quite difficult to solve,” one delegate commented to Bridges. Other areas that remain difficult, sources say, include technical and financial assistance for countries to implement commitments under a trade facilitation deal.

The Director-General cautioned that members should avoid “getting lost” in details of customs procedures and regulations, and to also find a formula that will provide the necessary assurances for members regarding the implementation of commitments and capacity-building. He also noted the importance of needs assessments, and matching up individual needs with donor support.

At this stage of the negotiations, Lamy urged members on Friday to mobilise in their respective capitals the necessary resources and support to achieve the objectives of a trade facilitation agreement, stressing the value of political work and coordination with ministries in clinching a deal.

Members who intervened at the TNC generally stressed the importance of advancing the trade facilitation talks quickly, while noting some of the difficulties that have arisen in this area. While there is now greater clarity regarding the issues involved, clarity also “reveals gaps,” and does not necessarily bridge them, the US reportedly said.

Agriculture

During Friday’s TNC meeting, members also discussed progress on two proposals that have been under review in the Committee on Agriculture’s special session in recent months.

One proposal, put forward by the G-33 coalition of developing countries, suggests that the global trade body’s rules be amended to make it easier for developing countries to buy food at administered prices from poor farmers when building public foodstocks or providing domestic food aid. (See Bridges Weekly, 14 November 2012)

The other proposal has been tabled by the G-20, another developing group, which favours reform of developed country farm policies - not to be confused with the G-20 group of major economies. It suggests that progress could be made on issues such as the administration of tariff rate quotas or export competition. (See Bridges Weekly, 3 October 2012)

While the Director-General described a “willingness” among members to achieve a deliverable for Bali regarding the G-20 proposal on tariff rate quotas, he noted that the G-33 public stockholding proposal is meanwhile undergoing a two-stage process that will involve several technical meetings to better understand the nature of the plan. (See Bridges Weekly, 20 February 2013)

Members who spoke at Friday’s meeting generally commended the G-20 proposal for being well-advanced with regards to technical work. However, several noted that the G-33 plan is less developed in this respect, with some - including the US - also questioning whether it was well calibrated to the rest of the negotiations.

Some members also raised at Friday’s TNC two other long-standing sticking points of the WTO’s agriculture talks: export subsidies and cotton. At the Hong Kong ministerial conference in 2005, members had decided that developed countries would eliminate export subsidies this year, a point that was reportedly mentioned by Brazil, the Cairns Group of agricultural exporters, and Uruguay. Members that have made use of these measures, such as the EU, have traditionally said that this agreement was dependent on broader progress in the Doha talks as a whole.

The Cotton-4 group - Benin, Burkina Faso, Chad, and Mali - meanwhile raised concerns at Friday’s meeting that the contentious issue of cotton had not seen any recent progress.

“The impasse within the Doha Development Agenda worries, to a great degree, African cotton-producing countries, who still do not understand why the commitment made by ministers in December 2005 in Hong Kong to address cotton ‘ambitiously, quickly, and specifically’ has yet to be implemented,” Burkina Faso said on behalf of the C-4. The group urged that members try new negotiating approaches ahead of the Bali ministerial.

Developing country, LDC issues

The third area of deliverables that members are currently reviewing for Bali relates to developing country and least developed country (LDC) issues. On this, the Director-General told members that work is continuing in the Special Session of the Committee on Trade and Development, with meetings being held every two weeks in an “open-ended” format.

Under discussion in this area have been three clusters of topics. The first involves the 28 Cancún proposals, which were part of a group of 88 proposals aimed at strengthening the special and differential treatment (S&DT) provisions in various WTO agreements. These 28 were agreed in principle ahead of the WTO’s 2003 ministerial conference in Cancún; however, they were ultimately not harvested.

Also under discussion is the so-called Monitoring Mechanism, which would review the functioning of provisions in WTO rules for special and differential treatment in favour of developing countries, and possibly suggest improvements to those provisions. Negotiations on the mechanism date back over a decade; however, questions remain over the mandate of such a scheme, a point that the Director-General noted in his remarks.

Some progress has also been made on six Agreement-specific proposals, relating to the Sanitary and Phytosanitary (SPS) and Import Licensing Procedures Agreements, Lamy said.

With regards to LDC-specific issues - specifically regarding preferential treatment to services from LDCs, duty-free quota-free market access, and cotton - members are reportedly still awaiting proposals from the LDC group.

An extension of the transition period for LDCs to implement the WTO’s rules on intellectual property rights is another topic under review, Lamy said. Least developed countries’ exemption from implementing the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) expires in July of this year; a proposal to extend this deadline further is scheduled to be discussed at next week’s meeting of the organisation’s TRIPS Council.

Other efforts, post-Bali prep

Meanwhile, other initiatives - such as an effort to expand the coverage under the WTO’s Information Technology Agreement (ITA) - are continuing in other venues, a point that was mentioned by both the EU at Friday’s TNC and by Lamy at Monday’s General Council. Whether or not the ITA expansion effort - which is an initiative among some members of the WTO’s plurilateral deal on information technology products to expand the agreement’s coverage - will be ready in time for Bali, however, is still unclear.

The Director-General has also begun to hold a first round of consultations on a potential post-Bali agenda, sources confirmed, while stressing that this process should not detract from the main goal of clinching a set of deliverables in time for the ministerial.

Members have generally stressed that results in Bali should not be the end for the Doha Round, but rather a “stepping stone” along the way. However, delegates speaking to Bridges privately have noted that - while establishing plans for after Bali is important - there is a nervousness among some of the membership about discussing other topics too early in the ministerial preparation process, given the risk that such topics could ultimately cause complications.

Avoid “Christmas tree,” members warn

Given the little time between now and Bali - and the WTO membership’s history of missing negotiating deadlines - various members repeated earlier cautions on Friday against any sort of “Christmas tree” approach in preparing for the ministerial.

“We need to all remember however, that the only reason why we have a chance of reaching agreement in MC9 is precisely because all of us have shown a remarkable ability to control our appetites,” EU Ambassador Angelos Pangratis said.

Director-General’s race

The Bali preparations come as WTO members gear up to choose a new Director-General to replace Lamy when he steps down at the end of August. Nine candidates - eight of which are from developing country members - are currently vying for the role; whoever wins the leadership contest will take office in time for the upcoming ministerial. (See Bridges Weekly, 6 February 2013)

Delegates in Geneva have commented to Bridges that - while the Director-General’s race has not played a major role in the Bali preparations yet - a new WTO head will need to be ready to hit the ground running on 1 September, given the timing of the ministerial conference so shortly thereafter.

The process, which took centre stage in Geneva during the last week of January as candidates made their pitches to the General Council, has now shifted to its next stage, with the nominees now travelling around the globe in an effort to build support among the membership ahead of the consultation rounds - which are set to begin in April. The consultations will be conducted by a so-called “troika,” made up by the new heads of the General Council, Dispute Settlement Body, and Trade Policy Review Body, who were formally announced on Monday.

The new General Council Chair will be Ambassador Shahid Bashir of Pakistan, as had been expected. The chair of the Dispute Settlement Body will be Ambassador Jonathan Fried of Canada, and the chair of the Trade Policy Review Body will be Ambassador Joakim Reiter of Sweden.

Members will have to choose a new WTO head by the end of May, at the latest.

ICTSD reporting.

Trade ministers suggest Easter stocktaking

Preparations for the upcoming WTO ministerial conference in Bali, Indonesia took centre stage during the annual - and now traditional - informal meeting of trade ministers that was held on Saturday on the sidelines of the Davos gathering.

Ministers from the organisation’s membership are scheduled to gather on the Pacific island from 3-6 December, in a meeting that is being closely watched by the trade community as a place where movement on the stalled Doha negotiations might occur.

The last ministerial - held in Geneva in late 2011 - was widely viewed as a “housekeeping” style exercise, with ministers declaring the Doha Round of trade talks at an impasse and agreeing on a few non-Doha items relating to least developed countries. (See Bridges Daily Update, 18 December 2011) However, this upcoming meet is being viewed as a chance to move some of the less controversial elements of the Doha talks forward, though WTO members have been cautious to date in placing too much pressure publicly on the Bali preparation process.

With that in mind, members have spent much of the last year trying to whittle down brackets in the draft text of the Doha negotiations on trade facilitation, while also reviewing proposals for possibly advancing a few components from the agriculture and Special and Differential Treatment (S&DT) parts of the Round. Sources have said that the trade facilitation draft text, while still under negotiation, is making progress, with many of the current brackets stemming from just a few areas of disagreement.

The Saturday trade ministers’ meeting, hosted by Swiss Economy Minister Johann Schneider-Ammann, brought together over 20 top officials from the organisation’s membership, along with outgoing WTO Director-General Pascal Lamy and current General Council Chair Elin Østebø Johansen of Norway, with the purpose of discussing next steps in the Bali preparation process.

In his concluding remarks following the meeting, Schneider-Amman noted that ministers agreed that the core of any Bali outcome should indeed include trade facilitation, some agriculture components, and items of special interest to developing and least developed country (LDC) members.

Given the importance of time management in preparing for Bali, ministers also agreed on the need for “clarity on the scope of the possible deal as soon as possible,” the Swiss economy minister said. To that end, they suggested that WTO members evaluate at Easter where things stand and whether a “meaningful result” in Bali will be achievable, he added.

“All of us stressed that a success in Bali should not be seen as the end of the Doha road,” he said. “It should be considered as a stepping stone on the way to address the remaining issues under the WTO agenda including the conclusion of the Doha Round.”

“There remain many technical topics open, and it’s about closing them one by one,” WTO Director-General Pascal Lamy told reporters following the trade ministers’ meeting. “I believe this is doable.”

Other high-level meetings to prepare for Bali are likely to be on the horizon in the coming months. With the US and China both set to have new officials in their top trade posts by the Bali ministerial, key WTO players could meet again in what is known in trade circles as a “mini-ministerial” setting ahead of the December gathering, Indian Commerce and Industry Minister Anand Sharma suggested to Lamy today in New Delhi, according to the Business Standard.

EU-US talks

Meanwhile, the prospect of Brussels and Washington launching trade talks this year also featured prominently during the Davos summit, with EU national leaders reiterating their push for the negotiations.

“In late 2008 we saw the steepest fall in global trade ever and the deepest since the Great Depression,” British Prime Minister David Cameron told an audience at Davos last week. “More than four years on, and trade has still not recovered fully. This should be foremost in the mind of every leader and every diplomat during those long negotiations on trade and there is a huge amount on the table today.”

Highlighting the EU’s various bilateral trade efforts - including negotiations with Canada, which are said to be in their final stages, the recent conclusion of talks with Singapore, and the planned launch of discussions with Japan - Cameron particularly stressed the value that a deal with the US could add to the fragile EU economy.

“The EU and US together make up nearly a third of all global trade,” Cameron said. “A deal between us could add over £50 billion to the EU economy alone.”

German Chancellor Angela Merkel also reiterated her own support of an EU-US pact during last week’s gathering.

Notably, US Trade Representative Ron Kirk - who is set to leave his role as the US’ top trade official next month - told the New York Times in an interview that his country is indeed interested in such negotiations, and said that his departure should not have any effect on the launch of the talks. However, he explained, such a deal must be able to pass in the US Congress and address possible concerns from domestic farm groups.

“We greatly value the trans-Atlantic relationship,” Kirk said, noting that Washington has devoted much time toward evaluating the possibility of an EU-US deal. “If we do this, we want there to be a bridge to somewhere and we want to get there on one tank of gas,” he added.

The delay in an expected report from a joint EU-US working group - which is meant to include recommendations on whether to begin trade talks - has sparked questions over whether Washington is getting cold feet over the potential pact. However, EU Trade Commissioner Karel De Gucht told Reuters on Friday, the report is essentially ready, minus a few outstanding issues.

“I will go to Washington to discuss a couple of small items and for a final reading,” the EU trade chief said along the sidelines of a separate summit in Santiago, Chile (for more on the Santiago summit, see related story, this issue). “But essentially we’re on the same page.”

“We will have a common recommendation,” he added. “If we were of the opinion that it was not worth trying, we wouldn’t have put in this much time.”

Director-General candidates begin to campaign

During the five-day Davos meeting, candidates for the WTO’s highest post also began making their push for the job. Nine nominees are currently in the running for the Director-General position - the largest contingent ever in the organisation’s history - with eight of the candidates being from developing countries.

The list of candidates is made up of current or former trade ministers or WTO ambassadors. These include former Indonesian Trade Minister Mari Elka Pangestu; current South Korean Trade Minister Taeho Bark; Herminio Blanco, Mexico’s former minister of trade and industry; and Amina Mohamed, formerly Kenya’s WTO ambassador.

Also in the running are Costa Rican Foreign Trade Minister Anabel González; former Ghanaian Minister of Trade and Industry Alan John Kwadwo Kyerematen; New Zealand’s Tim Groser, who serves as his country’s Minister of Trade, Minister for Climate Change Issues, and Associate Minister for Foreign Affairs; Roberto Carvalho de Azevêdo, Brazil’s current WTO ambassador; and Ahmad Thougan Hindawi, previously Jordan’s Trade and Industry minister.

Speaking on Wednesday at an event hosted by the Evian Group - a global economic governance think tank at the Lausanne-based business school IMD - several of the candidates noted that the Doha negotiations’ struggles have caused significant frustration among the business sector.

“You have to distinguish [between] WTO and Doha - a lot of business people, when you say Doha, that’s when they get frustration in their eyes,” Pangestu commented. “This is also from my travels - some of them find Doha has undermined the WTO.”

“I think the fundamental point remains - physician, heal thyself,” Groser said. “They will be here once we start to develop momentum [in the negotiations].”

“I can get them back into that space when I convince them something real is going on here,” he said.

However, some stressed that businesses have not given up on the global trade body. As for whether businesses find the WTO irrelevant - “I don’t buy it,” Mohamed said, while acknowledging that there is frustration. “A divorce between [the two] could not happen, even if we tried.”

However, the five candidates at the Evian event - Mohamed, Groser, Pangestu, González, and Kyerematen - all noted that a trade facilitation deal in Bali could send a positive signal to the private sector, and help incite their interest further in the global trade body, and stressed that the WTO remains relevant despite the Doha Round struggles.

All nine are in the process of formally presenting themselves to the WTO membership this week at a meeting of the General Council, which is the organisation’s highest-decision making body outside of their ministerial conferences.

The presentation will next be followed by rounds of consultations among the membership, until one candidate can be chosen by consensus. Absent agreement, the appointment could go down to a vote, though that would be a last resort.

A full run-down of the General Council presentations will be published in a special Bridges report on Friday, 1 February.

ICTSD reporting; “EU, US on verge of ‘difficult’ free-trade negotiations,” REUTERS, 26 January 2013; “WTO’s Lamy Says Trade Deal Is Needed to Ease Bali Talks,” BLOOMBERG, 26 January 2013; “Doha Round: Key WTO members may meet before Bali conference,” BUSINESS STANDARD, 30 January 2013.

Tentative - and fragile - recovery

The 23-27 January Davos meeting - also known as the Annual World Economic Forum - comes as the global economic environment begins to post signs of recovery. However, many analysts caution that risks remain, particularly given the uncertainty surrounding some of the upcoming policy battles in developed economies.

Both World Bank and International Monetary Fund (IMF) top officials have urged policymakers in recent weeks against becoming complacent, insisting that no one can yet afford to return to “business as usual.” IMF estimates released on Wednesday found that global growth is likely to reach 3.5 percent in 2013, up from 3.2 percent in 2012. However, the institution noted, the euro area still poses a substantial downside risk to global prospects.

“We stopped the collapse, we should avoid the relapse, and it’s not time to relax,” IMF Managing Director Christine Lagarde told reporters last Thursday in Washington.

The new growth estimates come as Washington lawmakers begin preparing themselves for a second “fiscal cliff”-style fight in as many months, this time on raising the US debt ceiling. Meanwhile, the EU’s struggles are set to continue, with the 27-country bloc now facing the possibility that Britain may choose to reassess the nature of its membership, amid other potential challenges. Japan, for its part, has lately had to undertake additional quantitative easing in order to meet an inflation target of two percent - a move that has reignited concerns of an international “currency war.”

Trade mini-ministerial on Saturday

Trade ministers from some of the WTO’s members are also slated to meet on the sidelines of Davos, in a mini-ministerial gathering hosted annually by Switzerland. These events have traditionally served as a way to assess progress in the Doha Round of trade talks, which are now in their twelfth year.

As 2013 will be a ministerial year for the Geneva-based trade body - with trade ministers from the WTO membership planning to meet in Indonesia this December - many will be watching Davos for any early indications of how the Bali preparation process might unfold in the upcoming months.

“I think Davos will be important, notably for more generally defining where we are going in 2013 and what we will see at the end of 2013 in Bali,” one developed country delegate commented to Bridges. “In that sense, it’s important, but let’s not overstate it. We’re not going to see any major breakthroughs at Davos - it’ll just be a chance for ministers to touch base.”

Others added that it was probably too early to say what might come out of this weekend’s mini-ministerial, while noting that the planned Bali package is expected to be among the topics of discussion.

WTO members are aiming to conclude a scaled-down package of deliverables from the Doha negotiations in time for the Bali meet, including a possible deal on trade facilitation, which involves easing customs procedures and other border restrictions. Selected components from the Round’s agriculture talks or regarding special and differential treatment (S&DT) issues are also among those being considered for a December agreement.

However, given the limited amount of time that WTO members have to prepare the hoped-for package of Doha deliverables - and the membership’s difficult history with this round of trade talks - many are still cautious about overhyping the prospects for the Bali gathering.

In that context, WTO Director-General Pascal Lamy urged members last month to be realistic in their preparations for the upcoming ministerial, noting that any sort of “Christmas-tree” syndrome in compiling a Doha deliverables package could have “destabilising effects on the entire process, jeopardise the ministerial conference itself, and dent the credibility of the WTO.” (See Bridges Weekly, 12 December 2012)

As negotiating processes back in Geneva begin to kick into gear, delegates speaking to Bridges have expressed a similar tone of cautious optimism. Sources note that some meetings are already occurring on trade facilitation to begin clearing up the remaining brackets in the draft text, while an informal meeting of the agriculture negotiating group was held last Friday (for more on the agriculture discussions, see related article, this issue).

“At the end of last year, we were talking about meeting [back in Geneva] early this year for any ideas, proposals for the Bali package to turn out,” one developed country official said.  “But again, you can’t stop someone from putting something forward at the last minute, so I guess we’ll have to wait and see.”

Some candidates for top WTO post expected at Davos, sources say

With the race well underway to find a successor for WTO Director-General Pascal Lamy - who will step down from his post in August - sources expect several of the contenders for the job to appear at the Davos meet as they begin their efforts to build support among the organisation’s membership. (See Bridges Weekly, 16 January 2013)

The WTO Director-General contest is being closely watched by the international community, with questions abounding in Geneva circles as to whether the next global trade chief will be from a developing country - which has only happened once in the organisation’s history, with Supachai Panitchpakdi of Thailand - and what effect, if any, having a new organisation head might have on re-energising the Doha Round talks.

Nine nominees are currently in the running for the post, with eight of them being from members self-designated as developing countries. It is uncertain at this stage whether geography or political alliances will be meaningful as delegates and observers increasingly voice their hope that competence and skills serve as the primary criteria for selection.

The list of candidates, made up of prominent current or former trade ministers or ambassadors to the WTO, includes well-known trade economists such as former Indonesian Trade Minister Mari Elka Pangestu; current South Korean Trade Minister Taeho Bark; and Herminio Blanco, Mexico’s former minister of trade and industry who also served as his country’s chief negotiator for the North American Free Trade Agreement (NAFTA).

The nominees also include well-known international and trade law experts such as Kenya’s Amina Mohamed, who was previously her country’s WTO Ambassador; Costa Rican Foreign Trade Minister Anabel González, who in the past ran the WTO’s Agriculture and Commodities Division; and former Ghanaian Minister of Trade and Industry Alan John Kwadwo Kyerematen, also an economist.

Long-standing and experienced career diplomats, such as Tim Groser of New Zealand, who serves as his country’s Minister of Trade, Minister for Climate Change Issues, and Associate Minister for Foreign Affairs, and Roberto Carvalho de Azevêdo, Brazil’s current ambassador to the WTO, are also in the running. Ahmad Thougan Hindawi, an engineer and businessman who was previously Jordan’s Trade and Industry minister, is also vying for the role.

The candidates will all have the chance address the WTO membership at a meeting of the General Council - the organisation’s highest decision-making body outside of its ministerial conferences - from 29-31 January. Lamy’s successor is expected to be announced by the end of May, at the latest.

A full report on the Davos trade ministers’ meet will be featured in the 30 January issue of Bridges, while an update on the General Council presentations will be made available in the 6 February edition.

ICTSD reporting.

Over the last few months, components of the Doha Round’s agriculture negotiations have been tabled as possible items to balance out a deal from a different area of the talks - trade facilitation.

The latter, which deals with easing customs and border procedures, has been increasingly talked about in Geneva circles as a possible centrepiece of any Bali mini-package. However, after many members insisted that trade facilitation alone could not serve as a “self-balancing” pillar, negotiators have been examining other areas of the talks - including agriculture - for possible items that could be extracted to achieve that balance.

In that context, separate proposals from two developing country coalitions in the WTO - the G-20 and the G-33 - have been raised so far as possible agriculture-related deliverables. (See Bridges Weekly, 21 November 2012) The proposals deal with the administration of Tariff Rate Quotas (TRQ) and public stockholding for food security, respectively.

However, whether these components, or any others, will ultimately be approved by WTO members in time for Bali is still unclear, sources say.

Adank: Time to “intensify” negotiations

At Friday’s meeting, New Zealand ambassador to the WTO John Adank - chair of the organisation’s agriculture talks - encouraged officials to share any new proposals as soon as possible to “intensify” the negotiating process in the coming weeks.

A prerequisite for further discussions, he said, were answers to two questionnaires circulated in December by the WTO secretariat. The questionnaires were an attempt to inform those proposals currently under consideration by cataloguing the structure of public stockholding for food security, domestic food aid programmes, export credits, export guarantees, and insurance programmes. One delegate described the data requested as an “important catalyst” to move the talks forward by Easter.

Cautioning against turning the Friday meeting into a “technical workshop,” Adank noted that more focused discussions should start by mid-February. The negotiating proposals submitted last fall offer plenty of ground for “the technical and political decisions” needed for a Bali compromise, a developing country delegate told Bridges.

Several Geneva-based trade officials echoed Adank’s observation that discussions on the G-33 proposal on public stockholding for food security are at an earlier point in their “evolution” than those on the G-20’s call for improved TRQ administration.

“This year will be spent on understanding each others’ policies,” observed one delegate when asked to comment on the proposals and the work ahead. Another remarked that “all activities are geared towards Bali,” adding that there is “reduced short-term” ambition, given both the limited time between now and next December, and how little was achieved at the previous ministerial in 2011.

Two additional proposals are rumoured to be under consideration, one on export competition, taken from the fourth draft of agriculture modalities - known in Geneva jargon as Rev. 4 - and another on the food security needs of Net Food Importing Developing Countries. Delegates speaking to Bridges noted that those discussions were at a very early stage.

Expectations for the Bali ministerial are being managed by Geneva-based officials, with one developed country delegate anticipating not much more than “warm weather, no rain” on the tropical island in December. With negotiations off to a slow start this year, many are waiting to see what happens after the World Economic Forum’s summit in Davos, Switzerland. (For more on the Davos meet, see related story, this issue)

ICTSD reporting.

“MC8 left us with a long to-do list,” the Director-General told WTO members, referring to last year’s ministerial conference in Geneva, where trade ministers formally directed the global trade body’s members to explore new negotiating approaches in light of the stalemate in the talks.

However, Lamy added, members now appear to be showing “encouraging signs” that they are ready to resume their negotiations in earnest, despite 2012’s admittedly slow start.

“The activities of 2012 have contributed to building some momentum. You have put on your negotiating caps again. And we cannot afford to lose it,” he said, urging members to transform this renewed sense of engagement into concrete proposals during the first quarter of 2013. “Our credibility in the next phase will depend on our ability to make tangible progress on specific issues as they mature.”

Progress in some areas, standstill in others

Chairs of the various Doha negotiating groups also spoke at Friday’s meeting of the WTO’s Trade Negotiations Committee (TNC) - which is tasked with all negotiating aspects of the Doha Round - in order to give delegates the current state of play on the different topics under negotiation.

Topics such as trade facilitation, agriculture, special and different treatment (S&DT), least developed country (LDC) issues, and dispute settlement have advanced over the past twelve months, they said, while others - such as the WTO’s negotiations on services - have barely moved at all, and are unlikely to move forward in the months ahead.

The possibility of a trade facilitation deal by end-2013 - an area of the talks that deals with easing customs procedures and other border restrictions - has gained

increased prominence over the past several months. Negotiators have been working toward finding internal balance within the subject-specific talks, as well as trying to find deliverables from other areas of the Round to go with it, in response to concerns from some members that a deal focused solely on trade facilitation would not be “self-balancing.”

On trade facilitation, negotiating group chair Eduardo Ernesto Sperisen-Yurt - who serves as Guatemala’s WTO ambassador - noted that talks in this area have shown promising developments over the past year, with members demonstrating a willingness to continue negotiating further in the year ahead.

In his oral report to the TNC, Sperisen-Yurt also stressed that members should not be alarmed by the various unresolved parts of the trade facilitation draft text.

“Those who don’t follow these negotiations closely could see themselves tempted to count the brackets that still remain in the text,” he said. “But I’d warn them that it would be an error to see that as an indicator of current progress,” he added, noting that in many cases, just one area of disagreement is the source of many of those brackets.

Notably, the topic of S&DT in the trade facilitation talks was raised by many members in their interventions, and is expected to feature prominently in upcoming negotiations.

In parallel, three proposals on agriculture - two from the G-20 coalition of developing countries, and one from the G-33 developing country group - have been debated as possible components to pair with a trade facilitation deal, earning a cautious welcome from fellow WTO members. (See Bridges Weekly, 21 November 2012)

Australia, speaking on Friday on behalf of itself and for the Cairns Group of agricultural exporters, reportedly commented that the new proposals have been a positive development, given that they have helped re-establish agriculture as a key element of the negotiations. However, sources note that Switzerland, on behalf of itself and the G-10 coalition of countries with highly-protected farm sectors, remarked that agriculture is not the only issue on the table.

Steer clear of surprises, Lamy cautions

In preparing for MC9 in Bali next year, members should “go back to our well-known principle of ‘no surprises’,” the Director-General cautioned on Friday. “Any kind of Christmas-tree syndrome as we get closer to MC9 would have destabilising effects on the entire process, jeopardise the ministerial conference itself, and dent the credibility of the WTO.”

Efforts last year at building an LDC-focused “Doha-light” package in time for the December 2011 Geneva ministerial ultimately fell apart, due to members being unable to agree on which LDC - and non-LDC - issues to include in such a deal, in what was also referred to as a “Christmas-tree” problem.

In order to achieve results in time for Bali, Lamy added, members should pursue “realistic” demands that account for other members’ so-called “red lines,” while avoiding unattainable goals or being confrontational in the negotiating process.

He also said that proponents of any new proposals should take on the responsibility themselves to build consensus among other members, and that members must avoid setting “new and unworkable deadlines.”

MC9: a Doha Round stepping stone

While a small package of Doha deliverables for next December now appears to be members’ current goal, many made clear at Friday’s meeting that the Bali event would not mark the end of the organisation’s efforts to conclude the entire Round.

“Of course, we should be under no illusion about the breadth of what we can achieve in the short timeframe between now and MC9,” Lamy said. “Nor should we create unrealistic expectations. The main stumbling blocks of the [Doha Development Agenda] are still standing and many of the toughest nuts will likely not be cracked by the time ministers meet in Bali.”

“But we should also not wait for the last minute to engage,” the trade chief warned. “One more housekeeping ministerial conference in Bali would not suffice to keep the Doha House alive.”

Various delegations who spoke on Friday echoed the Director-General’s comments, noting that Bali is just one step in a longer process. Many also cautioned that the year until Bali’s meeting is - in practice - less time for negotiating than it sounds.

“A successful MC9 appears today clearly as a necessary precondition for the conclusion, at a later stage, of the whole Round,” EU Ambassador Angelos Pangratis commented. “Progress achieved is fragile; the road ahead is long and the time to MC9 is in fact very short.”

“Bali is not a deadline, but it has already emerged as a milestone. One way or the other, Bali will mark a moment when not only we but the world outside of Geneva take stock of our work and the health of the trading system,” US Ambassador Michael Punke added.

ICTSD reporting.

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This new paper - which will be released and presented by the authors at the side event - seeks to capture the political economy of the discussions on transfer of technology during the past five decades. In doing so, it addresses two key questions: Have such debates catered to country level technological needs in developing countries? To answer this, the paper critically reviews the progress made in understanding the role of technology and innovation capacity for economic development over the past decades and critically assesses whether these debates find a place in the negotiations and deliberations as we have them today. The second question is more forward looking, with a view to make a constructive contribution towards resolving some of the most longstanding issues in technology transfer. How and through what ways can international discussions on technology transfer be made to reflect the lessons learned up until now on how countries build technological capabilities and the challenges posed by the changing global environment for knowledge and technology?

If you do not have an accreditation to the CDIP and wish to attend the event, please email Mr. Alessandro Marongiu at amarongiu@ictsd.ch