Bridges Weekly Trade News DigestVolume 15Number 36 • 26th October 2011

Road to Ministerial Appears Murky as WTO Members Explore Options

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The past week has seen a flurry of activity at the WTO in preparation for the upcoming December ministerial. With the event less than eight weeks away, delegations are pushing to finalise items for inclusion on the ministerial agenda before next week’s 2 November deadline. Meanwhile, members are also exploring the option of an “early harvest” for some Doha items in an effort to move past the current negotiating impasse. Today also saw the General Council approve Vanuatu’s accession to the global trade body.

The WTO General Council - the organisation’s highest decision-making body outside of ministerial gatherings - met informally on Friday 21 October and then formally on Wednesday 26 October. The Trade Negotiations Committee (TNC) - tasked with the Doha Round of trade talks - also met on Friday to discuss the state of play of the negotiations.

“Small steps” suggested for moving forward on Doha

WTO Director-General Pascal Lamy, speaking to the TNC on Friday, urged members that the “challenge before us is to convert the prevailing negative mood into something positive - a signal on forward movement.”

To that end, Lamy suggested that this be done via a series of “smaller steps,” instead of a major leap forward or revamping the Doha agenda.

The Director-General has been conducting a series of consultations with WTO members since the last TNC was held in late July. At July’s TNC, members abandoned the plan to pursue an LDC-plus package oriented around the needs of least developed countries (LDCs); the impasse led the Director-General to declare at the time that “what we are seeing today is the paralysis in the negotiating function of the WTO” (see Bridges Weekly, 28 July 2011).

With regards to the “smaller steps” approach suggested on Friday, Lamy noted a convergence among members around advancing negotiations “in areas where progress can be achieved.”

“In other words, I sense a readiness to operationalise paragraph 47 of the Doha mandate, it being understood that this would be a step towards delivering on the entire Doha agenda,” Lamy explained.

Paragraph 47 refers to the WTO concept of single undertaking, where “nothing is agreed until everything is agreed.” However, the paragraph allows for agreements reached at an early stage to be implemented either provisionally or definitively - in other words, an “early harvest.” The paragraph adds that such agreements “shall be taken into account in assessing the overall balance of the negotiations.”

The approach the Director-General discussed would therefore involve moving away from the single undertaking, finding agreement on smaller issues for the time being. Should agreement eventually be reached on all Doha issues, the areas initially agreed upon would be reviewed in the context of the entire Doha package for balance.

Lamy stressed that “development should remain as a central theme of any outcome.”

The “small steps” suggestion and current state of play drew responses from several members. Some members, including Kenya on behalf of the African Group, marked their disappointment with the current impasse in Doha talks. Australia, speaking on its own behalf, cautioned that the worst outcome is more of the same.

Norway and Mexico both noted that an early harvest is necessary, given the difficulties in achieving consensus.

The US, in their statement to the group, recognised the progress in identifying possible themes where members might converge. However, Ambassador Michael Punke cautioned that “we should not pretend that [this progress] is more or less than it is.”

“We can all choose to have a contest over who can profess their love for the DDA most emphatically. But that won’t accomplish anything. What we need are concrete substantive ideas - new ideas - that will help us to find a way forward,” he urged.

Along the lines of the paragraph 47 suggestion, China urged that “priority should be given to addressing the concerns of developing members” and called upon ministers, developed and developing alike, to put in a concerted effort to “continue to work out something tangible for the [least developed countries, or LDCs],” in line with the development mandate of the Round. At the July TNC, it appeared that members were struggling even to find consensus on what LDC-only issues, along with non-LDC issues, to include in the proposed Doha mini-package.

Concerns over the WTO’s ability to achieve progress were repeated by several members. China noted that, “whatever the case may be, [the ministerial] will be a litmus test of whether the WTO can still deliver. To be or not to be, it is in our hands.”

EU proposal

While few specifics were suggested on the “small steps” possible on Doha, the EU did make a series of suggestions at Friday’s meeting for moving past the negotiating impasse. These included a call for a Trade Facilitation Agreement, coupled with special and differential treatment and appropriate supporting measures for developing countries. The EU argued that this would “represent a genuine win-win outcome for the membership and be of real value for our traders.”

Other EU suggestions included the removal of non-tariff barriers and improved functioning of the Dispute Settlement Mechanism, which would “reduce regulatory impediments to trade and reinforce the multilateral trading system”

Along the lines of further attempts at trade liberalisation, the EU suggested that members examine the possibility of targeted sectoral initiatives, adding that a number of such proposals are already under discussion in the non-agricultural market access (NAMA) negotiating group.

The EU also suggested that the present negotiating mandate be re-examined, and urged that ministers at December’s gathering recognise that “the current multilateral rulebook is not adequately equipped to deal with emerging global challenges such as energy, food security, competition, and investment.”

One developing country delegate, speaking to Bridges, noted that the EU proposal “didn’t receive much of an echo” at the TNC meeting. The EU repeated its proposal at today’s General Council meeting, putting the proposal on the record. TNC meetings are informal, and therefore not part of the official record; in contrast, formal General Council meetings are.

At the formal General Council meeting, the EU proposal drew disapproval from some members, particularly India. The latter stressed that this type of discussion had already been had before, and any new movement would need involvement from ministers.

One official from a least developed country told Bridges that, “my gut feeling, is that many members might not be comfortable” with attempts to bring new issues into the scope of the talks.

Ministerial agenda items remain unclear

Delegations are currently testing out various proposals on non-Doha issues, given that an informal pre-existing ‘gentleman’s agreement’ specifies that agendas for ministerial gatherings should be finalised six weeks ahead of such events - i.e. 2 November.

At Friday’s informal General Council meeting, Chairman Yonov Frederck Agah stressed that “there is a clear need to advance rapidly in our preparations. This is a shared responsibility of us all.”

With regards to the ministerial agenda, one LDC official told Bridges that it is currently “hard to say which items would be on the table or off the table”; more clarity is expected to come next week. However, the difficulties in finalising a ministerial agenda have prompted concern among some trade observers.

The Dominican Republic, speaking for the informal group of developing countries, stated at today’s formal General Council meeting that the group is in the process of working through a number of proposals. The group asked the chair for applying flexibility with regards to the 2 November deadline - a request echoed by Bangladesh on behalf of the LDCs.

The chair did not make a decision in either direction with regards to the extension request, trade sources told Bridges.

At the informal General Council meeting on Friday, Bangladesh stressed that development must remain central to all discussions, and urged members to consider LDC proposals. Kenya added that the African group would be presenting draft proposals for the ministerial, specifically with regards to food security.

Along with Bangladesh on behalf of the LDC group and Kenya on behalf of African Group, Costa Rica, the EU, Mauritius on behalf of ACP Group, Switzerland, and Thailand all called for ministerial action on trade and development issues at Friday’s meeting.

Other proposals being prepared for possible inclusion on the agenda include a work programme for regional trade agreements and improving guidelines for WTO observership of intergovernmental organisations.

Convergence is also lacking on what might serve as a ministerial outcome document. On Friday, Agah told members that his consultations showed some wanting a Ministerial Declaration, others a Ministerial Statement, while still others suggest that a summary by Ministerial Conference Chairman “may be all we can achieve.”

Vanuatu accession approved by General Council

The General Council today also approved the accession package of Vanuatu today; the country applied for WTO membership in 1995 and the Working Party concluded negotiations in May 2011. Vanuatu needs to ratify the deal by April 2012; 30 days after ratification, it would officially be the global trade body’s 154th member.

“[Vanuatu's] membership will strengthen the multilateral trading system and provide this country with a stable and predictable trade environment.” Lamy said.

Trade sources told Bridges that the accession of Vanuatu led to discussions today on the burdensome accession process for least developed countries (LDCs).

The LDC group within the WTO is working on various proposals for the agenda of the upcoming ministerial; one of the proposals is related to the accession process, the source noted.

New negotiating group chairs

Chairman Agah also announced to the General Council that members have reached a consensus regarding new chairpersons for three of the WTO’s negotiating committees. The three ambassadors will formally be elected as chairs at the next formal meeting of their respective committees.

New Zealand Ambassador John Adank will chair the Special Session of the Committee on Agriculture, Malaysia Ambassador Hiswani Harun will chair the Special Session of the Committee on Trade and Environment, and Jamaica Ambassador Wayne McCook will chair the Negotiating Group on Rules.

Adank will be replacing David Walker, the previous New Zealand Ambassador, who stepped down from the position in April to return for a post in Wellington (see Bridges Weekly, 28 September 2010).

McCook will be replacing Dennis Francis, the WTO Ambassador from Trinidad and Tobago, who was elected to the post of rules group chair in July of last year (see Bridges Weekly, 14 July 2011).

Harun will be replacing Manuel A.J. Teehankee, the WTO Ambassador from the Philippines. Harun is currently the chairperson of the regular Committee on Trade and Environment.

ICTSD reporting.

One response to “Road to Ministerial Appears Murky as WTO Members Explore Options”

  1. Mohammad Bajwa

    Less than ideal can be achieved.Some of the issues are not ripe for decision so single undertaking should consist of settling key issues and remanding futuristic
    agenda like competition with a reinforced commitment and a definitive dead line.

  2. Anonymous

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