Bridges Weekly Trade News Digest • Volume 7 • Number 27 • 28th July 2003
Early Harvest On S&D May Have To Wait Until Cancun
On 17 July, General Council Chair Ambassador Pérez del Castillo (Uruguay) circulated an updated list of proposals aimed at strengthening special and differential treatment (S&D) provisions for developing countries. This updated list (available at http://www.ictsd.org/issarea/development/resources/16-07-03_S&D-text.pdf) deals with the first category of proposals offered by the General Council Chair (i.e. those proposals targeted for possible agreement at or before the 10-14 September Cancun Ministerial Conference) in an attempt to overcome the long-standing impasse on the S&D review (see BRIDGES Weekly, 17 July 2002). While Chair Pérez del Castillo had hoped to offer a package of proposals for adoption at the 24 July General Council session, a lack of consensus led him to postpone this move in hopes of offering a "better" package either before or at the Cancun Ministerial.
Latest language — Category I
This latest list, put together with the help of a ‘Friends of the Chair’ group comprising Brazil, Kenya, Bangladesh, the US, EU and Norway, offers revised language on the majority of the 24 proposals in Category I that as of early July had yet to be agreed upon, including one new proposal from Paraguay related to waivers. It essentially divides these remaining proposals into six subcategories. The first (A) includes those proposals on which Members have essentially already ‘agreed to’ in principle (although a number of developing country delegates have expressed reservations on them being agreed outright). The second (B) is further sub-divided into i) proposals on which there is an agreement in principle; ii) proposals on which there appears to be an agreement, but where minor adjustments are required; iii) proposals on which an agreement seems close, but further work needs to be done; and iv) proposals that the Friends of the Chair consider should be withdrawn. On this latter sub-category, one Africa Group delegate insisted that the title used was misleading, as the proposals here had merely been "set aside for now, and were certainly still on the table". The final subcategory (C) includes those proposals "considered in the regular process of consultations [...]".
Curiously, the latest text appears to be missing a proposal regarding flexibilities for least-developed countries (No. 38 in the 5 May text, see http://www.ictsd.org/issarea/development/resources/Latest-SDT-proposals.pdf). Attempts to confirm whether this was indeed a decision made by consensus or simply a clerical error could not as yet be confirmed.
Process
As mentioned above, initially the aim was to put forward a package of ‘Category I’ proposals for ‘early harvest’ (i.e. early agreement) to be adopted at the 24 July General Council session. Towards that end, the diverse sub-group ‘B’ of proposals were taken up for redrafting by the Friends of the Chair. These were then revisited, along with the others still under consideration, in the morning of the 21 July Heads of Delegations (HOD) meeting, and again at a Friends of the Chair session on 23 July. Pervasive differences of opinion, however, could not be bridged.
Despite being part of the Friends group, Kenya reportedly raised the concern that some of the proposed texts did not properly reflect the discussions that had been held in the Friends meetings. Another participant reported a fairly consistent "four against two", with Brazil often siding with the developed countries. This positioning, the source continued, was also the case on the latest cross-cutting stumbling block to arise — the insistence that no automatic flexibilities, exceptions, and/or assistance to developing countries should be granted.
Kenya was also reported to have commented that many of the proposals failed to fulfil the objectives of the original submissions. To that effect, one developing country delegate said that "[we] would almost be better off forgetting about the ‘agreed’ proposals in group A", as they offered very little in terms of meaningful economic benefit. Another trade source concurred, adding that the net effect could be "very negative" if taking into account the potential costs that developing countries may have to pay in Cancun for the adoption of these S&D proposals (vis-à-vis trade-offs elsewhere in the work programme).
Thus with the cavernous gap seeming too large to overcome, at least for now, the move to offer an early harvest was postponed to late-August (as part of the resumption of the 24 July GC session, see related story, this issue), or the Cancun Ministerial itself. Noting the constant and considerable difficulties Members have faced in this review to strengthen S&D provisions, one trade source following the discussions "wished [Chair Pérez del Castillo] luck in getting a package together before Cancun."
Category II
Of the other 38 proposals sent to relevant WTO subsidiary bodies — which are to report back to the GC just prior to Cancun, with possible additions to the early harvest — the Chairs of the relevant bodies made mostly oral reports to the 24 July General Council meeting (see related story, this issue). One observer summed up the progress as "nothing concrete". Four formal reports (out of a possible nine) were submitted (available at http://docsonline.wto.org) — Agriculture (G/AG/17 & TN/AG/11), Trade-Related Investment Measures (TRIMs) (G/L/638), and Rules (TN/RL/7) — none of which indicated any substantial progress.
Category III
There has also been little progress made on the twelve proposals that are to be taken up by the General Council Chair before Cancun. As far as one developing country delegate was aware, "not a single discussion on category III proposals had taken place so far."
Where to now…
General Council Chair Pérez del Castillo will continue his consultations towards finding an acceptable initial package of proposals to strengthen WTO provisions on S&D after the WTO’s two-week break (ending August 11). Any such package would be offered for adoption at the resumed General Council meeting in late-August (see related story, this issue), or at the Ministerial in Cancun.
ICTSD reporting; "Cancun 2nd Draft on 22 Aug, Clash on process issues at WTO HOD meeting," TWN, 24 July 2003.