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LOW KEY WTO DISCUSSIONS OF POST-SEATTLE OUTLOOK

by Chakravarthi Raghavan


Geneva, 3 Feb 2000 -- Trade ambassadors to the WTO Wednesday sought to project a picture of the organization being back in business (after the Seattle debacle) and of members trying to discuss collectively and with goodwill the problems facing them, and particularly, that of developing countries.

In what was described by trade officials as discussions in a "constructive" atmosphere with none of the tensions of recent periods, the members generally seemed agreed to technically start-off further negotiations in agriculture and services, without reopening procedural or other differences (on what, where and how), and of a collective effort to paint a picture of getting on with the business of the WTO.

The discussions were at the informal General Council meeting to prepare for the formal Council meeting on 7 February. There is to be another informal meeting Friday afternoon.

But the discussions in two meetings of the informal General Council Wednesday did not suggest that any of the substantial differences, among the major trading entities and between them and the large number of developing countries, have disappeared or been narrowed down by the bilateral, and some plurilateral consultations, that have been held by the WTO Director-General Mike Moore since January. But the major industrialized countries seemed to go out of the way to suggest that "practical solutions" need to be found and they were ready for dialogue on this issue.

And surprisingly, there seemed to be few takers for the view, pushed in the immediate aftermath by the US leaders, the UK Prime Minister and others that the principal cause of the failure was the issue of transparency and participation in decision-making, and internal and external perceptions of these, needing some quick-fixes.

While no one seemed to ignore this problem, this was not seen as the principal source of the difficulties at the trading system, and almost everyone seemed anxious to avoid quick-fixes that would prove to be attempts to legitimise the present processes by which major trading entities take decisions and then try to stamp it through bilateral, plurilateral and 'green room' consultations to announce a consensus.

The post-Seattle situation was discussed collectively at an informal session of the General Council, chaired by Amb. Ali Mchumo of Tanzania, with the discussions focusing on (a) the mandated negotiations or work (which covers many more areas than agriculture and services), (b) the transition periods and implementation problems, (c) transparency of WTO decision-making, and (d) the Programme of Action for LDCs and WTO technical assistance.

In his report on consultations, Moore said there was "considerable convergence" on several points seen as immediate priorities, but these did not exclude any further action members might decide to take in due course on other areas of interest and concern.

Everyone, he said, had stressed the importance of taking up as a priority, the measures discussed before Seattle favouring the least developed countries, encompassing market access (where Moore and his predecessor Ruggiero had been calling for bound concessions favouring LDCs for quota-free, duty-free access on all products), and capacity building, but that these could not be seen as a "trade off or leverage" to gain agreement for a new round of negotiations. Moore promised to hold further consultations and report back before the Easter recess (in mid-April). This would be an important confidence-building measure.

Another on which he hoped for early agreement was on the WTO technical cooperation programme where Moore is seeking an increase in the regular budget to an amount of swiss franks 10 million a year.

On the question of transition periods (which ended on 31 December 1999), Moore noted that a number of written requests for extension had been made by individual members. His consultations showed that other members were ready to adopt "reasonable and constructive attitude to crafting practical solutions" and he hoped that they would be able to work together to achieve a consensus.

And while the transition periods issue was the most immediate pressing problem, there were also other implementation issues, of major continuing concern for a good number of members, and which had to be taken up in due course. These countries had noted that the proposals for Seattle envisaged establishment of a special implementation review mechanism under the General Council and this was an area that might have to be revisited for further consultations, Moore said.

On the issue of transparency and decision-making, Moore agreed that major issues of substance played a greater role than process in preventing agreements at Seattle. But getting the process right was also important, and he was committed to working on this problem, and that a start could be made by inviting contributions from Members, and further consultations, conducted in a transparent way, perhaps at an informal heads of delegations meeting, which could be held when delegations return from UNCTAD-X.

Moore had been holding bilateral consultations on the General Council meeting and its consideration of the follow-up to Seattle, which had been on the agenda of the 17 December 1999 meeting but had been put off to the next meeting, with the Chairman Amb. Ali Mchumo saying in summing up that informal consultations would take place before the formal General Council.

But in bilateral and plurilateral consultations this week, the WTO head had presented these as consultations by "We/Team". A report by Moore to the informal meeting said he had "consulted widely with Members in cooperation with Chairman and assistance of deputies" to get a sense of priorities for attention beyond the current mandated negotiations.

The informal General Council meeting had been summoned to discuss the agenda before the 7 February formal meeting of the Council which has on its agenda as three separate items:

* Follow-up to the Seattle Ministerial Conference,

* (Mandated) Negotiations in Agriculture and Services, and

* Other aspects of the WTO work programme.

Much of the discussions on the mandated negotiations centred on whether the agricultural negotiations should be in a special committee or in the committee on agriculture. Though there was not as much focus on services, it was clearly understood that whatever was done on agriculture negotiations would apply to the services one too.

While the Cairns group clearly wanted a special committee, or as a compromise special sessions of the Committee on Agriculture with its own chairman, led by a non-Geneva based personality, many others saw merit in the negotiations being conducted in the Committee on Agriculture and the Council on Services. And while they were willing to agree on special sessions of these committees for the mandated negotiations (so that other routine items would not be on the agenda, and there could be focused discussions on the negotiations), they preferred the same, Geneva-based persons, heading the two WTO bodies also chairing and running the special sessions for negotiations. In such a case, they said, the chair of the committee and the negotiations would be able to understand why members raising implementation issues were not in a position to be more forthcoming in the negotiations.

In summing up the discussions Wednesday evening, Mchumo is reported to have said that there appeared to be a growing consensus in favour of existing bodies (the Committee on Agriculture and the Council on Trade in Services) undertaking the mandated negotiations. Mchumo hoped to be able to finalise soon the names of the chair of these two committees and the dates for their first meetings.

In his opening remarks, Mchumo had said that the agriculture meeting (whether of the regular committee or special body) should be held on 23-24 March, and that on services on 21 February.

The issues of how to deal with transition periods and of the other implementation issues, it was apparent, could not be resolved by the 7 February meeting, but consultations would continue to find solutions.

On the transparency issue, it was clear too that most members did not want any new process that would reduce or weaken the present situation of decisions by consensus by a system involving the kind of weighted representation or voting as in the IMF and the World Bank or a UN Security Council format.

As the EC reportedly said Wednesday the ardour for changes has cooled since Seattle, and there should be no rush to judgement.

Several other countries and groups also made the same point, stressing that while there were several useful suggestions and these should be discussed, there should be no attempt to rush into decisions.

One trade diplomat suggested that there were three kinds of views:

There was the view of the major entities and the developed countries who are in any consultation process and without whose consensus no decisions were possible or would even be brought forward to the generality of membership. In effect, some of them favour, under the guise of efficiency and management, creation of smaller bodies where 'consensus' would prevail, but the views of the smaller bodies could be brought up to the general membership and pushed through. This in effect would legitimise the current Quad initiating moves that are sought to be brought up in green rooms and consensus manipulated through some bilateral and restricted consultations.

A large number of developing countries are totally opposed to this.

Among the developing countries, there were those who are now invited to the restricted consultations -- either because of their size or weight of the economy, and the fact that they would be ready to say 'no' to decisions or proposals adverse to them and on which they had not been involved in private consultations.

They do not like these consultations, where often the minority of them are put under pressure by the ganging up of the industrialized countries and some representatives of developing countries who in such closed meetings could often act without instructions from capitals or even contrary to them, in order to support the US or EC.

They are thus not averse to wider open-ended consultations and negotiations, but are not making an issue of it.

There are the large number of small countries who are never involved in the consultations, even when they may be vitally affected, and do not even have any information coming to them from these. These countries and their resentment exploded at Seattle. And while they want wider and more open-ended negotiations and consultations, most of them are not ready to accept any new ideas about steering committee or other processes that would legitimise the present dominance of the majors.

It is probably this awareness that the resentment against the "green room" process could not be used to resurrect old ideas like the "steering committee" (proposed at the Montreal mid-term review) or creating a Consultative Group of 18 (but with something more than consultation and exchange of views, and bordering on negotiations), or a UN security council format based on trade weights, that has cooled the ardour of some majors for reforms aimed at combining "transparency and efficiency".

Argentina, supported by several Cairns members, expressed a preference for special negotiating groups on Agriculture and Services and for starting off the negotiations.

In various interventions, Mexico favoured the existing fora for agriculture and services to discuss the mandated negotiations in their respective fields, and preferred chairs for these bodies based in Geneva. Morocco speaking for African group, supported the Mexican view. As for internal transparency, while there were a number of useful suggestions, these should be discussed but there should be no rush to judgement. Colombia was ready to support Mexico or favour separate negotiating groups.

The Pakistan representative quoted extensively from a speech of the Pakistan ambassador, Mr. Munir Akram on 25 January to the Geneva diplomatic club to insist on the need to pay attention to the implementation problems and remedy the inequities and injustices and lack of benefits under the WTO for developing countries.

Pakistan said that in the light of the implications for the failure at Seattle, it was natural for the Chair of that meeting to hold open the possibility of reviving inconclusive negotiations. But Mrs.Charlene Barshefsky's statement was not a "negotiated" one or even "consulted" text and was not in conformity with WTO rules and procedures.

The Conference, Akram had said, has ended, and while the various texts on the table could not be obliterated from memory, they had no legal existence, and the future actions of the Director-General "will have to be determined through formal decision-making process of the WTO." In any event there was no prospect of reviving the idea of a new Round.

The tasks facing the WTO were the "deadline" issues which were not however "one-way" streets. An overall arrangement responding to the interests of all members had to be achieved, and extension requests could not be dealt with on a case-by-case basis.

But there were also several other implementation issues that had to be examined and addressed.

As for WTO reforms should go beyond 'fixing' decision-making process. If developing countries were to be enabled to participate genuinely the pace and rhythm of meetings would have to be reduced and rationalized. Ministerial conferences should meet after longer periods.

The chairpersons and the General Council should take a stronger role in achieving consensus, and not leave it to the secretariat, which should be overhauled to reflect development concerns and be more representative of developing countries.

Hong Kong China said the WTO should focus on issues on its agenda and not engage in other matters (presumably a reference to labour and other new issues being brought up). Its main focus should be on market access and progressive liberalization.

A number of other speakers said that the mandated negotiations and work programme should also encompass other built-in agenda and mandated reviews, and not merely on agriculture and services.

The US ambassador, Mrs.Rita Hayes said there was need for reflection on the implementation questions and attempts to solve them with good will and focus on practical solutions.

India stressed that there should be informal meetings like this, before formal sessions, to enable proper discussions. India preferred the mandated negotiations in agriculture and services in existing bodies, and even if they were to be in special sessions, there should be the same chairman, so that they would be aware of the implementation issues and difficulties figuring in their normal agenda and positions of countries. There should be debates among the membership on the transparency and decision-making and they should not be rushed into decisions. (SUNS4599)

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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