WTO Ministerial to end with "negotiated" conclusion

by Chakravarthi Raghavan

GENEVA: The forthcoming Ministerial meeting of the World Trade Organization on 18-19 May in Geneva is now expected to wind up with a Ministerial statement or declaration dealing with both the issues of implementation and a future work programme "in a balanced way".

The statement or declaration will be a "negotiated text" and would provide some clear guidelines to Geneva trade negotiators, with a time-bound component, to prepare for the third Ministerial meeting.

Trade officials said this consensus view emerged at an informal consultation at the WTO on 30 March, chaired by the Canadian Chairman of the General Council, Ambassador John Weekes.

The time and venue of the third Ministerial meeting are yet to be set. But the WTO head and the European Commission have publicly expressed views suggesting it should be held by end 1999 (rather than the once-in-two-year intervals envisaged in the WTO charter). With no one so far offering to host, the next meeting may be in Geneva.

New round of negotiations

While trade officials in Geneva suggested that the guidelines for Geneva negotiators to come out of the second Ministerial meeting would "in all probability be used to launch the next round of negotiations," several trade diplomats said that while this prospect could be at the back of the minds of several participants, alongside many of the issues due for review or negotiations (agriculture, services, TRIPs provisions for protection of plant varieties), there is so far no consensus for a decision on such a round.

The EC Vice-President and Trade Commissioner, Sir Leon Brittan, directly, and the WTO head, Mr. Renato Ruggiero, indirectly, have been talking of the 1999 Ministerial meeting launching a new round of trade negotiations - Brittan has been calling it the "millennium round".

At Brussels, on 30 March, Brittan appeared to have gotten the endorsement of the EC Council of Ministers to make a proposal for such a round at the May Ministerial meeting.

Singapore, at the 1997 Commonwealth Heads of Government meet (before the Asian financial crisis) had broached this subject, but many, including some other ASEAN and Asian countries and African countries were cool.

The Cairns Group of agricultural exporting countries, in particular Australia, New Zealand, Argentina and some of the other Latin American members, have also been supportive of the idea of a new round - which will have both agriculture and some of the new issues on the table.

The EC has been privately arguing that it would need such a mixed package to enable it to make more concessions in the reform package on agriculture. However, some of the reports from Brussels suggest that as in the Uruguay Round, the "reforms" to the Common Agricultural Policy that the EC would anyhow have to make to meet its budgetary problems, would be presented as "concessions" to the developing world and used to extract more out of them - such as investment rights for foreigners, competition policy and opening Third World government procurement operations to foreign corporations.

The US, however, appears to be ambivalent.

Some of its statements imply that it sees greater advantage for itself in sectoral negotiations of its choice (information technology, Internet commerce, financial services and so on). Other statements suggest that it may agree to a new round if there be a "critical mass" in the package of interest to it. Developing countries, and particularly their capitals, do not appear to have really focused on the issue.

NGO efforts

However, there is also a movement among business sectors and non-governmental activists in these countries - whose views and ideas on agriculture and development are not running along the same track-viewing the WTO exercises as part of the neo- mercantilist globalization process seeking level playing fields for TNCs.

Unlike in the Uruguay Round, when they became aware of the vast changes being forced on their countries, involving domestic policy-making and development, these groups, for some time, have been organizing themselves and finding partners in the North to oppose the new issues, focus on existing rules to get them changed, and roll back WTO intrusion into national development policy.

These groups, and their partners in the North, have realized the common thread behind efforts to forge a Multilateral Agreement on Investment at the OECD - which appear, temporarily at least, to have been stalemated by the NGOs - the promotional efforts for a multilateral framework agreement, with extra- budgetary funding from the Europeans at UNCTAD, the WTO efforts for multilateral investment rules and financial sector liberalization through trade in financial services, and the IMF's moves on capital account convertibility.

These NGO efforts may or may not get far, but will at least force Third World capitals to pay attention and not brush them aside as they did at the time of the conclusion of the Uruguay Round on the "there-is-no- alternative" plea.

According to the WTO, the May Ministerial meeting will now be attended (for the 50th anniversary celebrations of the trading system), besides the announced presence of the heads of Switzerland and Singapore, by British Prime Minister Tony Blair, who this year hosts the G-7 summit and is also the head of the EU. The WTO expects many other heads of government/state to also turn up, and suspects there will be an "avalanche" if US President Bill Clinton does decide to come.

The meeting will begin on 18 May, with an afternoon session devoted to implementation questions, the next day's morning session focusing on a future work programme, and a closing session in the afternoon.

These two sessions will be so-called "business" or "working" sessions, with the secretariat keeping minutes.

This compromise on what was becoming a North-vs-South issue was evolved. Earlier, the industrialized countries of the North had sought informal sessions, while developing countries, learning from their Singapore experience and fearing that they would again be left out or their voices ignored at an informal meet, insisted on formal sessions. The processes will be marked by transparency and universality of participation, trade officials said.

A number of developing countries also insisted on a negotiated text, and not a chairman's summary. Hong Kong, though, reserved its position, on the ground that it had no instructions over a negotiated text. Japan and South Korea too were reportedly not in favour, but were ready to go along with a consensus for an agreed text.

Consultations towards such a text are to begin soon. The General Council Chair and the WTO head are to prepare a draft, with the first draft to be presented to a heads of delegation meeting on 24 April.

Pakistan wanted such a document to spell out clearly the mechanism for implementation as well as a specific programme of action for an agenda. (Third World Economics No. 182, 1-15 April 1998)

Chakravarthi Raghavan is the Chief Editor of the South-North Development Monitor (SUNS).