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TWN Info Service on WTO Issues (July 03/8)

17 July 2003

Third World Network

Dear friends and collegaues

WILL DIFFERENCES AMONG COUNTRIES ON SINGAPORE ISSUES BE REFLECTED IN THE DRAFT CANCUN DECLARATION?

The “Singapore Issues”  (investment, competition, transparency in government procurement, trade facilitation) are the most controversial and important topics that will be decided on in Cancun.

Informal consultations on each of the so-called Singapore issues have been held in the WTO in the past month with small groups of countries in the World Trade Organisation.  There are no records of these “informal consultations”.  Only some countries were selected to take part.  In fact, information on what meetings went on, when, and what happened, has not been made available.

However, trade officials of some countries that were invited to take part in these “informal meetings” have said that there has been no change discernible in the differences of views and in the different position of the countries  involved In the consultations.

Whether this divergence of views on all the four issues will be reflected in the draft Cancun Declaration,  which is expected to be circulated by the Chairs of the Trade Negotiations Committee and the General Council on 18 July, is a subject that will be most keenly watched as a test of the objectivity of the Draft Declaration and a sign of the degree of transparency and participation in the whole Cancun process.

Below is a report on the consultations on Singapore issues that have been taking place.

With best wishes

Martin Khor

Third World Network

 

 

SAME DIFFERENCES AMONG COUNTRIES MAINTAINED IN “INFORMAL CONSULTATIONS” ON SINGAPORE ISSUES,  BUT WILL THESE BE REFLECTED IN DRAFT CANCUN DECLARATION?

TWN Report by Martin Khor,  16 July 2003

Informal consultations on each of the so-called Singapore issues have been held in the past month with small groups of countries in the World Trade Organisation.  There has been no change discernible in the position of the countries involved In the consultations, according to some trade officials who took part.

Whether this divergence of views on all the four issues will be reflected in the draft Cancun Declaration, which is expected to be circulated by the Chairs of the Trade Negotiations Committee and the General Council on 18 July, is a subject that will be most keenly watched as a test of the objectivity of the Draft Declaration and a sign of the degree of transparency and participation in the whole Cancun process.

“As far as we can see, there are still the same wide divergence of views among WTO members in each of the new issues,” said one senior official from a developing country who has been monitoring the discussions.  “The WTO members are still far from being able to agree on the issues being discussed, and we are not in any position to even talk about modalities, let alone think about a consensus on them.”

The “informal consultations” were convened by each of the four so-called “Friends of the Chair” relating to the Singapore issues - investment, competition policy, transparency in government procurement and trade facilitation.   The “Friends” were appointed by the Chair of the WTO General Council, Ambassador Carlos Perez del Castillo of Uruguay at an informal Heads of Delegation (HOD) meeting in early June, to assist him to consult members on the Singapore issues and to report back to him.

The “Friends” are Brazilian Ambassador Luiz Felipe de Seixas (who was Chair of the Working Group on investment) for investment;  Frederic Jenny of France (who had chaired the Working Group on the interaction between trade and competition policy) for trade and competition policy;  Costa Rican Ambassador Ronald Saborio Soto (who chaired the Working Group on transparency in government procurement) for transparency in government procurement; and Ambassador Milan Hovorka of the Czech Republic (who chairs the Council of Trade in Goods, where the trade facilitation discussions have taken place) for trade facilitation.

The “Friends” have been active in the past two weeks holding a number of meetings with different groupings of countries, and also with some members in larger groups.

However, there was reportedly some variations in the conduct of meetings.  For example, the Friends of the Chair for competition, transparency in government procurement and trade facilitation met seperately in small groups with delegations that are supposed to be “proponents” and “opponents” of starting negotiations on the issues, as well as with other members, and then also convened larger meetings in which a larger number (proponents, opponents and others) were invited.

For investment, the “Friend of the Chair” apparently held separate meetings with the advocates of a multilateral agreement, with those known to be opponents of starting negotiations, and with some members who are supposed to be “neutral” or that had not make up their minds.  Up to now, thre has not been a meeting where the various groupings have been brought together.

According to officials of some delegations that were invited to some of the informal consultations, the different countries or groupings of countries seemed to have maintained their previous positions, which had earlier been made known at the Working Groups, during the consultations.

On transparency in government procurement, the “Friend of the Chair”, Amb. Ronald Soto, held several consultations in small groups, and last Wednesday convened a larger meeting with slightly more than twenty delegations present, among them the US, EU, Canada, Japan, India, Pakistan, Venezuela.

The Chairman posed the questions whether the delegations thought the study process is complete, whether they could move on to discussing modalities of negotiations in Cancun, whether the modalities should be procedural in nature or in more substantive terms, and what are the necessary elements required for a decision on modalities in Cancun.

The major developed countries reportedly took the view that the WTO is ready to move on to negotiations, and that only a simple decision is required on modalities in Cancun, implying that the modalities need only be procedural in nature.   The EC also insisted that the issue is part of the single undertaking agreed on at Doha.

Many developing countries took a different view, arguing that the Doha mandate was for members to clarify the issues, and this was not tantamount to negotiations nor pre-negotiations. The issue is thus not part of the single undertaking.  In their view, there was still no clarity on the issues as there was a wide divergence of views.

The developing countries also said the “modalities” could not simply be procedural.  One country said the Ministers are not going to Cancun just to discuss procedures such as how many meetings the negotiations will involve.  They said “modalities” involved substantive issues such as the meaning of issues and the nature of obligations involved.

They also said that members had to be very clear, before deciding on starting negotiations, what was the objective of having a multilateral agreement and what its nature is.  It was not acceptable to take the approach that we can sort out these important issues during the negotiations.   

On trade facilitation, there were also a number of consultations convened in small groups by the Friend of the Chair, Ambassador Milan Hovorka.   Last Friday, a final meeting meeting was held to which a large number of countries were invited. 

A clear divergence of views and positions was also clear at the meeting.  Major developed countries, especially the EC reportedly argued that something on modalities had to be given to the Ministers for them to consider in Cancun. 

However some developing countries countered that this was not possible if there is no clarity yet on the issues being discussed, and no consensus on modalities or on launching negotiations on the issue in Cancun.   On substantive issues, there was also basically no change in positions voiced by various countries during the meeting.

On competition, the Friend of the Chair, Frederic Jenny, held a series of meetings in small groups and then at a larger meeting  a fortnight ago, with about 20 delegations, including the US, EU, Switzerland, Norway, Japan, Canada, Mexico, Brazil, Egypt, India, Malaysia, the Philippines, and HongKong.

At the meeting, a discussion took place as to whether competition was linked to other issues, with some developing countries insisting that it was a separate issue to be decided on its own merits, and a few other countries of the view that a decision on competition  would for them be linked to what happens in other areas, especially agriculture.

The meeting also discussed the possibility of setting up a regular WTO body, such as a committee, to deal with competition related issues, for information exchange and peer review. Some officials who attended the meeting were however not clear whether the proponents of this idea intended this committee to supplement  the present Working Group’s work, or that would be in place of a legally binding agreement.   Some other countries spoke against establishing a regular body. 

Some developing country delegations at the meeting reiterated their position that there was no consensus in the Working Group on the issues that had been discussed, and there was thus no basis for a discussion to take place on the modalities of negotiations.  One delegation said that at best , the differences of view among Members could be catalogued, and Ministers could decide what future course to take.

On investment, the Friend of the Chair, Ambassador Liuz Felipe de Seixas, is reported to have held at least three separate consultations early last week - one with the proponents of a WTO investment agreement, one with some developing countries that are known to be against the launching of negotiations, and one with some other members whose views are supposedly more “fluid.”

At a consultation with some developing countries, these delegations reiterated their position that on the issues that had been discussed at the Working Group, there was clear divergence of views and it had not been possible to resolve the divisions. Thus the was no basis to embark on a discussion on modalities and there should not be a decision for starting negotiations in Cancun.

It is not known if there are plans to have a larger meeting on investment.

The four Friends of the Chair on Singapore issues are now scheduled to report back to the General Council chairman.  Trade officials from developing countries said they were not sure what the next step would be.  They expect Ambassador Carlos Perez del Castillo to hold a meeting at the heads-of-delegation level to present his findings, before the next General Council meeting on 24-25 July.  Failing that, he will have to present his report on the Singapore issues to the General Council itself.

Meanwhile, WTO Director General and TNC chair, Dr Supachai, has announced that a draft of the Cancun Declaration will be produced by him and the General Council chairman and distributed around 18 July.   That draft will presumably contain a section on the Singapore issues.  If there were to be an objective asessment, it would have to report that there is a wide divergence of views on all the four issues, and thus no consensus on modailities.

Whether such a conclusion is made, will be a test of the acceptability and objectivity of the “draft Declaration”.

Whether the WTO members are allowed time and opportunity to officially make their views known, and to revise the draft, will also be a test of the transparency and participation in the WTO decision-making process on the crucial last leg of the road to Cancun.

 


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