Global Trends by Martin
Monday 7 November 2005
Week of decision for the WTO
The success or otherwise
of the world trade talks known as the Doha Round could be decided this
week, when a last-ditch effort is made to save the World Trade Organisation’s
ministerial meeting in Hong Kong from failure. Several small meetings
of selected Ministers will be held in London and Geneva. But developing
countries complain they are being left out of the action.
This is expected to be the
crucial week that will determine the success or otherwise of the World
Trade Organisation’s Ministerial conference in Hong Kong in mid-December
and the trade talks known as the Doha Round.
The WTO secretariat, and a
few major countries, will be going all out to make a big push – perhaps
the last – to save the Hong Kong meeting from being a failure, or a “non-event.”
On Monday a meeting will be
held in London of the Ministers of the “big four” WTO members – US, EU,
India and Brazil – which will reportedly focus on a range of key issues,
starting with agriculture and moving on to services and industrial goods.
Presumably that meeting may
come to some political conclusion on the “level of ambition” that will
be possible (at least for these four members) for Hong Kong and maybe
the rest of the Round.
On Tuesday the action shifts
to Geneva, where the Ministers of the four countries are expected to continue
their meeting and also meet with some other Ministers to review the status
of the talks. But this will be meaningful only if the four have already
made some progress in London.
Senior diplomats from some
developing countries are however skeptical of these mini-Ministerial meetings.
In their view, almost all the Ministers coming to Geneva would be from
the developed countries.
The developing countries would
be under-represented, and will not feel they “own” the decisions that
may emerge. Some feel the situation has been manipulated to get a majority
of members to go along a certain route, when they could not take part,
even as spectators, said one diplomat.
This week’s meetings are seen
by many as a last-ditch effort to have Hong Kong produce “high-ambition
In recent weeks, there have
been setbacks in the key issue of agriculture. There is deadlock in talks
among the EU, US, Brazil, India and Australia. Others have produced their
own proposals, including the African, Caribbean and Pacific Group and
the Group of 33 led by Indonesia.
How to reconcile the different
interests on a wide range of issues, in such a short time, has become
an improbable task.
Ordinary members of WTO are
also voicing their frustration that the priority has been given to the
major agricultural exporting countries that want trade barriers to go
Most developing countries,
however, want to be able to protect their farmers from cheap imports,
and fear that they cannot do that if they are required to bring down their
tariffs too much. Their views have however been sidelined so far.
Meanwhile, the negotiations
on services are also in trouble. A broad spectrum of developing countries
are increasingly exasperated with the insistence of the Chair of the negotiations,
Ambassador Fernando de Mateo of Mexico, to include “benchmarking” or “targets
and indicators” as a new negotiating approach, even though they have objected
to it so many times.
The Chair’s procedural ruling
that his draft Ministerial text on services cannot be changed unless there
is a consensus on amending it have earned the ire of many delegations,
as well as 60 civil society groups that issued an open letter of complaint
At stake is the freedom of
the developing countries to decide their own policies on whether and when
to open up various services sub-sectors, such as banking and finance,
telecommunications, distribution and the professions.
“Benchmarking” is an initiative
by the rich countries to get the developing countries to compulsorily
open up in half or more of their services sectors, thus greatly removing
their present freedom of choice.
This week will also see talks
intensifying on reduction of tariffs on industrial goods. Disputes remain
on what kind of formula to use to cut the tariffs, how to treat those
tariffs that are presently not “bound” in the WTO, and the special treatment
(if any) for developing countries.
Smaller developing countries
are now worried they are being asked to slash their tariffs too sharply,
and that many of their local firms won’t survive the flood of cheap imports.
The latest European proposal,
demanding such drastic cuts, has raised the temperature. Several developing
countries are expected this week to counter this with their own proposals
that are more “development friendly.”
It would be overly optimistic
to expect that these thorny and complex problems in agriculture, services
and industrial goods will be resolved this week.
At a WTO meeting last Thursday,
the Director General Pascal Lamy gave a rather bright view on the state
of the negotiations.
Many countries however complained
about how the majority of members were being ignored. Venezuela expressed
concern about the process of drafting of the Ministerial text, especially
the practice of Chairs of negotiating groups presenting texts on “their
own responsibility”, instead of allowing the members to undertake the
It complained that in one case
the Chairman kept putting a proposal in the draft even though it was repeatedly
opposed by many delegations.
Cuba, Bolivia and Botswana
also raised concerns about participation of developing countries in the
At present, many countries
are not invited to take part in small and “informal” meetings on various
topics. Cuba proposed that at least the minutes of such meetings be given
to all members. But this was turned down as not feasible by the Director
Thus, on top of the already
complex issues to be resolved in agriculture, services and industrial
products, is the long-standing issue of democracy in the WTO -- the rights
of the developing countries to take part in decisions that have such important
consequences for their people.
It remains to be seen whether
enough progress is made this week on the “road to Hong Kong”.
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