TWN Info Service on WTO and Trade Issues (Oct05/20)

21 October 2005

WTO General Council discusses text drafting, TRIPS, commodities

The WTO General Council was scheduled to have an important meeting on 19-20 October, where it was hoped that important progress could be made on the Doha talks.

However, the meeting turned out to be an anti-climax, as the Trade Negotiations Committee had already been held the previous week and it had
also not produced results.

The meeting ended by 1pm on 19 October, and there was no meeting either on 20 October.

Below is a report of the General Council meeting.

With best wishes
Martin Khor


WTO General Council discusses text drafting, TRIPS, commodities

By Martin Khor, Geneva, 19 Oct 2005

The WTO General Council meeting on 19 October ended rapidly without discussion on the main issues preoccupying the negotiations towards the Hong Kong Ministerial meeting.

The General Council meeting was held in the shadow of "the real negotiations" going on at the same time outside the WTO in an exclusive meeting of Ministers of the so-called Five Interested Parties (FIPs) in agriculture.

Most of the delegations in the WTO were in the dark about the meeting of the FIPs (the US, EU, Brazil, India and Australia) or even where it was taking place.

In any case, there wasn't anything new about the state of negotiations to report at the General Council, as most countries that wanted to had already made statements on the negotiations at the meeting of the Trade Negotiations Committee (TNC) just last week (on 13 October).

Wednesday's General Council meeting received more information about the negotiating process between now and Hong Kong, and heard views or reports on some issues, including cotton, TRIPS and public health, small economies and commodities.

In fact, the main development within the WTO Wednesday was a revival of the cotton issue, with the Minister of Trade of Mali speaking at the Council, registering the displeasure of African cotton-producing countries that there had been no progress on solving the problem and insisting that Hong Kong must produce some concrete results.

This was reiterated by him and the Minister from Chad as well as leaders of African cotton producers at a press conference (see separate article).

It also became clear that the main task of coordinating the first draft of the Hong Kong Ministerial text will be undertaken by Pascal Lamy, in his capacity as Chair of the Trade Negotiations Committee.

According to trade officials, the division of labour between Lamy and the General Council Chair, Ambassador Amina Chawahir Mohamed of Kenya, was clarified at the meeting.

The chairs of the various Negotiating Groups (such as NAMA, agriculture and services) will produce drafts on their respective topics which they will submit to Lamy, who will coordinate the drafts as inputs to the main text.

The General Council Chair will coordinate the drafting of texts on issues not taken up by negotiating groups. Ambassador Amina announced these issues as including TRIPS and health; small economies; trade, debt and finance; technology transfer; LDCs; and e-commerce.

She said that she would not like to see these issues trampled in a last-minute rush, and that she was committed to a bottom-up approach. She added that she did not want to duplicate the Director-General's work. She would operate with awareness of the need for transparency.

The timelines are also becoming clearer. The first draft is scheduled to be produced by mid-November, according to Lamy. On 1-2 December, the General Council will have its last meeting before Hong Kong. Ambassador Amina said the organisation and conduct of the Ministerial would be discussed then.

Trade officials said that the draft Ministerial text can be expected to be discussed at that meeting. But whether it would be the first draft, or another draft, that would be discussed then, and which draft would be taken to Hong Kong, no one could say at this stage.

At the start of the General Council meeting, Director-General Pascal Lamy summarised his statement at the 13 October TNC meeting, that negotiations had gained new momentum with the new proposals in agriculture but that positions were still too far apart on market access in agriculture.

Lamy said this week's agriculture meetings will be important to keep up the pressure, but solid progress is also needed on NAMA, services and rules, while on development the greatest gains will stem from each negotiating area.

In his view, interventions by delegations at the TNC converged on the diagnosis of the overall situation, concerns about transparency and inclusiveness, and the centrality of development.

On implementation issues, he said that two deputy Directors-General will assist, with Valentine Rugwabiza taking up TRIMS issues and Rufus Yerxa taking up geographical indications and TRIPS/CBD relations.

The Trade and Industry Minister of Mali, Dr Choguel Kokalla Maiga, made a statement on behalf of Chad, Benin, Burkina Faso and Mali, laying out the concerns of cotton-producing countries, which depend on cotton for 40% of export revenue, with many million farmers dependent on cotton for their livelihoods.

He said there had been no progress on the cotton issue since before Cancun when it was first raised and since the July 2004 framework, and criticised the recent agriculture proposals of developed countries for not making any reference to cotton. He reiterated the demands of the cotton countries that cotton subsidies should be eliminated and that an emergency fund to compensate the exporting countries be set up to which the OECD countries should contribute.

The Council had a brief discussion on the negotiations for a "permanent solution" to the TRIPS and Health issue pertaining to ensuring access to medicines of countries with no or inadequate manufacturing capacity (i. e. paragraph 6 of the Doha Declaration on TRIPS and Public Health).

The TRIPS Council chairman, Ambassador Hyuck Choi of Korea, said that since the General Council met in July, the "most interested delegations" had been pursuing consultations among themselves aimed at finding a way forward based on some new ideas.

He himself resumed his consultations earlier this month, having separate meetings with the EC, African Group and the US to be fully debriefed on the discussions they had had. This was followed with joint meetings of those delegations last week, which will continue later this week.

He reported that "the number of outstanding issues seems to be more limited than had been evident in earlier TRIPS Council discussions."

However, he said it was unlikely that the matter would be ready for the TRIPS Council to agree on a recommendation at its meeting next week. He thus planned to suspend that meeting to allow more time for consultations. He believed it was possible to reach agreement before Hong Kong.

The Cuban delegation said it was surprising that after so much time taken, there was yet no solution. It reiterated that the issue was an important one for developing countries.

The Kenyan delegation said there had been useful consultations but it was disappointed that there was a failure to have consensus as yet. In the past this issue had been seen as a problem affecting the poor in developing countries, but given the emergence of the bird flu and the possible coming of a pandemic, access to medicines is now seen as a problem affecting poor and rich countries alike. Kenya hoped this would give added impetus to urgently finding a solution.

The General Council chair, Ambassador Amina, said there is already a waiver in place which could be utilised in the meanwhile.

On the work programme on small economies, Barbados said that the concerns and proposals of the small economies, which had been set out in papers submitted at the NAMA and agriculture negotiations, should be strongly considered. It was supported by several countries, including Jamaica, Honduras, and Cuba.

Under the agenda item of non-recognition of rights under Article XXIV: 6 and Article XXVIII of GATT 1994, Honduras and Guatemala referred to their concern on the on-going issue of banana exports to the EU and stressed their position that the rules require the EU to discuss the matter with suppliers like them.

The two countries were supported by several other countries, including Venezuela, Ecuador, Brazil, Uruguay, Colombia and Nicaragua.

The EC said they attach importance to following WTO rules, and if the General Council wanted to alter rules in favour of smaller producers, it could take up the matter but it did not want this to be handled in an ad hoc manner.

Ambassador Amina said that she would consult with members shortly after the second arbitration report on the issue comes out next week.

The issue of commodities was then highlighted by Uganda, speaking on behalf of itself, Cote d'Ivoire, Rwanda, Tanzania, Kenya and Zimbabwe. Uganda said the countries have tabled two papers on commodities, which faced many problems including those raised by the Mali Minister earlier.

The countries had engaged the Committee on Trade and Development as well as the chair of the Committee on Agriculture to find the best way to address this issue which is of utmost importance to them and many African countries whose economies are dependent on commodities.

Uganda said this is a matter that falls under the mandate of the WTO as it is a core trade issue. The countries wanted to see commodities featuring in the preparations for the Hong Kong Ministerial Conference and in the report to the Ministers.

The sponsors of the commodities issue had identified three areas in which the WTO should focus:

* Tariff escalation affecting commodities in markets of developed countries should be eliminated. The formula under negotiation should take this into account.

* Clarification of rules under Article 38 to allow for joint action to ensure stable, equitable and remunerative prices of primary commodities.

* The establishment of a consultative mechanism at the WTO on declining prices of primary commodities.

Uganda said the co-sponsoring delegations requested that the Hong Kong declaration provide a clear mandate for work on these three issues relating to commodities.