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TWN Info Service on WTO and Trade Issues (June06/24)

28 June 2006


MEMBERS CONFIRM DEEP DIVISIONS IN AGRICULTURE


At a meeting at the WTO on 23 June, WTO members discussed the draft possible modalities prepared by Ambassador Crawford Falconer of New Zealand, Chair of the agriculture negotiations.

The members confirmed the existence of wide divergence on many issues.  Many members including the G33 group of developing countries pointed out that the document precisely captured the "still very wide divergences in the positions of Members".

The US described the differences in market access as "breath-taking" and said some tariff reduction proposals would not deliver the mandate for market access.

Please see the report below on the meeting.

With best wishes
Martin Khor
TWN

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MEMBERS CONFIRM DEEP DIVISIONS IN AGRICULTURE


Geneva, 23 June 2006:  By Goh Chien Yen (TWN)

WTO members met this morning after the release of the draft possible modalities prepared by Ambassador Crawford Falconer of New Zealand, Chair of the Committee on Agriculture (Special Session) the previous day.

Commenting on the draft modalities, many members including the G33 group of developing countries pointed out that the document precisely captured the "still very wide divergences in the positions of Members".

The US described the differences in market access as "breath-taking" and said some tariff reduction proposals would not deliver the mandate for market access.

According to trade sources, the G20 and EU said that they are willing to consider new options provided others are also willing to move.

Nonetheless, the G20 maintained that it is up to the biggest members to move first, the US to offer more on domestic support and the EU and G10 to offer more on market access.

The current draft modalities text of 72 pages contains over 750 pairs of square brackets that can be found in almost every paragraph. Issues in dispute are square bracketed.

"We are faced with the formidable challenge of narrowing these still very wide gaps in order to deliver the modalities by the end of June," said the G33 at the meeting.

Falconer said that he did not think that Ministers will go through the draft modalities square-bracket by square-bracket when they negotiate "modalities" in Geneva, starting on 29 June.

He told members that he did not expect his draft to become a working document for ministers, and that this is not the document that would go to the ministers for consideration, unless members think so. In his view, ministers are more likely to focus on key questions and if these are settled the options will be clearer.

He also informed members that the process is now out of his hands and that he has performed his duty as Chair. He will therefore not be holding any more consultations in the next few days and that the negotiations will now be handled by the Trade Negotiations Committee (TNC) until the end of the month.

The formal TNC session will tentatively begin on 1 July and the green room meetings with some ministers are scheduled to start on the 29 June.

According to a senior trade diplomat, speaking after the meeting, it is now not clear which document the ministers would be looking at and how the process would be structured next week.

Nonetheless, several developing country members such as Kenya, Nigeria and the G33 that spoke this morning reiterated the need to continue with a bottom up and inclusive approach.

"All members, big or small, must be given the fair opportunity to effectively take part in the decisions that have to be made. In the coming fortnight, there must be a deliberately sequenced inclusive process, especially since the issues, drafts and texts are very technical and it would be impossible to understand something that comes at the last minute, let alone react to it in a meaningful way," Nigeria proposed.

On the content of the draft modalities text, most members that took the floor felt that the document has fairly captured the range of proposals on the table.

According to Kenya, the document has reflected members' positions. Like Nigeria, it also welcomed the inclusion of the ACP proposal on countries with ceiling bindings in paragraph 5 of the text, as well as the Annex M on commodity arrangement.

Kenya pointed out however that the issues of periodic review and technical assistance have been left out of Annex M and wanted these issues to be included next week.

Nigeria said that the draft modalities texts can still be improved, especially in relation to the range of tariff reductions for developing countries, and the language on SP and SSM according to Nigeria.

The US also wanted to see parts of the draft modalities changed. They complained that their proposal on SSM to limit the eligibility of products to those which have actually reduce their applied tariff rates has not been reflected.

The US has also proposed the inclusion of the peace clause in the draft modalities. This was opposed by several other members. The Chair replied that he would not do so as the peace clause is not in the mandate.

 


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