TWN Info Service on WTO and Trade Issues (Jul11/01)
11 July 2011
Third World Network

WTO DG proposes "fast track" priority for LDC-specific issues
Published in SUNS #7162 dated 1 June 2011
Geneva, 31 May (Kanaga Raja) -- WTO Director-General Pascal Lamy has proposed that Least Developed Country (LDC)-specific issues such as Duty-Free Quota-Free market access for LDC products, including rules of origin, an LDC services waiver and "a step forward" on cotton be put on a "fast track" for a Doha outcome at the upcoming eighth Ministerial Conference in Geneva in December.

Lamy's proposal for a three-lane or "three-speed" process - yet another analogy from his seemingly vast repertoire - namely, the fast track, the middle lane and finally, the slow lane - came at an informal meeting of the Trade Negotiations Committee (TNC) on 31 May.

Mr. Lamy's proposal for "a step forward" for cotton to be put on a "fast track" seemed to imply for trade observers that an actual deal on cotton (involving elimination of US subsidies) itself may not be possible to complete as part of the LDC fast-track process.

Speaking after the informal TNC meeting on 31 May, trade officials said that at this meeting, for the first time, there has been a collective assessment that the window of opportunity for concluding the Doha Round this year has closed, in so far as completing the entire Doha Development Agenda goes.

In Lamy's proposal at the TNC meeting, moving into the slow lane are the issues of market access in agriculture, NAMA (non-agricultural market access) and services, trade remedies and TRIPS issues, which Lamy said, Members will need to look beyond the eighth Ministerial Conference and plan accordingly latest by December 2011.

The WTO head also pointed to the need for an "LDC-plus" outcome with a significant development component by December, and these issues would make up the Middle Lane.

As to the issues that could be potential candidates for adding to the LDC-specific issues and making up the Middle Lane, trade officials pointed to special and differential treatment monitoring, the 28 Cancun agreement-specific proposals, trade facilitation, agricultural export competition, certain non-tariff barriers, elements of the trade and environment negotiations that pertain to closer cooperation between WTO and Multilateral Environment Agreements, as well as closer harmony with respect to policies that are trade and environment related, transparency with respect to Regional Trade Agreements and some steps forward on fisheries subsidies.

The informal TNC meeting came following the recent APEC Ministerial meeting in Montana, the United States (on 19-20 May), and a meeting of some trade ministers on the sidelines of the OECD Ministerial meeting in Paris last week.

In a statement on the WTO Doha Development Agenda negotiations, the APEC ministers responsible for trade had expressed their collective "deep concern" regarding the difficulties confronting the Doha Development Agenda (DDA).

"Despite intensive engagement by officials in Geneva, the gaps remain unbridgeable, as of now, in many key areas. We share a strong concern about this state of affairs, and we must work together to develop a clear and realistic path forward that is consistent with our continuing aspiration for the successful conclusion of the Round," they had said.

"We direct our negotiators to review urgently all options, in light of the development dimension as mandated, and to work with all WTO Members to find a path forward. In doing so, we must keep in mind that we should build on the progress already achieved over the past decade in the DDA negotiations, and that we are setting the terms of global trade for decades to come. These steps are pressing and cannot be deferred," they had further said.

Speaking to journalists in Paris after the trade ministers' meeting on the sidelines of the OECD Ministerial, Director-General Lamy reportedly said that there is a stalemate in concluding the Doha Round by the end of the year, but that no one wanted to drop the Round.

Lamy reportedly said that they also wanted to maintain the Single Undertaking. He added that there is need to find a way to deliver on issues that have become mature in a short time. As to what these issues are, he reportedly pointed to some issues that are of interest to LDCs, such as duty-free quota-free market access for LDC products, a services waiver for LDCs, rules of origin in the context of LDCs, and cotton.

The Director-General also reportedly said that the market access issues in agriculture, non-agricultural market access (NAMA) and services would not be part of the deliverable outcome at the end of this year.

The informal TNC meeting was preceded by a "Green Room" meeting on Monday afternoon.

According to trade officials, Members realize that what they need to try to do is to deliver something by the end of the year and figure out a way to carry the rest of the Doha package forward, both of these being the two over-riding objectives.

Within those objectives, trade officials added, there is a very strong feeling that the LDC component is paramount, but beyond that it becomes a lot trickier - for example, some are calling for an LDC-plus package or an LDC-plus package with development.

Trade officials noted that apart from the LDC issues (such as duty-free quota-free market access for LDC products, a services waiver for the LDCs, LDC-specific rules of origin, and cotton) there are other issues such as trade facilitation, non-tariff barriers, fisheries subsidies, and dispute settlement understanding.

For some members, said trade officials, the question also arises as to what happens to the market access issues.

To get an agreement on market access issues before the end of this year is clearly something that is not going to happen, trade officials acknowledged, agreeing with the observation that there is now a shift away from market access issues (namely, in agriculture, non-agricultural market access and services) to something that is deliverable.

No one is saying now that the Doha Round must be concluded by the end of this year, said trade officials.

One participant in the Green Room meeting said that the big debate now is whether there should be a deliverable package for the LDCs or an LDC-plus package including what issues should be in the LDC-plus package.

The trade diplomat added that there was an emerging consensus on the LDC issues but that some members are also saying that they want an LDC-plus package. But Lamy did not want to categorize the LDC-plus issues and this is still open for discussion.

A lot of views were expressed at the Green Room meeting but at this stage, the proposals that have been made were only preliminary, the trade diplomat told SUNS.

Another participant in the Green Room said that the elements of the list of issues for the LDCs and LDC-plus issues that reflect other Members' interests need to be negotiated.

Yet another participant said that the market access issues are out but that the other issues are on the table. "We have to look at everything," said the trade diplomat.

One senior official told SUNS that Members acknowledge that there is need for the LDC issues, but how sincere are they on this is the question. They could end up spending the rest of this year arguing on what should be on the list of LDC issues and what should not.

How is the US going to deal with the issue of cotton, asked the senior official, noting that both the issues of duty-free quota-free market access for LDC products and cotton are important to the LDCs.

On trade facilitation, one of the issues being cited for a possible delivery this year, the senior official said that a lot of elements are still unresolved.

In his remarks at the informal TNC meeting, Director-General Lamy, in his capacity as Chair of the TNC, said that the purpose of the meeting was to report back to the membership on his consultations and contacts over the past few weeks and to continue the discussion on the next steps for work on the DDA.

[According to some trade diplomats, in these consultations, Lamy has been advised by some key delegations that he should first find out from the United States what its deliverables are, as otherwise at the last minute at the ministerial the US may come up with more demands on others without indicating what it would deliver.]

Over the past few weeks, Lamy said that he had consulted with groups and individuals on how to follow up on the views and ideas expressed at the last TNC (on 29 April) on the way forward. He said that he had consulted groups and individual Members in various configurations and at various levels, including at Ministerial level.

At the beginning of this month, the WTO head said that he attended the fourth United Nations Conference on Least-developed Countries (LDCs) in Istanbul and more recently, the APEC Trade Ministers meeting in Big Sky, Montana.

In Istanbul, Lamy said he received an unambiguous message of concern and pre-occupation on the part of LDCs regarding the state of the DDA. Similarly, Ministers at the APEC meeting recognised that work towards a DDA end-game had not progressed in keeping with the aspirations of Leaders at the G-20 and APEC summits last year. They therefore expressed strong concern about the difficulties confronting the Round. However, resolve and commitment to work together to develop a clear and realistic path forward was also expressed.

Last week, Lamy said that he also attended the small gathering of trade ministers hosted by the Australian Trade Minister in the margins of the OECD Ministerial Meeting.

From all of these meetings, as well as from the bilateral consultations he had held, Lamy said that he saw a number of elements emerging:

-- "First, nobody wants to drop the Doha mandate.

-- "Second, nobody wants to break the Single Undertaking and no Member is ready to see its specific issues of interest disappear from the mandate.

-- "Third, there is a unity of purpose among you to ensure that the WTO 8th Ministerial Conference (MC8) taking place in Geneva in December delivers results in the Doha Round. If not the full Round, then at least an early harvest of issues as under Paragraph 47 of the Doha Declaration.

-- "Fourth, many Members have also stressed the importance of having - by the time of the Ministerial - clarity about the road map for work on the Doha Development Agenda after MC8. I know that a number of you see it as essential to build in a sense of the continuation of the Round to its full completion at a later date.

-- "Fifth, many of you see development as the common thread running through the issues which could be mature by the end of the year, and in particular LDC-related issues."

"I know that discussions have already begun among many of you on specific issues which could be delivered by the end of this year. My sense is that we now need to intensify them. I will be doing so in the days ahead in my own consultations."

The WTO Director-General added: "Presenting lengthy lists of demands and insisting on all of them will not help us to move forward. Even though the Ministerial is in December, we cannot afford a Christmas tree. We have to build ‘up' rather than ‘down'. There is precious little time if we are to deliver by the WTO Ministerial Conference. It is time we roll up our sleeves and restart working - that is, negotiating. And as we do so, we must re-create the spirit of co-operation that was present when we launched the Doha Round."

On the issues, Lamy said that his consultations so far suggest a way of approaching the substantive issues and he believed this way could help to facilitate convergence:

-- "Firstly, priority should be given to LDC issues such as Duty-Free, Quota-Free, including Rules of Origin, the LDC Services Waiver and a step forward on Cotton. These LDC specific issues should be put on a Fast Track.

-- "Secondly, we will need an LDC-plus outcome with a significant development component by December and there are a number of issues which could be candidates for adding in to the LDCs specific issues. These issues, to come to the table through your on-going deliberative process, make up what I would call the Middle Lane.

-- "Thirdly, from my consultations there are issues like market access in NAMA, Agriculture and Services, trade remedies and TRIPS issues which you do not see as candidates for outcomes this year. If you allow me to continue with the analogy, these issues will move into a Slow Lane, it being clear that for these areas we will need to look beyond MC8 and plan accordingly latest by December 2011."

"The immediate challenge, then, is to generate momentum on realistic, credible and achievable targets for a positive result by the end of the year, so that we can get down to working on them without delay. We need to avoid a lengthy negotiation about the issues to be negotiated, or we could find ourselves going round in circles," Lamy cautioned.

Following this meeting, he said that he will be stepping up his contacts and consultations with the membership, individually and in groups, to facilitate convergence on these possibilities.

Lamy further said that he intends to call another informal TNC meeting on 9 June, by which time his aim is to have "more clarity on your targets for December, in order to go back as soon as possible to the real work, i. e. negotiations among you. I count on everyone to make this possible."

"With only 15 weeks of work remaining until mid-November, we have no time to waste. It is vital that we get into the substance of the priority issues for the Ministerial without delay," the WTO head warned.

A number of delegations spoke following the remarks by the TNC Chair.

(A report on the interventions of various delegations at the informal TNC meeting will appear in a future issue of SUNS.) +