Info Service on WTO and Trade Issues (Jun13/08)
19 June 2013
Third World Network
progress needed to deliver at Bali, says Lamy
Published in SUNS #7597 dated 4 June 2013
Geneva, 3 Jun (Kanaga Raja) -- With only about forty working days
left before the end of July, Members must make "substantive advances"
in this period if they are to have any chance of successfully delivering
at the ninth ministerial conference (MC9) in Bali this December and
preparing a post-Bali roadmap, the Director-General of the World Trade
Organisation (WTO), Pascal Lamy, warned on Monday.
According to trade officials, delegations who took the floor after
Lamy at the informal meeting of the Trade Negotiations Committee (TNC),
stressed that importance of the Bali ministerial meeting cannot be
underestimated, and failure to achieve something in Bali would very
likely lead to a severe loss of credibility to the WTO's negotiating
A number of developing countries reiterated that an adequate amount
of progress is needed in Section II of the draft negotiating text
on trade facilitation (on special and differential treatment provisions
for developing country and least developed country members), and that
more flexibility needs to be seen on this front from the developed
They further said that the question of food security is extremely
important, and that this had to be part of a Bali package. They also
said that development issues must be at the core of any agreement,
further stressing the importance of the issues of Duty Free Quota
Free (DFQF) market access for LDC products and cotton.
South Africa stressed that agriculture must remain a core element
of the Bali package, and that development and the LDC pillar is a
litmus test for the multilateral trading system. "We cannot return
from Bali without any meaningful delivery to the poorest members of
this organisation," said South Africa.
In his statement at the informal TNC meeting, Lamy, as TNC Chair,
said that the purpose of the meeting was to report back to the membership
on his recent consultations and contacts and to continue the review
of progress on the three Bali potential deliverables of trade facilitation,
agriculture and Special and Differential Treatment (S&D)/Least
Developed Country (LDC) issues.
At the last meeting (in April), said Lamy, "we collectively faced
up to the reality that the pace of the substantive engagement to successfully
deliver in Bali was wanting. In realisation of the heavy responsibility
that confronted us all, not only for Bali, but also for the future
of the DDA [Doha Development Agenda] and the WTO's negotiating function,
we all committed to a set of prescriptions - changing course; urgently
engaging substantively; seeking necessary political will and flexibility
from capitals and displaying mutual trust and realism."
Since the April meeting, the continuous intensive process in negotiating
groups has started to bear some incremental progress, Lamy maintained,
but that on the negotiating mode, "we are yet to see the kind
of flexibilities that are needed in an endgame negotiation."
"We all know that process, however good, is not enough to deliver.
It is substantive engagement that holds the key. And here time is
turning against us. We are entering the red zone," he warned.
Lamy gave his assessment of the state of play on the three areas for
On agriculture, he said that intensive consultations have continued
on the G-33 proposal concerning public stockholding for food security
and domestic food aid on the basis of the four questions posed by
the Chair (of the agriculture negotiations) to facilitate the search
According to the TNC Chair, some progress has been made on elements
of political convergence which have begun to surface such as willingness
to work on declaration/communique language that would recognise in
general terms that the policies and programmes mentioned in the first
part of the G-33 proposal could fall within the scope of "General
Services" of Paragraph 2 of Annex 2 to the Agreement on Agriculture,
together with a political message on the role of public stockholding
in developing countries.
On the amendment or interpretation of existing agriculture disciplines,
Lamy said that the views on this issue span a range of different options,
none of which is the subject of any consensus at this stage. The main
concerns expressed regarding an amendment or interpretation have been:
(i) the infeasibility of the "one-solution-fits-all" approach
given the differences in the situations the proponents find themselves
in, and (ii) the complexity of the issue which many see as only resolvable
as part of a much broader agricultural negotiation, which cannot happen
in the short time left before Bali.
According to Lamy, some Members have indicated an openness to consider
a mechanism/process that might provide for some additional flexibility
for specific Members on the basis that this would be time-limited,
non-automatic, and create no or minimal trade or production distortions.
Such flexibility should not be at the expense of economic reforms
and transparency - notably through timely notifications - would be
an important element in monitoring any flexibility. Some Members also
stressed that whatever the temporary solution, it should be an operational
one and should not be a substitute for a broader solution.
So, said Lamy, "on the key outstanding issues raised by the proposal,
we have made progress towards framing the debate appropriately. This
is just at conceptual stage and let me stress that obviously none
of this is agreed or even accepted as the possible avenue to solve
On this point, what is needed is to explore further a possible landing
strip working out the specifics. This will be the focus of the Chair's
On the G-20 proposal on export competition, Lamy said that the preliminary
and varying reactions to this proposal indicate that a more in-depth
exchange of views to seek to identify the way forward is urgently
required and the Chair will be working in this direction.
Further to the discussions held over the (G-20) proposal on Tariff
Rate Quota (TRQ) administration, "it seems to be in a reasonably
On trade facilitation, Lamy reported that further progress has been
made on improving the draft Trade Facilitation agreement through negotiations
conducted by the four Friends of the Chair. This allowed Members at
the Negotiating Group meeting on 24 May to eliminate a further batch
of square brackets from the text. It also produced convergence on
other parts of the text that can hopefully be turned into consensus
during the new phase of negotiations by the Friends of the Chair that
has just begun.
"But the progress that is being made is still not enough to provide
assurance that we are on track to produce a good result for MC9. What
is needed now is more signals of flexibility of the kind displayed
at the Senior Officials' meeting in May," said Lamy, adding that
the key issue is how to build consensus, especially on those areas
which require a higher level of political intervention such as customs
co-operation and transit, as well as on other issues such as pre-shipment
inspection, customs brokers and consularisation fees.
There is also the issue of Section 2, which provides flexibility for
developing countries to implement the binding disciplines in Section
1, Lamy pointed out, further saying that these flexibilities are about
developing countries scheduling commitments under categories A, B
and C, according to their ability to implement them, coupled with
technical assistance based on needs assessments.
"The key now is to synergise both parts of the agreement so that
the flexibilities in Section 2 are used constructively to move the
substantive disciplines in Section 1," said Lamy, adding that
last week's negotiations showed that the key in this area is not so
much whether assistance is available, which it is, but rather finding
a way to better link needs with available assistance.
"Members need to invest now in making the breakthroughs that
we need to see before the end of July. No-one can seriously expect
that the many areas of disagreement that still exist in the text can
be left until the autumn and can then be sorted out in time for Bali.
We need to start removing less conflictual brackets now."
In his vew, there are three ways of removing brackets: agreement on
substance, agreement to disagree and papering over disagreement with
ambiguous or with best endeavour language.
"Experience of GATT/WTO negotiations pleads, I believe, broadly,
for the first two options."
On S&D, the TNC Chair said that in the two meetings held so far
on the Monitoring Mechanism and the Cancun agreement-specific proposals,
positive advances have been made which could potentially translate
into concrete progress in the coming weeks. Further such consultations
"We need to show similar progress in the six Agreement-specific
proposals, relating to the Sanitary and Phytosanitary Measures Agreement
and the Import Licensing Procedures Agreement to present a credible
development package to Ministers in Bali."
On LDC issues, Lamy noted that the LDC Group submitted their proposal
on an LDC Package for Bali which was circulated to delegations last
Friday in document TN/C/W/63. The package that the LDCs are proposing
to form part of a Bali outcome includes essentially four areas: implementation
of the Hong Kong DFQF (Duty Free Quota Free) Decision; preferential
rules of origin; cotton; and operationalisation of the LDC Services
Lamy said that this was the thrust of the message he had delivered
to Ministers last week, both at a small gathering of trade Ministers
hosted by the Australian Minister on the margins of the annual OECD
Ministerial meeting in Paris and during the bilateral meetings that
In Paris, he said he had asked two questions of Ministers: (i) Whether
they were all ready to ensure that by the end of July, the contours
of landing zones would be in sight; (ii) Whether in particular the
so-called "majors" were ready to be more flexible in their
positions by moving more to the middle and not simply asking others
to move where they were.
According to Lamy, the Ministers expressed concern that the negotiations
were not on a path that provided confidence of success in Bali. Ministers
acknowledged that not making progress in Bali would have damaging
implications for the future of the Round and the credibility of the
multilateral trading system. Therefore, something significant, substantive
and credible had to be done as a building block for work after Bali
to pursue the DDA.
Ministers acknowledged that holding up progress in one area over demands
in another was not a productive approach. In order to unblock this
situation, Ministers instructed their negotiators in Geneva to test
various options and explore landing zones in a more focused, intensified
manner on a "without prejudice" basis in all three areas,
[A press release issued by the Indian Ministry of Commerce and Industry
on 30 May, referring to Minister Anand Sharma's meeting in Paris with
Lamy and WTO D-G-designate Mr Roberto Azevedo, quoted Minister Sharma
as telling them that India will play a constructive role in ensuring
a successful outcome in the Bali Ministerial.
[While recognising the importance of Trade Facilitation (TF) and upgrading
infrastructure at border, ports and custom procedures for giving a
boost to exports, Sharma underscored the need for addressing the concerns
of food security which have been outlined in a proposal presented
by G-33 countries. "This is essential to protect the interest
of the subsistence farmers in developing countries and also the responsibility
of the state for assuring food security for the poor and vulnerable
section of the society," he said.
[According to the press release, Minister Sharma also said that government
procurement of food grains for public distribution system under the
MSP mechanism cannot be diluted. This assumes importance as the Food
Security Bill is pending before the Parliament.
[On the possibility of an early harvest at Bali, Sharma stressed that
it must address the concerns of LDCs and small and vulnerable economies
to ensure that the development dimension of the Doha Round is retained,
according to the press release.]
[Some participants said that apart from the mini-ministerial meeting
hosted by the Australian Trade Minister, there had been some bilaterals
and limited plurilaterals. Also, some of the trade ministers had meetings
with Ambassador Azevedo (who was present in Paris at their request),
who takes over as D-G in September.
[The various discussions centered around a Bali package, and key issues
of give-and-take in achieving it.
[According to some of the participants at the Paris meeting, little
progress was made. The US and EU were insisting on securing a Trade
Facilitation Agreement with mandatory obligations in Section I of
the draft TF text, and unwilling to consider or indicate the concessions
they would make to developing countries on a Bali package - whether
on TF or food security or LDC issues. They were merely promising to
consider what they could give after securing a TF agreement, and it
was not even clear whether it would be as part of a Bali package,
or a future work programme.
[The Bali meeting, and its successful conclusion, is thus held hostage
by the US and EU, in their attempts to secure a TF accord without
any quid pro quo on their part, a developing country trade diplomat
said. It raised questions as to whether once the TF deal was secured,
the US and EU would even engage in serious negotiations on the other
issues in the Doha talks, and carry out the obligations they undertook
at Marrakesh, under Article 20 of the Agreement on Agriculture, for
continuation of the reform programme, or bury Doha and bring new agendas
into the WTO. - SUNS] +