Info Service on WTO and Trade Issues (Jul13/10)
30 July 2013
Third World Network
Officers for MC9 elected, Lamy gives farewell speech
Published in SUNS #7635 dated 26 July 2013
Geneva, 25 Jul (Kanaga Raja) -- The last WTO General Council meeting
(24-25 July) before the summer recess here formally elected the full
slate of officers for the upcoming ninth Ministerial Conference (MC9)
to be held in Bali from 3-6 December, and also heard outgoing Director-General
Pascal Lamy's farewell statement to the membership.
According to trade officials, the Chair of MC9 will be Indonesia's
Trade Minister Mr. Gita Irawan Wirjawan (this was previously agreed
to at a General Council meeting on 4 June), while the Vice-Chairs
are Mr Francois Kanimba, Minister of Trade and Industry of Rwanda;
Mr Stephen Green, Minister of Trade and Investment of the United Kingdom;
and the Minister of Foreign Trade and Tourism of Peru (according to
trade officials, yet to be named by the Peruvian government).
According to trade officials, the Chair of the General Council, Ambassador
Shahid Bashir of Pakistan, announced that a special General Council
meeting will be held on the afternoon of 9 September, at which the
new Director-General Mr Roberto Azevedo (who will take office on 1
September) will give a statement.
There will also be an announcement by the Chair (at that meeting),
in cooperation with Mr Azevedo, of an intensification of the work
programme leading up to Bali, starting with the focus and shape of
MC9 and what members expect the outcome document to be from that ministerial
conference, trade officials added.
On the question of the attendance of observers from international
intergovernmental organisations at MC9, trade officials said that
there was a continued lack of consensus on the request from the League
of Arab States to participate as an observer at MC9.
The General Council Chair said that he will continue his consultations
and expressed hope that some kind of an outcome can be found on this
issue after the summer break.
Egypt (on behalf of the Arab Group) expressed disappointment that
members could not reach a resolution on this issue.
As to the request for observer status by Palestine to MC9, members
said that they will need more time to confer with capitals and give
due consideration to this request.
On the agenda of work in the coming months to prepare for MC9, Ambassador
Bashir reminded delegations of the roster of issues that had been
put forward by Ministers at the last ministerial conference in 2011.
These included the issues of TRIPS non-violation complaints, E-commerce,
the Work Programme on Small Economies, the extension of the LDCs'
transition period under TRIPS, the accession of LDCs, the LDC services
waiver, and the Trade Policy Review mechanism.
Trade officials noted that decisions had already been taken on the
guidelines for the accession of LDCs to the WTO and on the extension
of the transition period for LDCs under TRIPS, as well as on the work
programme on LDCs.
The General Council Chair suggested that members focus on a few issues,
namely E-commerce, TRIPS non-violation complaints, as well as other
issues that may be put forward for consideration by members in the
Under the agenda item of the report by the Chair of the Trade Negotiations
Committee (TNC), Lamy, as Chair of the TNC, thought that everyone
shared the overall assessment that the road to Bali was much clearer
than two months ago.
"In sum, I believe that the glass is two-thirds full and that
Members are on track to deliver concrete outcomes in the three deliverables.
Despite this positive momentum, Members realistically acknowledged
that they were not there yet. More work is required to close remaining
gaps in the short time left after the summer break," he said.
In this regard, he added, all Members agreed that there was no time
for complacency. This third part of the glass needed to be urgently
filled. "Therefore, Members need to sustain the renewed momentum,
be more flexible and substantively focused in the final stretch to
deliver the desired outcomes at MC9."
Lamy stressed that Bali offers a unique opportunity to reignite the
Doha Development Agenda (DDA) negotiations.
"Bali is important because of the systemic value it promises,
if Members succeed. And as we look into delivering in Bali, our eyes
must also be in crafting a post Bali agenda of work for the Round.
The Bali opportunity must not be missed."
According to trade officials, a few delegations that did not speak
at the TNC meeting on Monday took the floor at the General Council
meeting. These included the Dominican Republic, Cuba, Barbados, Angola,
Cote D'Ivoire, Bolivia, Oman, and Ghana.
Delegations that had spoken at that TNC meeting asked for their statements
to be put on the record (see SUNS #7634 dated 25 July 2013).
The Director-General also reported on the fourth global review on
Aid for Trade that was held here on 8-10 July, and said the intention
of the Global Review was to use the event to bring together the work
streams of Aid for Trade, value chains and the ‘Made in the World'
Initiative and examine the implications of a world built on trade
in tasks from a trade and development perspective.
In his view, the fourth Global Review has substantively contributed
to this debate. Firstly, through the in-depth monitoring and evaluation
analysis which the WTO Secretariat, the OECD and a range of other
partners conducted for the meeting.
Secondly, through the debate that took place across the 54 sessions.
A true development dialogue in which the private sector from developed
and developing countries were well-represented, together with senior
policymakers with many diverse portfolios.
And thirdly, said Lamy, through the key issues that emerged. "This
list does not contain surprises. What the 4th Global Review did was
to validate this list - and its relevance for connecting the least
connected in our value chain economy."
According to Lamy, this list includes factors such as the importance
of services for connecting to value chains; the key role played by
skills in adding value; the critical importance of border management
and transport services; access to finance, and trade finance in particular;
and capacity to ensure standards compliance.
According to trade officials, many developing countries called for
a re-commitment at Bali to Aid for Trade, as well as the mandate of
the Director-General to continue with his work in this area.
Several LDCs said that this issue is of great importance to them,
and that while global value chains (the theme of the fourth global
review) are important, there needs to be attention paid to the importance
of special and differential treatment for developing countries. On
trade facilitation, they said that there needs to be adequate balance
between Section I (on commitments) and Section II (on S&D) of
the draft negotiating text on trade facilitation.
On the agenda item of the management of the WTO Secretariat 2005-2013,
Lamy reported that he had tabled a document entitled "Management
of the WTO Secretariat 2005-2013" as a compilation of all the
reforms that have been brought about in the past eight years, adding
that it is a "reminder of the serious effort at modernising our
financial and human resources, our technology and information systems,
as well as at delivering on a one-WTO campus".
Lamy said: "I hope that both secretariat and Members will have
a better sense of what needs to be done in future to both consolidate
and build upon the progress made. We live in a changing world. And
as the world changes, we will have to keep on adjusting."
Lamy however said that he is aware that not everyone in the Secretariat
is happy with these reforms. "I think this is the inevitable
cost of change. But I believe that compared to similar organisations,
benefits and working conditions remain attractive at the WTO, especially
in recent years during which taxpayers' money has become politically
In his lengthy farewell statement, Lamy said: "I think it is
fair to say that, together, we have strengthened the WTO as the global
trade body, as a major pillar of global economic governance. Despite
the heavy headwinds and the turmoil in the global economy as well
as on the geo-political scene, together we have made this organisation
larger and stronger. This, I believe, is our main achievement during
these last eight years."
On the experience of the last eight years, Lamy said because the Doha
Round has not yet been delivered, some would be tempted to say that
this organization is in crisis; that trade multilateralism does not
function, that the WTO has become irrelevant. "I believe these
are simple shortcuts at a much more complex reality."
"Opening trade and crafting multilateral rules have been impacted
by the profound shifts in geopolitics and economics. The former two-speed
model of a world divided between developed and developing countries
no longer reflects today's economic realities. A serious conceptual
adjustment is needed. We must find a new balance between reciprocity
and flexibility in a multidimensional membership if we are to deliver
on multilateral trade opening. This is compounded by short-term politics
that are becoming increasingly incompatible with the setting of the
medium and longer term goals essential for designing consistent trade
Lamy said that he often hears that the way forward is to abandon the
WTO and simply move to plurilateral or regional arrangements.
"But we have all seen the fate of a number of these plurilateral
deals such as the ACTA or the Global System of Trade Preferences among
developing countries. We also know that behind the headlines of the
launching of mega regionals, as some refer to them, lie tremendous
difficulties and sometimes even no final deal at all, as was the case
of the Free Trade Area of the Americas."
"I do not wish to be misunderstood. I am not against trade opening
outside the WTO. I believe that plurilaterals, mega regionals, regionals,
bilaterals and unilateral arrangements CAN contribute to trade opening
and hence to the levelling of the global trade playing field, which
must ultimately remain our collective goal. Because this is what fairness
is about. But I do think we would do well to recognise that the issue
is not trade opening IN the WTO as opposed to trade opening OUTSIDE
the WTO. The issue today is with the difficulties involved in trade
He said that domestic trade politics have become more difficult and
trade deals have become more complex because the nature of obstacles
to trade has evolved. "We are no longer negotiating just the
reduction of tariffs, but also of non-tariff barriers, which have
gained enormous importance."
Lamy also used the opportunity to again air a longstanding secretariat
agenda, a role for itself in contractual negotiations with legal implications,
as he put it this time, "mirroring the processes followed by
other international organizations."
"Much time could be saved in the negotiating process," he
claimed, "if, after an initial phase of definition of objectives
to be reached and principles to be observed," the Secretariat
was tasked to "mobilise its expertise to table proposals around
which the negotiations would take place."
[According to Mr. Chakravarthi Raghavan, who has been closely following
and monitoring since 1978 the trade negotiations at the GATT and later
at the WTO, during the Uruguay Round negotiations, both in the so-called
‘FOGS' negotiating group, and in the final stages of concluding the
agreements at senior officials' level in November-December 1993, the
then GATT Director-General, Peter Sutherland, had twice gone before
a key group of negotiators (meeting outside the GATT premises and
trying to reach an accord), to incorporate such a mandate for the
secretariat in the Marrakesh Treaty. After considerable discussions,
all the major delegations, both developed and developing, rejected
it on the ground that in a treaty, involving contractual rights and
obligations, enforceable through a dispute system (with negative consensus
for adoption), the secretariat could not have such a role.
[Since then, several trade observers have noted, if the secretariat
is given a role as suggested now for tabling proposals, even if they
are not accepted, or some ambiguously worded compromise is adopted
by members, in future disputes, the secretariat working in the interests
of the major corporations - the ‘stake-holders' in WTO language -
would bring the proposals it tabled before negotiators as "negotiating
history" and "context", and enable panels and the Appellate
Body to interpret the language of the agreements to create "new
obligations". - SUNS]
According to Lamy, all of these are valuable lessons for the Doha
Development Agenda, an unfulfilled promise, which will need to be
fulfilled in order "to redress the imbalance in some of our rules
which is a legacy of history, starting with agriculture."
Lamy believed "there is no escape" from achieving positive
results in the Doha Round, just as there "is no escape from adjusting
the Doha menu to today's realities." This will require the "introduction
of new elements into the menu, new elements which require multilateral
handling, so as to better level the trade playing field."
Lamy also said that perhaps because members, since 1999, have mainly
focused on the negotiating pillar of the WTO, "we all took the
administering of existing rules for granted, the reality is that the
surveillance function of the WTO has been underperforming" for
The mandates for "notification and peer review" are clearly
there, their implementation is "somewhat spotty," to put
it mildly. While he felt the situation has improved, "more remains
to be done."
There was a time when trade negotiations could be conducted, agreements
could be reached and even implemented largely away from the public
"But our societies no longer allow this," and there is "a
growing need to engage with our stakeholders [which in WTO language
appears to mean private corporations] and with the public at large."
"This is why ministers' and capitals' involvement is decisive.
But experience shows that engaging both ministers and ambassadors
is a delicate chemistry. Too much time spent with ministers and the
ambassadors get restless. Too much time spent with ambassadors and
the ministers become distant and mobilising their support at the right
moment becomes harder. On this, my successor will have to find the
right recipe. Mine did not always work!"
Over the last eight years (of his tenure), Lamy said there has been
a building of the WTO as "a stronger institution" - providing
benefits to its members, and as an institution, is an asset in itself,
"a global public good that each and every one of its members
Lamy said over eight years, he had also seen the political economy
of trade opening better integrated into a set of domestic and international
policies. However, support for more open trade will not be sustained
without ensuring greater fairness between winners and losers of trade
opening, and without more convergence on values-based preferences
that lie behind differences in non-tariff measures. "This remains
a challenge ahead."
Lamy ended his peroration, with the remark: "My journey at the
WTO is coming to an end... It is time for me to embark towards another