TWN
Info Service on WTO and Trade Issues (Sept13/06)
28 September 2013
Third World Network
D-G reports on first round of talks on Bali issues
Published in SUNS #7660 dated 24 September 2013
Geneva, 23 Sep (Kanaga Raja) -- An informal meeting of the Trade Negotiations
Committee (TNC) on Monday heard a report by its chair, Director-General
Roberto Azevedo, on a series of meetings held over the last two weeks
on the three potential deliverables of trade facilitation, agriculture
and development/LDC issues for the upcoming Bali ministerial conference
this December.
A first round of intensive negotiations was held during this period
in the Room E/Room D format (usually involving some 30-plus delegations
including regional groupings), with two seats at the table for each
delegation: an ambassador and one senior official from capital, or
in his/her absence, a capital-based expert. A meeting of senior officials
was also held on 19 September (see SUNS #7659 dated 23 September 2013).
Following the TNC meeting, the Director-General also held a press
conference (see below).
In his statement at the roughly one-hour TNC session, Mr Azevedo not
only reported on the meetings that were held over the past two weeks,
but also provided an overview of the state of play on the three potential
deliverables for Bali, as well as the process going forward.
In his statement, he noted that every member is aware that the most
significant challenge facing them is the mere 10 weeks or so that
they have left to prepare the basis for success at the Bali Ministerial.
"It is important therefore that most of our time and efforts
are directed towards our substantive work to find convergence."
On the Room E/D process, the Director-General recalled that he started
a process of intensive consultations at the "Ambassador plus
one" level on the three potential deliverables for Bali: Trade
Facilitation, Agriculture and Development.
This is a joint effort that has been undertaken with the Chairs of
the Agriculture Special Session; Committee on Trade and Development
(CTD) Special Session; Negotiating Group on Trade Facilitation; the
Facilitator for LDC issues and Friends of the Chair on the Trade Facilitation
negotiations, he said.
The TNC Chair said that members had a first run of all three topics
in 10 sessions. Specifically, in agriculture they covered: (i) the
G-33 proposal on public stockholding for food security and domestic
food aid purposes; (ii) Tariff Rate Quota (TRQ) administration; and
(iii) export competition.
On trade facilitation, sections I (on commitments) and II (on Special
and Differential Treatment provisions for developing country and LDC
members) of the Rev. 17 text were covered, while on development, the
Monitoring Mechanism, the Cancun 28 proposals and LDC issues were
covered.
The Chair reported that the discussions have been "focused, precise
and business-like," and that Members were actually negotiating
and interacting in a constructive manner.
"Delegations are in a solution finding mode and I am encouraged
by the new tenor to the discussion. If we keep this mood and attitude
in the upcoming weeks, I believe Bali will be within reach. This is
a great and inspiring start but more, of course, will be required."
Mr Azevedo stressed that inclusiveness has been a tenet of the process
with the participation of close to 50 delegations. All major regional
and group coordinators and Members most affected by the different
issues are represented. And anyone with a strong interest in the discussion
has not been precluded from participation.
"These large format meetings have been criticised frequently
for being supposedly unmanageable. We are proving that perception
wrong. Discussions have been focused and objective. Delegations are
taking the floor only when they must and keeping their interventions
short. We are avoiding repetitive or rhetorical statements. We are
having productive meetings and covering a lot of ground with the short
time available to us."
On the senior officials' meeting on 19 September, the TNC Chair said
that the good news is that there was a positive indication by Members
to get things done and find landing zones.
"We saw Members starting to move in that direction, although
not as much and not as far, as we must. The clear message I delivered
to senior officials was that their continued political leadership
and direction was crucial. Capitals must be engaged," he said,
adding that many of the issues still pending are political.
"There is a limit to what the Permanent Representatives in Geneva
can do. The Senior Officials in capitals must help us unlock the key
negotiating areas without further delays."
On the substance of the three issues, the TNC Chair reported that
on trade facilitation, all parts of the mandate were covered: (a)
new disciplines (Section I); (b) flexibilities for developing countries
and LDCs, and implementation plans (Section II); and (c) customs co-operation,
"which is technically in Section I, but it seems to me to be
a very specific pillar in the trade facilitation negotiations".
While members have been getting results, such as last week on Articles
1, 7 and 10, and while there are good prospects for further progress
in the coming days, there are a number of topics where positions are
not yet converging.
These relate, in particular, to the areas of: (i) customs co-operation,
where discussion is still less mature; (ii) flexibilities for developing
& Least-developed countries and implementation plans; and (iii)
a number of difficult issues in Section I including - and this is
an illustrative list: customs brokers; pre-shipment inspection; consularisation;
and certain transit issues.
To break up the blockages in those areas, several things have to happen,
said Mr Azevedo, adding: "We need the proponents to come up with
really improved proposals, manageable proposals, and opponents to
equally move towards the middle ground. Some issues also need to be
addressed in bilateral or smaller group settings to help the efforts
in the larger format, which will remain as our primary negotiating
approach."
On agriculture, the TNC Chair reported that intensive consultations
have continued on the G-33 proposal, and that consultations have also
taken place on the G-20 proposals on export competition and on TRQ
administration.
On the G-33 proposal, Mr Azevedo said that the important development
has been the agreement by Members to explore a due restraint provision
as a possible interim solution, and that is very important in itself.
According to the TNC Chair, different elements of the solution were
identified and discussed:
(a) firstly, the nature of such an instrument i. e. whether it is
to be political or legally binding;
(b) secondly, its character i. e. is it to be automatic, non-automatic
or some kind of hybrid. "There was some brief discussion and
I think some convergence is shaping up on this particular issue";
(c) thirdly, its coverage;
(d) fourthly, transparency and reporting issues. "I think we
already had a very good conversation on this particular element and
I do not think that any Member disagrees that these issues are going
to be critical if we are going to find an interim solution";
(e) fifthly, the safeguards that might be appropriate to minimize
distorting effects. "We all agreed that this is also going to
be an important element of the discussions, but we have not yet had
a deep conversation on this";
(f) sixthly, its duration and how it would be reviewed. But, as in
the case of safeguards, the conversations have not gone deep enough
yet; and
(g) finally, we also need to have some work focusing on the post-Bali
longer term solution.
According to the TNC Chair, all these elements are interlinked. "We
have been discussing them and there is no clear convergence so far
on any of them. Common ground on some concepts is beginning to emerge,
but very intense work is needed in the coming weeks."
Some members made clear that they want to seek, not only an interim
solution, but also a more permanent solution to the concerns that
led to the G-33 proposal. Other members are mindful of the potential
market-distorting consequences of any solutions sought, whatever their
nature and duration.
As far as the interim solution is concerned, the TNC Chair said that
it is his view that the discussions on transparency and safeguards
will probably frame the outcome in the other elements of the potential
due restraint solution. There is no time to waste in moving to a solution
in these critical areas.
Regarding other aspects of the issue, he noted that there seems to
be convergence around declaration/communique language for Bali recognizing
that public stockholding and food aid programmes in developing countries
are important and legitimate policies and that the G-33 concerns need
be addressed in a focused post-Bali negotiating effort.
On export competition, Mr Azevedo reported that the discussions that
took place in recent days confirmed the sensitivity and seriousness
of this issue. All Members agree that the parallel elimination of
all forms of export subsidies for agricultural products and disciplines
on all export measures with equivalent effect, is a key objective,
and for some Members one of the priorities, if not the priority, of
the Doha Round.
"This helps explain why I detected that everyone is increasingly
prepared to accept the concept of some kind of outcome on this issue
in Bali. Of course there are differing views on what that appropriate
outcome might be, as Members have expressed clearly divergent views."
He added: "What has been encouraging has been that all the participants
expressed in our recent discussions a clear willingness to search
for a landing zone. Not prejudging what that landing zone would be,
we heard some useful suggestions emerging from the debate including,
for example, elements like: (i) the reaffirmation of the final objective
to be achieved on export competition; (ii) the recognition of the
fact that the use of export subsidies significantly has decreased
in recent years; (iii) some type of engagement to maintain this positive
trend; or (iv) the need to improve transparency as regards the use
of some export measures with equivalent effect to export subsidies."
On TRQ administration, the TNC Chair reported that many Members continue
to see this proposal as one that can realistically be part of a balanced
outcome in Bali. However, the S&D aspects of the proposal continue
to prevent the membership from taking this issue forward for agreement.
"I want to repeat what I said to Senior Officials and in the
Room E process - namely that if this issue cannot be resolved then
we really have little hope for Bali. This is a simple and straightforward
proposal that most members tend to find well calibrated and achievable.
I would hope that this could be done quickly so we can concentrate
on the more complex agriculture issues," said Mr Azevedo.
On Development and LDC issues, he said that on the Monitoring Mechanism,
members have started to close some of the gaps. Members are much more
clear about what the Mechanism is, what it should do, and how.
There appears to be agreement on three characteristics of the Monitoring
Mechanism, which do not exist in practice today: First, it should
conduct regular reviews of existing S&D provisions. Second, it
should have the ability to make recommendations to the appropriate
technical body if a shortcoming is detected in the Monitoring Mechanism's
evidence-based deliberations. And third, that the recommendation could
include the launching of negotiations on S&D provisions in the
appropriate WTO body.
"However, more work still needs to be done to find an appropriate
landing zone on a number of issues, in particular with regard to the
relationship and interface between the Monitoring Mechanism and the
relevant WTO technical body under whose remit an S&D provision
falls."
On the Cancun 28 proposals, the TNC Chair said that during the Room
E consultations, Ambassadors were asked the specific question whether
they could agree to adopt some of these proposals on which agreement
was possible, in the event that Members were not in a position to
adopt all 28 in Bali.
At this meeting, the African Group and the LDCs reiterated their position
that they could only agree to the adoption of all the 28 Cancun proposals
as a package, and in case this was not possible, it would be better
that these proposals are taken up in the post-Bali work programme,
within the overall framework of the mandate of paragraph 44 of the
Doha Ministerial Declaration.
The TNC Chair further reported that a round of discussions was held
on the LDC Bali package. A promising development last week was the
revised submission from the LDCs on preferential rules of origin.
It is very encouraging to note that most considered the revised submission
as a step in the right direction.
In two areas, namely cotton and the services waiver, members are awaiting
detailed proposals from the LDCs.
Concerning DFQF (duty-free quota-free) market access, "we need
to find a solution that can be acceptable to all stakeholders involved.
Some realistic compromises are required here from all sides. But our
collective responsibility is clear - we have to ensure a meaningful
package for the weakest and most vulnerable members of our family."
On the next steps, Director-General Azevedo underlined: "I believe
that we must aim to conclude the main part of our negotiations in
Geneva by the end of October. By then, we should be able to see the
landing zones for Bali."
He said that on 24 September, members will resume the intensive Ambassadors+1
consultations in the Room E/D process through to 27 September, covering
all three Bali deliverables.
"This phase will be slightly different from the past two weeks.
The focus will be to make advances where we can, on the critical issues
requiring more concentrated attention. We have scheduled two half-day
sessions for agriculture and development issues, and two full days
for trade facilitation. We will conclude this second phase of consultations
with a TNC on 30 September at 3pm."
He said that work will need to continue after this second cycle of
consultations and he will ask that Chairs continue meeting to look
for convergence.
"From the week of 14 October onwards, we will be in final countdown
mode to the end of the month. A frank assessment of the progress that
has been made will be required - as well as setting the course for
the final stretch of our path towards Bali."
"So, to sum up, the Bali Ministerial meeting is in about 10 weeks
- yes, only 10 weeks. The good news is that I am a lot more optimistic
about where we are now than two weeks ago. But that is just the start,
an inspiring start, but there is a long way to go and the distance
between positions in some of the issues is still very large. We have
to expedite our negotiations and work more intensely. The absolute
need for close and more political effort cannot be understated,"
said the TNC Chair.
According to trade officials, only three delegations spoke following
the TNC Chair's statement, these being Bolivia, Venezuela, and Barbados
(on behalf of the Small Vulnerable Economies). They supported the
Director-General's view on the importance of making progress in the
negotiations, trade officials added.
At a media briefing following the TNC meeting, Director-General Azevedo
explained that the ‘Room E' (process) is a traditional format in the
WTO, adding that there had been Room E and also Room D meetings, both
depending on the number of delegations that came for the meetings.
What is important is that those meetings are at Ambassador-level --
Ambassador plus one.
The delegations that have been invited are the ones that the Chairs
(of the respective negotiating groups) believe have been more involved
or are more sensitive to the issues that are under discussion, and
the number of delegations varies depending on the issue. It goes somewhere
from 30 to almost 50 delegations, he added.
Pointing out that usually in the larger formats, meetings tend to
take a very long (time) because all delegations take the floor and
make long statements etc, he said "we have changed that, and
that is part of the atmosphere that we have in Geneva now."
He said that the meetings are more focused and that the interventions
(by delegations) are very pointed, adding that he has tried to enforce
a 60-second rule, for speakers who take the floor to say whatever
they have to say in 60 seconds or less.
He noted that almost every single intervention is observing that limit,
"and we have been able to make a lot of progress in a very expeditious
fashion because the meetings are very business-like, very focused,
very solution-oriented, so that's the kind of meeting that we are
having."
He felt that it was ‘shock-treatment' to get people to realise that
this is crunch time and that "we are actually with just a few
weeks to finish and that we need engagement at the highest level with
difficult political calls that have to be made now...", adding
that he is also starting meetings on time.
Asked about the issue of customs cooperation under the trade facilitation
pillar, Mr Azevedo said that there are difficulties in that discussion
because members have different laws and regulations internally which
regulate how the information that they process is treated, particularly
in terms of confidentiality.
Given the diversity of laws and regulations in the different members,
it is difficult to find a common multilateral binding approach which
tells customs how to interact with other customs officials in other
countries, he said, adding that that is very challenging and "we're
trying to find a solution for that in a way which is meaningful, in
a way which allows members to have predictability on what they can
do in terms of customs cooperation."
This is still not very mature, and there is a lot of work to be done
there, he added.
In response to another question, he said that the message he is trying
to send is that by the end of October, "we need to have negotiations
advanced enough in all areas so that we are in a position to say ‘this
is doable, we have figured out the landing zones, and now what is
left is just touch-ups', where you have to finalize some technical
work and maybe a difficulty with one member or two who are still reluctant
to fall in line with a particular outcome or something like that and
see whether we can find the right balance for those members as well."
But that should be a residual part of the negotiating process, (and)
it cannot be the bulk of the negotiating process, he said, adding
that "today, that is what we have. Today, what we have is the
bulk is unresolved and we have a residual part of agreed elements.
We want to change that in the next few weeks until the end of October.
By the end of October, we should have the opposite - we should have
the bulk of the negotiations concluded and just the residual part
to be done."
"... And I think that it's doable and if we keep going like we
did over the last two weeks, if we can improve and accelerate a little
bit more our work, I think we can do it," he said.
[The remark that the ‘bulk' of the negotiations be concluded in Geneva
by end October, with ‘just the residual part to be done' seemed to
imply that this might involve some negotiations at the three-day Ministerial
meet in Bali. - SUNS]
In response to another question, Mr Azevedo said that whatever is
agreed, it is agreed by all members, and that he can't impose a solution
for them. "So if it is an agreement which is reached by all members,
it is by definition balanced because no member would accept an unbalanced
result."
"So it will not be their dream scenario. I don't think we're
going to get the dream agreement for anyone. Everybody will have to
make compromises and everybody will have to, from their own each perspective,
do more than they expect and get less than they expect. That's the
nature of negotiations," he added.
On the post-Bali work, he said that from the beginning, "everybody
knew - there was no question about this - that we were not going to
achieve the perfect outcomes, fully complete outcomes on every issue
by Bali. It's just impossible. Everybody knew that. So, what we intend
to do is do as much as we can by Bali, but I am sure there will be
some leftovers from each area of the negotiation which will have to
be figured out after Bali."
He added that Bali is not the end of the road, but a point on the
road to more achievements, negotiations and outcomes.
So, Bali is a checkpoint "where we're going to deliver as much
as we can multilaterally and we continue our work after Bali. If we
deliver these multilateral results in Bali, that will be the first
time in the history of the WTO that we deliver results multilaterally,
which is frankly a very welcome development."
"And the fact that these outcomes are not perfectly complete
shouldn't distress us. On the contrary, they should be an encouragement
to continue working and trying to complete these understandings"
in a more profound and detailed fashion subsequently, said the Director-General.
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