TWN Info Service on WTO and Trade Issues (Aug15/03)
7 August 2015
Third World Network

No progress on delivering DDA work plan, report D-G and Chairs
Published in SUNS #8075 dated 4 August 2015

Geneva, 3 Aug (Kanaga Raja) -- There is a continued lack of convergence among the membership, resulting in missing the 31 July deadline on delivering on the post-Bali work programme, the Director-General of the World Trade Organisation (WTO) and the Chairs of the various Doha negotiating bodies reported at a formal meeting of the Trade Negotiations Committee (TNC).

A November 2014 General Council decision had mandated that the deadline for agreeing on a "clearly defined" work programme on the remaining Doha Development Agenda (DDA) issues shall be July 2015.

According to trade officials, at the formal TNC meeting held on 31 July, the Chairs of the negotiating bodies reported that they were not in a position to say that members have achieved the necessary convergence. While the level of engagement had improved, there remained profound differences among the membership.

The Chairs and Director-General Roberto Azevedo told members that if they do not shift gears and move towards more textual-based negotiations, not much will be achieved at the Nairobi Ministerial Conference (MC10) this December, trade officials added.

In statements after the report of the D-G and Chairs of the negotiating groups, developing countries continued to stress that the Rev. 4 draft agriculture modalities text and the Rev. 3 draft NAMA text should be the basis for the negotiations.

They also underlined that the issues of Special Products (SP) and Special Safeguard Mechanism (SSM) are ‘must haves' for MC10, and that the LDC package, cotton and development outcomes are also essential for a successful outcome at MC10.

Earlier, in his report as Chair of the TNC, D-G Azevedo told the formal TNC meeting that "we have not seen the progress we need to deliver a work programme, as mandated, by today's deadline."

The tough political calls have not been made, and "we have not seen sufficient flexibility in members' positions," he added.

Referring to the reports of the Chairs (see below), the D-G said that as of today, "we do not have a proposed work programme on the table."

"So members must now face the reality of the situation. We will not be able to deliver on the instructions given to us by Ministers to deliver a ‘clearly defined' work programme on the remaining DDA issues by July 2015."

The "mandate to deliver the work programme" will lapse at midnight of 31 July, Azevedo said, adding, while this was a very disappointing result, it should not become an obstacle to achieving outcomes in Nairobi in December.

(Since the launch of the Doha Development Round negotiations in November 2001, the WTO has missed several deadlines, but Azevedo's statement about the mandate lapsing, echoing the views of the United States, was the first time perhaps that such a claim has been advanced by the WTO D-G, trade observers noted.)

"This missed deadline does not represent a barrier to delivering in Nairobi - but it should be a wake-up call about our prospects for success," he said.

While there had been excellent engagement on the DDA issues, "still we have not made sufficient progress to deliver a work programme."

Substantive progress towards convergence has remained very limited. There are still huge differences in expectations. The red lines don't overlap, he said.

"We will need to see a step-change in members' flexibility and political engagement if we are to make progress."

Azevedo said that when members return in September (after the summer recess in August), they will need to move on from questions of process and instead put an intense, relentless focus on substance.

The D-G said he can see potential outcomes in a number of areas, particularly on the LDC issues, but it will depend on how fast members can move in the second half of the year.

"I think the most important thing we can do today is send a united message that we are all committed to delivering real outcomes in Nairobi - and that this is our number one priority."

Referring to a number of papers that have been put forward in recent days, including from the ACP group and the G-90, the D-G said " ... We will need to see more such initiatives after the summer. Putting clear proposals on the table will be essential in spurring meaningful discussions on substance, narrowing down the gaps and starting to shape the outline of the final outcomes."

"So, while we have missed a deadline today, this is not the end of our discussions on what we can achieve in Nairobi, or on the DDA issues more broadly. Rather, this is where the really tough work starts."

Azevedo urged the membership to once again come back in September with ideas on substance, but better still, to come back with proposals.

"In addition, we must be prepared to tackle all of the issues on the table. We simply won't have the time to sequence our work. We will need to engage on all fronts immediately - and particularly the LDC issues," he said, adding that there is still a real chance of delivering meaningful outcomes in Nairobi.

The D-G's statement was preceded by the reports of the Chairs of the various Doha negotiating bodies.

According to trade officials, the Chair of the Special Session of the Committee on Agriculture, Ambassador John Adank of New Zealand, said that overall there has been little substantive progress to report.

The consequence of this is that he is not in a position to advice members today of any agreement on a clearly defined post-Bali work programme. This is a reality check and a wake-up call.

In the blue box, he could see some potential convergence because there are no limits on the blue box. But there are no signs of a breakthrough in domestic support. There is this whole issue of contributions by all major subsidisers versus the need to have exceptions among certain players.

There is also the question if a country does not have the amber box, should it have to cut de minimis. This is a hugely divisive issue. Political doability in this area remains challenging particularly for larger members.

The Chair said progress in domestic support is fundamental for unlocking wider progress.

On the issue of market access in agriculture, Ambassador Adank said there is a willingness to explore alternative tariff reduction approaches. There is a big question among members in terms of what is the relationship between tariff cuts in NAMA and those in agriculture.

When you look at alternative approaches, are you talking about cuts in average or average cuts? Are you talking about targets? How do you ensure less than full reciprocity, he asked.

According to the Chair, many members say that although there is a reduced level of ambition, there must be a substantive outcome vis-a-vis the status quo, if it is going to be politically viable.

On export competition, Ambassador Adank said that everybody agrees on the importance of eliminating all forms of export subsidies.

He pointed out that this was an agreement that was already reached by Ministers ten years ago in Hong Kong. But the consensus about export credits and in-kind monetization (of food aid) are areas where an agreement is elusive.

Some members are now renewing calls for disciplines on export restrictions or export prohibitions, said the Chair.

He also said that cotton needs to be part of any outcome. The link to the broader agricultural situation is no longer viable. We cannot wait for wider developments. We need to engage on this now, he said.

The Chair said that there is no evidence of any substantive progress on the issue of public stockholding for food security purposes. There has been a general willingness though to recognise the need to build consensus.

The Chair of the Negotiating Group on Market Access for Non-Agricultural Products (NAMA), Ambassador Remigi Winzap of Switzerland, said that while there has been engagement, there has been a lack of concrete proposals.

There is less of members operating in silos, and they do look at things more horizontally, at least in terms of agriculture and NAMA, and that members are much more open to alternative approaches to the Swiss formula.

However, there is significant divergence among the key players, particularly on conceptual issues, like how do the market access negotiations fit into the context of a development round.

There are big differences in terms of the level of expected contributions from others, as well as big differences in terms of the value of cutting ‘water' versus new tariff bindings. So what he has seen in 2015 is only very limited progress on NAMA, and not very much convergence.

The challenge is to identify the level of ambition, and to do that, more numbers-based proposals are needed.

We need to decide whether to use Rev. 3 NAMA text or not. But this argument of whether to use Rev. 3 or not is hindering progress. We need to encourage and not deter members from putting forward proposals, he said.

The Chair of the Council for Trade in Services in Special Session, Ambassador Gabriel Duque of Colombia, reported that despite best efforts, it has not proven possible to come up with a work programme. There is no convergence towards any text on a work programme.

He however said that even without a work programme, it should be possible to continue to advance towards a significant result in Nairobi.

The request-offer approach is the principal negotiating method for services, so revised offers will be necessary. This needs to be done as soon as possible, if we do not want services to hold up agreement in Nairobi.

The Chair of the Negotiating Group on Rules, Ambassador Wayne McCook of Jamaica, said there are some participants who have been reluctant to engage on rules until they understand and know better the extent of progress in agriculture and NAMA.

Others say that the sequencing approach does not work because it will mean running out of time.

He noted that a number of papers have been put forward which seek to identify ‘re-calibration'. There has been very limited movement, but it is very important to advance these negotiations ahead of Nairobi.

Some delegations say that it is indispensable to have an outcome on rules and if we do not, then it is impossible to envisage any kind of substantive outcome. We need papers that outline what is doable by Nairobi, he said.

The Chair of the Trade and Development Committee in Special Session, Ambassador Yee Woan Tan of Singapore, highlighted the G-90's proposal which details textual suggestions on S&D.

The Chair of Committee on Trade and Environment in Special Session, Ambassador Wiboonlasana Ruamraksa of Thailand, reported that delegations are willing to contribute constructively once they have a better understanding of the way forward in other areas. Sequencing is very much at work here.

The question of an agreement on environmental goods and services has been impacted by the fact that a sub-set of members are negotiating an environmental goods agreement, she said.

The Chair of the Dispute Settlement Body in Special Session, Ambassador Ronald Saborio of Costa Rica, said that members have explored a universe of issues that could lead to an ambitious package of results.

Possible contours of a successful outcome have emerged. The time has come to reap the benefits of this work by concluding these negotiations.

The number and complexity of cases that have been submitted reveals the need to enhance the efficiency of the dispute settlement procedures, he said.

The Chair of the TRIPS Council in Special Session, Ambassador Dacio Castillo of Honduras, said delegations remain hesitant to engage because of a lack of clarity in the overall picture.

The issue that divides the membership is that a group (proponents of proposal TN/C/W/W52, comprising both developed and developing countries) calls for negotiations to extend the GIs to products other than wines and spirits, and to broaden the TRIPS Agreement to take into account the progress that has been made in the Convention on Biological Diversity (CBD, on issues such as genetic resources, traditional knowledge and benefit sharing).

There are others that say that there is no mandate to negotiate the GI extension or the CBD elements. And they are not ready to engage as long as the ‘W52' group keeps putting forward these proposals. So, there seems to be a difficult time in getting any kind of substantive re-engagement, said the Chair.

A number of delegations spoke following the reports of the Chairs of the negotiating groups and the D-G, with developing countries stressing that the Rev. 4 draft agriculture modalities text and the Rev. 3 draft NAMA text should be the basis for the negotiations.

They also underlined that the issues of SP and SSM are ‘must haves' for MC10, and that the LDC package, cotton and development outcomes are also essential for a successful outcome at MC10.

(A report on the statements of various delegations at the formal TNC meeting will appear in a forthcoming issue of SUNS). +