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TWN Info Service on WTO and Trade Issues (Sept07/02)

11 September  2007


Practical but sombre mood as WTO prepares for talks ahead

The mood at the WTO as the delegations prepare for the start of at least a month of tough and intense negotiations is business-like as well as sombre.

At the first WTO meeting after the August summer break, only a few delegations spoke, and they did so briefly.

The serious talking, if any, is to be reserved for the agriculture small-group meetings of about 30 delegations, known in WTO jargon as "Room E meetings".

Beneath the calm surface, however, is an underlying layer of sombreness and anxiety, as many delegates ponder over the chances of the September negotiations succeeding, and what would be the options and consequences if they do not succeed.

Above all, the delegations are worried about a possible "blame game" in case the talks do not reach a conclusion. No delegation wants to be blamed if the September Geneva talks do not succeed. 

Below is an article on the WTO situation, which was published in the SUNS on 5 September.  It is reproduced here with the permission of the SUNS for the benefit of this email service.  Any re-circulation or republication of this report requires prior permission of the SUNS.  (sunstwn@bluewin.ch).  

With best wishes
Martin Khor
TWN

Practical but sombre mood as WTO prepares for talks ahead

By Martin Khor (TWN) Geneva, 4 Sept 2007  

The mood at the World Trade Organisation as the delegations prepare for the start of at least a month of tough and intense negotiations is business-like as well as sombre.

At the first WTO meeting after the August summer break, only a few delegations spoke, and they did so briefly and to the point, avoiding repeating more lengthy statements that they had already made at the end of July when presenting their initial comments on the two modalities papers on agriculture and non-agricultural market access (NAMA).

Perhaps the Monday meeting, an informal open-ended session on agriculture, was more in the nature of "feeling the water", and thus delegations did not want to present either long general speeches or specific negotiating proposals.

The serious talking, if any, is to be reserved for the small-group meetings of about 30 delegations, known in WTO jargon as "Room E meetings", which will start on Wednesday morning.

At least three countries, including Cuba and Brazil, made the point that more details are needed on the specific topics that will be discussed on specific dates, so that delegations will know what to prepare for.

"I'm happy the mood was practical, business-like. There is no sense of people trying to play games," said Ambassador Crawford Falconer, chair of the agriculture negotiations, to the media after the meeting.

Beneath the calm surface, however, is an underlying layer of sombreness and anxiety, as many delegates ponder over the chances of the September negotiations succeeding, and what would be the options and consequences if they do not succeed.

Above all, the delegations are worried about a possible "blame game" in case the talks do not reach a conclusion. They are mindful of the negative media coverage of parties pointing fingers at one another, for example when the G4 Ministerial meeting at Potsdam failed at the end of June. No delegation wants to be blamed if the September Geneva talks do not succeed.

Thus, even as the diplomats prepare their technical points and positions for the talks ahead, they will be careful to avoid giving others the opportunity to blame them if something goes wrong.

In fact, few diplomats at this moment are optimistic that the talks on modalities of agriculture and NAMA can be concluded in the next few weeks.

The first problem is the shortness of time left. Falconer himself told journalists on Monday that although there was no deadline as such, "if I don't see any move between now and mid-October, I would cry. It would be a pretty sad state of affairs."

The second is that the conditions that allow for movement do not seem to be there. In many past situations of impasse (for example, the end-July 2006 mini-Ministerial in Geneva) the other WTO members were mainly waiting for the United States to give an adequate offer on the cap for overall trade-distorting domestic support (OTDS).

In the previous situations, the US was unable to do so. In the present situation, many diplomats are pessimistic that the situation will be any better. They point to two recent developments - the inability of the Bush administration to have the fast track trade authority renewed, and the uncertainties over the 2007 US Farm Bill.

On the former point, experts and diplomats point out that since the US administration cannot be reasonably certain that its negotiating positions or any deal it agrees to can be sustained by Congress, it would not be conducive for other delegations to make significant concessions, which would then be "pocketed" by the US, but which itself cannot effectively promise to keep to what it has committed.

On the latter point, the US House of Representatives has passed its version of the Farm Bill, a version that the US administration itself has strongly criticised for not doing enough to reform or reduce the subsidies, and thus would make the US open to criticisms by its WTO partners.

Since it would take the whole of September and possibly into October (or even to the end of the year) for the Senate to produce its version of the Bill and for the Senate and House to then come up with a single reconciled Bill, many diplomats are of the view that it would be difficult for the US negotiators in the WTO to change the domestic support offer they have on the table.

This is being pointed out as one of the key difficulties. A senior developing-country diplomat today quoted the Indian Commerce Minister, Mr. Kamal Nath, as saying that if the US Trade Promotion Authority has expired, and if there is a time-frame problem relating to getting it renewed, then "it is their problem, not my problem."

The diplomat said that the developing countries are not going to stay aloof from negotiating because of problems that some developed countries may have, or are perceived to have.

"It will not stop us from engaging seriously and intensely," said the diplomat. "We are preparing to negotiate in good faith, both in substance and in process, and in accordance with the objectives and the mandates of the Round.

"We hope the members, including the developed countries, will do the same, and if they do not then it is their problem."

Another area of concern is that while the process of the agriculture negotiations has been clarified, it is unclear how the NAMA negotiations will proceed, or even when they will start, and on what basis.

Many developing countries have argued that agriculture is the main focus of the Doha Round, and that reduction of agricultural trade distortions by developed countries is the priority objective.

Only when the "ambition level" (or how much the developed countries are willing to undertake) in agriculture is settled can the developing countries decide on their level of response in NAMA and services, according to this widely-held approach.

In line with this, the September talks in the WTO will start with agriculture. The NAMA negotiations are expected to start in earnest only a fortnight later, and the services talks will also start around then.

This gives little time for all the issues in agriculture and NAMA, let alone services, to be covered by the end of September or by the first half of October (which somehow has become the unofficial deadline).

Meanwhile, developing country groupings including the G20, the G33, the ACP Group and the Africa Group, have been meeting, with some of these meetings even taking place during the August break.

The G20 is expected to present new detailed technical papers with its positions on the main areas of the agriculture negotiations. It is taking the negotiations seriously and will be engaging intensely, according to a G20 source.

Other developing-country groupings have also been preparing their positions in relation to the Chair's modalities paper, and will be detailing their suggestions to improve the paper.

 


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