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TWN Info Service on WTO and Trade Issues (Sept07/12)

26 September 2007


Expanded "Group of 8" in WTO taking shape

The informal "Group of 8" that started operating in the WTO earlier this month seems to have expanded its membership to include four or five more developing countries.   China, South Africa, Indonesia, Jamaica were invited to join the group on 18 September.

The G8 expansion came about at the insistence of India (one of the G8 members) which at a Tuesday (18 September) meeting of the G8, criticized the group for having a composition that is not representative of the developing countries.

The G8 comprises the old G6 (the US, European Union, Brazil, India, Australia and Japan) plus Argentina and Canada.

India suggested that the group be expanded to include other important developing countries, including those that coordinate developing-country groupings. Otherwise, it would have to leave the group.

Many developing countries are critical of the G8 process for diverting from the multilateral process.

The G33 and ACP groupings have indicated to their members that if they take part in the G8 process it would only be in their individual capacity and

that they cannot represent the groups in that process.

The report below was published in the SUNS (South North Development Monitor) on 20 Sept and is reproduced here with permission of the SUNS.  Any reproduction or recirculation requites the permission of SUNS (sunstwn@bluewin.ch).

With best wishes
Martin Khor
TWN

Expanded "Group of 8" in WTO taking shape

By Martin Khor (TWN), Geneva, 19 Sep 2007

The informal "Group of 8" that started operating in the WTO earlier this month seems to have expanded its membership to include four or five more developing countries.

China, South Africa, Indonesia, Jamaica and the Dominican Republic were invited to join the group on 18 September. At a G8 meeting this morning, four of these countries (China, South Africa, Indonesia and the Dominican Republic) attended for the first time.

The G8 expansion came about at the insistence of India (one of the G8 members) which at a Tuesday (18 September) meeting of the G8, criticized the group for having a composition that is not representative of the developing countries.

The G8 comprises the old G6 (the US, European Union, Brazil, India, Australia and Japan) plus Argentina and Canada.

India suggested that the group be expanded to include other important developing countries, including those that coordinate developing-country groupings. Otherwise, it would have to leave the group.

Following this, the five developing countries were invited to join the expanded G8.

Today, officials from China and Indonesia told the SUNS that they had joined the group. A South African official said that his country was still thinking about being part of the group.

A Jamaican official confirmed that the country had been invited to be part of the G8 but that it had to consult with its constituency, the ACP Group, whether it should participate. Jamaica is the current coordinator of the ACP Group.

The Dominican Republic is coordinator for the small and vulnerable economies on agriculture issues. At press time, it had not been possible to reach the delegation for confirmation whether it had decided to join the G8 process.

The Indonesian Ambassador to the WTO, Gusmardi Bustami, clarified that his country would participate in the expanded G8 in its national capacity and not on behalf of the G33 (the grouping of over 40 developing countries in the WTO agriculture negotiations).

Several developing-country delegations, responding to the news of the enlargement of the G8, were critical of the G8 process which they said was detracting from the multilateral negotiating process which only weeks ago had been reaffirmed by the WTO membership as the only legitimate process, after the collapse of the G4 Ministerial meeting at Potsdam at the end of June.

At a G33 ambassadors' meeting this morning, several G33 members expressed their criticism of the G8 process which they said did not have legitimacy, and eroded the work and authority of the multilateral process.

They insisted that any drafting of texts or review of drafts should be undertaken through the multilateral umbrella, or in a smaller group that is representative, known and acceptable to the whole membership (such as the Room E negotiations now taking place on agriculture).

These G33 members were of the view that if any member of the group were to take part in the G8 process, they would do so only in their own national capacity, and would not represent the group. In that way, the group would not provide legitimacy to the G8.

The G8 was established after the WTO's August summer break and held its first meeting on 6 September at the United States' Mission.

This was three days after the first WTO meeting - an open-ended informal meeting on agriculture - which re-launched the negotiations following the summer break. It was also only a day after the first Room E meeting (involving 36 delegations that include coordinators of the different WTO groupings) on agriculture.

The very existence of the G8 itself has not been acknowledged at the WTO meetings, and members of the G8 have not provided any information on their discussions at the two "transparency meetings" on agriculture (involving all members) held so far in September nor at the Room E meetings.

The aim of establishing the G8 (or even which country initiated it) is also not clear. One of the G8 members privately explained that its objective was to provide a forum for key members to meet and exchange views informally, but it was not meant to conduct negotiations or to come up with drafts and texts.

However, other G8 members may have a more ambitious view of the group's role. According to corridor talk floating around the WTO, the G8 is meant to take off where the G4 and the G6 left, to be the venue where the core issues of the Doha Round would be discussed and key bargains struck. In fact, the G8 has even acquired the nickname of the "core group."

According to diplomatic sources, the Chair of the agriculture negotiations, Ambassador Crawford Falconer of New Zealand, met the G8 last Friday and requested the group to negotiate among themselves and come up with language or draft texts for several unresolved issues in agriculture, such as special products, special safeguard mechanism, preference erosion, tariff escalation, and tropical products.

These issues are being discussed in the Room E process, and there has been very slow progress on some issues and no progress (but instead, evidence of wide divisions) on others.

Apparently, the Falconer request marked a turning point in the development of the G8, as it was now being asked to undertake drafting which would presumably be used as inputs for the Room E or multilateral process, or as contributions to the next draft of the Chair's modalities paper.

It was after this development - and the apparent attempt to change the nature of the G8 from an informal discussion forum into a negotiating and drafting group - that India announced to the group that it could no longer take part in it, unless more developing countries, that are more representative of the diversity of positions on the Doha issues, are included in the group.

The subsequent invitations to the five new countries certainly alters the balance in the group, with the developing countries now constituting a majority.

However, many developing countries remain not only suspicious but also hostile to the existence of the G8, its lack of legitimacy, and the un-transparent way it operates - even if it is now becoming the G8 Plus 4 or 5.

Most of all is the perception among these developing countries that the group is taking the negotiations away from the WTO process and into a private enclave that so far is unseen and whose talks are unknown to others.

At the G33 meeting today, the delegations passed on the message that G33 members who decide to be part of the G8 process can do so only on their own individual national capacity and could not represent the G33.

Some G33 members maintained their position that the G8 process had no legitimacy in terms of playing a leading role in the WTO negotiations, and that they would not accept any inputs (for example, draft language for the modalities) from the G8 process.

Speaking privately, a developing-country diplomat said that a majority of developing countries had not been in favour of the earlier G6 or G4 process because they did not want a small and unelected group to make key decisions on the Doha negotiations that by right should be made collectively by the whole membership.

"When the G4 was operating, there was hardly any significant negotiations at the WTO as everyone was expected to wait for progress from the G4," said the diplomat.

"It was like the G4 being given the unofficial power to decide for the rest of us, when they were not elected to do so. Everyone else was expected to rubber stamp the G4 outcome.

"When the G4 talks failed, the WTO membership agreed at the TNC meetings that the Doha negotiations would return to the multilateral bottom-up process in Geneva.

"By starting the G8, these countries are taking us backwards. By including a few more developing countries into their process does not mean that it has become legitimate.

"Who selected the G8 or the new members? Why should they make decisions for all of us? We cannot accept any small group that has the objective of negotiating for the members, whether it is G6 or G8 or G12 or G whatever number."

However, several of the newly invited members of the expanded G8 downplayed the significance of the group.

A senior official of one of these countries said that his country viewed the "G8 Plus" as only an informal discussion group for the exchange of views, and his delegation understood that the G8 was not meant to go into serious negotiations or into the drafting of texts.

"I understand that the group is only a forum for participants to give their views and to clarify their positions, and not to negotiate or draft," said the official. He hoped that by his country and the other countries joining the group, the developing countries overall could be in a stronger position to present their views, rather than have the positions developed by others later dropped down on the WTO members.

This position reflects the dilemma faced by officials of developing countries which are invited to take part in exclusive processes not sanctioned by the membership as a whole. If they take part, they seem to be legitimizing the exclusive group, and run the risk of having to compromise their positions, and also being unpopular with other developing countries if the latter do not like the process or its outcome.

And if they are invited but do not join, they may be accused by the developed countries of not wanting to engage, and also lose the opportunity to help shape the inner dynamics of negotiations that also include the major developed countries.

The other developing countries that are not invited to the G8 club have worries of their own. They are very concerned that the real negotiating energy, whether in agriculture or NAMA, will be centered in the G8 or its expanded version.

"Soon, the Room E meetings will be less significant, and the big players may not even turn up, as they put their real efforts in the G8," remarked a diplomat of a small country.

Said another diplomat: "Yes, you can say that the club is meant to only clarify the issues and not negotiate. But how long will that last? If it is to mean anything, they are sure to move into negotiations at some stage. But how can they negotiate for all of us?"

For these countries, the multilateral process is what was agreed on, and where the negotiations should be conducted.

 


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