TWN Info Service on WTO and Trade Issues (Nov07/29)
30 November 2007
in SUNS #6370 dated 21 November 2007
much of the focus on the WTO's
This is because of the strong push that the major developed country members have made to get developing countries to open up their services markets through multilaterally agreed principles or measures beyond what have been agreed to at the Hong Kong Ministerial.
The developed countries have succeeded in getting a discussion going on whether to have a text on services to be adopted, and whether this should be at the same time when the agriculture and NAMA modalities are adopted.
developing countries were initially against having a services text;
they argued a text already exists in Annex C of the
many developing countries implicitly agreed that consultations could
proceed on such a text. They did insist that whatever text is evolving
must be faithful to Annex C and the several development principles and
flexibilities in GATS and in the services guidelines for the
A group of ten developing countries (India, China, Brazil, Philippines, Thailand, South Africa, Indonesia, Pakistan, Argentina, and Morocco) in fact issued a Room Document setting out their "possible elements of a services text", which mainly reaffirmed Annex C and the GATS development flexibilities, while asking that improved and significant commitments in sectors and modes of interest to developing countries be reaffirmed.
developing countries remain skeptical and reluctant to have a text,
while several developing countries such as
turning point came when the
is an attempt to create a new template. Most developing countries argue
that agriculture is the leading factor driving the Round, with NAMA
to follow, and services only a third factor, at least in terms of sequencing.
In its key operational demands, the US paper also asks that a services text sets "guidelines instructing Members" to positively respond to bilateral and plurilateral requests with a view to achieve higher liberalization, and reducing or eliminating adverse effects on services trade as a means to provide effective market access by offering commitments to: (a) reflect current levels of market access and national treatment; and (b) provide new market access in sectors where trade impediments remain.
an informal services meeting on 15 November (the same day the G20 and
other Ministers and senior officials met at the WTO),
services negotiations are a remarkable "success story" in
a Round where some Members have been dragging their feet in agriculture
for more than four years. Hence, the very idea of a "services text"
looked bizarre when "lack of progress" and "need of political
guidance" would be more properly referred to other negotiating
in a gesture of good faith, said
two meetings to discuss the elements for such a text,
Now, added Brazil, we are confronted with a "proposal", which states that (I) services market access ambition should be comparable to the ambition in agriculture and NAMA; (ii) a factual assessment of the market access negotiation should be made, reflecting the range of Members' views and providing concise, non-attributed summary of the responses to collective request; and, finally, to add insult to injury, (iii) Members shall undertake commitments which reflect current levels of market access and national treatment, as well as provide new market access in sectors where trade impediments remain.
serious consideration of those proposals, either individually or collectively,
would lead us to the conclusion that the whole negotiating process in
services would be dramatically changed, stressed
Firstly, the very idea of "comparability" between agriculture/NAMA and services is difficult to grasp. First of all, because bound commitments in services is not just the result of a negotiating process, but also consequence of a previous domestic process of regulation and liberalization. To a large extent, trade in services is already liberalized in the ground, but the binding of such market openness depends upon the multilateral negotiating process.
the proponents rely on the argument that services, agriculture and NAMA
form a "three-pillar" of market access negotiations. True,
In the context of a "single undertaking", to follow that reasoning, it would be more appropriate to compare services not only to agriculture and NAMA, but also with trade facilitation, the review of S&D provisions, and rules negotiation, said Brazil. Especially at this juncture, where attempts are being made to legalize the practice of "zeroing" in anti-dumping investigations, it would be advisable to bring the outcome of rules to the "comparability exercise" proposed, since an outcome on "zeroing" could adversely affect effective market access.
would be a daunting task, assuming it is feasible, to convey the different
views of 150 members on 21 plurilateral requests. We could be in a position
that, when modalities in agriculture and NAMA are completed, we will
be negotiating views rather than commitments, said
If a "factual assessment" can help to give progress to the negotiations, perhaps the agriculture negotiations could undertake a factual assessment on the US cotton subsidies, the European Sugar Regime, the tariff peaks in Japan and Switzerland, as well as in Brazil and Argentina, in order to convey all the Members' views, and hope that this assessment would help negotiators to agree on the negotiating modalities, said Brazil.
By itself, this proposal already looks like a "benchmark is disguise", said Brazil But even more, the proposal should be seen in conjunction with the two previous suggestions, on "comparability" and "factual assessment".
In terms of "comparison", added Brazil, it does sound strange to ask for members to bind their actual levels of liberalization in services and even provide new market access, when, on the other hand, some members refuse to bind, let alone lower, their levels of agricultural subsidies, which are high and distortive.
In such comparison, members will be required to cast on stone their market openness in services, while some members will have the "policy space" to increase agricultural subsidies, distort markets and do harm to rural livelihoods, said Brazil.
It added that if we add the "factual assessment" to this equation, perhaps it would be useful to remind that, according to the OECD latest "Agricultural Outlook", the levels of expenditure in domestic support in developed countries has increased in absolute terms.
Those evaluations, not only regarding services revised offers but in other negotiating areas as well, will be properly reflected in the final stage of the request-and-offer process. In this context, there will not be any single and universally applied criteria for comparing and assessing different negotiating areas, but each member will apply its own criteria, according to its own national policy objectives and trade interest.
this regard, said
to diplomats who were at the meeting, after
the end of the meeting, the Chair of the services negotiations, Ambassador
Fernando de Mateo of
Meetings will resume in two weeks to address the rest of the items on the agenda of the Special Session on services. +