TWN Info Service on WTO and Trade Issues (May08/04)
11 May 2008
Third World Network

UNCTAD XII: Talks on text intensify, while G77 issues Declaration
Published in SUNS #6461 dated 23 April 2008

By Martin Khor, Accra, 22 April 2008

Several unresolved issues are at the centre of negotiations on the UNCTAD XII text to be adopted on 25 April, the final day of the conference.

According to diplomats engaged in the negotiations in the Committee of the Whole, the main problematic issues include the old topics of policy space and intellectual property (what kind of work, if any, UNCTAD should undertake on these); the wording on good governance; whether UNCTAD should have explicit mandate on "new issues" (climate change, migration) and what it should be; and structural issues (whether the existing three Commissions of UNCTAD should remain, and whether to have a new Commission on Globalization and Development, as proposed by the G77 and China).

The differences between developed countries and the G77 and China are wide, and diplomats expect the talks on the text to go on until the eve of the closing.

On Tuesday (22 April), the first two of the total nine roundtables was held. The roundtables on specific themes are the main open forums, which are meant for interactive discussion. The first roundtable, on globalization, development and poverty reduction, was held on Tuesday morning and the second one on foreign investment and sustainable development was held in the afternoon.

The G77 and China issued a Ministerial Declaration that emerged from the group's Ministerial meeting on 20 April. This document states the group's position on the issues being negotiated in the UNCTAD XII text. It covers policy space, the Doha Round, the "new UNCTAD issues", IPRs and finance issues.

The Ministers strongly called for the existing intergovernmental structure of UNCTAD comprising three commissions be maintained, one of which should be devoted to globalization to advise developing countries on issues relating to the challenges of globalization.

It recognized UNCTAD's unique orientation and development commitment and was assured that it will continue to play a vital role in providing insights on strategic and systemic issues.

"We also reject one-size-fits-all policies and rules limiting the policy space available to developing countries and their ability to choose appropriate economic policies. Recognizing our commitments to international obligations, we reaffirm that policy space is necessary to fully implement them in a manner best suited to our diverse national circumstances and conditions," said the Ministers.

They added that the current global institutional architecture for global economic governance requires fundamental reforms. Progress must be made to enhance the coherence of the international economic architecture, particularly the interplay of the multilateral trading system and the international financial and monetary systems.

There is a need for more inclusive and transparent governance of global economic relations, with an adequate voice and participation of developing countries in international economic decision-making. UNCTAD should give policy recommendations on all trade and development-related matters, including WTO negotiations.

The Ministers are particularly concerned that the Doha Round negotiations in the WTO have not concluded yet and met the expectations of developing countries. WTO members must demonstrate their political will for success of the Doha Round and the realization of its development agenda, with the necessary special and differential treatment for developing countries. Its final results should ensure fair, equitable and realizable commitments.

"The Doha Round should bring about improvements in multilateral rules that address and remove existing asymmetries and enhance the fairness and equity of the multilateral trading system," said the Declaration.

"In this light, the centrality of agriculture needs to be stressed: the fundamental basis for the existence of a fair and balanced trade in agriculture is the removal of the distortions currently present in agricultural trade. Agricultural domestic support granted for agricultural production by some developed countries must be effectively and substantially reduced, in accordance with the Doha mandate. Moreover, the Doha Round must eliminate all forms of export subsidies.

"We urge those developed countries providing subsidies for the cotton section to eliminate expeditiously both export subsidies and production-related domestic support, particularly with a view to fully addressing the concerns of cotton producers in Africa. The possible adverse impacts on LDCs and net food-importing developing countries of a WTO agreement, including implementation costs and other concerns, must be adequately addressed. Aid for Trade should be adequately funded through additionality and predictability of resources, to ensure that the needs of all developing countries, particularly LDCs, are met."

The Declaration touched on free trade agreements. It said the growing number and complexity of North-South trade agreements, such as bilateral FTAs and economic partnership agreements (EPAs) between the ACP countries and the European Union, point to the importance of ensuring coherence for sustainable development and a positive interface between regional trade agreements (RTAs) and the multilateral trading system, as well as with national development strategies of developing countries, so that these agreements more effectively contribute to the attainment of the MDGs and poverty eradication.

RTAs should be compliant with WTO rules, taking into account their development dimension. North-South RTAs should not result in additional burdens for developing countries, particularly for LDCs.

The WTO accession process should be accelerated without political impediments and in an expeditious and transparent manner for developing countries, especially for LDCs.

"We note with concern that recent escalations in food and grain prices have caused social destabilization and market instability in several of our member States," said the Declaration. "Collective urgent measures at the global level are required to assure the world of adequate food security and stable food and grain markets. Renewed attention is required for the development of the agricultural sector, particularly in Africa and the net food-importing developing countries."

The Ministers called on UNCTAD to help developing countries address the impact of commodity dependence. Domestic commodity diversification efforts need to be supported by specific actions by the international community to address the productive capacity deficiencies of commodity-dependent countries, particularly the LDCs.

UNCTAD has been, and should remain, at the forefront of efforts to resolve the trade and development problems associated with commodity dependence. Policy options should be developed to garner assistance for commodity-dependent developing countries through UNCTAD's pillars in order to mainstream commodity policies into their national and regional development strategies.

The G77 Declaration expressed concern over the sub-prime financial and credit crisis as well as the recent financial market instability and their adverse impact on the development prospects of developing countries, including the latter's access to crucial finance and credits.

"These situations require a vigorous international response to ensure that the sustained growth of the world economy and the development efforts of developing countries are not severely affected," it said, also highlighting the need for a new international financial architecture which guarantees the full participation of developing countries, including through reforms of the monitoring and regulatory systems.

"This architecture should further improve response capabilities for dealing with the emergence and spread of financial crises, and should give developing countries greater flexibility and autonomy in the management of capital flows." Discussions on the reform of the international financial architecture should stress democratization of international economic decision-making, enhanced measures to mitigate excessive volatility, and financing for development.

The Ministers were also concerned about the decline in levels of official development assistance (ODA) to less than one-third of the internationally agreed target of 0.7 per cent of the Gross National Product (GNP) of donor countries.

"We reiterate the need to meet, in an expeditious manner, the internationally agreed targets for ODA of 0.7 per cent of GNP of donor countries to developing countries and of an additional 0.15 per cent to 0.2 per cent of GNP to the least developed countries by 2015, in accordance with the Monterrey Consensus and the renewed commitments undertaken in various subsequent forums.

"We reiterate the call made by the leaders of the Group of 77 and China at the Second South Summit in 2005 in Qatar for the establishment of an effective monitoring mechanism to ensure that the internationally agreed ODA targets, most recently those established for Africa, are met."

The Ministers also called on UNCTAD "to assist developing countries in addressing the development dimension of intellectual property and the trade-related aspects of intellectual property rights, including improvements in the transfer of technology to developing countries, the development dimension and implications of the establishment and enforcement of intellectual property rights, as well as protection of traditional knowledge, genetic resources and folklore and fair and equitable benefit-sharing. We further call on the international community to continue its efforts towards a balanced international intellectual property system, in accordance with the Development Agenda of the WIPO."

On the "new issues" for UNCTAD, the G77 Ministers called on UNCTAD to take a proactive role to address trade and development dimension of the new and emerging issues of energy, climate change and migration.

It mentioned the need to address renewable sources of energy, including bio-fuels, with special attention to the maintenance of food security while producing bio-fuels. It recognized the challenges posed by migration; however, developing countries need to be enabled to derive development-friendly benefits from it.

On South-South cooperation, the Ministers reaffirmed commitments to implement fully the Havana Programme of Action, the Marrakech Framework of Implementation of South-South Cooperation and the Doha Plan of Action, which, taken together, represent a comprehensive framework for intensified cooperation among developing countries.

They welcomed the General Assembly decision to convene of a High-level Conference on South-South Cooperation, to be held in Argentina in 2009.

The Ministers committed to strengthen the capabilities of the G77 and China through enhancing coordination among the various chapters and strengthening coordination and cooperation with relevant South institutions.

In accordance with the Second South Summit outcomes, the Group should continue to explore ways to establish an open-ended working group to study possible ways and means of strengthening the G77 and China and its Secretariat, including identifying common modalities to facilitate inter-chapter cooperation as well as innovative approaches to address resource and personnel requirements of the G77 Secretariat so that it may meet the needs of the entire Group of 77 and China. +