TWN Info Service on Trade and WTO Issues (July08/54)
31 July 2008
Third World Network

Trade: Kamal Nath explains how the Geneva talks failed
Published in SUNS #6529 dated 31 July 2008

Geneva, 30 July (Kanaga Raja) -- "We cannot put at stake the livelihood security of 1 billion people from all countries," Indian Commerce Minister Kamal Nath said Wednesday, explaining the stalemate that occurred the previous day over the issue of the special safeguard mechanism in the WTO mini-Ministerial talks.

The Indian Minister was speaking to media today after the collapse of the WTO's Geneva talks. Nath said that when a special safeguard mechanism is operated, there should not be a remedy that frustrates it. "Then, why have this special safeguard mechanism," he asked.

Nath said that he has always said that he was willing to negotiate commerce, "but not livelihood security. If there was to be a stalemate on commercial considerations, it would have been entirely different from this deadlock on livelihood security."

He noted that the G33 had worked for the last three years on the issues of livelihood security. He also cited the declaration of the G33, the ACP, the African countries and the vulnerable economies - representing about 100 countries - in that the most important thing was that the livelihood security and the vulnerability of the poor farmers could not be traded off against commercial interests of the developed countries.

In the Hong Kong Declaration, developing countries had been given the SSM. He said that at the heart of the development round lies less than full reciprocity, special products, and special safeguard mechanisms. "That's at the heart of this round. That's the bedrock of this round."

He said the SSM would operate only in terms of a contingency, and when you operate it, you cannot have a remedy which frustrates it. "Otherwise, why have this special safeguard mechanism," asked Nath. "It was this which led to the stalemate, when I thought that we cannot put at stake the livelihood security of 1 billion people from all countries," said Nath.

Referring to the Lamy package on Friday, Nath said: "I want to make it very clear, there was a proposal on Friday where I had very clearly said that this proposal is not satisfactory, is not adequate in terms of the special safeguard mechanism. This proposal has subsidies which are twice than those subsidies which are being given.

"And if developing countries want to guard themselves against a surge of subsidized products, of course, they need a special safeguard mechanism. You need a special safeguard mechanism in any event and more so to protect yourself against subsidized products."

Nath said that he would urge Director-General Pascal Lamy to treat this as a pause, not a breakdown and to keep on the table what is there.

"For six months, officials have worked very hard and have produced texts and what is at stake is not mere commercial interests but what is at stake is so many benefits to our African friends, to our LDCs; we would have to not let these fritter away."

Asked about India's relations with Brazil and G20, which had taken a different position in the talks, Nath said that the G20 is a diverse group and that is what gives the G20 credibility. The G20's proposal has always respected and contained in it provisions for SSM and SPs. There are no numbers in it but the concept has been accepted by the G20 in its proposal.

Responding to a question on what USTR Susan Schwab had said about possible abuse of SSM, Nath said the US has imposed safeguards 28 times in the last three years on textiles.

Referring to what world prices are today, he said that the SSM would not need to be imposed, so why should anybody be worried. "But if it's a matter of caution, should you be leaning towards safeguarding livelihood security or safeguarding commercial interests?"

Asked if the single undertaking approach to the Doha Round had been one of the complications, with too many issues to be resolved at once, Nath said that the single undertaking has to be there because nothing is agreed until everything is agreed. "The WTO is not a buffet that you pick up what you want and go."

Asked about two developments on SSM - a compromise proposal by Lamy and subsequently, a negotiator within the G7 group who tried to converge positions by offering a tiered formula, Nath said that after the Friday effort, there was an alternate proposal because one of the concerns was misuse and abuse (of the SSM).

"And I categorically said that we are willing to subject ourselves to any anti-abuse or misuse provision. Let it be crafted any way. That was crafted," said Nath, who went on to read out the relevant provision whereby any member may request a review of the necessity by a permanent group of experts and their decisions will be within 60 days, and shall be binding and not subject to appeal.

"Never in the history of the world trading system has any country agreed to this," said Nath, adding that India agreed to this. "We agreed to this only to dispel a feeling of misuse or abuse." There was a proposal and it was rejected by one country (referring to the US).

Nath said on Monday night it was decided that a proposal meeting the concerns of everybody could be prepared after consultations, and for three hours, it was worked on (by senior officials) on Tuesday morning. It was rejected by one country, said Nath, adding that he did not want to go into the blame game.

Nath said the SSM was a "given" and it is the bedrock. It was the mechanism of protection and "if you say 'we don't want to give you anything to protect yourself', well then so be it."

Asked how the collapse of the Doha talks will go down in India, Nath said that he has to go back home to find out. India has always stood for under-developed countries. "We must remember that India has more poor than all the LDCs put together. And we have always stood by the concerns, the needs of the poorest countries and we shall continue to do so," he said.

In response to another question, the Indian Commerce Minister said that the negotiations were going very well. It's not that they have broken down on huge issues. They have broken down on a safeguard mechanism to protect livelihood security. "I don't think anybody doubts that. Now, if somebody says 'we don't want to give you this protection', what do you do," he asked. +