TWN Info Service on Trade and WTO Issues (July08/56)
31 July 2008
Third World Network

Trade: Failure of talks a serious setback, admits Lamy
Published in SUNS #6529 dated 31 July 2008

Geneva, 30 July (Martin Khor) -- At a press briefing just hours after the collapse of the Geneva WTO talks on Tuesday night, WTO Director General Pascal Lamy said there was no point beating about the bush about the serious setback caused by the failure of the negotiations.

He said the difference regarding the trigger for special safeguard mechanism (SSM) led to the failure.

"We had a mandate for SSM. Those who feared it would disrupt normal trade wanted as high as possible a trigger. Others wanted a lower trigger. After over 60 hours to bridge positions these differences were not reconcilable. The remaining issues including cotton were not negotiated.

"What happens to the package on table and Round? We need the dust to settle first, it is hard to see too far in future at this point, must see how members want to bring pieces together."

A sombre Lamy said what happened today will not strengthen the multilateral trading system (MTS) which gave insurance against protectionism for 60 years but the system is resilient and can go through the bumpy road ahead.

Asked if the failure was due to a lack of leadership by the US and India, Lamy said there would be no blame game on his side. Whether and when it can be back on track needs reflection.

The Ministers in the Green Room wanted the talks to be put back on track shortly. "Some asked for a last try to be made tonight on this difference in SSM. So we'll think about that and consult but as far as I am concerned, today is a serious setback, I will try to put it back on track."

Lamy said he told the Ministers their failure to bridge a difference meant they had to take a collective responsibility on what threatened the conclusion of this Round.

Lamy was then asked whether cotton should have been addressed up-front, and that it was not appropriate to say that the SSM issue is the cause of the collapse.

He replied: "We didn't negotiate cotton. The thing broke down on SSM. Why didn't we address cotton? Because it was linked to product specific caps and Blue Box.. These needed adjustment and cotton is linked to that. It is not in my capacity to oblige people to negotiate something if they believe in their own to-do list which is linked to other things.

"We have dispute settlement in WTO, there are on going litigations on cotton. If decisions on cotton were taken they would have been implemented in Round. In future months the cotton issue will be active in the DSB."

Asked if he should have called the meeting and if he intended to stand as DG again, Lamy said he asked himself the same question. He asked Ministers, and none of them said he shouldn't have done it.

"We would not have got it done without Ministers in town and de-doing the fortresses their officials had constructed around these topics. We need Ministers to take down the tactical walls. We did it, we had 25 items and we did down 23. They did most of the job. We are in single undertaking, we can assess that there remain 1 or 2 or 3 issues to be closed."

On the second question, Lamy said he had no answer for moment, it is a very personal question.

Asked if talks could be picked up only in 2 years because of elections coming, Lamy replied that there is the political cycle, in the US, India, etc. "The US administration is near the end of its mandate. We have to factor this in." +