Info Service on WTO and Trade Issues (Oct08/11)
Geneva, 14 Oct (Kanaga Raja) -- The G20 developing countries, at a meeting of the WTO General Council on Tuesday, stressed that the Doha Round must redress the fundamental distortions in international trade rules, and thus, unleash the potential for development. It said that these distortions are mainly in agriculture and linked to developed-country levels of subsidies and layers of market protection.
The G20, represented by Ambassador Ujal Singh Bhatia of India, expressed concern about the continuous reduction of the level of ambition in agriculture, particularly on market access and domestic support. It said that more and more layers of exception are being asked by the developed countries, while disproportionate efforts in agriculture and non-agricultural market access (NAMA) are demanded from developing countries.
Several countries supported the G20 statement at the General Council meeting.
Also at the General Council meeting, WTO Director-General Pascal Lamy announced that he has "constituted a Task Force within the Secretariat to follow up the effects of [the] financial crisis on our different areas of work."
He said that if there are indications that the financial situation could be having serious implications more generally for trade or the trading system, he shall consult with the General Council Chair on the possibility of convening a General Council meeting under the coherence mandate.
Under the agenda item of "other business", the General Council Chairman made an announcement regarding the process for the appointment of the next Director-General under the Procedures adopted in December 2002. Director-General Lamy's present term of office comes to an end on 31 August 2009. The appointment process begins on 1 December this year.
According to WTO spokesman Keith Rockwell, while the discussions at the General Council were similar to the one that took place at the Trade Negotiations Committee last Friday (see SUNS #6566 dated 13 October 2008), the mood was lifted by the rally in the major stock exchanges around the world yesterday. But there was very much a feeling that even if the prospects of a massive financial meltdown had receded, there is already evidence of this financial crisis seeping into the real economy.
There was an acknowledgment among members that it would be the developing countries that would be the hardest hit, and on the importance of concluding the Doha Round and of agreeing the agriculture and NAMA modalities as soon as possible. According to Rockwell, some believed that it could be achieved by the end of the year, but most suggested that it be done as soon as possible.
The importance of the development dimension was also stressed by members. The return to the multilateral process in the negotiating groups was welcomed, and there was acknowledgment that the 10 July texts should be the basis for negotiations. Where members disagreed was on the extent to which things that happened over the course of the July ministerial meeting should also be a basis for negotiations, or to which extent they should be ruled out, said Rockwell.
In its intervention at the General Council, Argentina rejected all the elements that came out of the process involving the G7, arguing that it was not in its interest, as well as the manner that these particular elements were constructed - in a smaller group and through a top-down approach.
In his report as Chair of the TNC, Lamy said: "Although it is clear that the Round will not be concluded this year, I believe it is still possible to reach agreement on modalities and the Ministers with whom I have spoken are all determined to push ahead. As underlined by many of you, considerable progress has been made, in July and earlier, and I believe a renewed effort could bring us to the point where agreement on modalities is possible."
He noted that all the Negotiating Groups have programmes of meetings and consultations over the coming weeks, in particular Agriculture and NAMA which remain key to further progress across the board. Any ministerial involvement which might become necessary will take place when the moment is right.
Lamy also said that he has reconvened major providers of trade finance to a meeting on 12 November to examine this issue and find ways to alleviate the situation if it was to deteriorate.
"One third of the world economy, mainly in emerging countries, still has a big growth potential and we must try and make sure that this engine can work through trade."
"Finally, yesterday, trade took centre stage with the award of the Nobel economics prize to an economist who has spent a great part of his life trying to better understand trade and its economic underpinnings, the relationship between trade and inequality or the relationship between multilateralism and regionalism. I see this as an encouraging signal to all of us," said Lamy.
was referring to the award of the Nobel Prize in Economics to Prof.
Paul Krugman of
Following the report of the Director-General in his capacity as Chairman of the TNC, a number of countries spoke at the General Council meeting.
Ujal Singh Bhatia of
The group welcomed the resumption of the multilateral discussions under the chairmanship of Ambassador Crawford Falconer. The G20 remained concerned about the continuous reduction of the level of ambition in agriculture, particularly on market access and domestic support. More and more layers of exception are asked by developed countries -- in increasing the number of sensitive products, in avoiding tariff simplification and tariff capping, in creating new TRQ -- while disproportionate efforts in agriculture and NAMA are demanded from developing countries. The central numbers in domestic support remain open -- OTDS, product specific disciplines and cotton.
"We must avoid a race to the bottom on the level of ambition in agriculture. Developed countries must show whether they are prepared to live up to the Mandate for substantial reductions in trade-distorting domestic support; for substantial improvements in market access, and the elimination of all export subsidies."
The group said that Chairman Falconer's July 2008 Draft Modalities is the only basis for negotiations. Any new revision of that text must be the product of a multilateral, transparent and bottom-up process.
"We remain convinced that substance must take precedence over timing. We believe that it is possible to achieve modalities in agriculture consistent with the level of ambition in the Mandate and a final outcome to the DDA that preserves the balance with other areas of the negotiations, particularly NAMA, and the appropriate flexibilities for developing countries."
financial turmoil is already affecting the real economy and no country
is insulated from this problem. A
is no reason to keep issues other than agriculture and NAMA on hold.
It called for leadership and flexibility from all players on issues of importance to it including cotton, Special Safeguard Mechanism, and duty-free, quota-free market access for LDCs. It would also like to see a solution to the question of TRIPS/CBD.
The EU said that the recent financial crisis has made it all the more urgent to get the Doha Round concluded. The developing countries will face greater hardships. It welcomed the 12 November meeting on trade finance. Agriculture and NAMA are key but this does not mean that other things should be pulled off the table. The EU mentioned that Baroness Catherine Ashton has become the new trade commissioner. This was a matter of internal EU politics, not an indication of any sort of flagging enthusiasm for the EU on the Doha Round.
Chinese Taipei said that it is important to make progress.