WTO DG voices concerns over divergences on Bali issues

Despite advances in talks to craft an outcome for the WTO’s upcoming Ministerial Conference in Bali, significant gaps remain among member states’ negotiating positions, the WTO Director-General has reported.

by Kanaga Raja

GENEVA: The Director-General of the World Trade Organization (WTO), Roberto Azevedo, voiced concern over divergences on several key issues in the package of potential deliverables for the Bali Ministerial Conference in December, despite there being engagement and members having made progress.

According to trade officials, this assessment was provided by Azevedo at an informal meeting of the WTO General Council on 1 November.

A somewhat more upbeat assessment had been given by the Director-General at an informal meeting of the Trade Negotiations Committee (TNC) on 25 October, when he had said that “significant progress” had been made in all three areas – trade facilitation, some elements of agriculture, and development/LDC (least developed country) issues – of the proposed Bali package, and that the finish line was “clear and it is in sight” (see following article).

Trade officials said that on the issue of trade facilitation (TF), gaps still persist in a number of areas. Members have not been able to square the relationship between Section I (on commitments) and Section II (on special and differential treatment for developing countries) of the draft consolidated TF negotiating text, they added.

There are also many other areas in TF such as customs cooperation, advanced rulings and customs brokers which have not been resolved yet, they said.

There also remain differences of opinion on the key issues in the agriculture and development pillars, said trade officials.

Trade officials said that the discussions at the informal General Council meeting were largely on technical issues such as what kind of an outcome document will emerge from Bali.

According to trade officials, the Director-General told the meeting that real progress had been made in recent weeks and that there had been a lot of engagement. He believed that it could be done, but they were not there yet. Significant gaps remained, he said, adding that he did not know if success could be achieved in delivering a multilateral agreement in Bali.

According to trade officials, the DG pointed to two scenarios, the first of which was one of not having delivera-bles  and  with very little  time left. In such a scenario, an outcome could not be negotiated in Bali itself as there was not enough time for this, and there would only be a factual Chair’s statement emerging from Bali.

According to the DG, people would see this as a failure and as the end of the Doha Round negotiations and there would be little prospect of members getting the negotiations back on track anytime soon. Some would say that it would be damaging to the negotiating function (of the WTO).

Under the second scenario of having deliverables, he said, members would have seized the opportunity and sent a message to the world that the WTO was back in business. There could then be a consensual ministerial declaration from Bali that sends a very positive message, he said, adding that it would have to be as short and simple as possible and it might contain three things – the regular work, the Bali package (the three pillars) and something about a positive message about the future of the multilateral trading system.

Something about the Doha Development Agenda (DDA) could signal intentions to explore and address non-DDA issues, which are not yet part of the regular work. But it was premature at this stage to go into too much detail because there was still uncertainty over the Bali outcome, the DG said.

He further said that the question now was whether we could make calls on what we were going to do next and how to translate these into texts, adding that it was going to be members who would be making the calls.

According to trade officials, the DG had serious concerns about the degree of convergence in certain areas and the window of opportunity closing. The next week was going to be critical. Future trade-offs needed to be identified in the next few days, he stressed.

He said that on 11 November, he would be sitting down with the General Council Chair, the Deputy DGs and the chairs of the various negotiating areas to make an assessment of whether the Bali package is achievable. He would then render his assessment at a TNC meeting the following day.

He said he would be focusing his work on trade facilitation because that was where there were the most issues that needed to be resolved, also adding that there was a need to make sure that all of the issues moved forward in unison towards convergence and that this had to happen in the next week.

“We have to find the landing zone and the plane is nearly out of fuel,” he concluded.

Bringing the work together

Also at the 1 November informal meeting, the General Council Chair, Ambassador Shahid Bashir of Pakistan, said that the Bali Ministerial Conference was less than five weeks away and that the time had come to bring all the work together.

The annual reports from the General Council’s subsidiary bodies were being finalized, he said, adding that most of them had already been adopted. These annual reports were the main vehicle through which WTO bodies report to ministers. All of these will go to the General Council for its approval and transmission to the Ministerial Conference.

(Trade officials said that no date has been set as yet for the General Council meeting.)

On the mandates of ministers from the last Ministerial Conference (which was held in Geneva in 2011), the General Council Chair said that work was on track, and in some cases, they pointed to action from ministers.

Several member state delegations spoke at the informal General Council meeting.

According to trade officials, Morocco (on behalf of the African Group) said that for the African Group, there was only one scenario, that of success at Bali. At no point had it envisaged failure, and it did not take on the failure or disaster scenario.

The African Group would be constructive and pragmatic, it said, adding that it was not only the Bali package that was at stake but the future of the multilateral trading negotiations and of the DDA. If this opportunity was missed, the organization would be hit, it said.

It said that time was short and that political will was needed. The outcome in Bali was one on which the future of the organization hinged.

Cuba voiced hope for success in Bali, but stressed that the development objectives could not be relinquished. There must be a balanced solution at Bali. While it had seen progress over the last two months, they were however not at a position yet where the result was balanced.

It would like to see any anchored outcome anchored in the development objectives, and said that any work programme must be multilateral in nature.

The issues of implementation must be taken into account, and there must be an inclusive process over the course of the next week or 10 days. There could not be a situation where texts were imposed on other members, it said.

Immediate solutions must be offered for LDCs, especially duty-free, quota-free market access for LDC products and cotton, said Cuba, adding that these were issues that had been on the agenda for a very long time.

Barbados agreed that there was a lot of work to do, but asked whether members should not be having more in-depth discussions on the post-Bali work programme.

According to trade officials, India said that the DG had painted a realistic but sombre picture. There would be a very heavy price to pay for the membership, the organization and the multilateral trade negotiations, India said, if a successful outcome at Bali was not reached.

It supported what the African Group coordinator had said, underlining the need to work very hard in terms of finding solutions.

According to India, one of the questions (before the TNC meeting on 12 November) would be how all the elements of the trade facilitation discussion were put together. It added that there was a need to talk about what kind of document would come out of Bali and how the disparate parts of trade facilitation, agriculture and development would come together. (SUNS7688)

Third World Economics, Issue No. 556, 1-15 Nov 2013, pp4-5