Nairobi MC shaping up as David vs. Goliath battle

At the upcoming WTO Ministerial Conference in Nairobi, developing countries face an uphill task of not only securing some credible development-friendly outcomes but also defending the very continuation of the Doha Round trade talks.

by D. Ravi Kanth

GENEVA: The World Trade Organiza-tion’s tenth Ministerial Conference, which will take place in Nairobi on 15-18 December, is all set to be a David vs. Goliath battle in which a large majority of developing and the poorest countries will take on the most powerful trading elephants – the United States, the European Union and Japan.

These three, who had used the 9/11 terrorist attacks to force the WTO membership to launch a new round of multilateral trade talks at Doha, Qatar, in November 2001, are now hell-bent on burying the Doha Development Agenda (DDA) negotiations without a trace on African soil, several trade envoys told the South-North Development Monitor (SUNS).

According to Chakravarthi Raghavan, a veteran trade analyst and Editor Emeritus of SUNS, “The entire preparatory process leading up to Nairobi, and the way in which the US and the EU, aided by the [WTO] secretariat, orchestrated and launched the Doha negotiations and manipulated the talks all these years to ensure that their treaty commitments at Marrakesh are buried without a trace, raise some fundamental questions about their ‘good faith’ in treaty negotiations – a requirement of the Vienna Law of Treaties – and risk [undermining], in the eyes of the public at large, any legitimacy about all past commitments, including those forged at Marrakesh. And without such legitimacy, the WTO will not endure, and there will be an upsurge among the public in developing nations against their own commitments and obligations at the WTO.”

If the draft Nairobi Ministerial Declaration is any indication, said an African trade envoy, the developing and poorest countries will not only be waging a grim battle for a few credible deliverables but will also be fighting to preserve the continuation of the DDA negotiations.

In almost all deliverables of interest for the developing and poorest countries, the chances of binding outcomes are ruled out.

Even the so-called LDC package for the poorest countries, which includes duty-free and quota-free market access, simplification of preferential rules of origin, a waiver for services providers from the least-developed countries (LDCs), and even in cotton, will be buried without trace in sub-Saharan Africa, which has the largest number of LDCs, trade envoys engaged in the negotiations told SUNS.

The outcomes on public stockholding programmes for food security and the special safeguard mechanism (SSM) for which the G-33 group of developing countries fought so hard over the last two years, will be close to zero unless China, India, Indonesia and the 44 other countries fight to the finish.

The only area where there could be a binding outcome is in agricultural export subsidies. But binding outcomes in two other areas of the agricultural export competition pillar – trade-distorting export credits and food aid – are ruled out because of intransigent opposition from the United States, said a trade envoy involved in the agriculture negotiations.

Never in the 14-year-old DDA negotiations have things looked so bleak and miserable for the developing and poorest countries as now, as their trade ministers prepare to congregate in the Kenyan capital. Unless they wage a do-or-die battle at Nairobi in a unified way, the chances are that developing-country delegates will come back to Geneva after the conference to remain as “excluded” members at the WTO forever, according to trade envoys.

The five-page bracketed (brackets around text indicate lack of agreement) draft Nairobi Ministerial Declaration has been presented in such a way as to create a situation that if developing and the poorest countries fight to retain the language they have proposed for reaffirming the continuation of the DDA negotiations, they could be accused of bringing the Nairobi meeting to a collapse.

However, if the countries of the South let the developed countries have their way, then there is no future for them at the WTO as plurilateral and new issues of market access will become the order of the day, according to developing-country trade envoys.

Doha Development Agenda at stake

Some 14 years after having successfully pushed for the launch of the DDA negotiations along with the EU, Japan and other developed countries, the US has ensured that there is no mention of the DDA, including the Bali Ministerial Declaration, in the crucial Part III of the draft Nairobi declaration dealing with the post-Nairobi work programme, an African trade envoy told SUNS.

At a Room W meeting in the WTO on 8 December, the US insisted that the sentence “We welcome the progress in the DDA which is embodied in the following Decisions and Declarations we have adopted at our Tenth Session” must remain in square brackets as it refused to agree with the language, an African envoy said.

In Part I, the paragraphs for reaffirming the continuation of the DDA negotiations as proposed by the African Group and by China, India, Indonesia, South Africa, Ecuador and Venezuela are also placed in square brackets.

The African Group’s proposal in square brackets reads: “We reaffirm the Doha Development Agenda (DDA), and the Declarations and Decisions adopted at the Doha and at the Ministerial Conferences held since then, and further reaffirm our full commitment to conclude the DDA negotiations on that basis.”

The language proposed by China, India, Indonesia, South Africa, Ecuador and Venezuela says: “We reaffirm the Doha Development Agenda (DDA), and the Declarations and Decisions adopted at the Doha and the Ministerial Conferences held since then, including the Decision adopted by the General Council on 1 August 2004, and further reaffirm our full commitment to conclude the DDA negotiations on that basis.”

The six developing countries have also proposed language to say that “we reaffirm the Ministerial Declarations and General Council Decisions relevant to the Doha mandates; and commit to take concrete steps to conclude the remaining issues in the Doha Development Agenda, with development as a key component.”

The so-called “middle group of countries”, including Australia, Canada, Norway, Switzerland, Singapore, Hong Kong, Korea, Chile, Mexico and Costa Rica, have proposed the following language: “On the future of the Doha Development Agenda and the negotiating function of the WTO, we take note of significantly different perspectives, which remain very difficult to reconcile. Despite candid discussions and serious efforts, we have yet to reach an agreement on this key question.”

The WTO Director-General, Roberto Azevedo, suggested at the Room W meeting that the middle group’s proposal is more viable.

The EU and the middle group of countries also inserted language on new issues to the effect that “we agree that the WTO should have the ability to take on, at least on an exploratory basis, any trade-related issues deemed necessary in order to stay relevant and in keeping with the evolution of the global economy. We further agree to undertake the exploration of such issues in a manner that does not undermine the ongoing work to deal with the outstanding issues.”

In short, the developing and poorest countries have a last chance to protect and fight for themselves at the Nairobi conference, akin to the battle David waged against Goliath in biblical times. (SUNS8153)                              

Third World Economics, Issue No. 604, 1-15 November 2015, pp2-3