Address DDA issues, development and SDT are key, say South

Amid continued uncertainty following the Nairobi ministerial meeting over what subjects are to be taken up in the WTO and how, many developing countries have stressed the need to prioritize the outstanding Doha Development Agenda issues while keeping the centrality of the development dimension as well as special and differential treatment.

by Kanaga Raja

GENEVA: The first meeting of all members of the World Trade Organization (WTO) to discuss the work going forward following the adoption of the “Nairobi Package” at the WTO’s 10th Ministerial Conference (MC10) last December heard a number of developing countries calling for the remaining Doha Development Agenda (DDA) issues to be addressed as a priority and saying that the development dimension and special and differential treatment (SDT) are key in moving forward.

In their various interventions at an informal heads-of-delegation (HOD) meeting on 10 February highlighting their priorities for the post-Nairobi work, developing countries also said that the flexibilities that have been inscribed in the WTO texts over the past 14 years must be preserved.

Some developing countries also voiced disappointment with the negotiating process in Nairobi, saying that having five countries making decisions and the broader membership being presented (with less than one-and-a-half hours to digest the draft and decide) with what was more or less a take-it-or-leave-it text, was not acceptable.

They called for a more effective, accountable, transparent and inclusive process in Geneva. Some also called for a period of reflection.

Working together

According to trade officials, in his remarks at the informal HOD meeting, WTO Director-General Roberto Azevedo said that success in Nairobi made it two Ministerial Conferences in a row. He cited paragraph 33 of the Nairobi Ministerial Declaration which says that members should work to advance the negotiations and calls for him to report to the WTO General Council on these efforts.

Nairobi was a success, he said, but there was a need to improve the way of work in Geneva.

He acknowledged that there was too much left undone when members left for Nairobi with too many open issues. This was something that led to a process in Nairobi which was not ideal or even close to ideal.

“We tried very hard to have a process that was transparent and inclusive and this was not as transparent and inclusive as people would have liked. It resulted in something that was either that or nothing,” he added.

He said that ministers could not be expected to keep pulling rabbits out of the hat, adding that “we are running out of rabbits”.

Azevedo further said that there was a need to be in a much more advanced position for MC11 (to be held in 2017). One of the ways would be to get ambassadors to be prepared to leave their comfort zones and to work more closely with their capitals, and political engagement by ministers throughout the process was something that should be regularized.

The Director-General then went through Parts I and II of the Nairobi Ministerial Declaration, and mentioned in particular pursuing negotiations on the Special Safeguard Mechanism (SSM) and accelerating the search for a permanent solution on public stockholding for food security purposes, as well as continuing work on the dedicated discussions on cotton. All these three actions demanded attention, he told members.

In Part III of the Declaration, he said, there was no agreement on the major elements. But it highlighted the importance of the remaining Doha issues and also introduced the possibility of non-DDA issues. There was no consensus on how to address the DDA and likewise members did not have consensus as yet on what to do with the non-DDA issues.

He said he had spoken to the negotiating group chairs and requested them to begin discussions. It was very important that members begin to have a conversation about all of these things. To move forward, now more than ever, this must be a member-driven process, he said.

“I think members need to acknowledge their differences. The fact is that members don’t see eye-to-eye on some issues – and this is not likely to change in the short term. Faced with this situation, the worst thing we could do would be to allow these differences to seize up WTO negotiations – and push activity towards other forums. We can’t allow multilateral cooperation to suffer, especially at a time when the world needs our contribution to help improve people’s lives and prospects around the world – particularly for the poorest,” Azevedo was also quoted as saying in a news item posted on the WTO website.

“In my view, we need to accept the reality of the situation. We need to figure out how to work together – despite members’ different perspectives – for the benefit of all. We need to figure out how we can keep delivering for jobs, growth and development – to make as full a contribution as we can.”

Members’ views on post-Nairobi work

According to trade officials, Switzerland gave a report at the HOD meeting on the ministerial meeting held on the sidelines of the World Economic Forum in Davos in January.

Kenya said that the outcome in Nairobi was a historic one. The effective implementation of the MC10 decisions would make a very important contribution to the Sustainable Development Goals (SDGs). It was now important to get back to the DDA issues as soon as possible, and the momentum generated from the Nairobi process must not be lost.

Zimbabwe voiced disappointment about the negotiating process, with too much being left to the last minute. This created an atmosphere that was difficult as many developing countries could not participate in the final process and they were presented with a take-it-or-leave-it text. While the need to have consultations in different formats was obvious in an organization with 162 members, there needed to be a much more accountable, transparent and inclusive process.

On going forward, Zimbabwe said it was very appreciative of the outcomes that came out of Nairobi, such as the decisions on export competition and those pertaining to the least developed countries (LDCs). It was glad as well that there was special notice of the SSM and public stockholding. But the need now was to focus on getting those issues resolved as well as issues related to the development dimension and on domestic support in agriculture.

While it was open to negotiations on these issues in different ways, it was very important for the principles of development to be central, said Zimbabwe.

Bolivia, in thanking Kenya, said that a great deal of effort had been made to bring about a result in Nairobi. But having five countries making decisions was not something that was acceptable, and the Geneva process needed to be much more effective so that this would not recur.

It was very important that issues pertaining to the DDA received priority and it was not acceptable to consider issues that might in some way limit policy space. No new issues should be considered until the DDA was concluded, said Bolivia.

Guatemala, on behalf of the small and vulnerable economies (SVEs), said it was still assessing the Nairobi outcome. For the SVEs, domestic support and market access in agriculture, services, non-agricultural market access (NAMA) and rules were important.

It wanted the negotiating groups to take up work promptly. There must be a transparent, inclusive and bottom-up  member-driven process, with development at the centre. It was also important that the flexibilities that had been written into some of the earlier negotiating texts for the SVEs be preserved.

Lesotho, on behalf of the African Group, said that the elements of the Nairobi Ministerial Declaration were not all clear and there was a need for some time to reflect. Any attempt to run this process on overdrive would not be productive.

The industrial countries needed to recognize that they had had a big say in setting the WTO agenda over the last 20 years, so it was not acceptable for them to not engage on the issues that were out there, said Lesotho.

It also underlined that the flexibilities that had been written into some of the texts as they pertain to African countries and the key principles must not be ignored. The objective of development written into the Ministerial Declaration must be retained.

South Africa voiced agreement with Lesotho, saying it was very glad to see the outcomes on export competition and LDCs. It would still like to see much more done in the other areas, including in areas where agreement was not reached, such as SDT, fisheries subsidies and the idea of getting some affirmation of the DDA.

Tanzania agreed with the Director-General on the need to improve on the Geneva process. There should be a systematic effort made to avoid having final decisions taken in a manner that was not inclusive.

On future work on the DDA, it said there was a need for many exchanges on these issues to determine what was the best way forward.

Pakistan said that Nairobi proved the sceptics wrong and that it was an example of the success of the multilateral trading system. There was a need to maintain this momentum. There was also a need for speedy implementation of the Trade Facilitation Agreement (TFA) and the Nairobi outcomes.

On the way forward, Pakistan said the DDA and non-DDA issues fell into the same stream, and the membership had a great responsibility to ensure the centrality of the WTO.

It said 90% of Pakistan’s exports were through micro- and small- or medium-sized enterprises (MSMEs). It looked forward to having a focused discussion on how the issues of importance to MSMEs could be mainstreamed into the work of the WTO.

The best way forward

Bangladesh, on behalf of the LDCs, said that the Nairobi Ministerial Conference was a step in the right direction. The biggest challenge now was to try and determine the best way forward. Implementing the decisions taken at Nairobi would be of great importance.

It liked the way in which the DDA architecture dating back to 2001 was structured, and wanted to see the issues of NAMA, rules and domestic support in agriculture on the table, but it understood that there was no clarity in terms of how the membership could go forward. Equally, there was no clarity on the new issues. It wanted to see all the flexibilities that had been attained over the course of 14 years preserved in whatever system goes forward.

Uganda said that while there were some important gains in Nairobi, there was a great deal of disappointment with the process. There had always been pride in having a process that was member-driven, transparent and inclusive, but that did not happen in Nairobi, it added. This was something that needed to be addressed in the future. In the future, texts or documents that are only partially completed should not be sent to ministers.

Benin voiced agreement with the African Group and LDC statements, saying that there was a benefit in the Nairobi Ministerial Declaration but there was a need to reflect carefully on the way forward.

On cotton, it said that while it welcomed some of the results obtained on this issue, more needed to be done. SDT was something on which the members did not agree and this must be taken up. The same applied for the issue of fisheries subsidies. There was a need to reflect on the new issues just as on the other approaches.

Not a balanced outcome

Cuba said that five countries working on the text in Nairobi was not acceptable. This needed to be done in a way that was transparent and inclusive. A period of reflection was required and the outcome at MC10 was not a balanced outcome in terms of the way forward with respect to Doha. The same was also true at Bali (MC9 in 2013), and the DDA had not delivered all that the developing countries wanted. Cuba said it was prepared to work with others in terms of how to advance these issues. It did not want the Doha structure built over the course of a decade to be totally dismantled.

Rwanda congratulated Kenya and the Director-General, saying that the leadership shown at Nairobi was extremely important to the outcome there. It considered the Nairobi deliverables to be very important for developing countries, and there was a need to build on these as quickly as possible.

It was important for the process in Geneva to work better than it has, Rwanda said. Before going to MC11 from Geneva, there should be a decision that was agreed or almost agreed.

Russia said it did not have any complaint about how things were done in Nairobi. It understood the enormous difficulties that the Director-General and Amina Mohamed, chair of the conference, faced. Bali and Nairobi proved that deals could be made. There was a need now to build on those outcomes.

Brazil said that the WTO’s negotiating function was of paramount importance. It did not deny that there were other modes of negotiating outside the WTO that bring about trade liberalization and investment, but they could not replace the multilateral trading system, especially when it came to agriculture.

For Brazil, what was very important about these agreements was that they be about trade creation and not trade diversion. This was why it wanted very much to have a structured discussion in the WTO about trade agreements like this, whether they were coherent with the multilateral trading system.

The multilateral system had brought about useful results at both Bali and Nairobi, Brazil said. There was a need to work on these to build on the two successful Ministerial Conferences.

Brazil said it wanted to see a very strong commitment to addressing the remaining DDA issues as was highlighted in the Ministerial Declaration, as well as a substance-driven and bottom-up approach. It was time to begin to look for deliverables for MC11.

On new issues, Brazil said it was something that “we should collectively consider”. There was a need to make sure that any consideration of these issues, whatever the manner in which it takes place, should not adversely affect the DDA issues.

For Brazil, agricultural market access and domestic support were very important. These should be taken up, as should SPS (sanitary and phytosanitary measures) and TBT (technical barriers to trade) issues. They should be dealt with multilaterally.

Argentina said that it was pleased with the export competition outcome at Nairobi. It was also very glad to see that the importance of the DDA issues was stressed and agreed to by all members. It highlighted the centrality of the development dimension and SDT, adding that these were key in terms of going forward.

Referring to paragraph 34 of the Nairobi Ministerial Declaration pertaining to the ongoing Doha issues, it said that as long as the issues of domestic support, agricultural market access and fisheries subsidies were taken up and used as a means of helping to achieve the SDGs, then under these conditions, it would be happy to discuss different approaches to the DDA.

It was not clear what was the best way to address the DDA issues but these principles needed to be taken into account, said Argentina. “We need to be creative and pragmatic when we consider new approaches.”

The US thanked Kenya, saying that there was a significant outcome in Nairobi. It pointed to two areas of substantive deliverables – on LDCs and export competition. What was equally significant was that Nairobi had achieved a big opportunity for all of the members to engage in a new and more constructive conversation, whether it was about old issues or so-called new issues. What was important was not whether they were old or new issues but that there was a new way of discussing them that created opportunity rather than the old way that produced failure.

There was a lack of clarity on the way forward and it was disquieting without familiar fixed posts along the route, the US said, but this uncertainty and dealing with it was part of the process. The US said it preferred a process that lacked clarity but offered promise, to one that had more clarity but promised failure.

Introspection and reflection

India said Nairobi was an important milestone where the negotiating arm delivered to some extent on some longstanding issues like export subsidies.

On the issue of public stockholding, India said it was important to highlight that the ministers in Nairobi reaffirmed the General Council decision of 27 November 2014 and decided that members shall engage constructively to negotiate and make all concerted efforts to agree and adopt a permanent solution in dedicated sessions and an accelerated time-frame in the WTO Committee on Agriculture in Special Session (CoA-SS). Similarly, the ministers decided to pursue negotiations on an SSM for developing countries in dedicated sessions of the CoA-SS. India said it looked forward to active constructive engagement on both these mandates in 2016.

On the way forward post-Nairobi, from India’s perspective, the intent and purport of many of the paragraphs in the Ministerial Declaration were not entirely clear. This would require more intensive reflection, thought and discussion by all members.

It noted that an overwhelming majority of members had reaffirmed their commitment to the DDA. “As we move forward, we must resolve to successfully conclude the negotiations under the framework of the DDA.”

It emphasized that moving to new issues without satisfactorily resolving outstanding mandates would not be acceptable. Being constructive and flexible did not imply rushing into narratives that were not entirely clear to many, while issues that had been on the agenda for years remained unresolved.

India noted that paragraph 33 of the Nairobi Ministerial Declaration mandated that “officials” should work to find ways to advance negotiations. In India’s view, these efforts had to be essentially driven by the collective membership of the WTO in a bottom-up approach. In other words, it had to be member-driven. Members needed to bring forth proposals to advance negotiations.

In addition, India agreed with the views expressed by a number of members that “we need to introspect and reflect on the process”, both leading up to a Ministerial Conference as well as during the Ministerial. This would be in the interest of preserving the credibility of the negotiating arm of the WTO.

India underlined that while members must immediately engage on the mandate that the ministers in Nairobi had given them in terms of the specific deliverables, “we must also seriously reflect, introspect and discuss the way forward in a manner that is of benefit to the larger membership as a whole, keeping development at the core”. It was clear that not only the DDA but also paragraph 32 of the Nairobi Ministerial Declaration reiterated that the future agenda shall maintain development at its centre. This period of reflection must address how the WTO can be more responsive to the needs and aspirations of developing countries, particularly the LDCs, said India.

Meaningful outcomes

The European Union said it was ready and willing to work for more meaningful outcomes. It was important to implement the Nairobi outcomes and to follow up on the transparency and enforceability of key elements. There was also a need to look at the outstanding DDA issues and find the best way of dealing with these questions.

A multilateral environment was a way where solutions could be found, and the TFA and export competition were two decisions that were illustrative of this, it said. Now, “we need to look at other issues including other agriculture issues and see if there is a way that we can move forward on these as well. The SSM and public stockholding issues need to be taken up with priority.”

There also needed to be flexibility and new approaches on many of the other issues provided that some key principles were retained, including SDT, the EU said. There should be reflection as well on how other issues of interest could be brought up where multilateral rules were needed. Time should be taken to identify these issues and to scope them. There was a need to consider the best way of putting these issues into a multilateral setting, that there be enough flexibility in the WTO machinery to come up with a multilateral agreement on something new that would apply to everyone. But if this was not something all members wished to take on board, there was flexibility in the WTO that would enable some members to go ahead first, the EU maintained.

There was now a moment of opportunity that should be built on to identify the ways to move forward, the EU said, and  these issues should be looked at constructively and creatively without members  getting  bogged  down in sterile political or metaphysical discussion.

Uruguay said that Nairobi was a very important outcome for the WTO and for the country. The agreement eliminating all forms of trade-distorting agricultural export competition was something that Uruguay had sought for 30 years. But there were still many areas in agriculture that needed to be addressed, such as the fact that tariffs on agricultural products were much higher than those for industrial goods.

Japan said that after Nairobi, multilateral trade negotiations had entered a new stage. It said it was open to any way of considering issues, be they old or new. It was keen to see an approach that was pragmatic, creative, transparent and inclusive, and said there should be no repeat of the same old statements that led nowhere. This was not the way to advance negotiations in the WTO.

Indonesia said that 2016 was a window of opportunity and there was a need to go about the work in a constructive manner. While there were those who would like to take up new issues, there were others who believed in the need to focus on the existing Doha issues.

As far as Indonesia was concerned, agriculture was still of crucial importance. If new issues were to be considered, this should be done carefully and should be taken up in the General Council so that there was a transparent approach for all to discuss.

Mexico said that the outcomes were very important but not everything that was needed. It said it was very keen to get much more out of the Doha issues and was prepared to talk about new issues as well. There was a need to move forward in a constructive, transparent and inclusive manner. (SUNS8179)    

Third World Economics, Issue No. 608, 1-15 January 2016, pp2-5