African Group deals body blow on e-commerce talks

African countries at the WTO have opposed moves to steer the talks on electronic commerce in the trade body away from the agreed upon mandate.

by D. Ravi Kanth

GENEVA: Members of the African Group on 18 October delivered a body blow to the so-called Friend of the WTO General Council Chair overseeing the dedicated sessions in the WTO on electronic commerce/digital trade, saying they will not accept attempts to force discussions on thematic or negotiating issues that are inconsistent with the 1998 WTO work programme on e-commerce, several envoys told the South-North Development Monitor (SUNS).

Morocco, on behalf of the African Group, issued a hard-hitting statement at the 12th dedicated session on e-commerce which forced Ambassador Alfredo Suescum of Panama, the so-called Friend of the GC Chair, to suspend the thematic session on “Facilitating e-commerce and e-commerce for development”.

Several members of the African Group such as Uganda, Cameroon and Zimbabwe joined Morocco in conveying forcefully to Suescum to back off from his efforts as they were procedurally inconsistent with the “inclusive” and “consensus-building” practices propagated by the WTO ad infinitum.

“It will be recalled Ministers in Nairobi reaffirmed the value of our consistent practice of taking decisions through a transparent, inclusive, consensus-based, Member-driven process,” Uganda told Suescum.

“Whilst we recognize that we were not part of the consultations held on 4 and 5 October, we have difficulty proceeding on the basis of a ‘thematic based approach’ as has been suggested,” Uganda said, starkly pointing to the opaque and non-inclusive process adopted by Suescum.

Uganda said it is not against any discussions on e-commerce but that such discussions should be “consistent with the mandate bestowed upon us.”

“It is inconceivable that a country like Uganda, a least-developed country, could argue against a development-related discussion,” Uganda maintained. “However, such discussion has to be well structured, agreed upon, and rooted in the work programme ... we recall that the work programme is exploratory in nature and has no negotiating mandate.”

Call for clarity

On behalf of the African Group, Morocco issued the strongest statement yet on the manner in which existing mandates and rules are being violated to force negotiations on e-commerce/digital trade while the outstanding issues in the Doha Work Programme are swept under the carpet.

Over the last several months, the US, the EU and their allies have intensified their efforts to launch negotiations on e-commerce on several fronts.

The African Group reminded Suescum about what ought to be the role of the WTO in conducting day-to-day business. “The WTO is a Member-driven organization ... where the order of business ought to be conducted in a transparent manner among all Members, in order to facilitate the effective participation of all,” Morocco said.

The African Group, according to Morocco, “has not agreed to proceed in the Dedicated Discussion on a ‘thematic’ basis.”

“Before we agree to a process like this, the African Group needs clarification on how the different themes will be decided upon, and how these discussions will unfold in relation to the existing mandate in the work programme,” it said.

Citing a proposal made by Canada that “four WTO Committees would contribute to the programme” as agreed by Ministers in the Nairobi Ministerial Decision on e-commerce, Morocco said “the submissions on the table should be taken to the relevant bodies for further examination.”

“This is also in line with paragraph 1.1 of the work programme where it states that ‘the General Council establishes the programme for the relevant WTO bodies as set out in paragraphs 2 to 5’ of document WT/L/274,” the African Group argued.

Therefore, “the African Group will be unable to fully engage in these Dedicated Discussions” until there is clarity on all aspects of the mandate, Morocco made clear.

“We are ready to engage in a discussion to examine the issues under the broad framework set out in the work programme on e-commerce on this basis, with priority attention given to the developmental aspects of e-commerce,” the African Group coordinator maintained.

But “we do not support a discussion on multilateral rule-making in this area”, Morocco said emphatically.

Given the persistent “knowledge gap” that exists among countries, “the intensification of work and the submissions about the possibility of rules on e-commerce runs the risk of dividing us even further”, it warned.

Therefore, “the African Group does not want to see existing imbalances further entrenched”, Morocco argued on behalf of the 54 countries. (Three countries – Nigeria, Cote d’Ivoire and Seychelles – did not sign on to the joint statement issued by the African Group.)

Morocco demanded that the 1998 work programme on e-commerce be fully implemented as a matter of priority.

“With over 68% of people in Sub-Saharan Africa living without electricity and only 1 in 5 people in Africa using the Internet, the facts and figures paint a stark picture of where Africa stands, [and] the digital divide and infrastructure deficit indicates that most of Sub-Saharan Africa, which is comprised mostly of LDCs, is not e-commerce-ready,” Morocco said.

More crucially, “the work programme is as relevant today as it was in 1998”, Morocco maintained, suggesting that “the African Group is particularly interested in the proponents’ views on examining ways of enhancing the participation of developing countries in e-commerce, in particular as exporters of electronically delivered products: role of improved access to infrastructure and transfer of technology, and of movement of natural persons”.

The African Group delivered the hardest blow to Suescum and the US, the EU and others when it said that it is “guided by the Nairobi Ministerial Declaration, [where] Ministers agreed to prioritize work on the outstanding Doha issues, such as Agricultural Trade-distorting Domestic Support; SSM; Public Stockholding for Food Security; Cotton; LDC priorities; TRIPS; and last but not least, Development and S&DT [special and differential treatment].”

“We are yet to see that same momentum, breadth and scope of attention [to the outstanding Doha issues] as has been accorded to e-commerce,” Morocco said.

It offered a way forward by proposing “an inclusive approach to pursuing e-commerce discussions” and suggested the following points:

(i) The submissions should be taken to the relevant bodies as set out in paragraphs 2 to 5 of the e-commerce work programme (viz., the Council for Trade in Goods, the Council for Trade in Services, the Committee on Trade and Development, and the TRIPS Council). Only once the discussions in the relevant bodies have matured should they be reported to the General Council.

(ii) Members may identify any trade-related issue of a cross-cutting nature, detailing its cross-cutting nature. Once all members have agreed, it may be introduced for discussion in the dedicated discussion on e-commerce.

(iii) Members who wish to deviate from the mandate in the work programme should detail their proposed way forward in writing. Members should articulate the clearly defined problem and explain how such deviation will provide benefits to all members, especially developing and least-developed countries.

India, Bolivia, Cuba and Venezuela supported the African Group and asked Suescum to sort out the procedural issues before discussing any substantive aspects concerning e-commerce/digital trade.

Brazil said Suescum must address the legitimate procedural concerns raised by the African Group.

Several members pointed out that Suescum adopted a thematic approach that was not the product of consensus decision-making or prior discussion among all members.

Suescum had held private “confessionals” on 4-5 October with some 25 members on the way forward, without first bringing to all members the proposal to conduct the discussions on a thematic basis.

The EU, Canada, Singapore, Chinese Taipei and Pakistan, among others, supported efforts by Suescum to discuss their proposals, including e-commerce and development.

China said that any discussions on e-commerce should not result in any new market access obligations and should avoid controversial cross-border data flow and data localization issues that would not secure consensus in the short term as suggested by the US in a non-paper submitted several months ago.

Nigeria urged Suescum to hold open-ended consultations to address the procedural concerns and organization of work under the work programme raised by several members before proceeding to discuss substantive issues.

Brazil, India, South Africa and several other countries supported the Nigerian suggestion for open-ended consultations.

“Non-inclusive” process

“It was a huge embarrassment for Ambassador Suescum, who insisted at one point that he would press ahead with the meeting to discuss the proposals submitted by some members despite continued objections from members of the African Group,” said a participant from an African country.

“It is not that we are opposed to having a discussion on e-commerce and development; we were essentially questioning the decision-making process Ambassador Suescum adopted on a non-inclusive basis,” the participant argued.

“The chair’s process was not inclusive and constructive for the conduct of the activities in the dedicated session and he cannot ignore the Nairobi ministerial decision or the 1998 mandate,” the participant added.

The Nairobi ministerial decision merely directed members to “continue the work under the Work Programme on Electronic Commerce since our last session, based on the existing mandate and guidelines and on the basis of proposals submitted by Members in the relevant WTO bodies as set out in paragraphs 2 to 5 of the Work Programme [under the General Council decision of 30 September 1998, WT/L/274].”

Another African participant proposed, “Let us all meet in an open-ended format where members inclusively agree first on the conduct of discussions on cross-cutting issues and then send those issues to the four bodies – the Council for Trade in Goods, the Council for Trade in Services, the Committee on Trade and Development, and the TRIPS Council – for addressing the issues.”

The sudden developments at the 18 October dedicated session came against the backdrop of a clarion call issued by the US Trade Representative Michael Froman the previous day that WTO members must embark on e-commerce, as well as efforts by Norway to build ground for launching e-commerce as a priority deliverable at a mini-ministerial meeting in Oslo on 21-22 October.

In conclusion, the African Group and other developing countries have their task cut out to ensure that discussions on e-commerce are based on the 1998 work programme and that all other Doha issues are brought to centrestage in the run-up to the WTO Ministerial Conference in Buenos Aires next year, several trade envoys said. (SUNS8337)

Third World Economics, Issue No. 627, 16-31 October 2016, pp4-5