TWN Info Service on UN Sustainable Development (Jul17/04)
11 July 2017
Third World Network
Existential challenges to multilateralism dominate G20 summit meet
Published in SUNS #8498 10 July 2017

Hamburg, 7 Jul (D. Ravi Kanth) - As the G20 leaders began their stormy meeting amid violent protests on the streets of Hamburg, serious existential challenges continued to dominate the meeting, particularly on the uninterrupted multilateral trade liberalization under the auspices of the World Trade Organization, according to participants present at the meeting.

In less than one year from Hangzhou to Hamburg, there has been a sea change in the overall mood and collective resolve of G20 countries that include 19 industrialized and developing countries and the European Union.

Last year, the G20 leaders called for "growth" to be reinforced by "inclusive, robust and sustainable trade and investment growth."

They established the G20 Trade and Investment Working Group (TIWG) for strengthening "G20 trade and investment cooperation."

The Hangzhou communique of G20 leaders issued on 5 September 2016 reaffirmed their "determination to ensure a rules-based, transparent, non-discriminatory, open and inclusive multilateral trading system with the World Trade Organization playing the central role in today's global trade."

They had also committed "to shape the post-Nairobi work with development at the center and commit to advancing negotiations on the remaining DDA issues as a matter of priority, including all three pillars of agriculture (i.e. market access, domestic support, and export competition), non-agricultural market access, services, development, Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and rules."

The G20 leaders had also called for discussing new issues as well as plurilateral agreements. It had mentioned about the plurilateral agreement on environmental goods.

But the Hangzhou priorities were nearly drowned after President Donald Trump began withdrawing from the Trans-Pacific Partnership Agreement, TISA - Trade in Services Agreement - negotiations, and the Paris climate change agreement among others.

"There are "ugly" fights among the Sherpas in negotiating the trade agenda at Hamburg," said a participant familiar with the discussions.

"The US is posing difficulties in finalizing the trade agenda," the Sherpa from an industrialized country told the SUNS.

The G20 leaders are expected to discuss trade in the afternoon but the discussion could prove to be quite contentious between the US President Donald Trump on the one side, and the rest of the dominant G20 members - China, Germany, Australia, Japan, and other countries - on the other over the continued primacy for multilateral trade liberalization with the WTO playing the central role, the Sherpa said.

President Trump met with the German chancellor Angela Merkel on Thursday during which they tried to reconcile some of their differences over trade and climate change.

Separately, during a working session with heads of international organizations, Merkel urged the participants, "to strike compromises without bending backwards", emphasizing the importance of global trade, climate change, and energy policies.

The Sherpas are working on a watered-down communique.

During a meeting of the leaders of BRICS (Brazil, Russia, India, China, and South Africa) today in Hamburg, a common position was adopted against "protectionism."

The Indian prime minister Narendra Modi "advocated collective voice against the practices of protectionism, especially in the spheres of trade and movement of knowledge and professionals," according to a press release issued by New Delhi.

With the Trump administration on the brink of imposing 20% tariff on imports of steel and other products from China, Germany, Canada, and other countries on security grounds by using an archaic 1962 US provision of Section 232 investigations, the G20 leaders' meeting is mired in unprecedented differences, said another G20 Sherpa.

According to a report in the Financial Times today, the "EU officials have begun assembling a list of US goods including Kentucky bourbon whiskey, orange juice and dairy products to target for retaliation over Donald Trump's plans to invoke national security concerns to limit steel imports."

"The EU's contingency plans, which have emerged as Mr Trump and other leaders gather at a G20 summit starting on Friday, highlight the tensions set off by the US president's threat to impose new tariffs or quotas on steel - which analysts say could provoke a new trade war," the FT said.

Another area where serious differences continue to persist among G20 leaders is on the way forward on the Paris Agreement on Climate Change. It is not clear when the G20 leaders will discuss climate change today.

Meanwhile, protests continued to mount in different parts of Hamburg under the banner of "Welcome to Hell".

Hamburg, which is known as the bastion for left politics, should not have been the venue for a "dystopian" nightmare of globalization policies, said protesters.

German police resorted to strong-arm tactics, including water cannon and pepper spray to disperse protesters, according to reports in the local media.

In short, the Hamburg meeting will indicate whether a consensus is possible on multilateral trade liberalization as well as the fate of globalization.

A watered-down communique from Hamburg might postpone the divisions that are staring in the face of multilateral initiatives on trade and climate change for the time being.