TWN Info Service on WTO and Trade Issues (Oct16/07)
7 October 2016
Third World Network

Azevedo points finger at China for inflexible attitudes
Published in SUNS #8324 dated 3 October 2016

Geneva, 30 Sep (D. Ravi Kanth) -- The WTO Director-General Roberto Azevedo is reported to have told G90 coordinators about the inflexible positions of China and its refusal to contribute to the eleventh ministerial conference (MC11) next year, sources familiar with the discussions told SUNS.

The DG held closed door consultations with the G90 coordinators over the past two weeks, as trade ministers of developed countries and their allies in developing countries planned an informal summit at Oslo on 21 October to carve out deliverables for MC11, according to these sources.

The G90 coordinators include the chairs of the Africa, Caribbean, and Pacific (ACP) group, the Africa Group, and the Least-Developed countries.

During the meetings, Azevedo discussed the state of play at the WTO as part of preparatory work.

Azevedo has mentioned two major concerns during the meetings with the three coordinators, according to a debriefing by one of the coordinators to the group's members.

The DG has informed the coordinators at these meetings about China and its lack of flexibility, and that China does not want to contribute to anything with a view to making progress, said a source, who asked not to be quoted.

The DG has also insisted that he should be invited for a proposed retreat of the Africa Group which is going to take place during 10 to 13 October, outside Geneva, the source added.

Azevedo is now being asked to address the Africa Group for one and a half hours at the retreat.

The Director-General's office also called the coordinators today to advise them that they should deliver their statements at the informal Heads of Delegations (HOD) meeting on Friday, knowing full well that the statements issued by any member at informal HOD meetings do not go into the record, sources told the SUNS.

The DG's specific mention of China but not any other country, particularly the United States which has consistently adopted intransigent positions on the outstanding issues in the Doha Development Agenda (DDA) as well as cotton and other core concerns of the LDCs, has dismayed the three coordinators, the source suggested.

Also, it is puzzling as to why China is being mentioned at a time when Beijing has repeatedly adopted pro-DDA and developmental positions during the past ten months, including at the recently hosted G20 leaders' meeting in Hangzhou.

Against the backdrop of sustained efforts by the Cairns Group of farm exporting countries, including Brazil, in insisting that China must undertake commensurate commitments to reduce its trade distorting domestic support to convince the US to take appropriate commitments, it is plausible that the DG might be turning his attention to China, said a South American trade official, who asked not to be quoted.

Meanwhile, Norway will convene a two-day informal trade summit of select countries in Oslo on October 21 to discuss about the deliverables for the eleventh ministerial conference next year in South America.

Azevedo is expected to present his ideas at the Oslo meeting following the well-orchestrated public relations pitch made for launching negotiations on electronic commerce, digital trade, and global value chains by the European Union and other developed as well as some developing countries at the so-called Public Forum that concluded on Thursday (29 September).

The DG, who was seen all over the Public Forum for three days, addressed himself to the participants and said: "We have seen an impressive level of engagement this year, particularly from the private sector, and I am pleased that you decided to share some of your ideas with us today. However, to reach agreement amongst businesses is but one element of the equation. The biggest challenge is to bring your ideas and suggestions to the next level, helping to inform the debate among WTO members here in Geneva. And for that to happen, it is vital to engage with the members and interact with them."

Despite the opaque ‘green room' of Group of Five countries (the US, the EU, China, India, and Brazil), the Group of Seven countries (the US, the EU, China, India, Brazil, Australia, and Japan) that he perfected over the past three years, Azevedo chose to chant the mantra of "inclusiveness" endlessly during the Public Forum.

Significantly, the DG enabled the developed countries to transform their demand for e-commerce into a clarion call at the Public Forum, crowding out the unfinished developmental agenda of the Doha work program, said a trade envoy, who asked not to be quoted.

Several civil society participants at the Forum in their comments also made similar complaints, charging that even the e-commerce item had the hidden investment agenda and other jettisoned issues wrapped in it.

The Oslo meeting, which will witness the first concrete effort for launching of e-commerce/digital trade negotiations, will be a venue for two major meetings of trade ministers representing the controversial/plurilateral initiatives of Trade in Services Agreement (TISA) as well as the Environmental Goods Agreement (EGA).

Last week, both meetings ended without any progress on substantive issues, according to people who took part in the meetings.

The TISA ministers will hold a meeting on October 21 at Oslo to discuss about financial services, state-owned enterprises, localization provisions, telecom, maritime transport and air transport among others.

This will be preceded by senior officials from the 23 countries of TISA holding a two-day meeting in Washington from October 17 on the margins of the global summit on trade in services being hosted by the Coalition of Services Industries, the main US trade lobby for services liberalization.

After the TISA senior officials' meeting, trade ministers of the group will hold a stocktaking exercise in Oslo on the margins of a mini-ministerial summit to discuss ways to conclude the negotiations by the end of this year.

TISA's 23 members include Australia, Canada, Chile, Chinese Taipei, Colombia, Costa Rica, the European Union, Hong Kong, Iceland, Israel, Japan, Liechtenstein, Mexico, New Zealand, Norway, Panama, Peru, South Korea, Switzerland, Turkey, the United States, Pakistan, and Mauritius.

In a separate development, the trade ministers representing the plurilateral initiative on environmental goods agreement will also hold a meeting in Oslo to discuss the differences among key members on four major issues.

The four issues include the number of products, staging of tariff elimination, critical mass, and the work program for other outstanding issues.

Major developed countries are already blaming China for adopting an inflexible stand on the number of products, the issue of elimination of tariffs and also the staging of phase-out of tariffs.

"China is key to the negotiations on a robust EGA deal but Beijing is holding back its cards," said a trade envoy dealing with the EGA.

According to China and other developing-country members of the EGA, the G20 leaders' communique in Hangzhou early this month only emphasized that EGA members will "seek" to eliminate tariffs.

Therefore, there is no need for eliminating tariffs, a view that is being fiercely opposed by the United States, the European Union, Japan, and other major developed countries.

In short, the WTO has now become the chosen forum either for the type of multilateral agreements in which the US and its allies have major interests like the Trade Facilitation Agreement, or plurilateral agreements like the TISA and the EGA.

The G-90 countries have little to gain from such a transformed WTO under the current leadership which primarily works to advance the agenda of the developed countries in e-commerce, or other initiatives such as the SMEs and global value chains but not for those unresolved DDA issues, said a trade envoy. +