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Info Service on WTO and Trade Issues (Nov21/26) Geneva, 23 Nov (D. Ravi Kanth) – With less than a week left for the World Trade Organization’s 12th ministerial conference (MC12), attempts are already underway to “name and shame” countries that are standing-up for the multilateral principles at the WTO, said people familiar with the development. At the WTO’s General Council (GC) meeting on 22 November, several South American countries began pointing fingers at the developing countries, including India, for expressing concerns on the plurilateral Joint Statement Initiatives (JSIs) that are allegedly undermining the multilateral principles at the WTO, and on the report of the GC-appointed facilitator on the WTO’s response to the pandemic, Ambassador David Walker from New Zealand, said people familiar with the development. In his second revised draft report issued on 22 November, the GC chair, Ambassador Dacio Castillo from Honduras, placed the plurilateral JSIs on electronic commerce, disciplines for MSMEs (micro, small, and medium enterprises), and trade and women’s economic empowerment, in square brackets, implying that there is no consensus among members on these issues. Due to lack of consensus on the three crucial ” deliverables” for MC12 – fisheries subsidies, agriculture, and the WTO’s response to the pandemic – as well as on the “outcome document”, it appears that several countries are being specifically targeted for “naming and shaming”, as had happened at the recent Glasgow Climate Change Conference, said people, who asked not to be quoted. The WTO spokesperson Keith Rockwell acknowledged that there is no consensus on fisheries subsidies, agriculture, and the WTO’s response to the pandemic, but maintained that things could dramatically change as they had happened at the WTO’s fourth ministerial conference in Doha, Qatar in 2001. It appears increasingly likely that all these issues could go down to the wire where they are likely to be decided in a “pressure-cooker” environment among five or seven key members at the eleventh hour, while keeping the rest of the membership in the dark, said people familiar with the development. MC12 OUTCOME DOCUMENT On the outcome document for MC12, the GC chair Ambassador Castillo has removed paragraphs that proved to be “redlines” for some countries and placed all the controversial issues in square brackets. In the restricted document RD/GC/17/Rev.1 issued on 22 November, the GC chair has included controversial paragraphs concerning the JSIs on MSMEs, trade and women’s economic empowerment, and environment in square brackets. The GC chair said he respected members’ “redlines” in drawing-up the second revised draft text. However, some members from South America criticized attempts to block the inclusion of the JSIs, such as the digitalization proposal by Japan, trade and women’s economic empowerment, disciplines for MSMEs, and environment (by the European Union), said people, who asked not to be quoted. Members that opposed attempts to push through the JSIs in the outcome document argued that they are adhering to the multilateral principles as laid out in the Marrakesh Agreement that established the WTO, suggesting that they will not budge from their principled positions, said people, who asked not to be quoted. At issue is the tussle between the proponents of the JSIs on the bracketed language on JSIs in paragraphs 14 (trade and women’s economic empowerment), 15 (disciplines for micro, small and medium enterprises), as well as in paragraph 5A on environment, and those members including India, which have opposed their inclusion in the outcome document on grounds that these initiatives were not multilaterally agreed to at the WTO’s eleventh ministerial conference (MC11) in Buenos Aires, Argentina, in December 2017. At the Buenos Aires ministerial conference, the signatories to the JSIs – on digital trade, investment facilitation, disciplines for MSMEs, and trade and women’s economic empowerment – first tested them at the Heads of Delegation (HoD) meeting, where they failed to garner consensus, said people familiar with the negotiations. Subsequently, the JSI proponents announced their initiatives outside the negotiating hall in Buenos Aires, ostensibly to undermine the multilateral process, said people, who took part in the Buenos Aires ministerial conference. CIVIL SOCIETY CRITICIZES WALKER PROCESS In a similar vein, the GC-appointed facilitator, Ambassador David Walker from New Zealand, submitted a draft ministerial declaration under his own responsibility. That report took on board all the trade liberalization and market access measures, including a call to implement the Trade Facilitation Agreement, which hardly merits attention in the WTO’s response to the pandemic, said a person, who asked not to be quoted. Ambassador Walker’s report appears to have caused considerable consternation among the WTO members for elevating the trade liberalization issues over the intellectual property rights (IPR) barriers that have accentuated the vaccine inequity across countries, said people familiar with the development. Prior to the issuance of Ambassador Walker’s report on 22 November, many civil society organizations (CSOs), including the Third World Network (TWN), severely criticized the Walker process on grounds that it is “a skewed process leaving most of the WTO members in the dark.” “Without proper consultations, Ambassador Walker produced a draft text of a ministerial declaration on the WTO response to the pandemic with almost no brackets and proposed it as basis for deliberations among a very small group of selected countries. Such processes are designed to put pressure on the rest of the WTO membership, who are not in the room to negotiate, to accept the outcome when they are shown the result of the deliberations at the last minute,” TWN said on behalf of the CSOs. At the GC meeting on 22 November, the conduct of the facilitator’s process came under severe criticism. In his report (Job/GC/281) circulated on 22 November, the facilitator said he stuck to his position that he had made clear right at the beginning that the TRIPS-related issues will be addressed by the chair of the TRIPS Council, Ambassador Dagfinn Sorli from Norway. Ambassador Walker said that only trade-related issues are included in the revised draft text. The issues include: (1) transparency and monitoring; (2) export restrictions and prohibitions; (3) trade facilitation, regulatory cooperation and coherence, and tariffs; (4) the role of trade in services; (5) collaboration with other international organizations and stakeholders; and (6) framework for future preparedness that includes establishing a “work plan on Pandemic Preparedness and Resilience.” In his 30-minute address to the GC, Ambassador Walker said that he has left a placeholder in the preamble of the draft declaration to insert whatever decision that is finalized by the TRIPS Council. Ambassador Walker said the WTO’s response to the pandemic is a political document, and it is not concerned with members’ rights and obligations. Although Ambassador Walker gave an account of his small-group and bilateral meetings, he did not name the countries that participated in his meetings held in various configurations. The TRIPS Council chair Ambassador Sorli presented his report, saying that there is no consensus yet on the TRIPS waiver, suggesting that discussions will go on until the ministerial conference. At the GC meeting, Ambassador Walker highlighted some of the changes in the latest draft text. They include that the draft declaration on the WTO’s response to the pandemic “would not alter the rights and obligations provided in WTO agreements. The focus is on political language to reaffirm shared values and help guide our collective response to the pandemic. The intention is not to develop, for the ministerial conference, a new legal instrument that would modify existing rights and obligations under the WTO agreement.” He said that the changes that were made in the draft ministerial declaration are under his own responsibility. He said the draft text, in sections two to five, include language on “transparency and monitoring,” “export prohibitions or restrictions,” “trade facilitation, regulatory cooperation and coherence, and tariffs,” and “the role of trade in services.” Clearly, the facilitator appears to have borrowed from the Ottawa Group’s proposal, in which New Zealand is a member, said people familiar with the discussions. Further, the facilitator appears to have reflected the positions of a handful of countries that have insisted that IPRs are not the barrier for ramping-up production of diagnostics, therapeutics, and vaccines across countries to combat the COVID-19 pandemic. The preambular language states, “Noting the shared desire to ensure that the intellectual property system supports Members’ response to the pandemic, including through international efforts to develop, manufacture and distribute COVID-19 products; [taking note of the decision of […]]”. In short, the facilitator appears to have adopted double standards by including a proposal from the Ottawa Group of countries led by Canada, while excluding the proposal from India, as well as from four other developing countries that “sought to capture a lot of the concerns of the developing countries.” As TWN pointed out, the facilitator’s work on the WTO’s response to the pandemic ought to shift from trade liberalization and regulatory constraints to the use of policy space, and as enablers of structural transformation and resilience building, including economic resilience and food security. Yet, Ambassador Walker has refused to include the proposals from India, and from four other developing countries, namely Sri Lanka, South Africa, Pakistan, and Egypt, said people familiar with the draft declaration. FACILITATOR’S DRAFT DECLARATION The text of the facilitator’s draft ministerial declaration is highlighted as follows: “General Council facilitator process on the WTO response to the COVID-19 pandemic Draft ministerial declaration We, the Ministers, having met in Geneva, Switzerland, at our Twelfth Session, Desiring to promote strong multilateral cooperation towards tackling the COVID-19 pandemic and supporting response and recovery, and to continue contributing with our joint efforts to build resilience and to better prepare for future pandemics; Regretting that the COVID-19 pandemic continues to have profound impacts on human health and livelihoods worldwide and expressing our sympathies for those whose lives have been lost; Recognizing with concern the ongoing global public health, social and economic impacts of COVID-19, particularly on developing countries including least-developed countries, including food and economic insecurity challenges aggravated by the pandemic; Conscious that the global recovery remains highly divergent across the Membership, and that the pandemic continues to pose evolving challenges, in particular related to the possible spread of new variants of COVID-19 and uneven paces of vaccination; Regretting the inequity in access to COVID-19 products, notably vaccines, therapeutics and diagnostics, and affirming our commitment towards timely, equitable and universal access to safe, affordable, quality, and effective vaccines, therapeutics and diagnostics, with particular regard to the needs of developing countries including least-developed countries; Noting the shared desire to ensure that the intellectual property system supports Members’ responses to the pandemic, including through international efforts to develop, manufacture and distribute COVID-19 products; [Taking note of the decision of […]] Conscious of the critical contribution that trade and the rules-based multilateral trading system must provide to address the pandemic, and to foster recovery, resilience and stability of the global economy; Encouraging the collaboration of the WTO with other relevant intergovernmental organizations in the context of the response to the pandemic; Acknowledging the role that other relevant stakeholders have played in response to the pandemic; Conscious of the need to build on the lessons learned from the COVID-19 pandemic in order to enhance the multilateral trading system’s resilience in the response to and recovery from the current and future pandemics; Resolving, with this Declaration and the Action Plan on Pandemic Response, Preparedness and Resilience (the Action Plan) contained in the Annex, to take actions to respond to the continuing pandemic and to enhance global resilience against future pandemics; Confirming that this Declaration and the Action Plan do not alter the rights and obligations provided in the WTO agreements; Declare that: 1 Introduction 1.1. We emphasize the central role of the multilateral trading system in promoting the availability, in a timely manner, of essential goods and services needed in the fight against the COVID-19 pandemic and in ensuring equitable access to them, especially in developing countries including least-developed countries (LDCs), notably by promoting the diversification of essential medical goods production and supply and facilitating provision of such services, including through identifying opportunities and addressing barriers. 1.2. To further the prevention, diagnosis, treatment, and control of COVID-19, we recognize the necessity of keeping markets open, consistent with existing WTO rules, to facilitate manufacturing, and supply and distribution, of vaccines, therapeutics, and essential medical goods, including their inputs, as well as the provision of services. 1.3. We affirm our resolve to ensuring that any emergency trade measures designed to tackle COVID-19, if deemed necessary, are targeted, proportionate, transparent, and temporary; reflect our interest in protecting the most vulnerable; do not create unnecessary barriers to trade or disrupt supply chains; and are consistent with existing WTO rules. 1.4. We recall the Doha Declaration on the TRIPS Agreement and Public Health of 2001 and reiterate that the TRIPS Agreement does not and should not prevent Members from taking measures to protect public health. Accordingly, while reiterating our commitment to the TRIPS Agreement, we affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO Members’ right to protect public health and, in particular, to promote access to medicines for all. 1.5. Taking into consideration national public health policies, we acknowledge the relevance of shared standards to boost post-pandemic recovery and trade flows, including testing requirements and results, recognition of vaccination certificates and interoperability and mutual recognition of digital applications, while continuing to protect public health and ensuring privacy and data protection. 2 Transparency and monitoring 2.1. We reiterate our commitment to transparency and inclusiveness as fundamental to the functioning of the multilateral trading system. 2.2. We note that in a pandemic access to relevant information is crucial. In this respect, we reiterate our commitment to ensuring that notifications of COVID-19-related measures are timely and comprehensive, as required under the provisions contained in WTO agreements. We also note the value of the provision of relevant information including through the WTO Trade Monitoring exercise, and encourage Members’ active engagement in that work. 2.3. Timely and accurate information is important to enable the quick identification by Members of potential disruptions in related supply chains, and to assist dialogue between Members. Significant producing Members of COVID-19 vaccines, therapeutics and diagnostics or their inputs are encouraged to provide the highest level of transparency. 2.4. We note that the limited resources and institutional capacities that developing countries including LDCs have to comply with notification obligations may be further constrained during a pandemic. 2.5. We underscore the importance of technical assistance and capacity building in respect of transparency and monitoring. 3 Export prohibitions or restrictions 3.1. We recognize the rights of each Member to temporally apply export prohibitions or restrictions to prevent or relieve critical shortages of foodstuffs or other products essential to it in accordance with WTO rules and in particular GATT 1994 Article XI. We note, however, that export prohibitions or restrictions can affect the availability of and access to COVID-19 products and inputs needed to manufacture them. 3.2. We therefore encourage Members to exercise restraint in the imposition of export prohibitions or restrictions on COVID-19 products and inputs and to endeavour to have recourse to them only as a last resort, if the Member concerned deems it necessary. 3.3. In any imposition of export prohibitions or restrictions on COVID-19 products, we will give particular consideration to the interests of developing countries including LDCs who are highly dependent on imports and, where possible, will exempt them from the measures in order to avoid a negative impact of such measures on their access to COVID-19 products. 3.4. We will exempt shipments of COVID-19 products to humanitarian and equitable access mechanisms (such as COVAX) from export prohibitions or restrictions, notably for shipments from the mechanisms to developing countries including LDCs. 3.5. Each Member will review its own existing export prohibitions or restrictions on COVID-19 products with a view to removing them as soon as the Member determines that the conditions permit. 3.6. We request the WTO to continue to report regularly on the progress achieved in phasing out existing export prohibitions or restrictions and in avoiding disruption of COVID-19 product supply chains. 4 Trade facilitation, regulatory cooperation and coherence, and tariffs 4.1. We acknowledge that Members have been implementing trade facilitating measures to expedite the export and import of COVID-19 products to address the ongoing COVID-19 pandemic. 4.2. We reiterate the importance of strengthening the implementation of the WTO Trade Facilitation Agreement and particularly those provisions which have proved critical to date during the pandemic as discussed in the Committee on Trade Facilitation. 4.3. We will deepen experience sharing on lessons learned and challenges encountered during the pandemic, particularly by developing countries including LDCs, in respect of trade facilitation, technical regulations, standards, and conformity assessment procedures. To that end, we will give more impetus to this work in the relevant regular bodies. 4.4. With a view to expediting access to COVID-19 products, while facilitating trade and reducing adaptation costs for manufacturers, we encourage the strengthening of regulatory cooperation and coherence, including through promoting the sharing of regulatory information on a voluntary basis. 4.5. We recognize the importance to developing countries including LDCs of technical assistance and capacity building initiatives to implement trade facilitating measures. 4.6. We acknowledge that some Members have been removing or adjusting tariffs and other duties or charges applied on COVID-19 products or inputs on a voluntary basis in order to help facilitate access to COVID-19 products. We note the indicative list of critical COVID-19 vaccine inputs prepared by the WTO Secretariat. 5 The role of trade in services 5.1. We underline the critical role of services in ensuring resilience during the pandemic. We acknowledge the importance of facilitating the international operations of service suppliers involved in production and distribution of COVID-19 products, such as logistics and freight transport services. We also acknowledge the importance of facilitating trade in services, including health services and ICT services, during the current or future pandemics. 5.2. We recognize the significant impact of the pandemic on the services sectors and services trade of WTO Members, especially in developing countries including LDCs. We stress the importance of a policy environment that promotes the flow of services trade to support economic recovery. 5.3. We underscore the need to ensure that COVID-19-related public health measures that have a detrimental impact on services trade be removed as soon as conditions permit. 6 Supporting inclusive recovery and resilience 6.1. We acknowledge the need for trade to promote economic recovery and foster greater resilience through more diversified production across the world. We underscore the critical role of the WTO in promoting inclusive growth and development. 6.2. We recognize that the pandemic has revealed limitations in the fiscal and monetary means available to developing countries including LDCs to withstand, respond to, and recover from the pandemic. 6.3. We underscore the importance of understanding how the WTO rules have supported Members during the COVID-19 pandemic and their role in future pandemics. 6.4. We encourage work on analyzing how WTO rules support resilience and how Members operated under these rules during the pandemic and, as appropriate, identifying gaps with attention to the needs of developing countries and in particular LDCs. 6.5. We underscore the centrality of food security in resilience-building and responding to the current and future pandemics. Food security related issues are multi-faceted and require the adoption of a comprehensive approach. 7 Collaboration with other intergovernmental organizations and stakeholders 7.1. We underscore the importance of the WTO’s collaboration with other relevant intergovernmental organizations and stakeholders and recognize the efforts of the Director-General to promote such work. We strongly encourage the WTO Secretariat to continue these collaborations as part of the co-ordinated global response to the COVID-19 pandemic and in support of a strong, sustainable, balanced, and inclusive global economic recovery, within its mandate, in accordance with the Marrakesh Agreement. 7.2. Members welcome the work undertaken by the WTO Secretariat to analyze supply chains and regulatory bottlenecks for production and distribution of COVID-19 products in collaboration with other relevant intergovernmental organizations and stakeholders. 8 Framework for future preparedness 8.1. Taking lessons learned from the current pandemic and the related WTO response, including the challenges faced by developing countries including LDCs, we agree to establish an Action Plan on Pandemic Response, Preparedness and Resilience (Action Plan) aimed at enhancing future preparedness, response and resilience of the WTO and its Members, and at guiding the work of the WTO post-MC12 on these matters. This Action Plan is contained in the Annex to this Declaration. ANNEX Action Plan on Pandemic Response, Preparedness and Resilience 1. We hereby establish an Action Plan on Pandemic Response, Preparedness and Resilience (the Action Plan). The Action Plan is aimed at addressing issues related to the current COVID-19 pandemic and enhancing future preparedness, response and resilience of the WTO and its Members to any future pandemics, and at guiding the work of the WTO post-MC12 on these matters. The Action Plan will address issues identified in this Declaration, including those identified in paragraph 3.c below. 2. [ALT1: A Pandemic Response, Preparedness and Resilience Body (the Body) is hereby established under the General Council. This ad hoc Body will be chaired by a Head of Delegation appointed by the General Council by its next meeting. Pending the appointment, the Chair of the General Council will serve, or designate a Head of Delegation to serve, as the interim Chair. The Body, in order to guide, coordinate, and oversee work pursuant to this Declaration, will convene sessions at regular intervals or whenever necessary between now and the end of 2023 to assess progress, consider issues of a cross-cutting nature in specific areas of the Action Plan, and to provide overall guidance and direction to relevant WTO bodies set forth in paragraph 3 below.] [ALT 2: The General Council, in order to guide, coordinate, and oversee work pursuant to this Declaration, will convene dedicated sessions at regular intervals or whenever necessary between now and the end of 2023 to assess progress, consider issues of a cross-cutting nature in specific areas of the Action Plan, and to provide overall guidance and direction to relevant WTO bodies set forth in paragraph 3 below.] 3. Under this Action Plan: a. The Council for Trade in Goods or its relevant subsidiary bodies (including the Committee on Trade Facilitation, the Committee on Technical Barriers to Trade, the Committee on Market Access, and the Committee on Agriculture), the Trade Policy Review Body, the Council for Trade in Services or its relevant subsidiary bodies, the Council for Trade-Related Aspects of Intellectual Property Rights, the Committee on Trade and Development, and the Working Group on Trade and Technology Transfer will continue, or initiate as soon as possible, regular dedicated sessions to discuss lessons learned and challenges encountered in responding to the ongoing COVID-19 pandemic. Based on such discussions, as appropriate, these WTO bodies will develop guidelines, make recommendations, identify best practices, or take any other relevant actions to guide the response to the ongoing pandemic, and consider their applicability to future pandemics. These bodies will provide regular updates and reports to [the Body]/[the General Council] on their work described below. b. Papers, concept notes, or other information submitted by Members, as well as other supporting documents prepared by the WTO Secretariat may inform this work. c. In their discussions under the Action Plan, Members will consider existing flexibilities in WTO Agreements and their use during pandemics. To assist that discussion, the Secretariat will prepare a compilation of flexibilities contained in existing rules. d. Areas of discussion and focus will include the following: (i) reviewing existing provisions of the WTO agreements on transparency and monitoring, including with a view to identifying possible areas of improvement in light of lessons learned during the pandemic, and addressing challenges related to capacity constraints; (ii) reviewing export prohibitions or restrictions imposed during the pandemic, with a view to learning lessons and assessing the need to improve the framework applicable to such measures; (iii) considering strengthening and promoting best practices in implementation of the Trade Facilitation Agreement, and reviewing trade facilitating measures with a view to examining their effectiveness in the context of current and future pandemics; (iv) considering how to further expedite and streamline trade procedures, including by using electronic documentation and paperless processes; (v) considering ways to improve regulatory cooperation or coherence, including facilitating recognition of conformity assessment procedures; (vi) considering the impact that tariffs and other duties and charges have on trade in COVID-19 products and inputs; (vii) considering the contribution of trade in services to pandemic preparedness and resilience and sharing experience and information on measures taken to facilitate the operations of service suppliers during the pandemic, with a view to highlighting lessons learned; (viii) considering the role of the intellectual property system in ensuring the development and timely and equitable distribution of health technologies needed to respond to future pandemics, including through the full use of flexibilities in the TRIPS Agreement to protect public health; (ix) considering possible ways to promote the transfer of technology and know-how in order to diversify the production of COVID-19 products; (x) considering policy tools within the mandate of the WTO to promote food security and livelihoods. e. In the areas listed above, each relevant WTO body will consider and seek to address the following in light of factors they may consider relevant: (i) whether the existing WTO rules and their implementation are sufficient for WTO Members to be adequately prepared to address crises like the COVID-19 pandemic; and (ii) whether there are new or expanded methods of cooperation and consultation amongst Members and with other intergovernmental organizations and other relevant stakeholders, which would be desirable to better prepare WTO Members for future pandemics. f. The [Body]/[General Council] will collaborate with other relevant intergovernmental organizations on activities related to this Action Plan. 4. We direct the Secretariat to provide technical assistance and capacity building to developing countries including LDCs who face difficulties engaging in this Action Plan. 5. We direct the relevant WTO bodies to use all available technology and resources to encourage participation of Capital-based officials in the Action Plan. 6. We instruct the Chair of the [Body]/[General Council] to provide regular updates to, and deliver a report by the last regular meeting of, the General Council in 2022 on the work under the Action Plan. That report will include suggested next steps so that the General Council can take stock of the effectiveness of the above actions and consider options for moving forward. The [Body]/[General Council] will present the results of the Action Plan at the 13th Ministerial Conference, and in any case no later than the end of 2023.”
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