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Info Service on WTO and Trade Issues (Nov23/10) Geneva, 20 Nov (D. Ravi Kanth) — The World Trade Organization’s Director-General, Ms Ngozi Okonjo-Iweala, is convening an informal mini-ministerial meeting virtually on 28 November in which she has apparently changed the focus from discussing a permanent solution for public stockholding (PSH) programmes for food security purposes on its own merits to all issues in agriculture, said people familiar with the development. Under alleged pressure from the Cairns Group of farm-exporting countries as well as the Latin American Group of countries, the DG seems to have decided to focus on all issues in agriculture instead of just discussing PSH as demanded by India, said people familiar with the development. This is the first meeting which is expected to be followed by more meetings on some other issues, said people familiar with the development. For the past several months, India along with a large majority of developing countries have been campaigning assiduously for an outcome on the mandated issue of PSH at the upcoming WTO’s 13th ministerial conference (MC13) to be held in Abu Dhabi in February 2024. India appears to have pitched the idea for a mini-ministerial meeting several months ago to discuss the permanent solution for PSH, which is the central concern of around 80 developing countries drawn from the Group of 33 (G33) led by Indonesia, the Africa Group, and the ACP (African, Caribbean, and Pacific) Group, said people familiar with the development. DG’S CONSULTATIONS However, the DG, who has been holding meetings over the last seven days with the regional groups, including the Cairns Group, the Latin American Group led by Brazil, and other groups, seems to have changed the focus of the meeting, several members said on a background basis. Apparently, the DG also held a meeting with India, the United States, and the European Union among others last week to elicit their opinions on the Indian request, said people who asked not to be quoted. To the dismay of many developing countries, the DG is apparently now veering round to club together the PSH issue with all other issues in agriculture knowing full well that it was not the intention of the proponents of PSH, said people familiar with the development. Asked whether the DG has changed the focus of the meeting under pressure from the Cairns Group and the Latin American Group, the WTO spokesperson, Mr Ismaila Dieng, said: “We confirm that a representative group of WTO Members are scheduled to convene for the virtual mini-ministerial conference on November 28th to consider how to move forward the discussions in the agriculture negotiations.” He told SUNS: “Over the past two decades, the negotiations on agriculture have failed to yield the progress Members have called for. The DG and the Chair of MC13, Dr. Thani bin Ahmed Al Zeyoudi, have underscored the need to explore a reset of the approach that delivers strong support for the negotiations in Geneva. At this stage, ministerial guidance is needed to inject momentum in the discussions.” According to the spokesperson, “It is a matter of fact that the agenda for the mini-ministerial was never pre-determined. The DG and the Chair have actively engaged in a series of consultations with Ambassadors in Geneva to deliberate on the agenda and prepare for this crucial meeting. These consultations have proven productive, enabling Members to identify potential areas for further deliberations.” Further, he said: “The ongoing consultations are directed towards finalizing the agenda. This process ensures the comprehensive inclusion of all relevant issues for discussion during the mini-ministerial. The agenda, therefore, stands as a dynamic and evolving document shaped by the collaborative efforts of Members.” BRAZIL WELCOMES DG’S DECISION However, the DG’s apparent decision to focus on all issues in agriculture instead of only on one issue, namely PSH, was welcomed by members of the Latin American Group. Brazil’s trade envoy Ambassador Guilherme Patriota concurred with the DG’s decision to discuss all the issues in agriculture, saying it is a “positive” development. “We need to look at all issues in the profile of Agriculture in a “holistic” manner,” Ambassador Patriota told the SUNS. The Brazilian trade envoy maintained that he is not opposed to discussing the PSH issue, but added that other issues like domestic support, cotton, and market access also need to be discussed. However, he said the limited time of three hours for the meeting may not be adequate for discussing all the issues. PSH The permanent solution for PSH programs for food security was mandated to be concluded at the WTO’s 10th ministerial conference (MC10) in Nairobi, Kenya, in December 2015. At that meeting, the US, the EU, and Brazil among others apparently blocked the decision in the “Green Room” meeting while China and India pressed for an outcome. Subsequently, the issue was pursued at MC11 in Buenos Aires in December 2017 but the US, under instructions from the former US Trade Representative Ambassador Robert Lighthizer, apparently blocked the progress of any outcome at the meeting. Around 80 developing countries raised the issue in the run-up to MC12 held in Geneva last June. Members of the Africa Group, ACP (African, Caribbean, and Pacific) group, and G33 on 31 May tabled their proposal seeking a permanent solution for public stockholding programs at MC12, in an apparent counter to the DG’s proposal to postpone the PSH issue till MC13, said people familiar with the development. The DG, Ms Okonjo-Iweala, would not have visualized that around 80 developing countries joined forces to push back against her proposal to decide on the PSH issue at MC13. In her revised draft decision on PSH issued on 31 May, the DG stated: “Recalling the Ministerial Decision of 7 December 2013 (WT/MIN(13)/38 – WT/L/913), the General Council Decision of 27 November 2014 (WT/L/939) and the Ministerial Decision of 21 December 2015 (WT/MIN(15)/44 – WT/L/979), and recognizing the importance attached to public stockholding programmes for food security purposes by some developing country Members, including least developed and net food importing developing countries and mindful of the food security of other Members, we undertake to continue our negotiations and make all concerted efforts to agree to a permanent solution to the PSH issue by MC13.” She also said, “these comprehensive negotiations shall consider relevant elements including the review of the external reference price of relevant products, programme and product coverage, limits on Public Stockholding programmes, transparency and safeguards/anti-circumvention, and legal certainty.” In the run-up to MC12, members of the Cairns Group apparently exerted pressure on the DG to include a footnote that says that the review of the external reference price “would be considered more broadly in the context of current AoA (Agreement on Agriculture ) disciplines,” implying that it would be considered in preparing the domestic support modalities, said people, who asked not to be quoted. Despite the DG’s draft decision to defer the permanent solution for PSH programs until MC13, the 80 developing countries of the Africa Group, the ACP, and the G33, including India, China, and Indonesia, demanded that the decision on their proposal be concluded at MC12. The other co-sponsors of the proposal on the permanent solution for PSH programs included Antigua and Barbuda; Barbados; Belize; Benin; Bolivia; Botswana; China; Congo; Cote D’Ivoire; Cuba; Dominica; Dominican Republic; Grenada; Guyana; Haiti; Honduras; India; Indonesia; Jamaica; Kenya; Madagascar; Mauritius; Mongolia; Mozambique; Nicaragua; Nigeria; Pakistan; Saint Kitts and Nevis; Saint Lucia; Saint Vincent and Grenadines; Senegal; Sri Lanka; Suriname; Tanzania; Trinidad and Tobago; Turkey; Uganda; Venezuela; Zambia; and Zimbabwe. The proposed ministerial decision on the permanent solution for PSH has been opposed by the United States, the European Union, and the Cairns Group of farm exporting countries led by Australia during the Doha agriculture committee negotiating meetings over the last one year. In their nine-page restricted proposal (Job/Ag/229), the 80 co-sponsors stated unambiguously, in the chapeau, that “having regard to paragraph 1 of Article IX of the Marrakesh Agreement Establishing the World Trade Organization” and “taking note of the Ministerial Decision of 7 December 2013 (WT/MIN(13)/38 – WT/L/913), the General Council Decision of 27 November 2014 (WT/L/939) and the Ministerial Decision of 21 December 2015 (WT/MIN(15)/44 – WT/L/979), the ministers recognizing the importance of public stockholding for food security purposes for developing country Members, including Least-Developed and Net Food Importing Developing Countries (NFIDCs) decide as follows: 1. Members agree to a permanent solution as set out in this Decision, for the use of public stockholding for food security purposes by developing country Members. 2. Notwithstanding any provision of the Agreement on Agriculture (AoA), domestic support provided by a developing country Member pursuant to public stockholding programs for food security purposes, shall be deemed to be in compliance with Articles 3.2, 6.3 and 7.2(b) of the Agreement on Agriculture (AoA), provided that the conditions set out in paragraphs 5 to 9 of this Decision are met. 3. Where public stockholding programs for food security purposes of a developing country Member include programs under which stocks of foodstuffs are acquired and released at administered prices, then, for the purposes of footnote 5 of Annex 2, the Aggregate Measurement of Support (AMS) shall be calculated based on the actual quantity of foodstuffs acquired at administered prices, and the external reference price in this regard shall be either of the following: (a) the three-year average price (f.o.b for a net exporter or c.i.f for a net importer) based on the preceding five- year period excluding the highest and the lowest entry for that product; or (b) adjusted for excessive inflation as per the methodology given in Annex Z. 4.1. This Decision does not preclude developing country Members from introducing public stockholding programs for food security purposes in accordance with the relevant provisions of the Agreement on Agriculture. 4.2. For greater clarity, paragraphs 5 to 9 of this Decision applies when a developing country Member concerned exceeds the applicable Aggregate Measurement of Support (AMS) limits under the AoA, i.e., the Member’s Bound Total AMS or the de minimis level, as applicable, as a result of the public stockholding programs for food security purposes covered under paragraph 2 of this Decision. (The de minimis limit for developing countries is 10% as per the AoA or Agreement on Agriculture. India has already breached the 10% limit for rice and sought protection under the perpetual “peace clause”). ANTI-CIRCUMVENTION/SAFEGUARDS 5.1. Stocks acquired under public stockholding programmes for food security purposes covered under paragraph 2 of this Decision shall not substantially distort trade or adversely affect the food security of other Members. NOTIFICATION AND TRANSPARENCY Brazil says that it “understands that the demandeurs’ approach throughout the years and their respective proposals have not addressed non-demandeurs’ concerns.” Against this backdrop, India and the 80-odd developing countries seem somewhat justified to discuss the PSH issue on its own merits, particularly given the manner in which it was scuttled at each ministerial conference since 2015, several PSH proponents said on a background basis. LATIN AMERICAN GROUP Brazil, which had coordinated the G20 group in the Doha agriculture negotiations, has been calling for a “holistic” mandate on agriculture to address PSH as well as other issues such as cotton, domestic support, and market access on grounds that it has offensive interests in agriculture. Brazil says it supports the Costa Rican proposal on domestic support and PSH, and it appears that the Mercosur countries are planning to circulate a proposal on market access. Brazil, in a proposal submitted earlier, maintained that the “public stockholding (PSH) is but one of the elements of a comprehensive package, and food security is but one of the possible objectives of public stockholding programs.” It argued that “the decision-making process on public stockholding is a complex task and has to take into account several aspects related to the implementation of those programs, such as over-reliance on institutional markets; operational effectiveness; fiscal sustainability; cost efficiency vis-a-vis other approaches; effects on international markets.” According to Brazil, “market price support is the most distortive agricultural policy.” It said, “due to the well-documented negative effects on the international agricultural system, the curbing of market price support policies was one of the most important achievements of the Agreement on Agriculture. When procurements to build stocks are made through market price support, they cannot be left unchecked.” Brazil’s interest in market access seems to align with the US interests in market access, said people familiar with the development. US FARM LOBBIES OPPOSE PSH The US farm trade lobbies, which fiercely opposed the issue of PSH, seem eager to discuss market access while remaining opposed to any changes in domestic support. The US is understood to have breached its domestic support commitments during the COVID-19 pandemic and its “green box” subsidies remain a proverbial “eyesore” in the global farm trade negotiations, said people, who asked not to be quoted. +
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