|
||
|
TWN
Info Service on WTO and Trade Issues (Dec23/12) Geneva, 18 Dec (D. Ravi Kanth) — India has apparently stood its ground at the World Trade Organization by declaring that the proposed Investment Facilitation for Development (IFD) Agreement is allegedly “illegal” and cannot be placed on the agenda of the upcoming WTO’s 13th ministerial conference (MC13) taking place in Abu Dhabi on 26-29 February 2024, despite support from many members, including the United States, for its incorporation into Annex 4 of the Marrakesh Agreement, said people familiar with the discussions. At the WTO’s General Council (GC) meeting that concluded on 15 December, India appears to have reiterated its consistent position that IFD has been “illegal” since 2017, seemingly drawing the battlelines on the attempts to change the WTO’s multilateral negotiating function through the Joint Statement Initiatives (JSIs), especially the incorporation of the proposed IFD Agreement into Annex 4 of the Marrakesh Agreement, said people familiar with the discussions. The WTO’s year-end General Council meeting concluded amidst seemingly unbridgeable differences on the proposed deliverables being targeted for MC13, including on the Outcome Document at this juncture, said people familiar with the discussions. On 15 December, two issues – the European Union’s regulation on supply chains free from deforestation and forest degradation as well as the proposed plurilateral agreement on IFD being spearheaded by China – appear to have dominated the proceedings. “Everyone is against the EU’s deforestation item at the General Council,” said a South American trade envoy, suggesting that “the Latins, the Asians, and the Africans” inveighed against Brussels’ controversial deforestation and forest degradation and repealing regulation. They concluded that “while promoting environmental sustainability is a common goal that unites us all, it is imperative that the EU takes into account and meaningfully engages over a debate on the broader implications of a trend of unilateral regulations allegedly taken for the sake of sustainability, and consequently reviews its regulations.” Indonesia said, “There are many elements in the policy that require careful review – including how it indiscriminately curtails our market access to Europe.” “The EU’s one-size-fits-all approach, implemented through this model of due diligence, also ignores different local conditions – thus rendering small-holders vulnerable”, it said, adding that “small-holders may end up being excluded from global supply chains not because they have deforested their land but because they cannot prove their compliance to the excessive and ever-stringent sustainability criteria imposed.” IFD The plurilateral IFD initiative, which was introduced at the meeting by Chile and which is backed by 117 countries, was supported by more than 30 countries at the General Council meeting, including a non-member like the United States, said people, who asked not to be quoted. It appears that several members such as the EU, Japan, Switzerland, Cameroon, Brazil, Pakistan, Singapore, the Russian Federation, the UK, Saudi Arabia, the US, Korea, and Cameroon among others lent support to concluding an agreement on IFD at MC13, said people who asked not to be quoted. China, which has been the main navigator of the IFD initiative since 2017, said the “G20 New Delhi Leaders’ Declaration emphasized the importance of investment in promoting trade and economic growth, eliminating hunger, delivering quality education, implementing energy transition and enhancing women’s empowerment.” It maintained that “the G20 trade and investment ministerial meeting chaired by India also underlined the positive role of investment facilitation in promoting sustainable and inclusive global value chains, and supported deliberations at WTO on intersections between trade and investment. IFD was also discussed by G20 trade and investment ministers.” China said that IFD is currently supported by 117 countries, suggesting that for the non-participants, “some are favourably considering it, pending domestic procedures, while others (like the US) would not oppose adding the IFD Agreement into Annex 4 of the WTO Agreement.” China said, “Investment Facilitation for Development, as its name implies, is a development-oriented agreement”, with widespread support. It said that it “is an agreement with a dedicated development chapter, embodying elements of S&DT, needs assessment, technical assistance, and capacity building” and contributes to increasing “industrial production capacity and diversification and could provide for the exact kind of policy space and business environment that are needed by the developing countries for economic growth and transformation.” INDIA’S OPPOSITION In contrast to China’s rather upbeat pronouncements on IFD, India appears to have asked why the initiative has failed to comply with the WTO rules since 2004. India cited the “July 2004 package” which explicitly states that the “relationship between Trade and Investment, Interaction between Trade and Competition Policy and Transparency in Government Procurement: the Council agrees that these issues, mentioned in the Doha Ministerial Declaration in paragraphs 20-22, 23-25 and 26 respectively, will not form part of the Work Programme set out in that Declaration and therefore no work towards negotiations on any of these issues will take place within the WTO during the Doha Round.” India also drew attention to paragraph 34 of the WTO’s MC10 decision adopted in Nairobi in 2015, which said: “While we concur that officials should prioritize work where results have not yet been achieved, some wish to identify and discuss other issues for negotiation; others do not. Any decision to launch negotiations multilaterally on such issues would need to be agreed by all Members.” New Delhi also cited the General Council decision of May 2017 when it was agreed that investment facilitation, as it was called then, can only have an “informal dialogue” outside the WTO. The former General Council chair Ambassador Xavier Carim of South Africa said that such informal dialogue/ discussions “do not constitute proposals for negotiations”. Finally, India said that it had submitted a proposal along with South Africa and Namibia on 30 April 2021 (WT/GC/W/819/Rev.1) about the legal status of the Joint Statement Initiatives in which it was made clear that the JSIs are neither multilateral agreements nor Plurilateral Agreements (as defined in Article II.3 of the Marrakesh Agreement). According to the joint proposal by India, South Africa, and Namibia, the JSIs including IFD would erode the integrity of the rules-based multilateral trading system by subverting the established rules and foundational principles of the Marrakesh Agreement. Given the time taken by India to explain its stand at the GC meeting, the General Council chair, Ambassador Athaliah Lesiba Molokomme of Botswana, told India to submit its arguments in writing because of the paucity of time. In its second intervention, India said categorically that IFD is “illegal” and cannot be part of the MC13 agenda, according to people who asked not to be quoted. China, however, apparently remained silent on India’s main criticisms centring on the alleged bypassing of the WTO rules, including the foundational agreements, in advancing “illegal” agreements, said people present at the meeting. The seemingly entrenched positions on IFD suggest that countries like the US, which has not joined the IFD but is ready to support it, appear to be attempting to change the WTO’s negotiating function once and for all, said people who asked not to be quoted. It remains to be seen how the Outcome Document for MC13, which is yet to be negotiated and finalized, would reflect the seemingly “systemic” divide on this issue and whether it would garner consensus, said people familiar with the discussions. OUTCOME DOCUMENT Meanwhile, the fourth version of the Outcome Document for MC13 issued by the General Council chair on 7 December, leaves a lot of issues, including the restoration of the two-tier dispute settlement system for decision at MC13. The fourth version of the Outcome Document issued by the General Council chair, Ambassador Molokomme of Botswana, under her own responsibility, suggests that several issues are yet to be discussed/negotiated for inclusion in the document. The latest draft is as follows: [POSSIBLE OUTCOME DOCUMENT Working Draft – Version 4 (7 December 2023) PART 1 Thanks to the MC13 Host 1. We, the Ministers, have met in Abu Dhabi, United Arab Emirates, from 26 to 29 February 2024 for our Thirteenth Session. As we conclude our session, we would like to express deep appreciation to the Government and people of the United Arab Emirates for their excellent organization of the conference and the warm hospitality we have received in Abu Dhabi. Reaffirming the WTO’s principles, objectives, and role in its 30th anniversary 2. Our thirteenth session takes place as we mark the 30th anniversary since the establishment of the WTO. On this occasion, we underline the critical importance of the rules-based, non-discriminatory, open, fair, inclusive, equitable and transparent multilateral trading system and the WTO, and reaffirm the principles and objectives enshrined in the Marrakesh Agreement. 3. We acknowledge that during these 30 years in our trade and economic relations, WTO Members have sought to fulfil the objectives reflected in the Preamble to the Marrakesh Agreement consistent with Members’ respective needs and concerns at different levels of economic development. While important progress has been made, we resolve to further strengthen the multilateral trading system to provide strong impetus to address multi-dimensional global challenges and ensure inclusive prosperity and increased welfare gains for all Members. 4. As we work towards strengthening the effectiveness and responsiveness of the WTO as an organization and the multilateral trading system as a whole, we recognize the importance of implementation of the WTO Agreement and Ministerial Decisions and take note of the progress reflected in the reports from the General Council and its subsidiary bodies. WTO Reform 5. We reaffirm our commitment at our twelfth session to work towards necessary reform of the WTO to improve all its functions and acknowledge the progress made in this regard. We note and value the “Reform by Doing” work conducted to date to improve the functioning of WTO Councils, Committees and Negotiating Groups with a view to enhancing the WTO’s efficiency, effectiveness, and facilitation of Members’ participation in WTO work. We instruct the General Council and its subsidiary bodies to continue to conduct this work and report progress as appropriate to the next Ministerial Conference. 6. DS Reform 7. We resolve to preserve and strengthen the multilateral trading system, with the WTO at its core, to respond to contemporary trade challenges, take advantage of available opportunities, and ensure the WTO’s proper functioning. We acknowledge that Members have engaged in informal discussions on some of these issues. We recognize the need for all Members to deepen dialogue in a more focused manner to improve understanding of the implications of each of these issues* for trade, development and the WTO while continuing efforts to seek conclusion of ongoing negotiations. Development 8. We reiterate the centrality of the development dimension in the work of the WTO. We recognize that the full integration of developing country Members and LDC Members in the multilateral trading system is important for their economic development and for global trade expansion and recall the Preamble to the Marrakesh Agreement to make positive efforts towards this end. We reaffirm the provisions of special and differential treatment for developing country Members and LDCs as an integral part of WTO Agreements.* 9. We recognize the particular vulnerability and special needs of LDCs. In this regard, we underscore that their interests should be given due priority for them to secure meaningful integration into the multilateral trading system. 10. Recalling that at our twelfth session we recognised the role that certain measures in the WTO can play to facilitate smooth and sustainable transition for Members graduating from LDC Category, we welcome the progress achieved as reflected in the Decision adopted by the General Council in WT/L/1172. 11. We recognize the importance of the Aid for Trade initiative for developing country Members in particular LDCs for trade-related capacity building. We look forward to the outcomes of the 9th Global Review and recognize the continuing need for this Initiative. Trade and Sustainable Development 12. In recalling the objectives in the Marrakesh Agreement and the 2030 Sustainable Development Goals in so far as they relate to the WTO mandate, we underscore the importance of trade and sustainable development in its three pillars – economic, social, and environmental. 13. We recognise the importance of an inclusive and equitable multilateral trading system that supports sustainable development and ensures that the gains of trade benefit all*. WTO Negotiations 14. We acknowledge progress/welcome outcomes as reflected in specific decisions/declarations/decide or guide on WTO Negotiations: a. Agriculture b. Fisheries Subsidies i. Welcome deposits of instruments of acceptance and thank contributions to Fish Fund ii. Fish 2 c. S&DT d. [catch all messaging on other negotiating areas in Negotiating Groups] WTO Accessions 15. We celebrate the enlargement of the Organization in accordance with Article XII of the Marrakesh Agreement. We note with satisfaction that this Conference has completed the accession procedures for two least-developed countries, Comoros and Timor-Leste. We recognize the contribution of accessions to strengthening the multilateral trading system and recall our commitments at our twelfth session. NB: Other issues mentioned include, in no particular order: (I) trade and industrial policy, (ii) trade and climate, (iii) policy space for industrial development, (iv) trade and transfer of technology, (v) trade, debt and finance, (vi) trade and inclusiveness such as trade and gender, women’s economic empowerment, MSMEs, SIDS, LLDCs and indigenous issues on inclusiveness, (vii) implementation of past Ministerial Decisions and Declarations, (viii) food security, (ix) plastics pollution, circular economy, trade and environmental sustainability, and fossil fuel subsidy reform, (x) Aid for Trade, (xi) digital economy, (xii) trade in services, (xiii) levelling the playing field issues, and (xiv) agriculture reform as part of the WTO Reform heading, among others. PART 2 16. We acknowledge progress/welcome outcomes as reflected in specific decisions/declarations/decide or guide on WTO Regular Work:
* Illustrative list of issues includes trade and industrial policy, trade and environmental sustainability and trade and inclusion. * Illustrative list of issues mentioned as relevant for this paragraph were policy space for industrial development, SIDS, LLDCs, trade and transfer of technology, and trade, debt and finance. * Illustrative list of issues mentioned as relevant were trade and gender, women’s economic empowerment, MSMEs and indigenous issues. +
|
||
