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TWN
Info Service on WTO and Trade Issues (Feb25/11) Geneva, 24 Feb (D. Ravi Kanth) — Attempts to put together a “development package” for the World Trade Organization’s 14th ministerial conference (MC14) in Cameroon next year could give a short shrift to the real longstanding developmental issues that remain unaddressed since 2001, said people familiar with the development. The idea of a “development package” appears to have been discussed with the WTO’s Director-General, Ms Ngozi Okonjo-Iweala, in small group meetings outside the ambit of the WTO’s General Council, said a person, who asked not to be quoted. At the General Council (GC) meeting on 18-19 February, China’s trade envoy, Ambassador Li Chenggang, urged his counterparts to work on “broader development issues such as Fish II [the second phase of the Fisheries Subsidies Agreement], agriculture and food security, and the Investment Facilitation for Development Agreement (IFDA)” for MC14. The DG’s remarks at the GC meeting, as contained in a restricted document (Job/GC/429) and seen by the SUNS, against the backdrop of the unilateral tariffs as well as the reciprocal tariff plan proposed by the United States President Donald Trump, suggest that “the stability of the system depends on the collective actions of many, not just a few.” The DG said that “simulations conducted by WTO economists underscore three key points: a. First, a complete breakdown of trade policy cooperation would have severe economic consequences, with potential double-digit losses in real GDP. This is a scenario that none of us can afford. b. Second, trade policy uncertainty itself has significant effects. It is not just the policies that matter, but also their predictability. Ensuring that the multilateral trading system remains a credible and reliable foundation for global commerce is in everyone’s interest. c. Third, the WTO’s value extends well beyond tariffs and the GATT. Our agreements on services (GATS) and intellectual property (TRIPS), among others, provide substantial benefits to all Members. When assessing trade relations, it is therefore important to look beyond goods and consider the broader picture. For instance, companies worldwide generate significant revenues from services exports, as well as intellectual property royalties and licensing fees.” The DG called on members to return to the negotiating table after finalizing the chairs of the WTO negotiating bodies. Citing the comments made by the former chair of the Doha agriculture negotiating body, she underscored a pragmatic approach towards a positive outcome at MC14. Ms Okonjo-Iweala mentioned the upcoming retreat on “Sustainable Agriculture” being held under the General Council’s auspices. “I view these retreats as opportunities for reflection and generation of concrete ideas that can better address the needs of our citizens,” she said, even though serious questions are being raised about the way these retreats are being structured with questions that are not part of the mandate. For example, the former GC chair, Ambassador Petter Olberg of Norway, sought to focus on differentiation among developing countries for availing of special and differential treatment (S&DT), an issue that was pushed by the US and later supported by the developed countries. IFDA The DG’s emphasis on the controversial Investment Facilitation for Development Agreement (IFDA) and the Agreement on Electronic Commerce, which have no formal mandates since the WTO’s 11th ministerial conference (MC11), seem somewhat troubling, said several people who asked not to be quoted. In her remarks on IFDA, as outlined in paragraph 9 of the restricted document, the DG said: “We likewise need to reach a mutually agreeable solution regarding the incorporation of the Investment Facilitation for Development Agreement (IFDA) and the Agreement on Electronic Commerce – both of which were presented today [at the GC meeting on 18 February]. I’ve noted your comments on the issue of the incorporation of the IFDA. Proponents must continue to work hard to reach out to the three Members [India, South Africa, and Turkiye] who have reservations and I urge all of them to work together in good faith to move forward. The landscape we are seeing in the world today means that one can place only very limited comfort in any aid for developing countries. What does this mean? If you are a small or medium-sized developing country, you have to fight hard to get investment into your countries. It is easier for larger ones because they got what it takes but the smaller ones do not have anything – they need instruments. In this regard, the bigger WTO Members must think about this and how they can support this – that we should not deprive Members in that situation of an instrument that would help them attract investment at this critical time. We must also think carefully about how we approach our multilateral and plurilateral agreements. Ambassador James Baxter of Australia mentioned it today. When I look at the regional and bilateral agreements – and I see that what some Members [probably in reference to India] are blocking at the WTO, they have already signed on to elsewhere – and even more advanced. So, it remains an eternal puzzle to me on how one could sign up to something in a regional or bilateral agreement and then, at the WTO, one would not agree with it. I hope we can be fair. If we find all roads blocked to get an agreement, if we cannot conclude multilateral and plurilateral agreements then what can we conclude? We need to think carefully. The world has changed. We cannot come here to continue doing the same things we have been. We either have to unblock one set of instruments or the other. We cannot block both and then say we are here doing our job. As Chair of the TNC, I am putting this before the Membership that we have to think carefully about this matter.” Though only three members – India, South Africa, and Turkiye – spoke against the IFDA, a senior official of Namibia, who preferred not to be identified, said that “it would not block the IFDA, but we have no intention to join the Agreement”. Instead of following the rules as set out in the Marrakesh Agreement that established the WTO in 1995, the DG’s statements on IFDA are allegedly flouting the rules, said people familiar with the development. One of the three members opposing the IFDA apparently said at the GC meeting that the IFDA should not be brought to the GC again after it has been consistently blocked, said people familiar with the development. “DEVELOPMENT PACKAGE” It appears that the original list encompassing the “development package” suggested for MC14 centred on “Fish II”, attempts to incorporate the Agreement on Electronic Commerce and IFDA into Annex 4 of the WTO Agreement, WTO accessions, and the issue of sustainable agriculture. However, agriculture, which was conceived as the engine for the Doha trade negotiations at the time of the launch of the Doha Round in December 2001 and later witnessed substantial progress despite hurdles in all three pillars of domestic support, market access, and export competition until the WTO’s tenth ministerial conference (MC10) in Nairobi, Kenya, looks to be almost abandoned without resolving the mandated issues, said people familiar with the negotiations. Several core issues such as the permanent solution for public stockholding (PSH) programs for food security and the special safeguard mechanism (SSM) for developing countries among others are practically deferred from one ministerial to another, said people who asked not to be quoted. Attempts are allegedly now underway to replace the issue of sustainable agriculture, which was tabled by Brazil in order to address the protectionist measures imposed by the EU, said people familiar with the development. At the GC meeting last week, China said that “while we don’t share all those views and suggestions of Brazil, we see [that] sustainable agriculture is a valuable area that WTO has its role to play. So we support [launching] the discussions on this, starting from a retreat.” It went on to suggest three points. First, said China, it understands that “there is no universally-accepted concept of sustainable agriculture, however, in certain areas WTO can and should have a role to play.” China suggested “having an information session before the retreat”, saying that “we could invite relevant international organizations to share their understandings and work in this regard.” It pointed out that “we do have committees like Trade Facilitation, SPS and TBT in the WTO, whose work is very relevant to sustainable agriculture, and we could also invite them to the information session to introduce what they have done.” Secondly, China said that “for the purpose of efficient discussion and achieving the objective of reaching a common understanding on the possible future work of the WTO in the proposed retreat, the guiding questions should be carefully designed and avoid touching on too many details, which members could have very different views and that would not help us reach the expected outcomes.” Thirdly, China said, “we believe with good discussions on sustainable agriculture, it will help us better understand the realities of contemporary agricultural development, and change the mindset of agricultural negotiations instead of repeating the positions formed in another age.” In short, under pressure to change the status quo at the WTO as proposed by the US and allegedly endorsed by the DG at the GC meeting, it is imperative to ensure that the guardrails of the WTO, as enshrined in the Marrakesh Agreement, are safeguarded at any cost, said people familiar with the development. +
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