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TWN
Info Service on WTO and Trade Issues (Feb26/06) Geneva, 5 Feb (D. Ravi Kanth) — The Norwegian facilitator overseeing the discussions on the reform of the World Trade Organization on 3 February issued a “draft ministerial statement” that is not only likely to dominate the discussions at the upcoming WTO’s 14th ministerial conference (MC14) in Yaounde, Cameroon, but also leave little room for decisions on the unresolved mandated issues, said people familiar with the development. Several trade envoys who asked not to be quoted are sharply concerned that the three reform issues – decision-making, development and special and differential treatment (S&DT), and level playing field issues – are antithetical to the core mandated issues of the Doha Work Programme and serve the interests of the developed countries, particularly the United States. The Yaounde conference appears to be somewhat surreptitiously used to launch a new round of trade negotiations that have little relevance to the core issues of the developing and least-developed countries, said trade envoys, who asked not to be quoted. Against this backdrop, the facilitator’s draft ministerial statement seemingly imposes a top-down agenda on the developing and least-developed countries while pushing the unresolved mandated issues into mere declaratory statements, said people familiar with the development. FACILITATOR’S DRAFT The draft ministerial statement on WTO reform issued by the facilitator, Ambassador Petter Olberg of Norway, states: “We express our shared commitment to advancing reform of the WTO. We welcome the recent exchanges among officials, including written submissions and ideas by several Members and the work carried out thus far. The exchanges have highlighted a range of issues and perspectives that Members have identified as warranting further exploration for reform, with the expectation that additional areas will continue to emerge through ongoing discussions.” However, several countries are not party to the discussions on WTO reforms convened by the facilitator, and there are grave concerns over the three reform issues because they are primarily targeted against developing and least-developed countries, said a trade envoy who asked not to be quoted. Besides, the three issues are being viewed as an attempt to deny the rights of developing and least-developed countries, the trade envoy said, adding that their participation in the WTO could become redundant without any flexibilities to address their development-oriented concerns. The draft ministerial statement, prepared by the facilitator along with the WTO’s leadership, argues: “We value the constructive nature of the discussions across the Membership and instruct officials to continue this work with a sense of urgency, guided by the Work Plan set out in the Annex. We further instruct that a progress report be provided to Ministers at our next session, reflecting the state of work and recommendations for action. Ministers will conduct a midway review ahead of MC15.” Based on discussions among select countries, the facilitator is proposing that a final decision on the three reform issues be decided at MC15, said people familiar with the development. According to the facilitator, the draft work plan “reflects the areas where Members have recently focused efforts as a starting point: * decision-making * development and special and differential treatment (S&DT), and * level playing field issues” It is an open secret that the above three issues are being imposed by the facilitator along with the so-called “Friends of the System” group, to appease the United States, said several developing country trade envoys, who asked not to be quoted. While welcoming the facilitator-conducted reforms, the US has underscored the need for amending the MFN (most-favoured-nation) treatment provision – a point also raised by the European Union – to allow for the imposition of unilateral tariffs of differing levels on developing and least-developed countries, said trade envoys, who asked not to be quoted. On dispute settlement, the facilitator states that “the work plan also addresses dispute settlement reform,” in what appears to be an afterthought, given the way the negotiations on dispute settlement reform have been neglected since the WTO’s 12th Ministerial Conference (MC12) in Geneva in June 2022. For example, between MC13 in Abu Dhabi in February-March 2024 and the upcoming MC14, reform of the dispute settlement system has been pushed to the proverbial back burner, with no concerted effort being made to address the restoration of the two-tier dispute settlement system due to fear of upsetting one major member, which opposes the restoration of the Appellate Body, said trade envoys, who asked not to be quoted. Seemingly emphasizing the issue of flexibility, in his draft ministerial statement, the facilitator claims that “the Work Plan is designed to remain flexible, recognizing that, as discussions deepen, additional issues relevant to reform may be identified by Members.” He said, “this flexibility is intended to ensure institutional agility by allowing additional issues to be taken up without prejudging outcomes.” However, the way in which the facilitator has prioritized the three reform issues has seemingly created the impression that other issues will not be accorded the same level of importance, said trade envoys, preferring not to be quoted. Even though there is no Ministerial mandate for launching negotiations on the three reform issues, the facilitator appears to assume that the road to discussions on these issues will be cleared, as per his suggestions, by trade ministers when they congregate in Yaounde, said trade envoys, who asked not to be quoted. The draft ministerial statement states, “Work will be conducted under the authority of the General Council. The Chairperson of the General Council will appoint “Friends of the WTO Reform Facilitator” for the three work tracks: decision-making, development and S&DT, and level-playing field issues. Other friends may also be appointed as necessary.” Further, “the General Council will review progress at its meetings in July 2026, December 2026, July 2027, and December 2027, with senior officials participating as necessary,” it noted. The facilitator noted that “the WTO Reform process should continue to be Member-driven, open, transparent, and inclusive, and address the interests of all Members.” In reality, the discussions conducted by the facilitator on the three issues are hardly member- driven, because a discussion by the full membership would not have given consent for pushing the above three controversial issues, said trade envoys, who asked not to be quoted. The facilitator also said that “to ensure Members’ effective participation, the WTO Reform Facilitator and the Friends of the Facilitator will coordinate with WTO Councils, Committees and Negotiating Groups in convening meetings and take into account capacity constraints especially of smaller or resource-constrained delegations.” Interestingly, the capacity constraints of several poor and some developing countries were given short shrift during the actual discussions last year, said several least-developed countries, speaking on background. CRITICISM A careful reading of the facilitator’s draft ministerial statement and the proposed “Post-MC14 WTO Reform Work Plan” suggests a reform exercise that is heavy on process and light on the correction of longstanding imbalances, said trade envoys, who asked not to be identified. The repeated emphasis on “flexibility” is a case in point, said trade envoys, arguing that “while presented as institutional pragmatism, it effectively creates an open channel for agenda expansion. Members are encouraged to introduce additional issues, including under the loosely defined heading of “issues of our time”, without clear sequencing rules or substantive limits.” “In practice, these advantages Members with the capacity to drive and sustain new workstreams, while others are left responding to agendas they did not set,” said trade envoys, who asked not to be quoted. According to trade envoys who spoke to SUNS, “Development and special and differential treatment are framed in similarly cautious terms. S&DT is treated as something to be studied, refined, and better targeted, with a strong focus on usage and effectiveness.” However, “what is largely absent is any serious examination of the costs of non-delivery on longstanding development mandates, or of how unresolved imbalances, particularly in agriculture and subsidies, have shaped the system’s credibility problems,” trade envoys said. By contrast, “level playing field” concerns are positioned to move more quickly toward assessment of existing rules and the possibility of stronger disciplines, said a trade envoy, who asked not to be quoted. “The contrast is striking,” the envoy said, adding that “development flexibilities are placed under review, while concerns largely raised by advanced economies are framed as candidates for rule adjustment, accompanied by general assurances about preserving policy space.” The same pattern appears in decision-making reform, said trade envoys, arguing that “past mandates are acknowledged, but mainly as items for stocktaking. The emphasis is on improving efficiency and flexibility, without any clear link to delivering outcomes in areas where trust has been eroded by repeated deferral.” Finally, the inclusion of MFN, reciprocity, the balance of rights and obligations, and security exceptions within an open-ended exploratory track raises broader systemic questions, said envoys, on a background basis. “These are foundational elements of the WTO framework,” trade envoys said. “Addressing them without clear mandates or safeguards risks gradual reinterpretation through practice rather than deliberate political choice.” +
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