|
||
|
TWN
Info Service on WTO and Trade Issues (Mar26/06) Geneva, 6 Mar (D. Ravi Kanth) — The United States on 5 March appeared to have vetoed the draft “WTO Reform Work Plan” and the zero draft ministerial statement for the World Trade Organization’s 14th ministerial conference (MC14), while China, the European Union, Brazil, and the “Friends of the System” group indicated support and willingness to engage with the two documents, said people familiar with the development. Even countries like Paraguay, India, Turkiye, and several members of the African Group raised varying levels of objections to the manner in which the facilitator constructed the two documents under his own responsibility while seemingly violating the past mandates on WTO reform as set forth in the outcome documents of the WTO’s 12th ministerial conference (MC12) held in Geneva in June 2022 and the 13th ministerial conference (MC13), which concluded in Abu Dhabi on 2 March 2024, said people familiar with the development. US REJECTION While rejecting the facilitator’s two drafts – the work plan and the ministerial statement – the US is understood to have said that regardless of work plans or statements, what is needed are concrete proposals for reform after MC14. Washington apparently maintained that it will come forward with proposals after the Yaounde meeting, while encouraging other members to do so, said people familiar with the development. Paraguay, which had earlier tabled a paper sharply critical of the facilitator’s reform proposals, seems to have suggested that while it has no problems with the evolution of the facilitator’s work plan, it cautioned that if it does not work, there should be a “Plan B” – only on procedural aspects – at this juncture, said people familiar with the development. India is understood to have adopted a rather ambiguous position by rejecting the WTO reform proposals while informing the meeting that its capital is examining the facilitator’s two proposed plans, said people familiar with the development. Even members of the African Group apparently raised sharp objections to the two draft reform proposals submitted by the facilitator, said people familiar with the development. CHINA VOICES SUPPORT In contrast to the apparent rejection by the US, the Chinese trade envoy, Ambassador Li Yongjie, delivered a rather measured statement of support for MFN (most-favoured-nation) treatment and several development- oriented aspects, while informing the facilitator that it can work with his two drafts. Referring to its paper on WTO reform under the current circumstances, circulated on 18 February, China said the aim of the reform ought “to reinforce global trade governance to support economic globalization that is universally beneficial and inclusive.” “For three decades,” the Chinese trade envoy said, “the WTO has been one of the cornerstones of multilateralism and a vital pillar of global economic governance.” According to China, “despite current trade tensions and global uncertainties, the WTO remains an indispensable anchor of stability. WTO reform must strengthen, not weaken, the rules-based multilateral trading system.” Earlier, in “The President’s 2026 Trade Policy Agenda – The America First Trade Policy”, the US had severely criticized China for allegedly being the biggest beneficiary of the WTO, while adopting non-market trade policies. In a similar vein, at the recent Munich Security Conference, the WTO’s Director-General, Ms. Ngozi Okonjo- Iweala, also pointed a finger at China for utilizing special and differential treatment provisions while adopting export strategies that led to the generation of a $1.2 trillion trade surplus. On the “direction of the reform,” China said that “the MFN principle shall remain the bedrock of the WTO. Development dimensions shall be put at the center of WTO reform.” However, this would be tantamount to challenging the US and the European Union, who are seeking to review the MFN framework. The Chinese trade envoy said, “updating the rulebook shall include both addressing long-standing issues and exploring new and future-oriented rules.” China maintained that the “immediate priority of the reform” is “to adopt a balanced reform work plan at MC14, starting from identifying priorities for discussion post-MC14.” China appreciated “the facilitator’s efforts in organizing the reform month discussions and coming up with a high-level Draft Ministerial Statement and reform work plan with delicate balance and without prejudging.” Work on “WTO reform” must address “the challenges faced by members,” China said, adding that “there are the flip sides of economic globalization, including persisting North-South gap and rising domestic inequality, as elaborated in China’s paper.” In China’s assessment, “the WTO alone could not provide solutions to all these challenges. But we know what will not lead us to an economic globalization universally beneficial and inclusive.” Without naming the US, which has embarked on a regime of unilateral reciprocal tariffs that has been recently ruled illegal by the US Supreme Court, China said “power-based trade relations are not solutions.” Moreover, such challenges “ought to be addressed through both multilateral cooperation and domestic reform, conducive to inclusive and sustainable development,” China said. In contrast to the US unilateral approach to its “Make America Great Again” priorities on trade, China said that it is a strong proponent of “an open, inclusive, transparent, non-discriminatory and rules-based multilateral trading system [that] serves the interests of all and plays an important role.” In light of the above, China stands ready to engage in constructive cooperation with all members on WTO reform issues in the run-up to, at, and beyond MC14. In contrast to the position that Paraguay adopted on the facilitator’s work plan, Brazil appears to have endorsed the facilitator’s work plan, claiming that it is close to success. Brazil also said that there are some concerns, suggesting that a work plan with substance was needed, said people familiar with the development. DRAFT TEXTS The facilitator’s draft texts are as follows: DRAFT YAOUNDE MINISTERIAL STATEMENT ON WTO REFORM We acknowledge the contribution of the WTO to the economic growth of its Members over the past 30 years and that it continues to perform valuable functions. At the same time, we acknowledge that the WTO faces serious challenges that requires meaningful reform. While we hold differing views on the challenges, we commit to work urgently and in good faith following MC14 to advance reforms, recalling MC12 and MC13. In this context, we instruct our officials to intensify their work with a view to providing concrete and substantive recommendations for action by MC15. We will undertake a mid-term review in advance of MC15 to assess progress and provide further direction. WTO REFORM WORK PLAN Decision-Making, Development and Level Playing Field Issues – as a starting point Ministers note that, as a starting point, Members engaged in reform discussions leading up to MC14 that were focused on three areas: Decision-making; Development, and Level Playing Field as reflected in the Reform Facilitator’s Reports[1] and the Annex to this statement. Ministers engaged in discussions on these areas at Yaounde and agree that these three issues will continue to be a focus of work on reform post MC14. Foundational and other issues Ministers also had discussions on Foundational Issues at MC14 – including systemic issues such as WTO principles and the balance of rights and obligations. Post MC14 discussions will include these issues. Dispute Settlement Members acknowledge that the WTO Dispute Settlement System is not fully and well-functioning and needs to be reformed. Members agree that consultations on dispute settlement reform, under the auspices of the Dispute Settlement Body (DSB), should continue following MC14. Modalities Authority: Work will be conducted under the authority of the General Council. Dispute Settlement Reform will be under the auspices of the DSB. The WTO Reform process shall be Member-driven, open, transparent, and inclusive, and address the interests of all Members. The General Council Chair will appoint facilitators for Decision-Making, Development, and Level Playing Field issues. The WTO Reform Facilitator will lead Members’ discussions on foundational issues. The facilitators will organize the work – in an inclusive manner – with the objective of building convergence based on Members’ submissions and contributions. Under the guidance of the General Council Chair, the WTO Reform Facilitator will continue to oversee and coordinate the overall process in a holistic manner, including the three initial workstreams, ensure coherence across the workstreams and avoid scheduling overlaps. The capacity constraints of Members, especially of resource-constrained delegations, will be taken into account in scheduling meetings. Indicative Timelines/checkpoints: Work will resume in April 2026. Progress reports to the General Council will be provided in July 2026, December 2026, July 2027, and December 2027, with senior officials participating as necessary. Ministers will conduct a midway review ahead of MC15. Flexibility: The Work Plan is designed to remain flexible to ensure responsiveness and institutional agility. The identification of any particular issue as a “focus” issue or an otherwise important issue will not be interpreted in any way as limiting the scope of issues Members can address in the reform process or imply any particular sequencing. Moreover, this reform process will be without prejudice to work in any WTO committee or other body. ANNEX[2] Decision-making: determine if we need and how to: (i) rebuild trust in decision-making through a clearer understanding of the factors contributing to recurring delays in reaching consensus, (ii) improve efficiency, flexibility and outcome orientation in decision-making, and (iii) facilitate the integration of plurilateral outcomes into the WTO and consider guardrails. Development: determine if we need and how to: (i) examine how rules can more effectively enable integration into global value chains in a manner that supports economic growth and prosperity, while ensuring appropriate policy space for industrialization, structural transformation, and economic diversification, (ii) make S&DT precise, effective, operational, and explore approaches to S&DT which better reflect the diversity of needs and levels of economic development amongst the Membership, and (iii) strengthen technical assistance and capacity building, monitoring and institutional coherence. Level playing field (LPF) issues: determine if we need and how to: (i) identify areas for focused work and the relevant WTO rules, (ii) improve transparency, notification and compliance and, (iii) make relevant rules and disciplines more effective in addressing concerns, including distortions from state intervention in the industrial sector, as well as emerging agricultural trade issues, on separate tracks, while exploring flexibility for development policy objectives. Key Activities: a. Decision-making: compile factual evidence and take stock of (i) past mandates; and (ii) tools/practices used to facilitate consensus-based decision-making; and (iii) explore if and how different decision thresholds could apply to different types of WTO decisions. b. Development: compile and analyse information on: (i) S&DT usage, beneficiaries, effectiveness, and gaps, (ii) WTO provisions relevant to industrial development and, (iii) WTO technical assistance and capacity-building programs. c. LPF issues:(i) map level-playing field concerns, including in the industrial sector and emerging agricultural trade issues and identify areas for focused work; (ii) identify gaps in transparency, notifications, disciplines and remedies and underlying reasons; (iii) review and assess which additional and updated rules and disciplines are needed to address identified concerns while exploring flexibility for development policy objectives. d. Based on a-c above, determine needed reforms and develop recommendations including options for action. Foundational and other issues: discussions will continue following MC14, based on Members’ submissions and taking into account Ministers’ exchanges at MC14. Dispute Settlement Reform: consultations will continue following MC14, under the auspices of the Dispute Settlement Body (DSB). [1] JOB/GC/483 and JOB/GC/X (March GC Report). The Facilitator’s reports do not represent consensus documents but are issued under the Facilitator’s responsibility. [2] This Annex reflects discussions since January and recognizes that there are differences of views and perspectives. It is a reference guide and does not prejudice any Member’s position. +
|
||
