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TWN
Info Service on WTO and Trade Issues (Mar26/22) Geneva, 19 Mar (D. Ravi Kanth) — The Director-General of the World Trade Organization on 17 March released the “Draft Yaounde Package for the Fourteenth WTO Ministerial Conference”. “The documents enclosed are not consensus documents, but reflect the stage to which we were able to take the work in Geneva,” the DG, Ms. Ngozi Okonjo-Iweala, noted. “MC14 will take place against a background of significant strain for the global economy and the multilateral trading system, shaped by geopolitical tensions including the ongoing conflict in the Middle East, economic fragmentation, and mounting challenges,” she stated. According to trade envoys who requested anonymity, the document appears to indicate that discussions on WTO reform will trump all other mandated and unresolved issues, though “the documents enclosed are not consensus documents.” However, several trade envoys who requested anonymity said the DG seemingly remains totally silent on who caused the “significant strain for the global economy” and “geopolitical tensions,” in what appears to be a disingenuous introduction. Trade envoys who requested anonymity noted that it is common knowledge that one country – the United States – single-handedly wreaked havoc on the global trading system through its unilateral reciprocal tariffs imposed on countries since April last year, in addition to the “ongoing conflict in the Middle East.” Instead of addressing the core challenges such as fully restoring the WTO’s enforcement function or resolving outstanding issues from the previous Uruguay Round negotiations, the reforms appear designed to appease the US and a limited set of industrialized or middle-income countries seeking to move away from the development- oriented issues that are important to developing nations, a trade envoy said. REFORM CENTRAL TO MC14 The DG notes in her introduction that “MC14 therefore offers a timely opportunity for Ministers to reflect collectively on multilateral trade cooperation and consider how the WTO can respond to current realities and Members’ expectations.” She stated that “WTO reform will be central to the agenda, and many members accept that we now have to deliver on meaningful reform.” Trade envoys who requested anonymity said that given the lack of consensus on any of the reform issues – as acknowledged by the chair of the WTO’s General Council in his note on “WTO Reform” – the DG appears to be misleading trade ministers. Further, while reforms will occupy center stage with the lion’s share of the discussions, other issues “such as development including LDC issues, agriculture, electronic commerce, investment facilitation for development, and fisheries subsidies” will also be discussed. The DG notes that “Ministers will also receive an update on dispute settlement reform, which remains a priority for all members.” Several trade envoys who requested anonymity questioned that if dispute settlement reform has been a priority for all members since the WTO’s 12th Ministerial Conference (MC12), held in Geneva in June 2022, why is it not included as part of the reform discussions and why is it being accorded “stepmotherly” treatment at MC14? Ms. Okonjo-Iweala informed ministers that they will “participate in breakout group discussions designed to enable frank and substantive exchanges on foundational issues, including the WTO’s principles [most-favoured- nation treatment, which is the basis for non-discrimination in tariff obligations], decision-making [by consensus], development [differentiation among developing countries for availing of special and differential treatment, which is currently based on a self-designated framework], and level playing field issues [to radically alter disciplines in the Agreement on Subsidies and Countervailing Measures].” On 17 March, Antigua and Barbuda, Bangladesh, Guyana, India, and South Africa complained to the GC chair about the lack of transparency and inclusiveness in the proposed breakout sessions, and the issue remains a concern for the deliberations at MC14, said people familiar with the development. Amid the ongoing war in the Middle East, where flight arrangements in several countries in the region are expected to be significantly affected, it is unclear how many trade ministers and their officials will be able to attend MC14, said people who requested anonymity. MC14 PACKAGE The DG informed ministers that “to support your preparation, I am pleased to share – in advance of MC14 – a package reflecting the current state of play in Geneva.” With seven days left before MC14, trade envoys who requested anonymity said it seems a monumental task for trade ministers – currently occupied with oil and natural gas crises arising from the ongoing war in the Middle East – to parse through over 200 pages of documents. The DG states somewhat audaciously that “the political guidance you provide and the decisions you take in Yaounde will be critical in shaping the future direction of the organization and will reinforce the WTO’s effectiveness, credibility, and responsiveness in a rapidly evolving global environment,” and that “MC14 will therefore be a consequential moment for the multilateral trading system.” “Personally, I call it the turning point ministerial,” she proclaimed, urging ministers “to engage with ambition, flexibility, and a spirit of cooperation so that MC14 will deliver concrete results whilst renewing confidence in the trading system.” However, several trade envoys who requested anonymity noted that Ms. Okonjo-Iweala has not elaborated on what would constitute “concrete results,” leaving trade ministers guessing as to what surprises she and her allies in industrialized countries may likely impose in a “take-it-or-leave-it” gambit. Several trade envoys who requested anonymity said the fate of MC14 appears to depend squarely on whether ministers will preserve the multilateral, rules-based, and member-driven organization or allow the global trade body to be upended into a “them and us” framework. Several trade envoys who requested anonymity said that never in the past 13 ministerial conferences have developed countries, with the seemingly active connivance of the trade body’s director-general, created such allegedly opaque, non-inclusive, and misleading processes to accomplish their goals of dubious reforms. Under the goal of reforms, which appear to be inconsistent with the ministerial decisions of MC12 held in Geneva in June 2022 and MC13 held in Abu Dhabi in February-March 2024, there appears to be an “all-out, war-like” effort to significantly weaken the core WTO provisions such as consensus-based decision-making, the self-designated framework for special and differential treatment, and introducing asymmetrical subsidy provisions in the Agreement on Subsidies and Countervailing Measures that will leave developing countries at a major disadvantage, said trade envoys who requested anonymity. +
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