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TWN
Info Service on WTO and Trade Issues (Apr26/02) Yaounde, 1 Apr (D. Ravi Kanth) — The United States blamed Brazil and Turkiye for the “impasse” on extending the moratorium on customs duties on electronic transmissions at the World Trade Organization’s 14th Ministerial Conference (MC14), according to a press release issued by the United States Trade Representative (USTR) on 30 March. However, many countries held the US as being responsible for the failure of MC14 with its “maximalist” agenda in insisting on a permanent e-commerce moratorium, later for a double-digit duration, and finally for four years while killing all the other issues, including agriculture and even WTO reform, said participants on background basis. While expressing his gratitude to Cameroon for hosting MC14, the USTR, Ambassador Jamieson Greer, said he is “disappointed at the lack of seriousness of many members.” The USTR claimed that the US “engaged for months ahead of MC14 to encourage WTO Members to embrace a broadly acceptable reform agenda.” He expressed his scepticism about “the value of the WTO, and this week’s conference confirmed that this organization will play only a limited role in future global trade policy efforts.” However, Ambassador Greer did not elaborate on what would constitute the “limited role” of the WTO in future global trade policy efforts. The USTR said he traveled a long distance, like other trade ministers, to participate in MC14 given its potential significance, but was “disappointed that so few of my counterparts attended, despite their repeated assertions that the WTO is “at the core” of the global trading system.” Ambassador Greer was particularly frustrated that “the WTO could not achieve consensus to make the E- Commerce Moratorium permanent or even to extend it for longer than two years.” “Unfortunately, and despite revised US offers regarding the duration and format for an extension of the moratorium, two members would rather let it lapse after 28 years than do the right thing for innovation and the digital economy,” he said. According to the USTR, Washington “has secured commitments from dozens of countries – and nearly all of our major trading partners – not to impose tariffs on US digital transmissions.” PLURILATERAL THREAT He said somewhat rhetorically, “If the WTO cannot achieve this commonsense aim, the United States will work outside of the WTO with all interested partners to get it done”, perhaps on a plurilateral basis. “To that end, the United States invites all trading partners to commit to a plurilateral, e-commerce moratorium agreement,” said Ambassador Greer, knowing full well that 66 countries had concluded a joint digital trade agreement at the meeting from which Washington had earlier pulled out. However, several countries told SUNS that they reckon the USTR’s plurilateral initiative is a threat that will not be taken seriously. “There are some agreements like the Trade Facilitation Agreement, the Fish 1 agreement to prohibit subsidies linked to the fishing of overfished stocks (unless measures are in place to rebuild them), illegal, unreported, and unregulated (IUU) fishing and unregulated high seas fishing, and e-commerce moratorium” that were conducted on a multilateral basis, they noted. To recall, the US had to agree to the interim “peace clause” on public stockholding (PSH) programs for food security at the WTO’s 9th ministerial conference in Bali, Indonesia in December 2013, primarily to secure the Trade Facilitation Agreement. Even at the Yaounde meeting, the US insisted on a permanent e-commerce moratorium that was scaled down first to a duration in double digits and then to four years, with the unprecedented bullying of several groups of countries to agree to the four year duration, said an African participant who asked not to be quoted. India also agreed to a four-year moratorium due to pressure from Washington, while New Delhi’s long-pending mandated issue of a permanent solution for PSH was killed by the US in Yaounde, said participants who asked not to be quoted. Brazil and Turkiye said that they cannot agree to the duration of the e-commerce moratorium beyond two years as has been the practice since 1998. Turkiye, on the first day of MC14, even joined the Investment Facilitation for Development Agreement (IFDA), notwithstanding its earlier reservations. But on the e-commerce moratorium, it held its ground on a two-year duration, as anything more has to be balanced with outcomes on agriculture and other areas, said participants who asked not to be quoted. “While we are gratified at the constructive engagement shown by many Members at MC14 – particularly our most important trading partners – we are disappointed that certain members rejected the proposed e-commerce moratorium decision. When we return to Geneva, we will build on what we have achieved in recent months, while recognizing the very real limitations of what can be accomplished at the WTO,” said Deputy US Trade Representative and Ambassador to the WTO Joseph Barloon. “The United States has been leading the charge on reform and other crucial issues at the WTO, and we will continue to do so,” Barloon added. Ironically, the US, Paraguay, India, Bangladesh, and Pakistan almost blocked the WTO reform package and later showed willingness to join the agreement after the Norwegian minister-facilitator substantially altered the draft text after incorporating the changes proposed by the five countries, said participants who asked not to be quoted. Several small countries from Africa and South America said that they recognised the value of the e-commerce moratorium for the US, while admitting that they didn’t have the weight to block at the end, but played hard to extract something of value, said an African participant who asked not to be quoted. “What happened is a story of backfiring, according to the perspective of some small countries, in which Washington decided to up the ante and got busted.” According to the perspective of the small countries, the e-commerce moratorium could have been extended again for two years without much noise. But the US decided to “play hard-ball” by asking for a permanent moratorium while blocking the issues of agriculture and the moratorium on TRIPS non-violation and situation complaints along with Switzerland, according to the small group of countries. At the end, the US overplayed its heavy hand, which is meaningful to assess how its power is calibrated and will be evaluated from now on, said a South American participant who asked not to be quoted. +
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