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TWN
Info Service on WTO and Trade Issues (Jul26/10) Geneva, 16 Jul (D. Ravi Kanth) -- A fierce rift has seemingly fractured the World Trade Organization over the rules governing its reform discussions, with developing nations accusing the industrialised countries of "rigging" the process by recognizing only "written submissions" while discarding oral statements. According to people familiar with the development, a bloc of developing countries - including India, Turkiye, Brazil, and China - is demanding that oral statements from smaller nations carry equal weight to written proposals. The clash came to a head during the second day of the General Council (GC) meeting on 15 July. While the United States, the European Union, and other industrialized nations pushed to base the discussions solely on written questions responding to the GC chair's statement, developing countries warned that ignoring oral interventions would destroy any semblance of equity. At the center of the controversy is GC chair Ambassador Clare Kelly of New Zealand - a participant in all controversial Joint Statement Initiative (JSI) proposals. She justified the current WTO reform push, which critics have dubbed the "reform casino," driven by a small group of countries. According to the GC chair, "Reform is not an end in itself." "It is the means by which this organization can better respond to today's challenges and deliver meaningful outcomes for members and for the people and businesses who depend on the multilateral trading system. A reformed WTO that doesn't deliver substantive outcomes would fall short of expectations." However, several participants noted that she remained silent on the reality that these reforms are seemingly being foisted by a small group of industrialized countries, even as the majority of members stand opposed. According to participants who informed SUNS, Brazil articulated sharp concerns that the reform process must not rely solely, or even primarily, on written proposals. According to people present at the meeting, the SUNS was informed that Brazil argued that members must remain free to present their views orally, in consultations, or in writing. Furthermore, according to the same people, Brazil apparently cautioned that restricting effective participation to written papers would amplify existing asymmetries and create an artificial hierarchy based on drafting capacity. India escalated the challenge, taking direct aim at both the WTO reform process and the role of the facilitators. India argued that a facilitator's job is to facilitate discussions among countries, and not to host discussions by countries with the facilitator. China, a strong supporter of WTO reform, said "on process, we welcome the predictability of an indicative calendar and subsequent revisions made to take into account members' views." The Chinese trade envoy, Ambassador Li Yongjie, stressed "the need for a member-driven process that ensures inclusive participation, meaningful exchange, and adequate capital inputs." Ambassador Li emphasized that "discussions should be based on members' written proposals and oral interventions, instead of outside materials." Furthermore, "guiding questions from the facilitators, if necessary, should avoid prejudging future directions," China said - a point India also raised during the informal Heads of Delegation meeting last week. Conversely, the US and the EU have insisted that the WTO reform discussions be strictly confined to written submissions, explicitly excluding oral interventions. People familiar with the development noted that this stance imposes new burdens on developing and least- developed countries given their severe resource and capacity constraints. In line with this push, six proposals have been submitted so far: two by the EU, and one each by Japan, Switzerland, Australia, and Argentina. Privately, an Asian trade envoy who asked not to be quoted voiced the grave suspicions of several developing nations that the WTO Secretariat is lending a helpful hand to these dominant industrialized countries in drafting the proposals. GC DYNAMICS Last week, GC chair Ambassador Kelly of New Zealand - which is a member of the Friends of the System group - delivered a general report on the "kick-off" sessions held since 30 June. These sessions covered reform issues, including "level playing field," "decision-making," and "foundational issues." Her statement was followed by initial reports from three facilitators: Ambassador Mr. Elmer Jose German Gonzalo Schialer Salcedo (Peru) for level-playing field issues; Ambassador Mr. Katsuro Nagai (Japan) for decision-making; and Ambassador Ms. Sumathi Balakrishnan (Malaysia) for foundational issues. The facilitators walked through members' statements in their respective sessions and indicated that their reports, along with guiding questions, would be issued alongside the GC chair's report on 14 July. At the time of writing, they had not yet been circulated. During the interventions, developing country coalitions - including the ACP (African, Caribbean, and Pacific) group and the African Group - raised specific alarms regarding a lack of legitimacy, the need for true ownership, and crucial process-related flaws. Several developing nations, including the ACP coalition, highlighted the capacity constraints of small members and the chaos posed by the convening of parallel meetings, according to participants who asked not to be quoted. The highlight of the informal meeting - though some members dismissed it as being merely routine - exposed what several participants described as a clear strategy to narrow discussions exclusively to written submissions. The facilitators, they said, were reportedly advised to disregard oral positions, general conceptual considerations, and other verbal proposals. Several developing and least-developed countries viewed this as a dangerous new trend that strips them of power. It cloaks exclusion in the rhetoric of a "member-driven" process, leaving poorer nations unable to defend their views without the currency of written proposals, said an African trade envoy who asked not to be quoted. "REFORM CASINO" Privately, the African envoy coined a term for this emerging reality: a "reform casino." In this system, a country can only play if it has chips - otherwise, it is rendered redundant and relegated to the background. Meanwhile, geopolitical manoeuvring continued. The US seemingly added "development" to Article XXI exceptions, placing it on par with "essential security," while another member paired "development" with "environment," according to people familiar with the development. Some members of the Friends of the System group, such as Korea, pushed back on addressing "development" and "foundational issues," arguing that because no proposals exist on these topics, they should instead be linked to "decision-making" and "level-playing field" issues. +
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