Civil society organisations disappointed at failure of WTO conference to deliver on development issues
Lamenting the collapse of the 11th WTO Ministerial Conference, civil society organisations expressed disappointment on the failure of member states to address fundamental problems in the global trading system, especially those affecting the developing countries.
A GLOBAL network of civil society organisations (CSOs) has expressed deep disappointment over the failure of the Eleventh WTO Ministerial Conference (MC11) to bring about outcomes amongst others on a permanent solution for public stockholding (PSH) programmes for food security, a workable Special Safeguard Mechanism (SSM), and on addressing WTO constraints to development.
In a final statement issued following the conclusion of MC11 on 13 December, the CSOs, grouped under the Our World Is Not for Sale (OWINFS) network, said that they were deeply disappointed that WTO members once again missed a crucial opportunity to address fundamental problems in the global trading system.
At the same time, however, they were relieved that the push by giant technology corporations for an agenda to expand WTO rules over the future digital economy failed to garner support from a majority of members.
The CSOs said that despite a mandate to find a permanent solution for PSH at MC11, members failed to remove WTO constraints on countries' ability to feed their hungry populations and improve farmers' livelihoods; on a workable SSM; and on disciplining subsidies that distort trade and damage farmers' livelihoods around the world.
Likewise, said the CSOs, members made no progress on the key issue of addressing WTO constraints to development, having completely ignored the G90 country grouping's development proposals.
'Fortunately, given that there was no Ministerial Declaration, previous affirmations of the development agenda still stand.'
It was unfortunate, the CSOs pointed out, that members were not able to agree to discipline fish subsidies, but given that some members opposed preserving development policy space in fisheries, it was better that members continue consultations in Geneva.
In their statement, the OWINFS network welcomed that the majority of WTO members saw clear that it is far too premature for the WTO to begin negotiations on the digital economy, and simply reaffirmed the existing working programme for discussions on e-commerce.
Likewise, the majority of countries agreed that countries' sovereign right to regulate in the public interest should not be further limited by the WTO, and that 'domestic regulation' disciplines are not necessary, and thus no new rules on 'domestic regulation' were agreed.
Likewise, most members realised that new negotiations on investment facilitation are unwarranted, and decided against a new mandate on this issue.
Other issues like micro, small and medium-sized enterprises (MSMEs) and 'gender and trade', the CSOs said, are 'Trojan Horses' for sneaking in new issues like e-commerce, and represent the wrong agenda of further benefits for corporations at the expense of jobs and development.
The CSOs noted that a declaration against the appropriation of gender to further liberalisation was signed by over 164 groups in 24 hours during the week of MC11. Likewise, myriad MSME associations raised objections to the e-commerce agenda and against the so-called 'MSME work programme' that is against their interests.
The OWINFS statement continued: 'Despite many of our representatives from civil society having been unjustly, and without due process, banned from participating [in MC11], those of us who were allowed in have raised our voices about the negative impacts of existing WTO policies on workers, farmers, the environment, development, and the public interest, calling for fundamental transformations to the existing trade system.'
'We believe in a democratic, transparent, and sustainable multilateral trading system, and do not want to see the WTO depart even further from that ideal, and will continue our call on governments not to expand the failed model of the WTO to new issues,' the CSOs underscored.
According to the CSOs, it seems that the United States came to Buenos Aires with an agenda of rejecting the consideration of development concerns in trade. The US attempted to bully its way into shaping an outcome in its interests, but the majority of developing countries - having faced the brunt of negative WTO policies for so many years - resisted this pressure.
'We are just as disappointed at the EU, since it failed to play a constructive role at the Ministerial. While claiming to build consensus, it stuck with a discredited approach of expansion of WTO trade rules, deregulation, increasing market access, while refusing to repair the existing WTO rules which are harmful to developing countries.'
The CSOs however recognised the leadership of the African Group, India, the ALBA group of Latin American countries, and other countries in defending that multilateral trade policy should foster, rather than constrain, development prospects.
'No matter the outcome, the WTO as an institution continues to exist and continues to have rules that are detrimental to developing countries, workers, farmers, the environment, and the public interest generally. These rules need to be fundamentally transformed as we have outlined in the Turnaround Agenda, endorsed by hundreds of civil society organisations from around the world, which is similar to the objectives of the developmental aspects of the Doha Development Round,' said the CSOs.
Meanwhile, the CSOs added, the WTO's dispute settlement mechanism will continue to enforce asymmetrical rules against developing countries and public interest regulations. Moreover, its effectiveness depends on the complaining country's ability to retaliate, making it useful for powerful countries but less so for developing countries.
With or without agreements at MC11, the CSOs said, the new paradigm of plurilaterals and the continuation of bilaterals are used by neoliberal trade negotiators in different countries to impose their agenda of further expanding trade and investment rules. Such new trade rules further restrict the ability of countries to pursue public policy objectives such as the promotion of health, education and employment, as well as the protection of the environment and labour rights.
'We support the conclusion of the development aspects of the Doha Development Round, but we oppose the expansion of liberalisation trade rules - be they through bilaterals or plurilaterals or multilaterally in the WTO,' the CSOs underlined.
They applauded the majority of developing countries at MC11 which held firm against massive pressure, led by Japan, Australia and Singapore, to launch negotiations on e-commerce in the WTO.
A series of proposals on e-commerce tabled since mid-2016, initially by the US and then pursued by Japan and the EU, were designed for, and largely by, the Big Tech companies.
The CSOs noted that a Joint Statement on Electronic Commerce issued late morning of the final day of MC11 was supported by a minority of the 164 WTO members. The signatories plan to hold 'exploratory work towards future WTO negotiations' even though there is no mandate from the Ministerial Conference to take e-commerce any further than the 'discussions' that are currently authorised.
'We see this electronic commerce statement as a repeat of the tactics used in the Trade in Services Agreement (TiSA). A self-selected group of countries took it upon themselves to rewrite the trade in services rules of the WTO in ways that intrude deeply on nations' right to regulate and without any development dimension. TiSA had no WTO mandate and in theory was conducted outside the WTO, but the Secretariat was complicit by facilitating its meetings. The same must not happen with e-commerce.'
The joint statement seems carefully to avoid the word 'plurilateral', presumably to play to Trump sensitivities, but the United States is on the list of participants, the CSOs pointed out.
'It is not clear why electronically transmitted products should not contribute to the tax base while products that are traded through traditional mechanisms usually do. However, it is a positive outcome that the moratorium on TRIPS non-violation complaints, which is essential to ensure lifesaving medicines for millions of people, was approved, although it should have been approved on a permanent basis.'
On the subject of investment, the CSOs said that existing investment rules have given new rights to corporations to profit in countries while putting taxpayers on the hook for millions in payouts for upholding public interest regulations. Even if the proposals in the WTO focus on investment facilitation (IF), this is not a trade issue per se and the United Nations Conference on Trade and Development (UNCTAD) is already the primary multilateral agency working on investment. 'No new work programme on IF is a positive outcome of MC11,' the CSOs said.
With regard to the services sector, the CSOs noted that the Sustainable Development Goals (SDGs) agreed by all WTO members include a focus on expanding access to and quality of many public services, as well as other key services like financial services and telecommunications. The proposed rules on domestic regulation (of services) would severely undermine the regulatory sovereignty of countries.
Governments - not trade panels - should have the authority to decide community issues that are inherently subjective. Foreign companies should not have 'rights' to input on measures proposed by local or national authorities before they are decided domestically. WTO members have not yet agreed whether disciplines on these measures are 'necessary'. 'No disciplines on domestic regulation is a positive outcome for MC11,' the CSOs said.
Turning to the issue of fisheries subsidies, the CSOs said there is a clear mandate for a pro-development and pro-environment outcome on disciplining fishing subsidies. But existing industrial fishing nations are insisting on rules that would undermine the future developmental aspirations of developing countries and harm existing artisanal fisherfolks' livelihoods.
'The developmental and economic policy space of developing countries must be maintained whilst those nations that have contributed most to the problem of IUU [illegal, unreported and unregulated fishing] and overfishing must agree to eliminate harmful subsidies. Since policy space for development was not protected, it is better that members agreed to continue negotiations on fish.'
What should have been on the agenda
According to the CSO statement, there remains an urgent need to transform existing WTO rules which are constraining policy space for job creation and development, including achievement of the SDGs.
'The Doha Work Programme on development must be concluded as soon as possible, rather than permanently shelved in favour of a big business agenda of WTO expansion.'
Agriculture rules in the WTO must be transformed. A permanent solution for public stockholding that is workable for all developing countries, and a workable SSM should have been agreed as the top priority of MC11, said the CSOs.
Current inappropriate proposals on agricultural subsidies fail to take into account the huge dumping impact of domestic subsidies on exported products while calling on developing countries to cut subsidies.
The top priority for a genuine development agenda would be transforming the current rules on agriculture, said the CSOs. Rich countries, not the poor, are currently allowed to subsidise agriculture under WTO rules - even in ways that distort trade and harm other countries' domestic producers. It is unfortunate that members did not agree to reduce the subsidies of developed countries under 'domestic support' - including in the 'Green Box' category of subsidies when these actually have trade-distorting impacts.
Subsidies that the US and the EU provide to cotton producers enrich a few thousand there, but have unfairly decimated production of hundreds of thousands of cotton farmers in Africa. 'It is deeply disappointing that members did not decide to significantly reduce or eliminate developed countries' domestic supports for cotton at MC11.'
Given the existing subsidies, developing countries should also be able to protect domestic production when facing import surges. An outcome on SSM - unconditioned on further tariff cuts - would have greatly enhanced developing countries' ability to achieve food security and promote rural development and farmers' livelihoods, the CSOs said.
By contrast, most developing countries are only allowed minuscule subsidies. But the SDGs entreat countries to increase investment in sustainable agriculture. Also, there is growing acceptance of the 'right to food' as a human right. One of the international best practices for supporting farmers' livelihoods, ensuring food security and promoting rural development is public stockholding. But these programmes in dozens of developing countries often run afoul of WTO rules, even though the agriculture supported is not traded in global markets.
The CSOs noted that supports by China and India to farmers on a per capita basis remain minuscule - only a few hundred dollars per farmer, as compared with tens of thousands for the United States. Supports in African and many Middle Eastern countries and least developed countries (LDCs) should be increased even if they don't have existing programmes.
'Members had a commitment to deliver a positive resolution on the public stockholding issue that would have allowed all developing countries to implement food security programmes without onerous restrictions that are not demanded of developed countries' trade distorting subsidies, and it is deeply disappointing that they did not resolve this issue,' the CSOs said.
Along with transforming the global rules governing agricultural trade, developing countries have long advocated for other changes to the existing WTO rules to increase flexibility for them to enact policies that would promote their own development, noted the CSOs.
The G90 proposals for changes to existing WTO rules would remove some WTO constraints on national pro-development policies. These would allow developing countries to promote manufacturing capabilities, stimulate the transfer of technology, promote access to affordable medicines, and safeguard regional integration.
'It is deeply disappointing that the G90 proposals, without being conditioned on further market access concessions, and the Para 44 mandate to continue post-MC11, were not agreed at MC11.'
The CSOs called on WTO members to return to Geneva to reaffirm multilateralism and fundamentally transform the existing trading system - along the lines of the Turnaround Agenda endorsed by CSOs around the world - so that it can be an engine for development and shared prosperity rather than a platform for expansion of a big business agenda.
Kanaga Raja is Editor of the South-North Development Monitor (SUNS), from which this article is reproduced (No. 8597, 15 December 2017).
*Third World Resurgence No. 324/325, August/September 2017, pp 21-25