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THIRD WORLD ECONOMICS

Developed countries want “payment” anew for unresolved Doha agri issues

In return for dealing with outstanding agriculture-related issues in the WTO, developed countries want the trade body to take up new items on its agenda.

by D. Ravi Kanth

GENEVA: Major developed and some developing countries appear to be pushing for “payment” for addressing the unresolved Doha agriculture issues in the run-up to the World Trade Organization’s eleventh Ministerial Conference in Buenos Aires later this year, sources told the South-North Development Monitor (SUNS) on 21 January.

As a price for addressing these unresolved issues, the major developed countries, the developing countries and the least developed countries are to agree to negotiate new issues: disciplines for micro, small and medium enterprises (MSMEs) and electronic commerce.

(Developing countries have already “paid” a price at least twice over for bringing agricultural trade under trade discipline and seeking to end heavy subsidization and protection in developed-country agriculture. They paid a price when concluding the Uruguay Round negotiations, by agreeing to assume obligations on services trade and intellectual property rights in return for commitments by the developed countries to undertake a long-term programme of reforms to end subsidies and distortions in their agricultural trade. The developing countries again paid a price for continuing with the agricultural trade reform programme at Doha in the Single Undertaking, and in agreeing to several concessions to the developed countries at the Bali and Nairobi Ministerial Conferences, including the Trade Facilitation Agreement. – SUNS)

An early indication of the gameplan being pursued by the major developed countries and their allies in the developing world came at the informal ministerial meeting held in Davos on 20 January on the margins of the annual World Economic Forum meeting.

Trade ministers from China, India, South Africa, Indonesia (which represents the G33 farm coalition), the Philippines, Morocco (which is the coordinator of the African Group), Benin (which coordinates the least developed countries) and Nigeria, among others, demanded that outcomes on the permanent solution for public stockholding (PSH) programmes for food security and the Special Safeguard Mechanism (SSM) be reached at the Buenos Aires Ministerial Conference, said participants familiar with the Davos meeting.

The developing- and least-developed-country trade ministers along with Argentina, Brazil, Australia, New Zealand and Canada made a strong case for addressing trade-distorting domestic support.

Without acknowledging the demands made by many developing countries on PSH and SSM, trade ministers of the European Union, Switzerland, Norway, Canada, Australia, New Zealand, Korea, Singapore and Hong Kong, among others, said they want to see an outcome on new issues – disciplines for MSMEs and outcomes on e-commerce – at Buenos Aires, participants said.

After the Davos meeting, one participant from a developed country told SUNS that for any movement on Doha issues in agriculture, particularly PSH and SSM, there has to be reciprocal commitment to addressing new issues, implying that they would need a payment to address issues in agriculture.

Dealing with anti-trade sentiment

The Davos ministerial meeting was convened to address two issues – the state of the global trading system and the threat posed by an enveloping anti-trade and protectionist sentiment, and what needs to be done in the run-up to the eleventh Ministerial Conference.

During the three-hour meeting, trade ministers and senior officials from over two dozen countries – Argentina, Australia, Benin, Brazil, Canada, China, Costa Rica, Egypt, the European Union, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, Mexico, Morocco, New Zealand, Nigeria, Norway, Pakistan, the Philippines, Russia, Singapore, South Africa, Switzerland, Thailand and Turkey – did not enter into any substantive discussions. They merely reiterated their priorities in the face of the worsening anti-trade and protectionist sentiment and vowed not to give up negotiations, said several participants familiar with the meeting.

The US was represented by charge d’affaires Christopher Wilson, who did not speak during the meeting.

The WTO’s Director-General Roberto Azevedo merely spoke about supporting the system and the conclusions arrived at in the last informal ministerial meeting in Oslo in October, said a participant from a developing country.

Without directly referring to the new administration in the US led by Donald Trump, trade ministers discussed the threat posed by anti-trade sentiment to the WTO dispute settlement system and the challenges posed to the Appellate Body if countries refuse to abide by its rulings, the participant said.

Many ministers emphasized “preserving” the multilateral trading system and what is being negotiated at the WTO.

“Ministers highlighted the key role of the rules-based multilateral trading system in ensuring a stable and predictable framework for world trade ... they stressed the importance of safeguarding the integrity and the benefits of this system and of further strengthening the WTO,” the chair of the meeting, Johann Schneider-Ammann, Head of the Swiss Federal Department of Economic Affairs, Education and Research, said in the concluding remarks.

“Ministers noted that protectionism was not the right answer to anti-trade sentiments and to concerns about technological change ... Instead, trade should be made more inclusive and its benefits spread more widely,” Schneider-Ammann said.

Trade ministers of many developing countries – China, India, Indonesia, the Philippines, South Africa, Nigeria, Morocco, Egypt and Benin, among others – stressed the importance of concluding the permanent solution for public stockholding programmes and SSM at the Buenos Aires meeting, said a developing-country minister who asked not to be quoted.

“Everybody agreed there has to be an outcome on permanent solution for public stockholding programmes for food security but it has to be along with other results in agriculture,” the minister said.

India emphasized the need for tackling the distortions caused by trade-distorting domestic support.

On new issues – disciplines for MSMEs and e-commerce – there was a broad divide among the participants.

Many ministers – from Hong Kong, Australia, Canada, the EU, Costa Rica, China, Japan, Korea, Malaysia, New Zealand, Nigeria, Pakistan, Switzerland and Norway, among others – called for an outcome on new issues, particularly e-commerce.

However, South Africa said new issues must await an outcome on agriculture, while India along with African countries except Nigeria said work on e-commerce must proceed in accordance with the existing mandate of 1998.

“On a scale of 1 to 10, the support for e-commerce at this juncture is 5, while [that for] agriculture-related issues is between 8 and 9, fish subsidies 9, services domestic regulation between 6 and 7, non-tariff barriers between 5 and 6, and trade facilitation in services between 4 and 5,” said one participant who asked not to be quoted. (SUNS8386)                p


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