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THIRD WORLD ECONOMICS

DG proposes “minister facilitators”, chairs report on state of play

by Kanaga Raja

GENEVA (29 NOV): The WTO Director-General Roberto Azevedo on 28 November proposed the appointment of some five “minister facilitators” covering agriculture, development, rules, e-commerce, issues under services and “maybe some other areas”. The “minister facilitators”, he said, will be working with the negotiating chairs at MC11 in Buenos Aires.

This proposal came at the final meeting of the Trade Negotiations Committee just before MC11 gets underway.

[The manner in which so many unresolved issues are being pushed onto MC11 is reminiscent of what happened at the 1999 Seattle Ministerial Conference and its disastrous collapse. Meanwhile Azevedo’s proposal for “minister facilitators” is reminiscent of what took place at the 2001 Doha Ministerial Conference, whose outcome on mandates has been such that negotiations on the Doha Work Programme remain stuck – and Azevedo appears to be manoeuvring to jettison them. On Doha, see Chakravarthi Raghavan (2014), The Third World in the Third Millennium CE, Vol. 2, pp. 224-247. – SUNS]

The 28 November meeting also heard the chairs of the various negotiating bodies under the Doha Work Programme reporting on the state of play so far on the key issues in the negotiations (see below).

The assessment by the DG and the chairs was followed by interventions by the members, with an overwhelming majority of developing and least-developed countries rejecting new issues including establishing a working group on e-commerce, disciplines for MSMEs, and investment facilitation. They warned that there will be grave consequences if these new issues are taken up without completing the work on the unresolved issues in the Doha Development Agenda.

Significant activity

In his statement, DG Azevedo, who is also the chair of the TNC, noted that the last time members met to review progress on preparations for MC11 was just over a month ago, on 24 October. Since then, he claimed, there has been significant activity in a number of areas. The chairs have continued their consultations, members have continued contacts amongst themselves, and he has continued to hold consultations with members, both in Geneva and in capitals.

“Overall, I think that there has been a lot of progress over weeks. We have seen excellent engagement. Many proposals were brought forward, many meetings held, and much hard work has been done. However, members’ positions continue to diverge significantly on the substantive issues. Despite our best efforts, I don’t think there will be agreed negotiated outcomes in Geneva,” said the DG.

“So where does that leave us in terms of our work in Buenos Aires? While there remains a lack of clarity on what may be possible, I am hearing that there are numerous issues that members want to talk about in Argentina. I have been calling for prioritization for some months. I appreciate members’ efforts here, but limited progress has been made on this front. We still have a lot of issues in play for the Ministerial – many issues to deal with, in a very concentrated time period. And, of course, they are all important issues that merit ministers’ attention and consideration at the political level. We must consider how we manage this, and make provision for ministers to deal with these issues.”

“For the sake of the orderly management of the meeting,” Azevedo suggested, “we are considering options for appointing a few ‘minister facilitators’ who will work with the negotiating chairs in Buenos Aires. This will be ultimately a decision by the Chair of the Ministerial Conference.”

“Based on the current situation, I think it would be reasonable to expect facilitators for: agriculture, development, rules, e-commerce, and I think we would probably have a fifth facilitator covering issues under services, and maybe some other areas (although I can’t be very specific until all the work is finalized in Geneva).”

All this may need adjustments, depending on how things evolve, said the DG. “Nonetheless, I believe that five facilitators are about as much as we can handle – in part because of practical considerations, such as meeting space in Buenos Aires. Of course there may be other elements that I will pick up as appropriate together with the Chair of the Ministerial Conference and the Chair of the General Council.”

“Let me say as well that I know some members have also been developing work in limited group formats. This includes the work on MSMEs, investment facilitation, and any other issue that is being discussed in a track different from the negotiating groups. It is for the proponents in these areas to advance this work as they see fit. If they want to appoint their own chairs or facilitators at the Ministerial, that is for them to take forward.”

In considering the process for the meeting, clearly openness, transparency and inclusiveness will be important. In addition, it should always be a bottom-up process. Many members have emphasized this during the preparatory work, said Azevedo.

As to how he sees the process at this point in time, the DG said: “First, the facilitators (as well as the chairs and the Secretariat) will be there simply to facilitate your work – not to drive it. Their role will be to convene meetings and facilitate conversations – but not more than that. The driving force on substance has to come from the members. Facilitators can only consult and facilitate – they can’t do the job for you.

“Second, facilitators will aim to hold open meetings. All members who want to participate will have a chance to do so. Moreover, I will encourage facilitators to coordinate with each other in scheduling their meetings, so that we avoid overlaps, as far as possible.

“Third, we will also look to hold informal HoDs [heads of delegation] meetings in Buenos Aires at the end of each afternoon or early evening – starting on Monday the 11th. These meetings will be a chance for facilitators to report back to everyone on their work. And they will be an opportunity for every minister to participate on every issue and assess progress achieved in the different areas. Even if you haven’t attended a meeting on a particular issue, you will have a chance to make your views heard at the HoDs.

“Finally, I will be holding consultations in Buenos Aires, to help the process where I can. But let me stress that while I will hold consultations where needed, I will not convene closed-door negotiating meetings.”

He said he will continue to consult with the General Council Chair, the negotiating group chairs and the MC11 Chair before finalizing preparations here in Geneva.

“Given the number of issues likely to be discussed, I think we have to be prepared for a quite fluid process in Buenos Aires. Arrangements in Ministerial Conferences are always difficult. But, as I have explained, we will do everything we can to ensure that the meeting is open, transparent, inclusive – and orderly.

“It is right that we should take a bottom-up approach – true to the member-driven nature of the organization. But it is worth noting that with this approach, the responsibility to advance our work falls squarely on the shoulders of members.

“Success will require you to show flexibility and creativity. It will also require you to show restraint. If the HoDs meetings are to function as the forum for decisions, we will need to take a business-like approach. And this is very important. There will not be an opportunity for long, prepared statements. Your minister is not required to speak. We will hear the reports of the facilitators and anything that members have to say, and then take decisions in a very straightforward and executive fashion.”

Azevedo maintained that MC11 is “an opportunity to: take stock of the significant progress that we have made; deliver wherever we can; and set the direction for our future work”.

“Precisely how far each issue proceeds will depend on the dynamics of each negotiation. Whether you manage to agree outcomes, a work programme or neither will depend on the work in each area – and of course on the decision of the HoDs,” said the DG.

“So let’s see what we can do. The WTO has been on a very positive path over the last two ministerial conferences – let’s continue that journey in Buenos Aires and beyond. I ask for your continued commitment, engagement and flexibility in this final stretch,” he concluded.

Progress reports

The 28 November TNC meeting also heard progress reports from the various negotiating group chairs.

According to trade officials, the chair of the agriculture negotiations, Ambassador Stephen Karau of Kenya, reported that the bases for agreements that he sees are in the areas of public stockholding (PSH) for food security purposes and export restrictions and prohibitions.

He said that a decision could be envisaged on cotton at MC11. On domestic support, he said that unless there are significant changes in negotiating positions in the next few days, it will be very difficult for members (to gain anything). They could get a limited outcome comprising a decision and a work programme to guide the negotiations if positions change.

On the Special Safeguard Mechanism (SSM), the chair said that proponents are continuing with the views they had up until now, and it is very hard to see how this can be taken forward.

He said that he will be holding an open-ended meeting on 4 December to look at all the issues together with the dedicated session on PSH and SSM.

The chair of the rules negotiations, Ambassador Wayne McCook of Jamaica, spoke on the three pillars of the negotiations, namely fisheries subsidies, trade remedies and horizontal subsidies.

On fisheries subsidies, he said that there have been seven original proposals. The group is looking at issues such as preamble, scope, definition, prohibitions, standstill, special and differential treatment, the issues of illegal, unreported and unregulated (IUU) fishing and overfished stocks. They will be looking as well at overcapacity and transparency.

On trade remedies, McCook said that there have been discussions based on proposals from one member on anti-dumping and countervailing measures. This is in relation to transparency, and ways in which MSMEs could gain flexibility under anti-dumping and counter-vailing regimes.

On horizontal subsidies, the chair said that there has been nothing to report since the last meeting.

The chair of the services negotiations, Ambassador Hector Marcelo Cima of Argentina, spoke on the four areas of discussion. There is the Indian proposal on trade facilitation in services, services market access, services elements of e-commerce, and domestic regulation.

Nothing has changed in the first three areas. On domestic regulation, a revised text has been put forward by the proponents which they say has taken on board the concerns of many developing countries over the right to regulate and policy space. The opponents were not happy with some of the elements of the proposal, including on language pertaining to the right to regulate, which they did not think went far enough. They also did not think that the language on development went far enough.

[In his written report to the TNC dated 27 November, the chair noted that on 27 July, India circulated a revised proposal on services trade facilitation, which has not yet been discussed by members. On services elements of e-commerce, the chair noted that the EU had circulated, on 23 May, a proposal suggesting text for rules aiming to facilitate online service transactions.

[According to the chair, in view of the limited time available before the Ministerial, proponents in these two areas did not seek further meetings of the Special Session to discuss their submissions after the summer break. No outcome in the form of an agreed text can be expected in Buenos Aires in these areas, and the proponents agree with this assessment. In terms of post-MC11 work on these two topics, India and the EU have communicated their intention to re-engage on services trade facilitation and online transactions respectively after the Ministerial, he said.

[The chair said that discussions in the Working Party on Domestic Regulation (WPDR) in recent months have centred on a text proposing disciplines on domestic regulation, put forward by a group of proponents. This proposal contains seven sections: general provisions; administration of measures; independence; transparency; technical standards; development of measures; and development.

[Discussions last took place at the WPDR on 7-8 November, and divergences remain across the membership. For one, co-sponsors of the text consider that rules on licensing and qualification requirements and procedures, and technical standards would yield greater transparency and predictability, and provide important value added to existing market access commitments. They consider that their proposal is flexible, as it would allow implementation by members at different levels of development and regulatory capacity, as well as by means of diverse regulatory approaches. They also point out that LDCs would not be required to apply the disciplines.

[Second, some members expressed reservations of varying degrees of concern about different aspects of the proposals. Some conveyed general support, while pointing to a limited number of drafting and technical issues that they wished to see addressed. Others had more significant reservations about certain aspects of the text proposal, for example, in relation to the language on the right to regulate, the development provisions, the absence of specific provisions on qualification requirements and procedures, the proposed disciplines on gender equality and necessity, or the application of the proposed disciplines to varied levels of sector-specific commitments across the membership.

[Third, some members expressed concerns of a more fundamental nature, pointing to conceptual differences. They questioned the need for the proposed disciplines and the benefits that these might bring to developing countries and LDCs. This group of members maintained that the proposed text would be incompatible with their development aspirations and limit policy space. In terms of the way forward in these negotiations, some members were of the view that work on the basis of the proponents’ proposal could not lead to an outcome. Others considered the time remaining to be too short to achieve an outcome at MC11 and suggested continuing discussions after the Ministerial. Proponents said that they wanted to continue work with a view to achieving an outcome at MC11, and considered it important to raise discussions at a higher political level, said the chair.]

S&D proposals

The chair of the Committee on Trade and Development in Special Session, Ambassador Tan Yee Woan of Singapore, in relation to the 10 agreement-specific proposals on special and differential treatment (S&D) for developing countries, said that the differences are deep and wide.

She said that members are no closer to convergence. The proponents maintain that these are key to fostering industrialization and promoting diversification. Others say that these proposals send the wrong signals about what multilateral rules bring to development and that any deviation from these rules should only be taken in exceptional circumstances.

She said that the proponents believe that these issues should go to ministers (at MC11) because they are highly political and they are concerned about special and differential treatment. Some members said that having a discussion on trade and development more broadly would be fine.

According to the chair, other members say that convergence is not possible at MC11 or even afterwards, and that these proposals are past their expiry date, and that no member should be forced to continue to discuss this issue. Yet others have said that this is absolutely central.

[In her written report to the TNC dated 27 November, in reference to the G90 grouping’s textual proposals on the 10 S&D provisions, the chair said regardless of the level of engagement, her assessment of where members stand was that the fundamental differences in position remain deep and wide, and members were no closer to bridging these differences. The proponents continued to maintain that the requested flexibilities were needed for fostering industrialization, promoting diversification and facilitating structural transformation in their economies. On the other hand, some members contended that agreeing to these flexibilities would give a wrong signal that multilateral trade rules did not foster development. Any solutions to the issues raised in the proposals must be realistic, based on facts, and deviations from rules should only be considered in exceptional circumstances and for only those who really need them. The differences with respect to “differentiation” also remained.

[According to the chair, with no clarity on the way forward and with the objective of facilitating an honest assessment on where the work stood and to solicit members’ views on the way forward, she had posed the following questions to members: (i) What should we do to make progress in the remaining time available? (ii) What do we see ourselves and our ministers doing on this dossier in Buenos Aires? (iii) How can we better prepare ourselves for Buenos Aires?

[In response to her questions, the proponents indicated that they wanted work in the Special Session to be carried on towards a potential outcome on S&D at MC11. They also wanted ministers to actively engage on these proposals in Buenos Aires. They strongly believed that ministerial engagement would allow for a constructive ministerial discussion on how developing members, in particular LDCs, could be better integrated into the multilateral trading system. Some non-proponents shared the proponents’ views to continue efforts to find a landing zone for MC11.

[On the other side of the fence were some members who felt that the discussion on the proposals had reached its limit and any further work on the same proposals or subsequent revisions to them would, at best, be a repetition of what had already been flagged. Given the paucity of time and the charged dynamics in the run-up to MC11, it would only deteriorate the quality of discussion and lead nowhere. They viewed that transmitting “unripe” proposals to Buenos Aires for ministerial engagement was not the right course of action. Some members were of the view that convergence on these proposals would not be possible either at MC11 or even thereafter. Some members were prepared to continue discussion even though they did not believe convergence would be possible on the basis of the current approach and proposals, said the chair.

[At the Special Session meeting held on 20 November, while wrapping up the discussion, the chair said she indicated to members that she would hold informal consultations to achieve clarity on the way forward. These consultations were held on 22 November. The G90 reiterated the importance of ministers engaging in a discussion at Buenos Aires on S&D issues, which the Special Session had been discussing for a long time at the technical level with little results to date. They expressed a strong view that any discussion by ministers should be based on the 10 proposals that members had been discussing since September. They also stressed that the G90 proposals must be accorded the same treatment as that which would be accorded to other proposals/issues on the table across the house.

[An equally strong view held by some other members was that if at all ministerial engagement was necessary, it might be more constructive for ministers to discuss broader political trade and development issues instead of the 10 proposals. Some were against the Special Session convening in Buenos Aires. One member, in particular, was also categorically against the Special Session transmitting the proposals to MC11 for ministers’ consideration. It was however also acknowledged that it was the prerogative of any member to table any matter for consideration at the Ministerial Conference.

[The chair said although her consultations on 22 November proved useful in generating a deeper discussion of the three process-related questions that she had posed, there were no clear answers to any of them. There was broad agreement that what members were trying to grapple with were important issues. Members continued to stick to previous positions reflecting wide differences in perceptions on how these issues could best be tackled and appropriate solutions could be found. “However, I did not hear any member objecting to a discussion by ministers at Buenos Aires on development issues,” said the chair.

[After the chair said she had presented her report at the Special Session on 23 November, the G90 said that they intended to submit the 10 proposals to ministers for their action at MC11. Several members of the G90 intervened and highlighted their concerns and perceived imbalances in the multilateral trade rules and hence the need for revised S&D, particularly for the weaker members. In recounting how in the last 16 years they had come down from 88 original S&D proposals to 25 in 2015 and then only to 10 in 2017, they said they were disappointed at the lack of interest by some members to address the concerns and challenges that developing countries and the LDCs faced in their efforts to better integrate into the multilateral trading system. The G90 members also said that there was a disconnect between what the ministers had mandated in paragraphs 5, 31 and 32 of the Nairobi Declaration and what members were doing in the Special Session. The proposals should be sent to ministers at Buenos Aires because the technical debate in Geneva had not yielded any outcome. Ministerial engagement was necessary for a political decision on this dossier. They emphasized that the S&D proposals should receive equal treatment (parity) with other proposals in other areas being considered in the house. Several non-G90 members also spoke in support of the proposals and for their onward transmission to ministers at Buenos Aires, said the chair.]

Little activity

The chair of the NAMA (non-agricultural market access) negotiations, Ambassador Didier Chambovey of Switzerland, said that there has been very little activity for the last two years. There has only been one proposal, namely from the EU, Hong Kong (China) and Chinese Taipei amongst others, relating to greater transparency when governments put in place standards under the ambit of the Agreements on Technical Barriers to Trade and on the Application of Sanitary and Phytosanitary Measures.

The chair of the TRIPS Council in Special Session, Ambassador Dacio Castillo of Honduras, referred to the three areas under discussion, namely the register of geographical indications of origin for wines and spirits, extension of the register beyond wines and spirits, and the relationship between the TRIPS Agreement and the Convention on Biological Diversity. The chair said members want these issues to be kept on the table after MC11.

The chair of the Special Session of the Committee on Trade and Environment, Ambassador Syed Tauqir Shah of Pakistan, said members want the issues here to be raised in any declaration.

The chair of the Dispute Settlement Body in Special Session, Ambassador Coly Seck of Senegal, said that members are not in a position to come out with any outcomes at MC11. (SUNS8586)   

Third World Economics, Issue No. 651/652, 16 October – 15 November 2017, pp4-7


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