Doha deadlines may slip, Third World may be cheated again

Geneva, 7 Nov (Chakravarthi Raghavan) -- With just about five weeks (and 32 working days)left, unless the major trading partners - the US, EC, Japan and Canada - have a sudden change of heart and mind, the developing nations may find themselves again ‘cheated’ of any benefits from the trading system, and see another postponement of the deadlines set by Ministers at the WTO’s Doha Ministerial meeting, in particular the issues of implementation, Special and Differential Treatment, and implementing TRIPS and Public Health.

An informal meeting of capital-based senior officials and local ambassadors of a group of 25 WTO members, convened by the European Commission, and perhaps intended as a preview for the ‘mini-ministerial’ of 25 countries, but not all the same as at the senior officials meeting, convened by Australia for next week, showed that the Doha agenda and work programme are perhaps ‘gasping’ for life - though trade diplomats and negotiators, and WTO officials, are loath to admit or face up to it.

While the US and EC, and their two associates (Japan and Canada) in the socalled ‘Quad’, have perhaps realised that without substantial progress and agreements on these issues by year end, there will be no progress on other issues and areas - market access for non-agricultural products, services, and other areas of interest to the developed world - the path to solutions are not very clear, according to one participant at the EC convened meeting (5-6 November) held in neighbouring France.

The Director-General of the Trade division of the EU Commission, Mr. Peter Carl, at a press briefing 6 November on the meeting, sought to put a spin by using such terms as ‘constructive’ dialogue and the Community’s desire and determination to find solutions.

The term ‘constructive’ is a coded diplomatese - and means perhaps exchange of views and understanding of positions, but with no agreement or even convergence of views. The public in developing world are now fully aware of these coded languages, and their empty content.

Carl also spoke of giving operational content to the Declaration, and presented the differences in terms of the ‘conceptual’ and ‘pragmatist’ approaches of countries and groups. It however suggested to observers an effort by the EC and other majors to re-write and interpret the mandate given by the Doha Ministerial meeting.

As of now, the more than three years of efforts by the developing countries, and their putting forward detailed proposals (under the rubrics of ‘implementation’ and ‘special and differential treatment’), for redressing the wrongs of the past and curing the inequities and imbalances in the WTO trading system, arising out f the Uruguay Round agreements, have not led to any progress even in terms of serious bargaining and dialogue - leave aside any solutions.

Any efforts of negotiators, and the trade establishments of developing countries, to persuade their own domestic constituencies about the ‘constructive dialogue’ or ‘serious engagement’ in efforts with trading partners to find solutions, even as more demands under the new round are being thrust on them, will not be easy.

There was no discussion or mention of the Singapore issues (investment, competition, trade facilitation or government procurement) at the meeting, but his does not mean they have faded away.

Some Third World participants underscored that neither the senior officials meeting nor the Sydney Ministerial could lead to any decisions on behalf of the WTO membership, but that they could at best contribute to a better understanding of the positions and gaps.

A joker in the pack is the outcome of the mid-term Congressional elections in the US, and the Bush ‘victory’ in seizing Republican control of the Congress.  The EC-convened senior officials meeting ended before the clear picture emerged.  Whatever its results in terms of the ‘war on Iraq’, the results for the trade talks are not so simple.

Despite the rhetoric of George W.Bush, and his trade representative Robert Zoellick, on ‘free trade’, the Republican controlled Congress is as neo-mercantalist and protectionist as a divided Congress before - with Democrats ‘running’ the enate agenda over the past year, and the Republicans the House.

But the stock-market reactions, and the boost to stock prices of the pharmaceutical companies, suggest that those developing countries looking for ‘soft’ solutions, or negotiators hoping to add a line or two to their curriculum vitae by compromises, will be disappointed.

The elections may enable the EC to blame the US, but would not alter anything at Geneva.

Nevertheless, it seemed apparent that the majors, in the pursuit of their own neo-mercantalist agendas in the new round, while having major differences among themselves (as on agriculture) are attempting to play off one group of developing countries, and individual countries among them, against others, and speaking about the variegated situations of countries and need to ‘differentiate’.

While the majors are trying to use what was conceded by the developing countries at Doha as a starting point to extract more concessions and rewrite the mandate - all in the name of integration of developing countries into the WTO multilateral trading system - as in the past the developing countries seem unable to play the same game, to voice and move the issues in the other direction favourable to themselves.

On the three major areas of priority and concern for developing countries - ‘Implementation’, TRIPS and Public Health (implementing para 6 of the Doha eclaration, for ‘expeditious’ solutions to enable countries with insufficient or no manufacturing capacity, and thus can’t make use of the compulsory licensing provisions of TRIPS, to have access to the essential drugs) where Ministers have given specific 31 December deadline, and the S&D issues (making operational and effective the rovisions in the current WTO agreements) where the Doha deadline of 31 July has been extended till year-end—there has so far been a clear lack of engagement by the major industrialized countries in efforts to find solutions.

While Carl, at the senior officials meeting, is reported to have spoken about ‘constructive’ dialogue and a better understanding of positions, and what he would report to the EC Trade Commissioner Pascal Lamy - other participants said hat this was his business - there was no inclination or desire on the part of others to comment on these views, since it was never intended to be a meeting for conclusions.

However, a capital-based Uruguayan official, perhaps summed it best, when he reportedly told Carl that these views and conclusions could have been drawn up (by Carl)without the meeting too.

From the perspective of developing countries, some of the solutions floated - whether on TRIPS and Public Health, or the S&D issues - were not acceptable, and this view was put forward clearly.

On TRIPS, the EC said the Doha declaration, and the solutions under Para 6, should be available to all developing countries, excepting for the ‘high income’ developing countries (according to the World Bank categorisation).

However, the developing country participants made clear that the Doha declaration, and para 6 of the Trips and Public Health declaration and mandate, made no such distinctions, and the only ‘classification’ was one of ‘insufficient or no manufacturing capacity’.

The EC, both at the meeting and Carl at the press briefing, declined to go into ‘technicalities’ of the legal framework in which the Ministerial declaration could be implemented - an agreed interpretation by the General Council of the relevant articles and the rights and obligations of countries under TRIPS and the ‘flexibility’ available (as agreed by the Ministers) or the route of ‘waivers’ and ‘moratoriums’ which imply acceptance of an obligation.

This is one of the crucial elements to ensure that the promises of Doha, in the area of TRIPS and Public Health, will be fulfilled, and countries, and the poor and sick in them, in need of essential medicines can get the medicines they need.

It was made clear by the developing country participants that their position, and one supported by the World Health Organization, was that countries should be able to make use of the ‘limited exception’ to patent rights, provided by TRIPS (Article 30) to enable developing countries to give immediate authorization to enterprises, within their territory that have the capacity to produce, to export these products to other nations having public health problems.

Third world diplomats said that though within the group of developing countries, there were some nuances in positions of some countries, particularly in Africa, in finding quick solutions, the overall approach is clear and remains firm, at least so far.

Compromise proposals being floated or talked about - by the EC, the US and the Mexican chair of the TRIPS council in informal papers - ‘did not fly’ s one participant put it.

On the S&D issue, and the talks in the Special Sessions of the Committee on Trade and Development (where all the industrialized countries are together), he talk about the end objective of ‘integrating developing countries into the rading system’, and S&D to suit the particularities of individual agreements and countries, is a replay of the same old (broken) record since the Tokyo Round.

In other areas, the EC (or for that matter the other OECD countries), did not indicate that they are anywhere near putting on the table some figures on the socalled three pillars of the further reform process in agriculture - in respect of market access, domestic subsidies or export competition.

The EC put a spin on the recent decision of the EU Summit and Council, setting a budget ceiling on the Common Agricultural Policy, as of end-2006/beginning 2007, with only one percent for inflation (as against a projected annual two percent).  The EC also suggested that this CAP budget is now to be shared amongst a larger farming community - the present ‘farmers’ in the EU, and the new ones coming in y the accession of new states (from east and central Europe).

While this is an issue of redistribution within the EC, as far as the outside world is concerned, the market is ‘more closed’ with the EU+new members. And whatever the level of support that the new members get visavis the old, and the internal ompetitions, for the outsiders the European market is even more protected. And with the ability to vary the levels of support among the products, depending on the external market conditions, the domestic supports and export subsidies distorting the world markets and disadvantaging the developing world is even greater.

Apart from the EC, which sought to project its position as different from that of others increasing their subsidies (a reference to the US, Canada and Japan), the others too showed no inclination nor give any promise that by 31 March next, when modalities have to be agreed, there will be any figures put on the table, on the basis of which bargains can take place.

The issue is being avoided by the OECD members, by talk of need to look at the rules, and the issues of non-trade concerns, and environment etc, before actual bargaining.

On the services, the US, EC and other ‘demandeurs’ spoke of the low level of ‘requests’ only 20 to 25 requests (from countries or regional groupings have been put forward), and the need for more requests to take the talks forward to bargaining.

However, most developing countries have no capacity to export services and are mere passive spectators, unwilling or unable to ‘contribute’ or engage in bargaining.

And as trade experts and observers from outside note, the secrecy within which the ‘requests’ and possible at the next stage the ‘offers’ will be made, and the complete lack of any data(even remotely comparable to the IMF ones about’ directions of trade in goods’) - leave the governments and the public in any country, developing or developed, clueless about the effects.

And unlike trade in goods, the commitments in services across a wide range of sectors and sub-sectors, will be felt inside countries and add to the existing backlash against the WTO.

To the outcries about public services - health, education etc - would be added the new ones, the socalled environnmental or energy services. And the reassuring statements, after every round of GATS talks here, from the WTO officials, about liberalization benefiting developing countries by access to services and making their economies more efficient, only makes the WTO a more easy target.

Perhaps the new round of negotiations on services may well prove to be the proverbial last straw on the camel’s back. – SUNS5230

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