NGOs criticise Cancun draft, preparatory process

Geneva, 26 Aug (Kanaga Raja) - Several NGOS have come out in criticism of the revised draft Cancun ministerial text that has been put out by the General Council Chairman Uruguayan Ambassador Carlos Perez del Castillo late on 24 August.

At a press briefing Tuesday, Oxfam, Third World Network, Public Services International (PSI) and Focus on the Global South said that the current draft Cancun text is a clear step in the wrong direction.

Aileen Kwa, trade policy analyst at Focus on the Global South, in her comments on the draft text, said that the draft text reflects the wide divergences between the developed and developing countries that will not be resolved by Cancun. However, she noted, these differences will be “papered over”, by Members agreeing to ‘frameworks’ rather than detailed modalities.

This has been the case in agriculture and non-agricultural market access (NAMA) where the ‘frameworks’ for establishing modalities are being proposed. While the formulas in the proposal are very ambitious, there are no numbers attached to any of the reduction formulas outlined, she added.

In agriculture, Kwa cited the example of how the Cancun text was vague on how the serious loopholes in the Green Box (non-trade distorting subsidies) can be disciplined. The text merely states that the Green Box criteria remain under negotiations.

The developing countries have repeatedly called for the Green Box supports to be capped and reduced. Currently, there are no limits set on the amounts that Members can provide to producers via the Green Box.

Kwa stressed that this issue was important in that the EU CAP reforms will essentially be about shifting supports from the Blue Box to the Green Box, and a large proportion of US subsidies have already been shifted to the Green Box.

As it stands, the agriculture framework will easily allow developed countries to continue their agricultural programmes without need for reform.

The supports and dumping by the EU and the US is mainly in staple products.  Dumping by the US, for example, is 40% for wheat; 25-30% for corn; 30% for soybeans; 57% for cotton and 20% for rice. In the EU dumping still continues for cereals such as barley, maize and wheat and in sugar and dairy products.

Thus, Kwa noted , if the agriculture framework is agreed upon then it will exacerbate the trend where staple food production in the developing countries will decrease and staple food imports will increase, thus affecting employment and food security.

Mike Wagthorne of Public Services International, a federation of trade unions with around 20 million members worldwide, recalled a memorandum put out by NGOs setting out their complaints and recommendations on the non-transparent and undemocratic decision-making process at the WTO.

Several NGOs, he said, had a meeting last week with Dr Supahai Panitchpakdi, the WTO Director-General, and discussed with him the concerns of NGOs on the current decision-making process at the WTO.

At the end of the meeting, Wagthorne added, the NGOs were “quite despondent” - on almost every single issue that was brought up, the NGOs “could not get a straight answer”.

On the issue of what will be the rules for the processing of the Cancun text or what will be the rules at Cancun on how changes are going to be made to the text and who are going to make the changes, according to Wagthorne, the apparent response from the WTO at that meeting was that members couldn’t agree on rules and/or members don’t want rules.

Wagthorne also complained about the lack of minutes of WTO meetings where there is no ability for organizations or countries to have an informed institutional memory of the proceedings. The ‘Green Room’ process is still not being killed off and when documents are produced, there is no reflection of the differences that members have or of the concerns of developing countries in the differences that they have to what is being put on paper.

Wagthorne added that Supachai was just simply not able to indicate that any of these matters was going to be properly addressed.

Goh Chien Yen of Third World Network also criticized the process of the Chair submitting texts on his own responsibility and that the Cancun text is not reflective of the different positions.

Goh cited the proposal on NAMA where the developing countries have been arguing against using the formula approach, especially the Swiss formula or harmonization approach. The annex to the Cancun draft text on NAMA appears to reflect more faithfully the US-Canada-EC joint paper.

Why are the developing countries’ positions not reflected in this text, he asked. If the Chair’s draft text is adopted, in the area of NAMA (with a Swiss formula approach being used), it would set a historic precedent for future negotiations in that in the last eight rounds of tariff negotiations, a Swiss formula has never been applied to all members, he noted.

On Singapore issues, the NGOs complained that the modalities contained in the annex to the draft Cancun text are too vague and does not identify clearly the substance or scope of the negotiations. To sign on to vague procedural modalities would be equivalent to “signing a blank cheque.”

Celine Charveriat of Oxfam recalled the discussions that are taking place on TRIPS and public health between the TRIPS Council Chair and five countries (Kenya, India, South Africa, the US and Brazil).

Charveriat said that while the Motta text of 16 December 2002 is already restrictive, with developing countries facing increased burdens and bureaucratic processes, the US proposal to break the deadlock on paragraph 6 was even more restrictive.

According to the NGOs, the US demands apparently include:

Restricting the solution to “humanitarian use,” a vague clause that may disqualify normal generic production; an “opt-out” clause, that will further hinder the economic viability of the solution; heavier burdens on suppliers to change the packaging of products made under this system; and a “review mechanism,” to monitor usage of the system and diversion of generics back into wealthy markets. This is a redundant layer of bureaucracy that can easily be manipulated to pressure countries out of the system. -SUNS5405

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