A Year after Seattle, the WTO Bourbons have learnt nothing

by Chakravarthi Raghavan

Geneva, 30 Nov 2000 -- Just a year ago, when the 3rd Ministerial Conference of the World Trade Organization, collapsed ignominiously unable to launch a new round of trade negotiations, and with new issues, it came as a shocking surprise only to the United States and the three other Quad members, long accustomed to manipulate the system with the help of a willing secretariat, and ride rough-shod over the rest of the world.

When the meeting actually collapsed, with a large number of countries making clear they would not acquiesce in a consensus, the WTO Director-General and the leaders of the Quad (and their hangers on), were shocked that their will no longer prevailed.

The failure came as no surprise - neither to trade diplomats of developing countries nor to the public at large. Only the majors, and western media reflecting their views, were surprised and shocked, and began fulminating in name calling of opponents as anarchists.

In the immediate days and weeks after Seattle the shell-shocked leadership of the WTO, both the WTO head (and most of the secretariat) and the leaders of the Quad, particularly the US and the EC, began making noises about the need for building-bridges and for confidence-building measures. But since then, gradually they have returned to business as usual, and believe they can repeat the Uruguay Round history.

The acrimonious exchanges at the informal General Council consultations on 29 November over the ‘implementation’ issues and possible consensus decisions on ‘immediate’ measures on some of them, and the US position next day in the ‘consultations’ over the implementation concerns and issues of developing countries in the area of ‘subsidies’, showed that like the Bourbons, those in power and benefiting from the WTO system are in no mood to learn any lessons from the past.

Before Seattle, the majors were deeply divided among themselves, and the gap between them and the developing world was even larger. All these were ignored, and there was a steady chorus in the western media particularly about Seattle launching a new round!

The Seattle failure had been written into the script in the weeks of preparations - when the majors first refused to take note of the complaints of the developing world that they had gained little or nothing from the WTO and its agreements, but had rather than lost and more marginalised than before.

Only the four majors and the WTO head seemed unable to read the script or recognize that there were now other actors and script-writers, and that the old tricks of producing a last minute consensus would not work.

And in the final weeks before Seattle, when the majors appeared to take the issue more seriously, the US, the EU, Canada and Japan used nice-sounding words, but left little doubt they would do nothing, but rather wanted to make use of these issues to launch a new round with new issues, and extract more concessions from the developing world.

Though there were many differences among them, by and large, the developing countries had done careful preparations and put forward specific proposals. They were first sought to be kept out of the Seattle agenda through the process of a secretariat draft of a chairman’s text of a draft ministerial declaration. But the uproar it created, resulted in the issues being put back into a revised draft (paras 21 and 22 of the Mchumo text).

At Seattle when they found that the large numbers of developing countries were no longer willing to accept the old ‘negotiating culture’ of the system, the old manipulative ways of ‘holding’ non-transparent consultations and negotiations within a small group - with the Quad first negotiating and agreeing on themselves, and then presenting it to others to ‘expand’ the circles of consensus - and forcing these decisions on the rest, the majors were confused and perplexed, and spoke of need for combining ‘transparency and efficiency’. At the end of the year they have ended up with neither.

After Seattle, the WTO trade establishment, and the part of the western media that act more like cheer-leaders at games than independent media reporting and analysing fact, blamed the street demonstrations and non-government organizations. And there were attempts at quick-fixes, which did not fly.

Then followed the talk of ‘confidence-building’ measures and expressions of concern on the part of the WTO’s leadership and of the four countries to focus on and find solutions to the grievances of the developing countries who find themselves more and more marginalised in the system and the world economy is threatening to end with no tangible outcomes.

Months of intense consultations, have however produced nothing—with developing countries finding themselves ‘negotiating’ with the secretariat (deputy Director-General Miguel Rodriguez Mendoza) rather than with the principals (the US, EC and Japan).

Mr. Mendoza has been trying to broker a compromise (while the Director-General is criss-crossing the world trying to convince everyone about the need for a new round) listening and talking to the developing countries and then with the majors, and coming up with ‘informal’ texts that at every stage has produced a formulation to rephrase one set of ‘best endeavour’ clauses in the agreements with another set of even vaguer best endeavour clauses. These are presented as the only ones that could command consensus, and developing countries would do well to accept them, and launch a new round to negotiate the other issues.

An informal meeting of the General Council on 29 November on implementation issues was marked by acrimonious exchanges, and some adamant stands of the Quad countries (with Canada acting as the pointsman for the group).

The General Council chairman’s draft text for decisions (mostly what he had presented in October as a chairman’s own statement), and now presented as the outcome of the ‘best efforts’ of consultations held by the Chair and the WTO Director-General addressed a few of the over 50 ‘measures’ or ‘decisions’, ranging over some dozen individual agreements, and calling for immediate actions.

In an initial round of comments, many developing countries spoke expressing their disappointment at the very meagre results embodied in the Chairman’s text, and drawing attention to the other issues that were mentioned in para 21 of the Mchumo text, but not mentioned. Even the draft text of decisions envisaged in many cases no more than remitting some issues to subordinate bodies and thus leading to diversion and delay.

Chairman Kare Bryn of Norway explained that while his proposed text for a draft decision covered only a few of the points in para 21 of the Mchumo text, and on which he thought a consensus was feasible, the other proposals and points had not disappeared but remained on the table. Bryn’s remark implied that they would be the subject of further consultations, including on a mechanism to handle it.

When Pakistan and a few others asked the chair to put those points into a revised text, even presenting them in square brackets, Canada, followed by Japan, the US and EC came out in opposition.

The acrimonious exchanges between Akram and Canada, were followed by other exchanges between Pakistan and the Chair, with the latter at one stage offering to take back his draft if it was not satisfactory to the developing countries.

After further exchanges, it was agreed that the Chair should hold further consultations on the other points.

But on Thursday, when the first such consultations began over the issues in the ‘subsidies agreement’, the US representative at the informal meeting Alicia Greenidge bluntly made clear that the US would not accept or discuss any of these, and the meeting broke up abruptly.

After some bilateral talks between the US and the chair, Greenidge was less acerbic at the afternoon meeting on anti-dumping issues, but it became clear that while present in the room, the US was not involved in the talks and consultations. Some developing countries noted that this US stance was similar to that of Japan on agriculture before Seattle, when it was present in the consultations over agriculture, but made clear it was not bound by anything that could emerge.

The General Council is to hold special sessions on implementation issues on 14-15 December, but given the current stance, little seems likely to come out.

The attempt seems to be on the part of the Quad and the WTO head to create a situation where developing countries would agree to launch a new round, with new issues, in the belief or hope that the round would address their concerns and issues. But this seemed to be a case of hope against experience.

No wonder that the voices of civil society in developing countries are increasingly turning hostile to the WTO and its system, and are focusing on creating a situation in countries where the WTO diktat cannot be enforced.

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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