How to skin the cat or bring home the racoon skin

by Chakravarthi Raghavan

GENEVA: Trade negotiators at the World Trade Organization (WTO) were due to go into further consultations, and smaller huddles, to agree on the text of a statement or declaration to be issued by the 2nd Ministerial Conference which, effectively, will have one-and-a-half days of working meetings over 18-20 May.

Trade diplomats still were saying that no one wants the Geneva Ministerial to become like the one at Singapore, where a few ministers held negotiations for long periods, but that they want the "declaration text" to be agreed and out of the way to enable ministers to have substantive talks. But achieving this seems less easy and, at the least, some weekend negotiations may have to take place.

Negotiating on negotiations

Informal consultations chaired by WTO Director-General Renato Ruggiero broke up 15 May night without coming to grips with the operative part of the declaration - which, as worded, is about "negotiating on what to negotiate".

There were still some differences on "assessments" and "declaratory" views, such as whether there should be an affirmation or reaffirmation of the primacy of the multilateral system and/or whether such a reference should also include words legitimizing regional arrangements (such as MERCOSUR), which Argentina is demanding.

But some basic differences among trade negotiators on the wordings and phraseology of the draft text to be adopted and issued on the 20th relate to the "preparatory process" scheduled to commence in the beginning of 1999 and to make recommendations for the Third Ministerial (presumably to launch negotiations). The disputes and differences turn around various alternatives and combinations of these negotiations about negotiations:

  • whether there would only be sectoral negotiations, with emphasis on or mention of preparations on agriculture and a further round of services negotiations already mandated under the WTO agreements;

The US wants, at least for now, only sectoral negotiations. Having seen gains for itself in such negotiations since Marrakesh - basic telecoms, financial services, and zero- tariff negotiations on information technology products and spirits - it wants no more basket of negotiations. Anyhow, it has no accord with Congress on the negotiating objectives or subjects, let alone fast-track authority. It can only negotiate on issues where US law need not be changed.

Argentina and a few other Cairns Group members want specific mention of agriculture and the start of the process in the preparatory process to be set in motion. This is supported by the US, which also wants specific reference to the services negotiations.

The EC is opposed to sectoral negotiations, or to mention of any sector-specific work (in whatever context), but wants some general formulation about the preparatory process to begin early 1999 to focus on "comprehensive trade liberalization". It argues that it is not resiling from the commitments to continue agriculture and services negotiations, only that the commitments should not be accorded specific mention but rather be referred to as "negotiations already mandated". It also needs optical formulations that the next round would be for comprehensive liberalization.

This last, plus the references in the mandate for the preparatory process to the Singapore decisions and to any other subjects Members might raise, in the EC view, covers all the negotiations specifically mandated or envisaged under reviews, the new issues of investment, competition policy and government procurement on which Singapore mandated studies - with no commitment to negotiations, but which are already underway - and others that could be conveniently brought up.

There is a whole range of views among developing countries, with many opposing any decisions that imply negotiations on new issues, or advocating pre-empting the processes set in motion at Singapore through the Ministerial text, to those that are totally opposed to anything beyond what is now on the WTO agenda.

Various other protagonists have positions falling in between - with some refusing to contemplate any negotiations on new issues now or in the near future, to others who are willing to suggest they may consider it later in the General Council but will not commit themselves to it at this meeting.

Attendance list

Meanwhile, the WTO announced that 13 heads of state/government would be at the 50th anniversary celebrations on the 19th afternoon, with the 14th head, US President Bill Clinton, doing a solo act on the 18th evening, when, according to the WTO, he is "expected to make his address on the Commemoration of the 50th Anniversary."

The list announced on 15 May would bring from the developing world - besides the already-announced Brazilian President Fernando Henrique Cardoso, Cuban President Fidel Castro and Singapore Prime Minister Goh Chok Tong - South Africa's Nelson Mandela and the Cote d'Ivoire Prime Minister Daniel Kablan Duncan.

The event has resulted in some extraordinary security arrangements being put in place by the hosts, the Swiss confederation, to facilitate the presence of these wanted and invited guests, and keep at a distance the unwanted - NGOs and popular movements protesting the WTO, its neo-liberal order and globalization, which benefit a small minority and marginalize the vast majority everywhere.

An example of the arrangements was shown on Swiss TV on 14 May, when the Swiss police "arrested" a group of German youths, who entered via Basle (Germans can normally come in without visas) on motorcycles to come to Geneva where representatives of popular movements are gathering. The arrested youths, the TV broadcast said, were forced to go back to Germany.

In Geneva itself, on 15 May, a band of Kurds (protesting Turkey) chained themselves to the gates, while some 30 of them managed to get into the UN Palais complex and entered the building to shout slogans. They were subsequently met by a spokesperson of the Human Rights office and the South African ambassador who happened to come in at that time. Ultimately, the Human Rights Commissioner Mary Robinson came and talked to them; the Kurds reportedly apologized to her and said (before dispersing) they would rather have seen her peacefully.

Mr. Clinton, who will fly in and spend a little over two hours perhaps in Geneva, is expected to announce in his solo commemoration session at the WTO, an offer to host the 3rd Ministerial meeting - whose timing is still a matter of contention - to launch negotiations - whose scope and subjects are even more in dispute.

Standstill accord on electronic commerce

And for coming here to participate in and commemorate the 50th anniversary of the multilateral system, Mr. Clinton wants to carry back, and wave to his audience at home, another US "win" via the WTO - a WTO "standstill" accord on no duties on electronic commerce.

US negotiators have been busy trying their best to convince the other trading partners to find a way of "delivering" something - an indefinite standstill, a standstill till 2000 (as the Canadians have proposed), or one till a review at the WTO - whether as part of a Ministerial text or a separate agreement or a hybrid.

It is not at all clear whether and how this infiltration of "electronic commerce" into the WTO as a separate issue will be "delivered" to President Clinton as a prize for coming here - as a WTO standstill accord as part of an implicit negotiation commitment subject to review (and, if so, what sort and kind), or something more or less.

Will it be part of many other reviews to be undertaken in terms of the existing WTO agreements between now and the next Ministerial, a standalone standstill that would need consensus extension by a WTO review process, a standstill that could be upset only by consensus in a review process to decide what to do on "electronic commerce", or a hybrid of them all?

Trade diplomats, who broke up their consultations a little after 14-15 May midnight and were due to resume meeting formally and informally on 15 May afternoon, were not at all clear on this issue that has been on brought up by the US, and on which they have been holding a series of bilateral and plurilateral consultations, mostly in their mission.

On 15 May afternoon, some European sources said, agreement was reached with the result that there would be a separate text out of the Ministerial meeting which would not be part of the declaration, covering electronic commerce. This would provide for the "standstill" and for the issue to be taken up at the General Council.

Other sources cautioned that this issue has still to be cleared by the membership as a whole.

The developing countries, to the extent that some of them have spoken in the WTO processes, are not willing to get into the subject without some prior study at UNCTAD and at the WTO Committee on Trade and Development (CTD). Egypt has put forward a paper on these lines.

Sources said that developing countries, and others as well, are objecting to being rushed into decisions in an area where the Americans have built up a sizable technological lead and know what is involved, while most others are in states of relative ignorance.

Some others have begun to voice objections on legal and "constitutional" grounds to the way such "new issues" and "new subjects" are negotiated and brought up and made part of the WTO.

Legal briefs prepared for them show that their instinctive opposition has a sound basis, and that the old dictum of "anything is possible among consulting adults" in the old GATT as a provisional treaty is not at all applicable in the WTO as an international definitive treaty.

Instead in the WTO, and its negotiations that still reflect power relations, only those count who are prepared to be at meetings, and are ready to stand up and say no and be counted. And this is probably the most difficult of all to achieve at the WTO, along with having to explain back home why this was done or why that was not done. (Third World Economics No. 184/185, 1-31 May 1998)