Majors stalling on implementation issues

by Chakravarthi Raghavan

Geneva, 22 July 2001 - - A formal Special Session of the General Council Friday to assess progress on the ‘implementation’ issues suggested that behind the talk of ‘engagement’ and ‘positive reactions’ from the major industrialized nations, and the claims of progress towards resolving implementation issues, there has been little progress in terms of concrete decisions and actions.

There have been no lack of general, but mostly empty of content, statements from the EU, Japan, and lately from the US, including the latest from the G-7 Genoa Summit.

But after more than two years of consultations, and issues being tossed back and forth between the General Council and subordinate bodies, and consultations by the Chairman and the Director- General, some key issues like textiles and clothing (and lack of meaningful and economically significant liberalization and removal of quotas by the North) or misuse of anti-dumping rules have not even figured so far in the consultations.

Pakistan’s Amb. Munir Akram, a leading member of the Like-Minded Group of Countries who have been spearheading the ‘implementation questions’ gave a blunt warning that unless there was clear movement over the next few days, by the time the General Council meets for a ‘reality check’ on the preparations for Doha, the membership would have “to reduce their ambitions”.

The goal for Doha would then simply have to be the TRIPS and Public Health issue, the built-in agenda in agriculture and services negotiations and the mandated reviews, Akram said.

These ‘implementation’ issues (problems of implementation, lack of any benefits to the developing countries as a result of the WTO and its annexed agreements and promises, and the asymmetries and inequities facing them) have been raised by the developing countries, in particular by the Like-Minded Group (LMG) of developing countries, and brought on the WTO agenda in paras 21 (decisions to be taken by the Ministers at Seattle) and para 22 (issues and problems to be resolved within a year’s time) of the ‘draft Ministerial Declaration’ (the Mchumo text).

The issue had figured even at Singapore (December 1996) Ministerial Declaration, where it was just brushed aside. It came up more prominently at the Geneva (May 1998) meeting and was made part of the WTO work programme. In the runup to Seattle, the developing countries made detailed and concrete proposals (put into the Mchumo text for Ministerial Decision at Seattle). Even at Seattle, the majors gave short shift to it and given priority only after the collapse of Seattle (at the General Council of December 1999) as part of the confidence building measures, is still in the talking and consultation stage, with questions being passed back and forth between the General Council and the subsidiary bodies.

There were some attempts to deal with the issue in cosmetic terms, and on a case by case basis (in relation to time extensions for implementation, as in TRIMS), and that several needed renegotiation, and could only be done as part of a new round, with a broad-based agenda.

But finding the developing countries, and particularly the LMG members, fairly strong and united in demanding actions on these, since this year there have been renewed consultations and talk of taking some decisions at Doha, and after Doha (in a new round).

More recently, when it became clear that without some actions on the implementation questions, there would be no progress at Doha, and the Ministerial may well turn out to be a repeat of Seattle failure, a group of seven countries (Argentina, Morocco, New Zealand, Norway, Switzerland and Thailand, all favouring a new round, and known as the ‘submarine group’) ) put forward a set of proposals and ideas on actions to be taken before or at Doha, and others to be part of a new round.

These identified the implementation questions (in para 21 of the Mchumo text) and divided them into four parts - issues on which early agreement could be reached, issues that had been solved, clarified or appear relatively less urgent, issues referred to subsidiary bodies and to be taken up in September, and other pending issues capable of being resolved after Doha.

While the LMG group was only willing to use it as the starting point and a minimum for further talks, the Quad (Canada, EC, Japan and the US) took an even more minimal position than in the G-7 paper, while the report of the GC Chair and DG showed that even the G-7 points have been further reduced.

At the informal consultations of the General Council on 13 July, the GC chair and the DG had circulated a paper on the work done so far, and identifying elements on which there was possibility of early agreement. While not the others off the table, GC chair Stuart Harbinson suggested that in terms of the preparations for Doha the members should focus on the elements identified as possible of early agreement.

Harbinson also talked of the Doha preparatory process having reached a critical time and need for all “to engage constructively and show flexibility.”

A WTO official, in briefing the media on the formal session, said that the US, Canada, EU, Japan and Switzerland viewed the report in positive terms, while developing countries expressed their disappointment.

Pakistan’s Munir Akram compared the situation to a ship on the high seas, with everyone in the same ship, but with a small group in luxurious upper deck cabins and the vast majority below in the cargo holds, with the ship leaking, and those in the top deck revelling in restaurants. Nothing had happened in two years, until the ‘submarine’ (a reference to the g7 paper) emerged.

And while developing countries had been expecting concrete decisions at this meeting of the General Council, “we have been seeing a continuous process of proposals being denuded of content.” There were 50 proposals in the paragraph 21 of the Mchumo text, the group of 7 (submarine group) had reduced to 20, and now the chair had reduced it to ten.

“There has been no significant movement on any of these issues, and the textiles and anti-dumping questions had not been addressed, nor any decision taken on the extension of time for implementation of TRIMs.

“There has been no substantive consultations on textiles and clothing and the anti-dumping, issues that account for over 75% of Pakistan’s exports for e.g. If these are not addressed we have nothing really to gain.

“If there is no movement within the next few days, when the reality check takes place, he would be forced to take the position that the membership should reduce their ambitions, and the goal for Doha should simply be TRIPS and Health, the mandated reviews and the built-in agenda negotiations like agriculture,” Akram said.

India’s Amb. S. Narayanan said that the elements paper of the chair had caused India a lot of anxiety. It had left out textiles and clothing, TRIPS and anti-dumping. They had been discussing this issue for more than 2-1/2 years.  While they had been prepared to take the G-7 paper as a basis for further improvements, the Chair’s text has further truncated the G-7 proposals.

The proposals on TRIPS were even worse than the TRIPS agreement, Narayanan said.  Rather than dealing with it in this issue, the proposals on TRIPS should await the outcome of the discussions in the TRIPS Council (which is holding an informal discussion this week, and a special meeting scheduled for 13 September). India hoped that the trading partners would live upto their statements about ‘engaging in good faith’.

As for referring some issues back to the subsidiary bodies, Mr. Narayanan said that if all of them reported only on the 30 September deadline, it would leave little time for consideration. The subsidiary bodies should report before 30 September and stagger their reports.

The Dominican Republic, like Honduras, raised the issue of Annex 7 of the subsidies agreement (which sets a threshold on the basis of the per capita incomes).

The Dominican Republic cautioned that if the implementation issues, such as on subsidies, were not acted upon, it would prove that the critics of the WTO were correct in their assessments.

Colombia said that based on the g7 (submarine group) text, the SPS issue was close to an agreement. But several important issues remained to be solved, and unless resolved “we will play into the hands of the enemies of the system.”

Venezuela thought that progress had been “only very modest” and they would like to see substantive decisions, though they did not have too much confidence.

Jamaica was concerned about possible further delays in subsidiary bodies and wondered what kind of a ‘reality check’ could take place over the next few days.  It shared the concerns of others that several of the issues (being sent to subsidiary bodies) were political rather than technical, and the General Council would have to provide political guidance. Jamaica also complained that the consultations on these questions were becoming “increasingly opaque.”

Egypt said the situation was critical, and the prospects for solution seemed dismal. Even the g7 paper was below their expectations, but Egypt recognized it was proposed by a group of “well-meaning ambassadors”. However, the fact was that after 26 months, there was no clear and concrete response from the majors about their willingness to address these questions.

Malaysia too shared the concerns of several developing countries, and was deeply disappointed. It was looking forward to some positive commitments by major trading nations. – SUNS4942

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

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