A “development” agenda out of Doha?

by Chakravarthi Raghavan

GENEVA: The 10-page Ministerial Declaration adopted by the WTO’s 4th Ministerial Conference, a “work programme” to be completed no later than 1 January 2005 and as a “single undertaking”, is effectively an agenda for multilateral trade negotiations in at least 19 areas, larger and more intrusive, in terms of national economies and politics, than even the Uruguay Round agenda.

Most of the implementation issues raised by the developing countries have been shunted off to be negotiated under relevant parts of the new work programme. The 30-odd issues on which ‘decisions’ were taken have basically been sent to subordinate bodies to act, and seem to involve no more than a best-endeavour attempt. The implementation issues are addressed in a separate Decision on Implementation-Related Issues and Concerns which was also adopted by the Ministerial Conference.

Little benefit on textiles and anti-dumping

The three tirets in the implementation decision relating to the Agreement on Textiles and Clothing (ATC) on which decisions were taken are either best-endeavour appeals or devoid of real benefit. Two other tirets in this area, relating to “growth-on-growth” for import quotas and to the calculation of quota levels for small suppliers, have been referred to the Council for Trade in Goods (CTG), where the most likely outcome would be that they would be ‘bottled up’.

US Trade Representative Robert Zoellick, right from the beginning, has said that there was nothing he could do in this matter; the pace of integration and how, are set out in the US’ Uruguay Round Implementation Act and the Statement of Administrative Action (SAA), provided to Congress.

These require in effect that quotas on all restrained items be kept in place and removed only on midnight of 31 December 2004. The items being ‘integrated’ are the products already facing no restraint.

Though there have been some media reports saying that the countries whose exports are under restraint could have gained some benefits had they not opposed the US and EC on the new issues, this reflects ignorance of the situation of US law. This was why countries like India, Pakistan and several others, while making a lot of ‘noise’, never seriously figured that any benefits could be obtained; hence they were not ready to give up on anything for the sake of some minor benefits on “growth-on-growth”. Pakistan had settled for any GSP benefits it could get as a result of the ‘war on terrorism’ and got something perhaps from the EC, but little so far from the US.

As for small suppliers and LDCs, the major importing countries are not ready to do anything that they think will merely benefit Bangladesh. They claim to have taken care of African interests through their special accords (the Cotonou Agreement between the EC and the African, Caribbean and Pacific group, and the US’ African Growth and Opportunity Act).

The only issue at the CTG that India, Pakistan and others will be watching, in order to safeguard their interests, is not to allow the CTG to start a process for extending the ATC which, as set in the Marrakesh Agreement, expires automatically on the midnight of 31 December 2004. Bangladesh, in the US Trade Policy Review this year, has already raised its proposal for extending the ATC by another five years to enable it to continue to benefit from the rentier incomes of quotas. Other small suppliers no doubt would begin to make the same proposals,  and the US and EC may be behind it.

Another issue of great concern to developing countries, including India and others, has been the ability of major importing countries to end an anti-dumping investigation without taking any action (because the facts do not warrant it) but, within a few days, start a new investigation on the very same product - a plain case of trade harassment that the EC has been using, particularly against textile exporters.

On this, there is in the implementation decision a best-endeavour appeal to the investigating authorities in anti-dumping complaints  to “examine with special care” applications for initiating proceedings “where an investigation of the same product from the same Member resulted in a negative finding within the 365 days prior to the filing of the application”. However, any little effect this provision may have on investigators is more than offset by the formulation following it: “unless this pre-initiation examination indicates that circumstances have changed, the investigation shall not proceed.”

When yielding to special interests, therefore, the investigating authorities (the EC has been the biggest culprit) can continue resorting to the same tactics, and the investigating country will blandly say that they have examined things “with special care” and that there are indications “circumstances have changed.”

The implementation issues are to be treated as an integral part of the work programme (and thus a single undertaking). Any issues and subjects on which the work programme has a mandate (WTO rules, etc.) are to be addressed there. All the outstanding implementation issues are to be addressed as a matter of priority by relevant WTO bodies, which have been directed to report by the end of 2002 to the Trade Negotiations Committee to be set up under the work programme.

In one sense, therefore, the time and energy spent by the developing world to raise the implementation issues have amounted to nothing more than an agreement to negotiate them under the new work programme.

However, in reality, developing countries had not really expected anything else beyond merely managing to put  these up for renegotiation which otherwise the majors would have just refused even to look at.

Mandate for future complications?

The Doha Ministerial Declaration, in para 11, describes the work programme as being “broad and balanced” and says that it incorporates “both an expanded negotiating agenda and other important decisions and activities necessary to address the challenges facing the multilateral trading system.”

In the run-up to Doha, in an effort to discourage and head off the developing world, both the USTR Zoellick and EU Trade Commissioner Pascal Lamy did not want a detailed agenda or mandate to be spelled out, and discouraged what they called setting out the end result through the agenda. Zoellick preferred the Punta del Este approach enabling the agenda to be elaborated after the launch and modified at future Ministerial meetings as they go along.

However, at Doha, while presenting a seemingly united front against the developing world, the US and EC in fact tussled in trying to set the end result through the mandate.

As a result, in the areas of agriculture, environment and even WTO rules (where the US has seemingly given way to Japan and has agreed to put anti-dumping rules on the table for negotiations), there is a fudging of language such that many problems and complications will arise during the negotiations. Indeed, some negotiators believe that either the round can never be concluded or all those issues of interest to the developing world, as in the past, will be shoved on to another work programme.

Kenneth W. Dam, who is now in the Bush administration, in his book, The GATT: Law and International Economic Organization, has suggested that the success of the (old) GATT (the predecessor of the WTO) lay in the fact that its trade negotiations and market access concessions were not politicized.

Now, the WTO Director-General Mike Moore and the Doha meeting, which has been acclaimed by Zoellick for removing the “stain” of Seattle (whether he meant the town, the US or the WTO conference there is not clear), have highly politicized the WTO.

The use of strongarm tactics in the “green room” (by both Moore and conference Chairman Youssef Hussain Kamal on the night of 13-14 November) to force onto the agenda some issues of a highly political nature in a large number of countries, has made the WTO a very visible focus for protest movements. Such opposition is something that the support and misinformation campaign on Moore’s behalf by leading Western financial media (the reports in the Financial Times were probably the worst) cannot counter.

A motivation behind Qatar’s invitation to the WTO to hold its conference in Doha (given out amidst the mayhem and turmoil of Seattle) was said to be that the hosting of the meeting was seen as a way of putting Doha on the world conference circuit map and making Qatar as famous as Uruguay, which (the emirate believes), before the Punta del Este GATT meeting, was known only for its football.

Far from being a “Doha development agenda” that may bring fame to Qatar, however, the work programme, if it does reach a successful conclusion with agreements in all the areas, old and new, will only complete realization of the American vision of the ‘free market’ which William Blum, in his Rogue State (2001, London:Zed Books), calls the “privatization of the world or globalization.”

(Blum’s book,  based on US official documents, statements and leading US media reports, presents a history of American “rogue operations” abroad - planned or targeted assassinations of Third World leaders, including Zhou En-Lai, Nehru, Soekarno and Nasser. Among others, it explains the US drive for globalization via the IMF and WTO, and making opponents ‘terrorists’. It cites Zbigniew Brzezinski’s (national security adviser to President Carter) interview to Le Nouvel Observateur in 1998 that the US had supported and helped in the creation of Islamic fundamentalism in Afghanistan (including the fundamentalist moujahedeen which later became the Taliban), not as a response to the Soviet occupation or invasion of the country but six months before the invasion, during the Carter presidency, knowing it may provoke Soviet intervention.)

The paragraph on labour standards in the Doha Ministerial Declaration (para 8), which omits a sentence from an earlier draft, “The ILO provides the appropriate forum for a substantive dialogue on various aspects of” the globalization issue, may temporarily please the central trade unions (like the ICFTU) in the belief that it will augment their membership in the developing world to make up for the loss of members in the North.

However, it will in fact complicate negotiations and marginalize the UN system organizations trying to evocate the ‘social issues’. With capital, being a factor of production, on the WTO agenda for rules, the need for labour to be treated symmetrically will be difficult to resist, even if on the basis of a mere “should”.

Environment-agriculture muddle

Para 6 on the environment and sustainable development has been pushed by the EC and seems in a way innocuous by virtue of its being in the preamble of the declaration, although the UN Environment Programme (UNEP) and others are already happy they have found a place at the WTO.

However,  when the negotiating mandate on environment (in paras 31 and 32, sprung without notice on the developing countries and even some developed countries at 3 am on 13-14 November night in the green room) is carefully read, what the EC perhaps thought had been a gain to muddle the agricultural talks may actually muddle the environmental as well as the agricultural negotiations.

Developing countries, including some Cairns Group members, seemed to feel that the earlier negotiated text (providing for special and differential treatment and other measures and non-trade concerns of theirs) adequately safeguarded their positions in the negotiations, and do not appear to have ‘bothered’ too much about the Cairns Group-EC problems in this area.

In agriculture, the mandate in a sense has been expanded to go beyond the terms for further reforms set in Article 20 of the Agreement on Agriculture (AoA), and brings in wording about the “phasing out” of subsidies, a formulation on which the Cairns Group has set much store and in return for which they have given support to including the Singapore issues.

However, the EC insisted on introducing at the beginning of the agricultural mandate, as an overall qualification before setting out what is to be negotiated, the words  “without prejudging the outcome of the negotiations”. In a sense, this reduces or nullifies the bringing in of the term “phasing out” of subsidies.

It is not clear whether Australia (the ‘leader’ of the Cairns Group) had agreed or acquiesced, and whether Brazil’s Foreign Minister Celso Lafer, who without being a facilitator was reported by some Brazilian sources as having had a much greater influence at Doha on the documents, had also agreed. However, this phrase “without prejudging the outcome” clearly was much to the chagrin of some other Latin American Cairns Group members, who perhaps had come to the green room intending to ‘negotiate’ on this but found, when they came in, that the game was already over.

They then perhaps bided their time and promptly at about 3 am, when the paragraphs on the environment negotiations came up, wanted similar language (i.e., “without prejudging the outcome”) incorporated in the chapeau to this issue (in para 31), just as in agriculture. This was quickly endorsed by the US.

In addition, the US introduced in para 32 the following formulation: “The outcome of this work [work set in para 32 to be undertaken by the Committee on Trade and Environment] as well as the negotiations carried out under paragraph 31(i) and (ii) shall be compatible with the open and non-discriminatory nature of the multilateral trading system, shall not add to or diminish the rights and obligations of Members under existing WTO agreements, in particular the Agreement on the Application of Sanitary and Phytosanitary Measures, NOR ALTER THE BALANCE OF THESE RIGHTS AND OBLIGATIONS (emphasis added), and will take into account the needs of developing and least-developed countries.”

This will effectively prevent any attempt by the EC or anyone else to write new rules or interpretations to be able to use sanitary and phytosanitary or other measures (under a ‘precautionary’ or other ‘principle’) to take actions against imports (hormones? genetically modified organisms?)  to please domestic lobbies.

Given that the EC has been plugging the ‘deep attachment’ of EU members to the issue of environment and sustainable development, given the announced intention of the EU member states to use the environment ‘Trojan horse’ to maintain their agricultural protection, and given that the European Commission has been trying to use this negotiating issue to gain the support of European environment, development and consumer groups for the new round, it raises the question of whether it was a case of EC failure to notice the implications after nine hours of night-long talks, or a prearranged US-EC move?

The agriculture mandate calls for modalities for the negotiations to be established no later than 31 March 2003, and for draft schedules based on these modalities to be submitted no later than the 5th Ministerial Conference. However, since the work programme is to be a “single undertaking” and the decision whether or not to negotiate on the Singapore issues is to be settled only by express consensus at the 5th Ministerial, the EC can easily stonewall on agriculture (along with the rest of Europe, Japan and Korea).

Despite what happened at Doha, the outcome on the four Singapore issues is by no means settled, though perhaps most opponents are mentally preparing themselves for ‘negotiations’.

The only fly in the ointment for the EC (in agriculture) may be the expiry of the so-called “peace clause” in Article 13 of the AoA at the end of 2003 and the prospect of the EC thereafter being challenged in the WTO dispute settlement mechanism on its agricultural subsidies under the Subsidies Agreement.

The Cairns Group has long been threatening to raise disputes under the Subsidies Agreement to pressure the EC, but things are not so simple as that, however. Any dispute raised in 2004 will take at least two years to run its course and then another 15 months easily as “reasonable time for implementation”, by which time it may already be well into the 6th or 7th sessions of the Ministerial Conference. Moreover, it is not a foregone conclusion what the dispute settlement panels will do and how they will ‘interpret’ or ‘clarify’ the rules. And given, for example, the experience of the banana-exporting countries, no one need be sanguine about the EC’s implementing a panel ruling.

Services concerns

In services, the negotiating mandate is more or less what was developed within the Council for Trade in Services since Seattle, with a 31 March 2003 deadline set for participants to submit initial offers.

In an effort to head off civil-society protests against the General Agreement on Trade in Services (GATS), a paragraph has been introduced that states: “We reaffirm the right of Members under the General Agreement on Trade in Services to regulate, and to introduce new regulations on, the supply of services.”

However, the civil-society protests in the North have nothing to do with this “right to regulate.” Rather, they are motivated by fears and concerns that public services - education and health are often mentioned, but there are many others too - will be forced to compete with foreign private service providers, and that countries would be forced to open their markets. Article 3 of GATS only protects a public service supplied “in the exercise of governmental authority” and not on a commercial basis or in competition with one or more service providers.

The NGOs agitating this issue are thus not likely to be fobbed off with the paragraph in the declaration about the right to regulate and put in more regulations. (SUNS5013)

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