TWN Info Service on WTO and Trade Issues (Dec11/15)
22 December 2011
Third World Network

MC8 closes after adopting several decisions
Published in SUNS #7285 dated 20 December 2011

Geneva, 19 Dec (Kanaga Raja) -- The eighth Ministerial Conference (MC8) of the World Trade Organization (WTO) came to a close on 17 December night, after adopting some seven draft decisions, and approving the accessions of Russia, Samoa and Montenegro over the course of the two-and-a-half-day session.

Just moments before MC8 got underway on Thursday afternoon, the 42 parties to the plurilateral Government Procurement Agreement (GPA) had concluded a deal on a revision to the pact.

Apart from the opening and closing sessions, MC8 also held plenary sessions where Ministers had made statements, and closed working sessions that addressed three themes, namely, the importance of the multilateral trading system and the WTO, trade and development, and Doha Development Agenda (DDA).

One trade observer told SUNS that there was not really any discussion as such taking place in the working sessions.

Trade officials said that some trade ministers had already left even before the DDA theme was discussed in the working session (on 17 December).

One developing country trade diplomat told SUNS that he did not hear anything new in the working session on the DDA. Several ministers were not even present in this working session, he added.

The trade diplomat said that there was a vague determination to continue with Doha, and that there was a clear cleavage between those that say that it has not worked, and those that were steadfast with the single undertaking. Partial approaches were talked about, including Paragraph 47 of Doha Ministerial Declaration, but there was no agreement on this.

"The fog has not cleared," said the trade diplomat, adding that with respect to the DDA, there was no blueprint except for a repetition of old positions. The trade diplomat asked where does "the ten years of negotiating capital" of the developing countries go.

The seven texts adopted by the ministers at MC8 relate to extending the moratorium on TRIPS non-violation and situation complaints, extending the moratorium on E-commerce duties, the work programme on small vulnerable economies, extension of transition period of Least Developed Countries (LDCs) concerning the TRIPS Agreement, streamlining LDC accession procedures, an LDC services waiver, and the fourth appraisal of the Trade Policy Review Mechanism.

The ministers also took note of the report of the General Council Chair and other WTO bodies that were forwarded to MC8.

On the dates and venue of the ninth session of the Ministerial Conference (MC9, scheduled for 2013), the Chair of MC8, Nigerian Minister Olusegun Aganga, proposed that the ministerial conference request the General Council to hold consultations with a view to decide the dates and venue of MC9. It was so agreed.

The Chair of MC8 also drew attention to his concluding statement, which was in two parts. The first part (an agreed text) represented elements for political guidance and was outlined in document WT/MIN(11)/W/2. The Chair did not read out these elements for political guidance, but read out only the second part, the concluding statement under his own responsibility (see separate article on the concluding statement).

Following this, the Chair expressed appreciation and thanked the General Council Chair, WTO Director-General Pascal Lamy and the Secretariat team, as well as the ministers themselves for their constructive and cooperative participation.

Minister Aganga said he saw the ministerial conference as being significant in three main ways, in that it has produced some positive decisions - accessions of Russia, Samoa and Montenegro, the GPA, and the seven decisions that were adopted; it had sent a strong collective message that the WTO is more than ever important to the world; and it has seen constructive dialogue among ministers which has improved the WTO's atmosphere and outlook.

In his closing remarks, Director-General Lamy said that there is a Russian proverb that says "Don't chop off the branch you are sitting on". This is an appropriate saying for times of crisis, when governments take drastic and often short-sighted measures to address difficult social and economic problems, he added.

Lamy said: "During the last two and a half days, you have taken significant decisions and you have discussed relevant issues. We now have four new Members in our family - Montenegro, Russia, Samoa and Vanuatu - and some of you have decided to cut a deal on GPA. You have also taken decisions of specific importance to LDCs, which comprise a large part of our Membership. Let me highlight here the one relating to the streamlining of accession processes for LDCs, which we now have to operationalise. Bilateral discussions between the Cotton-4 and some Members have helped move the cotton issue forward even if a lot remains to be done to fulfil the DDA mandate on this issue."

In the three working sessions held in parallel with the plenary, Lamy said, "you have discussed some of the most pressing issues of the multilateral trade agenda and it is clear that this organization has plenty to work on in the two years to come."

"We also had an in-depth debate about the DDA, which exemplifies the legislative function of the WTO. The DDA - declared dead so many times, lambasted as a negotiation of the past, decried as a failure - is all the more important today, with an ever deeper crisis looming, than it was in the past. You have taken a first step in this Conference, in recognizing that there is an impasse, and a need to more fully explore different negotiating approaches, compatible with the principles of inclusiveness, transparency, bottom up of our work. Now there is a need to do exactly that: start exploring those approaches, Go back to business. In doing this, you will show that you care about the multilateral trading system, that you care about the WTO, that you are willing to help finding solutions to the economic crisis," he added.

Lamy further said: "This is the last regular Ministerial in which I participate as Director-General. My only stake in this Organization has been and remains pure, genuine interest in seeing it reinforced, thriving, more efficient, more inclusive, more relevant. I am therefore in a good position to speak my mind clearly and without reservations - something I have always done, as those who know me are aware."

"I am deeply convinced of the need to keep the WTO strong and meaningful. To fulfil its mandated objectives of raising the standards of living, ensuring full employment and a large and steadily growing volume of real income and effective demand. To contribute to sustainable development, as foreseen in the Marrakesh Agreement."

"I am, more than ever, convinced that political courage and goodwill can make a difference in helping us weather the storm. I am more than ever convinced that a ‘wait-and-see' attitude will not be helpful. The lack of convergence that exists today on some issues will not solve itself with time. I call on all Ministers, on all delegations, to start working immediately in a creative, constructive manner, as you know you are able to do, when there is political will. Above all, keep in mind that you should not, in any way, chop off the branch you are sitting on!," he concluded.

Following the closing remarks by Lamy, the conference was brought to a close at around 8.00 pm on Saturday.

At a media briefing following the closing session of the conference, Director-General Lamy said that this ministerial conference has been about two things, namely, "restoring confidence and a new beginning", two ingredients that are vital for setting the WTO and the world economy back on track.

Pointing to the gloomy state of the world economy with growth stalling, unacceptably high unemployment and protectionist pressures growing stronger, he said that contrasted against this dark setting, "we have seen this week some evidence that governments can tackle serious problems ... when they are prepared to work collectively to find solutions."

He added that this week has identified three elements, one, for the WTO to remain relevant, it must move the negotiating agenda forward; second, this move forward will not be "short-term big steps" but "forward small steps"; and three, to do that "we've laid ground for a better dialogue to recommence between our members early next year."

"So I believe we leave this ministerial, which was not a high ambition ministerial, with a better sense of priorities for the next years and thus a sort of guidance which we all needed but of course, [its] fair to say that a lot of work remains to translate this into concrete deliverables which is what we have to do starting after the Christmas break," Lamy concluded.

Also speaking at the media briefing, the Chair of MC8, Nigerian Minister Olusegun Aganga, said that successful outcomes at major international meetings are a rare thing in this day and age, given the current global economic climate, "but a successful outcome is exactly what we have achieved at this WTO eighth ministerial conference."

"We have enlarged our membership by three, in approving Russia, Samoa and Montenegro. We have seen improved rules and more market access agreement in the Government Procurement Agreement, which has a potential of adding close to about $100 billion to trade flows annually, and only a few minutes ago, we reached agreement on seven issues which whilst modest, are of importance not least because half of them deal with the concerns of Least Developed Countries (LDCs)," he said.

"Agreements give greater breathing space to LDCs on the issues of intellectual property protection, and trade in services, and a pledge to further streamline accession procedures for LDCs," he pointed out, noting that these are an important contribution from this conference.

During the course of the conference, he stressed, the "extent of our differences on the full range of WTO issues has also been evident... Some ministers highlighted the importance of keeping markets open and the need to resist protectionism in this challenging global economic environment. Others stressed that the use of existing WTO consistent policy space to achieve economic and development objectives should not be curtailed. Some ministers stressed that the WTO needed to address and respond to current global challenges while others harbour reservations about introducing new issues."

Ministers were divided on what to do next, he said, adding that "some ministers suggested exploring plurilateral-type of approaches for moving the round ahead. Others said that any approaches had to conform to the Doha mandate and not undermine multilateralism."

"Such division and diversity of views, I would say, are normal in any international organization and are not in themselves necessarily a bad thing. But at a time of mounting economic difficulties, there is clearly a need to strive for common ground and avoid a paralysis which prevents us from taking the collective action that the world expects from us."

"I very much hope that between now and the ninth ministerial conference, WTO members would dedicate themselves to doing all they can to overcome their differences and put the Doha Development Agenda back on track," the Chair of MC8 said.

Asked to elaborate on his comments that progress had been made on cotton, Lamy said that the Cotton-4 (Benin, Burkina Faso, Chad and Mali) have moved forward on technical assistance with China and the United States, where they have obtained a certain number of programmes. The C-4 has also talked to the European Union. The week was useful from that point of view, he added.

With respect to tariff issues and subsidies on cotton, Lamy said that the C-4 had obtained commitments from the US that are quite precise - duty-free quota-free market access to the US market (on certain tariff lines). This is now on the landscape, added Lamy, pointing out however that the US Congress has to deal with the matter. But progress has been made, he said.

On the next steps, Lamy said that members will have to discuss - not in principle, not in theory and not in process terms - what topics should be worked on for convergence in the bag of the Doha single undertaking, "and we've heard quite a number of ideas..."

"I think that after the experience we've had this year, the test we've had this year, I don't think we are in for a new mini single undertaking..."

In response to another question, the WTO Director-General said that this was his last regular ministerial conference.

(The ninth ministerial conference is scheduled to take place late 2013, with Lamy due to end his term earlier that same year.)

Asked if he will convene ministers (on his own initiative) to try to move the Doha Round forward due to the fact that time is running out before he concludes his term in 2013, Lamy said "the truth is that we are in an environment which is bad, and as the D-G of this organization, I always have to ponder the sort of necessity to try and move it forward - not because I want it to move forward - members have agreed on a mandate in Doha in 2001. They have decided themselves that they wanted to reduce trade-distorting agricultural subsidies... My job is to help them do that [and] not to invent new things."

But on the other side, Lamy said he also had the principle of "do no harm".

"I will sometimes be tempted of taking an initiative", which he said is in the very narrow margin of his authority "to move the thing forward, but in times like this one, I'm three times more careful on the 'do no harm' principle" because again the overall ambience is not good. "We are in difficult time [that] necessitates judgement, but my options are open, again within my limited executive capacity to try and move this agenda forward..." said Lamy.

Minister Aganga said that it is the members that make the decision and it is up to them to make it happen. "What I am saying is that I saw a sense of not just the will but the need to take responsibility and make this happen... They (members) recognize that Doha Round is very important but it's not necessarily the only important thing. WTO is bigger than Doha Round, meaning there are other very important things to address..."

Asked about the small group of Latin American countries (Bolivia, Cuba, Ecuador, Nicaragua and Venezuela, in document WT/MIN(11)/W/4) that in a statement had voiced disappointment with the political guidance document and disassociated themselves from it, Minister Aganga said that he met with this group after they had circulated their statement.

He added that it was a very good meeting, noting that the points that were being made is how to make the WTO a better organization for the members. It was an issue of inclusiveness, he further said.

During the discussion, issues about process and substantive issues were raised. It was obvious that the Chair of the General Council consulted very widely. It's a very difficult process, he said, explaining that there were 153 members, and now 157, and it was very difficult to have everyone in the room at the same time.

In this particular case, he said that the group made it absolutely clear that they were not breaking the consensus. The issue was clarified and resolved, he added. "We found a solution on how to deal with it going forward... In the end, they were happy, we were happy [and] everything is fine."

Asked to elaborate on the "multi-stakeholder" panel that he had proposed in his opening address at the conference on Thursday afternoon, Lamy said that "it's a relaxing exercise", adding that his concept is that "I need to help relaxing tensions in the membership, that's part of my job" as facilitator, mid-wife or confessor, "whatever you want to call it".

"There is a tension on this sort of 'new issues' question... a sort of looming confrontation between new issues and old issues," he said, adding that new issues are suspected from being the result of the intention to sideline, if not kill, old issues - as if new issues were to replace old issues.

Notwithstanding the fact that negotiating an issue and discussing an issue is procedurally totally different in this organization, Lamy said that to discuss an issue there is need for assent of the regular bodies of the organization and no one is prevented from putting something on the table.

Negotiating an issue is a totally different path, said Lamy, adding that in the WTO one does not negotiate an issue unless they have a consensually-agreed mandate of negotiation. "There is a bit of confusion in this debate between some wishing to discuss an issue and others resisting the negotiation of an issue, as if it was the same thing. No, it's not the same thing."

"In order to avoid this tension, and also in order to help members adjusting their knowledge - and I am speaking about trade negotiators - to the reality of what world trade is today, I think we need again to equip... the WTO with a sort of 21st century software. I very often have the impression that what trade negotiators are doing, the way they prioritize their objectives, the way they ponder their offensives and defensives, resembles more of the world of trade twenty years ago that what it is today," said Lamy.

Declining to say more on the matter, Lamy said that he will have to work on the terms of reference and the composition (of the panel). +