TWN Info Service on WTO and Trade Issues (Apr16/01)
4 April 2016
Third World Network

Some ICs plan "modern trade deals" at WTO
Published in SUNS #8210 dated 30 March 2016

Geneva, 29 Mar (D. Ravi Kanth) -- Several developed countries have begun some preliminary efforts to prepare the ground for what they call "modern trade deals" at the World Trade Organization.

If successful, such initiatives will end in fracturing the multilateral World Trade Organisation, trade envoys told the SUNS.

Some key elements of the major initiative will include graduation of "major developing countries" from Special and Differential Treatment (S&DT), new digital trade and e-commerce, and open-ended plurilaterals in different areas, including services.

Close on the heels of notching success at the WTO's tenth ministerial in Nairobi over three months ago, trade envoys from Canada, Australia, Switzerland, New Zealand and the former trade envoys of India and Bangladesh held a three-day meeting convened by the United Kingdom's foreign office to discuss about a new trade agenda for addressing outstanding issues as well as new topics.

The high-profile "Wilton Park Dialogue" for "Unlocking the potential for the World Trade Organization to deliver modern trade deals" was convened by the British foreign office during 14 March and 16 March to prepare the ground for negotiations with new approaches and new issues.

There is broad convergence at the meeting that a one-size-fits-all special and differential treatment architecture for developing countries to address the outstanding issues in agriculture, industrial goods, and services, will not work, said participants familiar with the meeting.

The trade envoys discussed how to arrive at modalities that are increasingly becoming a den of hostage-taking, according to the participants who debriefed the SUNS.

In services, there is a common understanding to pursue digital trade and e-commerce. Trade envoys focused on how to pursue issues in a plurilateral format if they become difficult to be negotiated in an open setting involving all members.

The theme for the meeting - "Unlocking the potential for the World Trade Organization to deliver modern trade deals"- sought to address how to build new trade deals based on the successes of the Trade Facilitation Agreement, the ministerial decision on export competition for farm products, and the Information Technology Agreement (ITA).

"However, these successes were delivered in spite of the persistent and fundamental divisions between members on the negotiating agenda of the WTO," the UK government argued.

"For the first time," according to the agenda circulated for the meeting, "ministers at the tenth ministerial conference [in Nairobi] acknowledged that the organization membership is divided on how to progress future negotiations in the WTO."

While recognizing the "strong commitment of all Members to advance negotiations on the remaining Doha issues," it is clear a new approach is needed to deliver progress. "Ministers also noted that some members will wish to identify and bring new issues to WTO negotiations."

"The WTO finds itself at a pivotal moment. The UK government is committed to international diplomatic engagement to ensure that the WTO re-establish itself as the driving force for global trade liberalization and the pre-eminent forum for trade negotiations. To deliver this ambition, it is clear that the flexibility, creativity and political will that has enabled these recent successes will need to be harnessed to provide a new framework for negotiation."

The participants were asked to deliver a set of recommendations on "how to codify best practice to drive future progress."

"What has the WTO done well? Where have subject-specific negotiations and flexible approaches enabled progress," the UK government maintained.

The chair for agriculture negotiations Ambassador Vangelis Vitalis of New Zealand and the Deputy Secretary-General of the United Nations Conference on Trade and Development (UNCTAD), Joakim Reiter, provided a detailed account on the outcomes of the Nairobi ministerial, particularly on what went well and what lessons can be learned.

Canada's associate deputy foreign minister and trade envoy at the WTO, Ambassador Jonathan Fried, spoke on "successful negotiations: what makes a good deal?" He answered several questions such as where have the WTO negotiations been successful and why?

The other questions include:

(i) What can be learned from different approaches to negotiations in the WTO?

(ii) What are the negotiations that have enabled progress? What were the key factors in these?

(iii) Which negotiations have broken down - and what were the reasons behind these?

(iv) A look at what enabled the conclusion of the Trade Facilitation Agreement?

(v) What has changed since 2001 and what areas of common interest can be found?

The participants, which included India's former trade envoy Ambassador Jayant Dasgupta, Bangladesh's former trade envoy Ambassador Debapriya Bhattacharya, Australia's trade envoy Hamish McCormick, Switzerland's Ambassador Remigi Winzap, who chairs the NAMA negotiating body, the World Bank's senior official Anabel Gonzalez, and Ricardo Melendez-Ortiz of ICTSD among others, addressed the following questions:

(i) What would a strengthened WTO that is more able to deliver modern trade deals look like?

(ii) In which policy areas or specific negotiations could new approaches be applied? Are these best pursued multilaterally or plurilaterally?

(iii) How to take forward the digital trade and e-commerce agenda?

(iv) How might the WTO use flexibilities to develop these new approaches?

(v) How can members use momentum from MC10 and Davos to build consensus in Geneva?

(vi) How to approach S&DT and allow countries at different stages of development implement agreements at a different pace?

(vii) How to address the global goals?

(viii) How to support LDCs to consider how their interests would be best serviced by a more open and flexible approach to WTO negotiations?

(ix) How might plurilateral negotiations help to effectively tackle the Doha and post-Doha agenda?

(x) How can plurilaterals be made more inclusive, helping developing countries like Kenya consider the benefits of joining the ITA, and making sure that new approaches do not leave much of the WTO membership behind?

(xi) In agriculture, learning from the success of delivering export competition pillar at MC10, can members turn their attention to domestic support and market access? Is a positive outcome on the latter [market access] possible, given the proliferation of FTAs?

(xii) In non-agriculture market access, what has been already delivered through the plurilateral agenda and how can more countries benefit from this progress?

(xiii) Services: a focussed review on areas with the most potential to deliver progress in the WTO - digital trade and services bundled with goods. Do the plurilateral models of the Understanding on Financial Services or the Basic Telecoms Agreement offer alternative models for the way forward?

(xiv) Development - is there more space for an effective trade and development agenda and what might be the elements of that agenda?

(xv) LDCs - did Nairobi get us clear to delivering the Bali package for LDCs and how can we make sure we do this?

(xvi) MC10 implementation: options on public stockholding by MC11 and what to do on the Special Safeguard Mechanism?

There is a common understanding that bite-sized, low-hanging fruits must be pursued given the complexities involved in the single undertaking which requires that nothing is agreed until everything is agreed, said one participant who attended the three-day meeting. +