TWN Info Service on WTO and Trade Issues (Oct17/24)
30 October 2017
Third World Network

DG, Chairs of WTO Doha bodies on state of play ahead of MC11
Published in SUNS #8561 dated 26 October 2017

Geneva, 25 Oct (Kanaga Raja) - An informal Heads of Delegations (HoD) meeting held just some seven weeks before the WTO eleventh ministerial conference (MC11) in Buenos Aires heard an assessment by the Director-General as well as reports by the chairs of the various negotiating bodies under the Doha Work Programme on the state of play so far on the key issues in the negotiations.

At the HoD meeting on 24 October, the reports by the Chairs of Doha negotiating bodies were preceded by some remarks by Director-General Roberto Azevedo.

Following Azevedo's remarks and the reports by the Chairs, a number of delegations took the floor, with the large majority of developing countries calling amongst others for credible outcomes at MC11 on a permanent solution for public stockholding programmes for food security, on the Special Safeguard Mechanism (SSM) and on cotton (see separate story).

According to trade officials, in his remarks at the HoD meeting, the Director-General recounted the meetings that he had been attending in recent weeks including the informal ministerial meeting in Marrakesh, a meeting of trade ministers from the Africa, Caribbean and Pacific (ACP) Group, the IMF and World Bank meetings in Washington (where he met with USTR Robert Lighthizer), and meetings with the African Group and the group of Francophone countries.

According to the DG, there is a strong reaffirmation of support for a good outcome at MC11 but there are very difficult issues that remain. In some cases what is seen are divergent positions, and he is hearing a lot of the same things that he has been hearing up to now.

He highlighted the issues that were raised at the Marrakesh meeting in October including agriculture and its many sub-elements including domestic support, public stockholding programs for food security, cotton and the special safeguard mechanism (SSM); fisheries subsidies; domestic regulation in services; special and differential treatment (SDT); electronic commerce; micro, small and medium sized enterprises (MSMEs); investment facilitation; and women's empowerment.

According to trade officials, Azevedo also mentioned the dispute settlement system, saying that the current situation is very concerning. Members need to find a way forward, he added.

He said that overall the discussions with the Ministers have gone well, but in terms of convergence, it is not very encouraging.

There is a great deal of support both at the Marrakesh and ACP meetings for an MC11 outcome but there is need to reduce the number of issues that are going to be on the table for ministers to take up in Buenos Aires.

In the very near future, members will have to decide which issues can be brought to MC11 and which have not advanced enough, said the DG.

According to Azevedo, Buenos Aires is not the end of the road. He expressed hope that we can leave Buenos Aires with members committed to strengthening the trading system and with a clear path forward for work on as many issues as possible.

The Director-General told the informal HOD meeting (excerpts of his remarks have been posted on the WTO website): "As our upcoming Ministerial Conference in Buenos Aires draws nearer, there has been a lot of activity taking place amongst members. Discussions are ongoing in many areas. While there are some signs of potential convergence in some areas, in many others this is not the case. We need to be very mindful of this."

"Given this situation, I think that members will soon have to decide which issues can be brought forward for ministers' consideration at the Conference - and which issues are not advancing fast enough to be resolved by that time.

"I think that this honest assessment will allow us to focus our minds on shaping what outcomes in Buenos Aires could look like, and also to start setting a game plan for our work after Buenos Aires - including the issues that need more time to mature. In all of this, flexibility and pragmatism will be essential.

"As I have said before, proponents have a particular responsibility here to build momentum behind their ideas. The chairs and I will do our part to keep the entire membership on board for any progress that you can collectively achieve.

"But each and every delegation has a role to play. We must all continue working and reaching out to each other. I hope that we can leave Buenos Aires with members committed to strengthening the trading system and with a clear path forward for our future work on as many issues as possible."

Azevedo further said: "I have found my recent interactions with ministers to be extremely helpful in raising their awareness of the discussions taking place in Geneva. I have also welcomed the strong reaffirmations of support for a successful MC11 that I have received during these various discussions. I hope we can continue building on this constructive dialogue."

REPORTS BY NEGOTIATING GROUP CHAIRS

According to trade officials, the Chair of the Negotiating Group on Rules, Ambassador Wayne McCook of Jamaica, reported that there has been significant work done on the three pillars in the negotiations.

On fisheries subsidies, the negotiating group had intensified its work during a four-day session. It reflected the strong determination of members to advance outcomes.

It is too early to predict exactly what the scope (of this outcome) will be but the members have in place at the moment the necessary conditions to bring about an agreement. But political and technical challenges remain.

The Chair said that so far the members are not shrinking from these challenges and that there are no linkages or sequencing that have been attached to this, and that has been the key.

When the members meet to take this issue up in the next couple of weeks, there needs to be precise and detailed interventions - we are talking about drafting changes (to the "vertical" text on fisheries).

It must be a bottom-up approach, said the Chair, adding that he cannot provide the substance.

The Chair also mentioned the other two issues of trade remedies (the proposal from China) and horizontal subsidies (the proposal from the EU).

The Chair said that the issue of fisheries subsidies is promising for a possible outcome at MC11.

The Chair of the services negotiations, Ambassador Hector Marcelo Cima of Argentina, said that so far on the question of trade facilitation in services and on market access, members should not expect a negotiating outcome in Buenos Aires.

According to the Chair, on domestic regulation in services, there continues to be quite a lot of energy in these discussions. A "significant" group says that there is enough progress that has been made for a negotiating outcome to be reached but "another sizable" group says that this is not something that can be done.

A large group of proponents will be presenting a revised paper very shortly and this will take into account many of the concerns that have been raised by others. These concerns are linked largely to policy space and the right to regulate.

The Chair of the Committee on Trade and Development in Special Session, Ambassador Tan Yee Woan of Singapore, mentioned that the big issue here is the G90's ten Agreement-specific proposals.

The opponents have said that the exemptions and open-ended flexibilities would be damaging to the system, so the question is how should the work proceed in the 30 working days before MC11?

Are there alternative approaches? Are there any areas of convergence? According to the Chair, the answer to that is "no".

The Chair of the NAMA (non-agricultural market access) negotiations, Ambassador Didier Chambovey of Switzerland, said that there has not been a meeting since 21 July. An informal meeting has been called for 1 November.

The Chair of the TRIPS Council in Special Session, Ambassador Dacio Castillo of Honduras, asked what is the role for the TRIPS Council in Special Session in the preparations for MC11? Should there be negotiations on the GI register for wines and spirits afterwards?

He said that the known positions were reiterated and members sensed little appetite for negotiations in this area.

The Chair of the Committee on Trade and Environment in Special Session, Ambassador Dr Syed Tauqir Shah of Pakistan, said that a meeting was held on 3 October, which was an information session.

There have been no new proposals but delegations said that the environment is too important an issue and should not be forgotten in any ministerial declaration.

The Chair of the Dispute Settlement Body (DSB) in Special Session, Ambassador Coly Seck of Senegal, reported that an informal meeting was held on 10 October.

There have been no new proposals and there has not really been a push for an outcome at MC11 but there is a desire to continue discussing these issues after MC11 in the current format and members like to take up one issue at a time.

Deputy Director-General Yi Xiaozhun reported on behalf of the Chair of the Committee on Agriculture in Special Session, Ambassador Stephen Karau of Kenya, who was out town.

He said that the issue of public stockholding for food security purposes is a priority issue. There are two proposals on the table.

On domestic support, he said this is the priority for the vast majority of members. On cotton, the Cotton-four countries have put forward a new proposal and are looking for a high level of ambition.

On agricultural market access, he said that a substantial outcome will not be feasible at MC11, but others would like to continue to take this up after MC11.

On SSM, the proponents have called for an outcome but the prospects are limited because without something in market access, opponents are very reluctant to move on this issue.

On export restrictions, he said many members support a limited outcome on enhancing transparency on export prohibitions and restrictions but others say that this should be seen within the context of a more comprehensive outcome.

(See below for Ambassador Karau's full report at a meeting of the Committee on Agriculture in Special Session on 19 October. A dedicated session on PSH and SSM was held on 20 October.)

According to trade officials, Director-General Azevedo concluded that from what he has heard from members there is still a long way to go and there is a short time in which to do this. He urged members to prioritize the issues.

Meanwhile, in his report to the Committee on Agriculture in Special Session, at its meeting on 19 October (JOB/ AG/117), Ambassador Karau had said that domestic support remains the priority for the vast majority of Members.

It is the pillar that has received a lot of attention in all our meetings thus far, as well as in my consultations with Members. It was also one of the main issues discussed at the Marrakesh Mini-Ministerial meeting, he said.

This engagement is yet reflected again by two more submissions that will be introduced today (19 October), namely the one by the ACP Group in document JOB/AG/112 and the one by New Zealand, Australia, Canada, Chile and Paraguay in document JOB/AG/114.

Nevertheless, important gaps still remain in the positions of Members on the negotiating issues.

Members remain broadly divided between:

* those that favour an overall limit on trade-distorting support, whether based on a percentage of the value of production or on a monetary ceiling; and

* those that consider that the AMS should be eliminated first - notably because it allows for product-specific subsidy concentration - and that at least some steps should be taken in that direction.

In addition, several Members consider that efforts should be proportional and the burden should not be put more on some Members than others. They consider that new disciplines based on the current elements - AMS and de minimis - would be more appropriate and cautioned against a one-size-fits-all-type of solution.

While acknowledging the usefulness of the proposal by the EU/Brazil and co-proponents, several Members regretted the absence of disciplines on product-specific support and/or immediate disciplines on the Blue Box. Some Members reiterated their sensitivities regarding Article 6.2 and de minimis entitlements.

On cotton, he noted that the C4 proposal containing a draft ministerial decision on Cotton was circulated on 11 October 2017 in document TN/AG/GEN/46.

The C4 proposal received preliminary comments from Quad Plus participants during a brief meeting on 13 October. Some of the Members who provided comments regretted the high level of ambition, while others requested the C4 to clarify some elements of the proposal, including the proposed treatment of developing country Members.

On export restrictions, the Chair said the discussions thus far have confirmed that many Members support a limited outcome, mainly focused on enhancing transparency in Export Prohibitions and Restrictions.

It should also be highlighted that most Members consider that an outcome on Export Prohibitions and Restrictions could not be envisaged in the absence of a more comprehensive outcome in the agricultural negotiations overall.

In Market Access, the Chair said there is acknowledgement among the Members, including the proponents, that a substantive outcome in Market Access may not be feasible at MC11. Simultaneously, he has not heard any Member questioning the importance of Market Access reforms.

The Chair had nothing new to report on export competition.

The Chair concluded that a lot of work, however, remains to be done given that we are only seven weeks away from MC11 which, in principle, means that there are only five working weeks still available.

It is now time to translate the engagement demonstrated in Marrakech by our Ministers and the shared willingness to have success at MC11 into concrete actions, he said.

"To prepare the ground for success at MC11, it should be our objective to submit to Ministers a limited number of issues for their consideration. This implies that we need to intensify our work here in Geneva and close as many gaps as possible in the negotiating positions of Members on the issues. Experience has taught us that the agenda for Ministers must be manageable if results are to be obtained," he said.

"Put differently, our objective should be to submit to Ministers a clear understanding of what can be envisaged as agricultural outcomes at MC11, with as few points as possible left open for negotiation by Ministers. Depending on the issue, the envisaged outcome could be a substantive one, a post-MC11 work programme or a combination of the two," he added.