TWN Info Service on WTO and Trade Issues (May20/14)
12 May 2020
Third World Network

Members being nudged to decide on June 2021 date for MC12
Published in SUNS #9117 dated 11 May 2020

Geneva, 8 May (D. Ravi Kanth) – Despite the worsening Covid-19 pandemic in many countries, the World Trade Organization’s General Council Chair appears to be nudging members to take a decision on Kazakhstan’s recent offer to convene the World Trade Organization’s 12th ministerial conference (MC12) in Nur Sultan, in June 2021, trade envoys told the SUNS.

A decision on MC12 at Nur Sultan in June 2021 would be taken at a regular General Council (GC) meeting soon.

Apparently, the GC chair is considering three possibilities for convening the regular GC meeting, said trade envoys, who asked not to be quoted.

The first is for convening the regular GC meeting on 29-30 May, scheduled in the calendar of events for 2020 last year.

As of now, the regular GC meeting is very much for 29-30 May on paper, unless it becomes extremely difficult to hold the meeting even in a hybrid format. The hybrid format involves two officials to be present physically from each member country, and the rest of the participants from that country to take part in the meeting virtually, said trade envoys.

Much would depend on what the Swiss government intends to do after 27 May when it is expected to announce new measures about the size of meetings/gatherings.

Currently, only five people can gather/participate at any public place, according to the Swiss government’s restrictions.

So far, the GC chair or the WTO director-general Roberto Azevedo have remained coy on the regular GC meeting on 29-30 May, said trade envoys. The DG had earlier indicated that all physical meetings will remain suspended till end May.

In case the 29-30 May regular meeting fails to take place, then the second option is to convene a GC meeting sometime in June for taking important decisions, said trade envoys, who asked not to be quoted.

And the third option being considered is to defer the regular GC meeting to end-July, which is normally held before the annual summer-break, said trade envoys, who asked not to be quoted.

The regular GC meeting has become essential to finalize the date and venue for the MC12.

Despite lack of clarity on how soon the Covid-19 pandemic will be brought under control all over the world, the GC chair, Ambassador David Walker from New Zealand, wants members to decide on this issue – whether they will approve Nur Sultan as the venue for MC12, said trade envoys, who asked not to be quoted.

Several countries have privately conveyed to the GC chair that it is too early to decide the date and venue for the MC12 against the backdrop of the Covid-19 pandemic that is showing no signs of abating at this juncture, said trade envoys, who asked not to be quoted.

Meanwhile, the GC chair and the “Friends of Fish”, which is being coordinated by New Zealand, are also trying to look at various ways to advance the fisheries subsidies negotiations, trade envoys said.

Based on an article – “The Fate of the WTO and Global Trade Hangs on Fish” – written by former Appellate Body members James Bacchus and Inu Manak in the American Foreign Policy magazine of 5 May, several members have intensified the campaign, saying that it is important to conclude a fisheries subsidies agreement at any cost by the end of the year as per the United Nations Sustainable Development Goal (SDG) 14.6.

The SDG 14.6 says, “by 2020, prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, eliminate subsidies that contribute to illegal, unreported and unregulated fishing and refrain from introducing new such subsidies, recognizing that appropriate and effective special and differential treatment for developing and least developed countries should be an integral part of the World Trade Organization fisheries subsidies negotiation”.

In their article, James Bacchus and Inu Manak argued that “at the root of the fisheries problem lies the WTO’s use of two different sets of trading rules – one for developed countries, the other for developing,” implying that special and differential treatment as suggested in SDG 14.6 is the barrier for reaching an agreement on fisheries subsidies.

Therefore, “reaching global agreement to limit fisheries subsidies is not just essential for preserving fisheries and the world’s marine fishing stocks. Because it can only be resolved if one of the WTO’s core problems – its blanket distinction between two groups of countries – is addressed; it is also a crucial test for the future of the WTO.”

“Progress on fisheries would be a sign that the world has a chance to preserve – and perhaps even strengthen – the global, multilateral trading order at a time when so many forces are arrayed against it,” the authors argued.

Treating this article as an urgent call to conclude the fisheries subsidies negotiations, several developed and developing countries – Australia, Canada, Norway, Switzerland, and Brazil among others – have launched a sustained campaign over the past few days, demanding that the agreement on fisheries subsidies ought to be concluded by the end of the year, trade envoys said.

But many developing countries such as India, members of the African Group, and the ACP (Africa, Caribbean and Pacific) group, have repeatedly insisted that without special and differential treatment they cannot support the agreement, trade envoys said.

Further, attempts to impose harmonized commitments to address overfishing and overcapacity, IUU (illegal, unreported, and unregulated) fishing on all members, regardless of the structural disparities among members, have generated massive opposition by many developing countries, trade envoys said.

During a virtual meeting between the representative of the ACP group and the six facilitators early this week, it has emerged that the Chair of the Doha fisheries subsidies negotiations, Ambassador Santiago Wills from Colombia, did not take into consideration the reports of the facilitators before issuing the first draft text on overcapacity and overfishing on 9 March, said trade envoys, who asked not to be quoted.

The chair’s first draft text was fiercely opposed by India, the African Group, and the ACP group on grounds that it was tilted in favour of major subsidizers, who were given special carve-outs, while ignoring the need for effective special and differential treatment for developing countries, trade envoys said.

During an informal closed-door meeting of select trade envoys early this week, the chair apparently suggested that it is very difficult to start work as there is no consensus among members, said trade envoys, who preferred not to be identified.

Several countries had already indicated that they cannot negotiate out of the blue, suggesting that they can only negotiate on the basis of the mandates they get from their capitals, said trade envoys.

Recently, the “Friends of the System”, a group led by Switzerland, had called for resuming work as soon as feasible.

But many countries in Asia and Africa are still under prolonged lockdown conditions, making it difficult for establishing proper contact between Geneva and capitals, said trade envoys, who asked not to be quoted.

Meanwhile, in an unrelated development, the WTO Secretariat’s sudden circulation of Notes on “E-commerce, Trade, and the COVID-19 Pandemic” on its own responsibility, and another on a sectoral agreement on pharmaceutical products between Canada, the European Union, Norway, Japan, Switzerland, and the United States among others signed in 1994, have caused considerable confusion among members.

In a restricted document (Job/MA/142) on “trade in pharmaceutical products: consolidated list of products covered by the Sectoral Pharma agreement”, the WTO Secretariat said it prepared the consolidated list of products at the request of the participants to the 1994 agreement on “Trade in Pharmaceutical Products” (also known as the “Pharmaceutical Agreement”, or the “Pharma Agreement”).”

The Secretariat said that it is “a plurilateral sectoral initiative that was negotiated on the margins of the Uruguay Round and resulted in the binding and elimination of tariffs on a large number of pharmaceutical products and the substances used to produce them.”

“This note,” according to the WTO Secretariat, “seeks to provide a comprehensive overview of all products covered by the initial agreement and its four subsequent reviews.”

However, it is not clear as to why this agreement is being mined all of a sudden and whether it is aimed at nudging WTO members for eliminating tariffs on pharmaceutical products under the pretext of the Covid-19, said trade envoys, who asked not to be identified.