BACK TO MAIN  |  ONLINE BOOKSTORE  |  HOW TO ORDER

TWN Info Service on WTO and Trade Issues (Jul20/20)
27 July 2020
Third World Network


Outgoing WTO DG highlights achievements and challenges
Published in SUNS #9168 dated 27 July 2020

Geneva, 24 Jul (D. Ravi Kanth) – The outgoing WTO director-general Roberto Azevedo, in a farewell statement on 23 July, proclaimed his achievements, namely the Doha Trade Facilitation Agreement (TFA) and a partial agreement on export subsidies, while admitting the loss of the “appeals body” that has made redundant the enforcement function of the trade body, trade envoys told the SUNS.

At a General Council (GC) meeting on 23 July, Azevedo delivered his farewell statement in which he did not acknowledge that the appeals body or the Appellate Body (AB) became dysfunctional on his watch.

Significantly, Azevedo signaled the need for pursuing more plurilateral initiatives like the current Joint Statement Initiatives (JSI).

He suggested examining the consensus principle on grounds that unanimous agreements are difficult to accomplish.

Azevedo indicated the need for adopting an approach based on grading flexibilities to developing and least- developed countries based on their ability to take commitments akin to the Doha Trade Facilitation Agreement and in other covered agreements.

“The joint statement initiatives potentially represent one path to a more nimble, flexible WTO,” he said, while acknowledging the fact that “whether it is the JSIs or something similar – will inevitably raise important practical and systemic questions.”

“This approach (of embarking on plurilateral Joint Statement Initiatives) is the only way we can save trade multilateralism,” he said in his statement at the GC meeting.

Touching on the consensus principle that is the bedrock of the 164-member intergovernmental organization, Azevedo argued that “this Organization (the WTO) will not survive” if “full consensus is required to even begin to discuss any issue.”

“I am glad this is not where we are today”, he claimed.

Clearly, he can claim success for turning the multilateral trade body into a purely plurilateral organization where powerful members can create their own JSI dens and force the weak and poor members to agree to the rules they create, said a participant caustically after the meeting.

Declaring that a”one-size-fits-all recipe” won’t work at the WTO, Azevedo suggested differentiation on grounds that “an open-minded approach to flexibilities (as suggested by the United States) would open up a new era of fruitful work for the organization.”

“And when exploring potential areas for such work, unanimous agreement (based on the consensus principle) cannot be a prerequisite for starting conversations at the WTO”, he claimed.

Significantly, he did not mention about his own role as the Director-General of the 164-member trade body in crafting the JSIs after the summer break in 2017, when he and his office worked day and night for giving shape to the various Joint Statement Initiatives, as reported in the SUNS in October 2017.

Seeing the writing on the wall after the change of the administration in Washington, a director-general who is supposed to work for all members abandoned overnight work on the outstanding issues such as the permanent solution for public stockholding programs for food security (because of opposition from the US) and the special safeguard mechanism (SSM) among others, said a former trade envoy, who asked not to be quoted.

Azevedo claimed success for concluding the Doha Trade Facilitation Agreement (TFA), though he refused to mention that he had opposed the TFA when he was trade envoy of Brazil to the WTO.

“For Brazil and many others, this (trade facilitation) is not a self-balancing issue,” Azevedo had said at an informal heads of delegation meeting of the General Council on 7 June 2012.

Ever since the Doha Trade Facilitation Agreement was concluded at the WTO’s ninth ministerial conference in Bali, Indonesia, in December 2013, he seemingly dropped the word “Doha”, knowing full well that it is part of the enlarged Doha framework that was agreed in July 2004.

Moreover, the conclusion of the Doha Trade Facilitation Agreement hinged on accommodating Cuba’s concerns over the unilateral embargo imposed by the United States.

At the Bali ministerial meeting in December 2013, the Cuban deputy minister for trade and investment Ilean Barbara Nunez Mordoche refused to negotiate with Azevedo, who was conducting the closed-door negotiations with key players, due to his alleged proclivities towards the US.

The incident prompted the former Indonesian minister Gita Wirjawan to intervene and pacify her, according to people present at the meeting.

(See https://www.livemint.com/Opinion/ZvCf0XZzczILdvX6Lh6vDK/Azevdos-legacy-at-the-WTO.html).

In his farewell statement or even at the press conference on 23 July, Azevedo did not mention the reasons for the undermining of the Doha trade negotiations at the WTO’s tenth ministerial conference in Nairobi, Kenya, in December 2015.

In the run-up to the tenth ministerial meeting in Nairobi, the United States and a group of developed countries mounted a huge campaign in Geneva to abandon the Doha Development Agenda (DDA) negotiations in which Azevedo appeared to play the central role, according to a former Indian trade envoy, who asked not to be identified.

The ambiguous paragraph 30 of the Nairobi ministerial declaration stated: “We recognize that many Members (developing and least-developed countries) reaffirm the Doha Development Agenda, and the Declarations and Decisions adopted at Doha and at the Ministerial Conferences held since then, and reaffirm their full commitment to conclude the DDA on that basis.”

“Other Members (the US, the EU, Japan, and other developed countries) do not reaffirm the Doha mandates, as they believe new approaches are necessary to achieve meaningful outcomes in multilateral negotiations. Members have different views on how to address the negotiations. We acknowledge the strong legal structure of this Organization.”

Strangely, Azevedo’s comments in his farewell speech seem to resemble the language of paragraph 30 of the Nairobi ministerial declaration, particularly the line “as they believe new approaches are necessary to achieve meaningful outcomes in multilateral negotiations.”

In his farewell statement on 23 July, Azevedo said: “This approach (of embarking on plurilateral Joint Statement Initiatives) is the only way we can save trade multilateralism.”

Turning to the systemic crisis at the two-stage dispute settlement mechanism without which the rules cannot be enforced, Azevedo remained completely silent on who had undermined the appeals body or the Appellate Body.

It is an open secret that, after the US single-handedly blocked the selection process for filling the vacant posts at the Appellate Body, the appeals body has become dysfunctional. Whether he likes it or not, the AB is decimated under his watch, said a legal analyst, who asked not to be quoted.

The AB division seems to have broken up with its director Mr Werner Zdouc being moved to a new division (see SUNS #9149 dated 30 June 2020). Effectively, the AB is almost decimated at the WTO.

In his farewell statement, Azevedo, however, acknowledged: “Nevertheless, the fact that we (namely just one member – the US) are not in a position to agree on the means of enforcing agreements speaks volumes.”

Having remained silent on the intransigent stand of the Trump administration, which had praised Azevedo’s tenure during the last seven years, Azevedo argued that “a dysfunctional dispute settlement mechanism introduces an unacceptable asymmetry in the system.”

“This asymmetry is to the particular detriment of the smaller and more vulnerable parties to any dispute,” he said.

“I don’t think we can simply sweep this under the rug, and it must remain a priority for WTO members to address.”

Surprisingly, he did not include the restoration of the two-stage dispute settlement mechanism in the proposed WTO reforms that is chipping away at the margins of the trade body.

He said working on the Doha work program is a tall order, but as guardian of the trade body, he can seemingly claim credit for leaving it in a state of comatose.

 


BACK TO MAIN  |  ONLINE BOOKSTORE  |  HOW TO ORDER