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TWN Info Service
on WTO and Trade Issues (Dec20/18) WTO members sharply
divided on notification, e-com & cotton issues Geneva, 17 Dec (D. Ravi Kanth) - Members of the World Trade Organization remain sharply divided on issues concerning compliance with notification requirements, cotton, and the 1998 multilaterally-mandated work programme on electronic commerce, as well as the damage being caused by the non-mandated plurilateral Joint Statement Initiative (JSI) group on establishing new rules on e-commerce, trade envoys told the SUNS. At a General Council (GC) meeting on 16 December, the participants of the Joint Statement Initiative (JSI) on e-commerce, particularly the United States, the European Union, Australia, and Singapore among others blocked a request from South Africa, India, and a large majority of developing countries for reviewing the work of the 1998 e-commerce work programme as a standing item on the GC agenda so as to enable the GC to play a central role, said participants, preferring not to be quoted. DATE AND VENUE OF MC12 At the day-long General Council meeting, the GC chair, Ambassador David Walker from New Zealand, provided an account of his consultations with members about the timing of the WTO's 12th ministerial conference (MC12). Ambassador Walker suggested that the 21-24 June 2021 date for MC12, as proposed by host Kazakhstan, is becoming unrealistic to use as a working hypothesis due to the ravaging COVID-19 pandemic. The GC chair indicated the possibility of deferring MC12 to December 2021 (possibly in Geneva). Kazakhstan, however, indicated that it is ready to hold the meeting on 21-24 June next year if conditions permit for convening the meeting. Several countries thanked Kazakhstan for taking the initiative to host the meeting subject to normal conditions, but suggested that the date of June 2021 is no longer a realistic goal due to the current state of the pandemic. Jamaica, on behalf of the ACP (Africa, Caribbean, and Pacific) group, said that "any date to be agreed must accommodate the concerns of the WTO's membership, including the psychological comfort of delegates and the lag effect that the virus would have in our capitals." The ACP group called for "wide consultation on the new date for the (MC12) Conference to ensure that it does not overlap with other major international meetings, such as UNCTAD XV [scheduled for October 2021 in Barbados], that require the undivided attention of our Ministers, many of whom are also in charge of WTO affairs." Jamaica urged the GC chair "to begin these consultations as soon as possible," arguing that despite "the progress being made in some capitals in respect of the containment of the virus and discovery of vaccines and other medicines, uncertainties continue over the return of normalcy, including in capitals with less resources." "Hence, it may well be that certain international travel restrictions will continue into 2021," the ACP group said, suggesting that "any date put forward at this time does not represent a final decision but continues to be a working proposal until we are in a position to adopt it." Concurring with the GC chair's assessment that the June 2021 date was becoming unrealistic to use as a working hypothesis, the African Group said "over and above that, despite promises of a vaccine, it remains unclear whether the COVID-19 pandemic would be contained by that time." "In the event of such an eventuality, we would suggest that consideration be given to returning to a December Ministerial cycle and be held in Geneva," the African Group said. Further, members also need to factor in delays in finalizing the appointment of the next Director-General," given "the instrumental role the DG plays both on the substance and logistics for the Conference," it said. The African Group called on "Members' cooperation in finalizing the selection process to pave the way for preparations for MC12," a call that was echoed by a large number of developing and several developed countries. However, the US trade envoy Ambassador Dennis Shea remained silent on the appointment of the next director- general even as many members expressed concern that the delay in finalizing the appointment of the next DG will have an adverse effect on work at the WTO. EU-INDIA FACE-OFF ON PUBLIC STOCKHOLDING During the discussion on the GC agenda item on the implementation of the Bali, Nairobi, and Buenos Aires outcomes and the report by the GC chair, the EU expressed concern that India, after invoking for the first time, the Bali decision on the public stockholding programs for food security purposes on rice, has so far not answered some six questions, according to the participants present at the meeting. The EU's trade envoy Ambassador Joao Aguiar Machado asked India to fulfill its transparency obligations and sought substantial answers to assess India's conformity with the Bali decision. Ambassador Machado said "the EU is far from convinced that India has respected the (Bali) decision", suggesting that India must submit information for rice, wheat, and coarse grains among others. The EU trade envoy also said that around two developing countries have not yet submitted their ratification of the Nairobi ministerial decision on export competition, suggesting that it is regrettable even as the Bali decision on the under-fill mechanism for tariff-related quotas was not implemented. INDIA'S RESPONSE In what appears to be a sharp rebuke to the EU ambassador's comments, India reminded members of the Bali and Nairobi decisions on the permanent solution for public stockholding programs for food security that ought to have been concluded at the WTO's 11th ministerial meeting in Buenos Aires, in December 2017, said a trade envoy, who preferred not to be quoted. India said that the outcome on the permanent solution is imperative for achieving the United Nations Sustainable Development Goals 1 and 2, arguing that the WTO must deliver on this issue which is being supported by a large majority of developing countries. Responding to the EU's specific criticism, India said, as a responsible member of the WTO, it has consistently complied with its notification requirements. It emphasized that India's transparency and compliance is much better than several countries since 1995, including "those members who are calling for enhanced transparency obligations," the participant said. India's trade envoy Ambassador Brajendra Navnit said, while it is not his intention to point fingers at any member, "our expectation is [that] members practice what they preach." India pointedly criticized the EU for not submitting so far its domestic support for the marketing year 2018-19. Even in complying with the notification of domestic support for 2017-18, the EU took more than 19 months, India said. Moreover, the EU has so far not notified new standards or MRLs (maximum residue limits) and its constantly changing SPS (sanitary and phytosanitary) measures, India said. Ambassador Navnit urged "the EU and other members to lead by example by implementing their notification commitments before proposing ever-growing new obligations standards, and compelling other members to follow." Intervening in the debate on Bali, Nairobi, and Buenos Aires implementation issues, Indonesia's trade envoy Ambassador Syamsul Bahri Siregar reiterated that the WTO needs to make significant progress to achieve the permanent solution on the public stockholding programs for food security and a comprehensive and balanced outcome on the special safeguard mechanism. Ambassador Siregar called for redoubling work for advancing the mandated issues in the context of agriculture reform, suggesting that reform measures must remain balanced in its outcome, said another participant, who asked not to be quoted. On fisheries subsidies, the Indonesian trade envoy urged members to adhere to the Buenos Aires mandate in prohibiting certain forms of subsidies that contribute to overcapacity and overfishing. "It is not our duty to encroach on other organization's mandate concerning fishery management and sustainability issues," Indonesia said. Indonesia called for resolving the impasse in restoring the Appellate Body (AB) through an expedited process, emphasizing that the next director-general should be appointed without further delay and should remain the top priority of the members. THE ISSUE OF COTTON A large number of developing and least developed countries overwhelmingly supported a draft General Council decision on cotton tabled by the C-4 countries (Burkina Faso, Benin, Mali, and Chad). The draft decision on an action plan calls for achieving the following goals: (1) Increased engagement of public and private sector stakeholders in commercial initiatives to add value to cotton by-products. (2) Enhanced capacity of cotton farmers, including women farmers, to collectively engage in value addition activities for cotton and its by-products (SDG 5). (3) Strengthened capacities of farmer representative groups to negotiate appropriate remuneration for produced fibres and by-products. (4) Enhanced capacity of cottonseed processors to improve oil recovery rates and market by-products effectively, including through modern, cost-competitive production techniques and technologies. (5) Improved capacity of policymakers to formulate evidence-based policies and ensure policy coherence in support of the development of cotton by-products. (6) Identifying the means to contribute to increased revenues for cotton producers and processors as well as for poverty reduction (SDGs 1, 8 and 10), including through the creation of sustainable and resilient industrial and trade-related infrastructure to the benefit of cotton producers and processors (SDGs 9 and 12). (7) Promoting consideration of ways in which economic operators in cotton value chains can be supported through appropriate assistance. (8) Engagement with existing mechanisms and programs for promoting transfer of technology and building capacity to add value to cotton by-products through technology transfer measures and technical and financial cooperation under Article 66.2 and Article 67 respectively of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). The US said that it has undertaken "a preliminary review of this proposal and has some initial questions we intend to share with the proponents." The US said that it wants "direct engagement from the proponents in order to ensure that any potential outcome in this area reflects a shared view of the expected outcomes from this Action Plan and that any future engagement in the Consultative Framework be consistent with the goals and competencies of the organization." The EU said it is working closely with the C-4 countries for the development of the cotton sector and address their core problems. The African Group supported "the joint submission by the C-4 and Cote d'Ivoire contained in document WT/GC/ W/808, with a draft General Council Decision for a Joint Action Plan to enhance support for cotton by-product development in LDCs." "Through such an Action Plan, we trust that resources can be mobilized to support the implementation of projects and programmes envisioned therein," the African Group said, calling for immediate approval by the General Council. In its intervention on the cotton debate, South Africa's trade envoy, Ambassador Xolelwa Mlumbi-Peter, said that cotton is a predominant cash crop for many African LDCs, providing income to over 3.5 million farmers and their families, and 17% of those lead farmers are women. She said that sub-Saharan African countries export more than 90% of the raw cotton lint they produce. "Many African agriculture producers are confined to producers and exporters of primary products due to trade distortions in agriculture," South Africa's trade envoy said, pointing out that "trade-distorting domestic support for cotton by WTO Members distort prices and disrupt international cotton markets, with severe consequences for the economy and social lives in African cotton-producing countries, especially Least Developed Countries (LDCs)." Further, the South African envoy argued that "given that cotton production is one of the most important sources of livelihood of these smaller economies, a sustainable solution to the challenges faced by many cotton farmers is the urgent resolution of the TDDS (trade-distorting domestic support) and the implementation of the Cotton Nairobi Ministerial Decision." The ACP (Africa, Caribbean, and Pacific) group, India, Chad, on behalf of the least-developed countries, and Bangladesh among others strongly supported the C-4 action plan, participants said.
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