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Info Service on WTO and Trade Issues (Jul21/22) Geneva, 23 Jul (D. Ravi Kanth) – Without addressing the structural imbalances and asymmetries in the chair’s draft consolidated text on fisheries subsidies, the WTO director-general Ms Ngozi Okonjo-Iweala is rushing to create a “WTO funding mechanism” for providing technical assistance and capacity-building in implementing controversial fisheries management schemes in the developing and least-developed countries, said people familiar with the development. The DG is apparently toying with the idea of a $20 million fund largely drawn from the European Union, Canada and several other developed countries for assisting the developing and least-developed countries (LDCs) in implementing these controversial fisheries management schemes. At a ministerial meeting on 15 July, around 80 trade ministers had issued calls for addressing the core disciplines to prohibit harmful subsidies in the overcapacity and overfishing pillar as availed by the big subsidizers such as the European Union, the United States, China, Japan, Canada, Korea, and Chinese Taipei among others for their industrial-scale fishing. The trade ministers from developing and least-developed countries demanded appropriate and effective special and differential treatment (S&DT) as per the United Nations Sustainable Development Goal (SDG) 14.6, which was further reinforced by the Buenos Aires ministerial decision in December 2017. The Buenos Aires ministerial decision calls for “comprehensive and effective disciplines that prohibit certain forms of fisheries subsidies that contribute to overcapacity and overfishing, and eliminate subsidies that contribute to IUU [illegal, unreported and unregulated] fishing recognizing that appropriate and effective special and differential treatment for developing country Members and least developed country Members should be an integral part of these negotiations.” Yet, the monumental failure of the chair’s draft consolidated text to adhere to the Buenos Aires ministerial decision is “written all over the wall”, said people, who asked not to be quoted. DG’S PLAN ON FUNDING MECHANISM The DG, however, seems determined to divert attention away from the core problems in the fisheries subsidies negotiations and towards technical assistance and capacity-building, said people who asked not to be quoted. The DG is expected to issue an initial report on establishing a “WTO Funding Mechanism” to finance technical assistance and capacity-building in implementing the proposed fisheries subsidies agreement at an informal meeting of the Trade Negotiations Committee (TNC) on 23 July. Ahead of the informal TNC meeting, the DG sent an email to members on 19 July stating the “importance of technical and financial support for developing and LDCs members to develop fisheries management experience for the purposes of implementing WTO disciplines on Fisheries Subsidies – and that this would not be seen as a substitute for Special and Differential Treatment.” In her email, the DG said that the chair of the Doha Rules negotiations (Ambassador Santiago Wills from Colombia) and she will reach out on this and the process ahead, in various configurations including with group coordinators, starting this week. Apparently, she convened meetings between donors and some countries for discussing the funding mechanism which is expected to be around $20 million from trust funds, said a person, who preferred not to be quoted. Surprisingly, according to several members who took part in the 15 July ministerial meeting, there does not appear to be a strong call by developing countries to bolster the technical assistance provisions of the proposed fisheries subsidies agreement. If anything, most of the ministers from developing and least-developed countries pressed for strengthening the core disciplines that will effectively discipline the large subsidizers while providing appropriate and effective S&DT to the developing and least-developed countries to develop their nascent fishing sectors, said a person, who asked not to be quoted. Moreover, the technical assistance fund will not remedy the glaring defects of the proposed fisheries subsidies agreement. It is also being thrust out of the crucial discussions to follow in the coming days, the person said. According to people who took part in the ministerial meeting on 15 July, a large majority of trade ministers called for strengthening the core disciplines for prohibiting the harmful subsidies being accorded to the large subsidizers such as the European Union, the United States, China, Japan, Korea, and Chinese Taipei among others. Many developing countries also dismissed the controversial approaches put forward at the ministerial meeting, said people, who are familiar with the deliberations. Also, the proposed instrument for funding technical assistance and capacity-building appears to be premature for discussion at this juncture when the provisions of the proposed fisheries subsidies agreement remain unclear and are not yet agreed, said people, who asked not to be quoted. Further, the DG’s message on discussing the issue of technical assistance seems utterly out of sequence, when the fate of many core issues now hang in the balance after the trade ministers’ meeting on 15 July, said people, preferring not to be quoted. More importantly, many WTO members, both developing and industrialized countries, indicated that the chair’s draft consolidated text needs further substantial work and many “red-line” issues would need to be resolved. Ministers as well as Heads of Delegation (HoD) referred to issues concerning Art 5.1.1 in the draft text on exempting the big subsidizers from the disciplines on harmful subsidies under a controversial sustainability-based flexibility; Article 8 relating to onerous transparency and notification requirements; non-specific fuel subsidies; Articles 5.4, 11.1 & 11.4; various elements of Article 3; and S&DT provisions. For example, the African Group said that S&DT must be effective “to enable us to leverage our resources” for economic development, it cannot be time limited or confined to artisanal and subsistence fisheries, and limited to technical assistance or capacity-building. For the agreement to achieve the requisite balance, it must be premised on the principle of common but differentiated responsibilities, the African Group said. Jamaica, on behalf of the ACP (African, Caribbean, and Pacific) Group, said at the ministerial meeting that the disciplines should target the major subsidizers and distant-water fishing nations. The ACP Group said special and differential treatment should not be limited to transition periods, suggesting that their core interests in having policy space for development of the sector should not be substituted for technical assistance and capacity-building. Cameroon said that “what is at issue here is, without a doubt, industrial fishing. Through this prism, and in view of the imperative for developing countries to support their fisheries sector, they should be given the necessary flexibilities under special and differential treatment, rather than highlighting the possibility of technical assistance.” The WTO Secretariat has claimed that the fund would “strengthen the fisheries management and data collection necessary for implementing the new disciplines, as well as taking advantage of the disciplines to establish data-driven sustainable fisheries management systems, including providing training to fisheries management personnel of beneficiary countries (“fisheries-related elements”)”. The ACP Group pointed out that in the overcapacity and overfishing pillar, the current approach focuses on fisheries management, instead of subsidy prohibition as instructed by the mandate. The ACP group pointedly said that there are loopholes in the current draft text that may lead to a maintenance of the status-quo, thus “defeating our collective sustainability objectives.” It asked for balancing the current draft text with clear mechanisms for the elimination of harmful subsidies, especially by the major subsidizers, rather than establishing disciplines for fisheries management. The ACP Group argued that addressing these issues represent work in progress and “we believe that their resolution would bring balance and equity, as well as improve the sustainability dimension of the text,” said people, who preferred not to be quoted. Further, many developing countries do not think that the fisheries management approach is appropriate, nor effective. As such, it seems premature to discuss a possible instrument to implement provisions which are not yet agreed, said people, who asked not to be quoted.
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