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TWN Info
Service on WTO and Trade Issues (Oct21/23) Geneva, 25 Oct (D. Ravi Kanth) – The United States and the European Union seem to have finalized their trade priorities and strategy for the World Trade Organization’s 12th ministerial conference (MC12) taking place in Geneva from 30 November, a development that appears to raise serious concerns for developing countries, as it had happened 20 years ago at the WTO’s fourth ministerial conference (MC4) in Doha, Qatar, said analysts. In a series of meetings held in Brussels and later in London last week, the two trans-Atlantic trade giants have apparently worked out a detailed strategy on how to push their concerns in the face of likely opposition from developing countries, said an analyst, who asked not to be quoted. The details of the meeting between the US Trade Representative (USTR) Ambassador Katherine Tai and the EU trade commissioner Mr Valdis Dombrovskis have not been made public. It appears that the two sides want to remain silent on what transpired during a one-on-one dinner meeting held last week. Interestingly, the USTR put out the details of the Group of Seven (G7) trade ministers’ meeting on 22 October. However, the USTR did not do the same about her meeting with the EU trade commissioner. The USTR put out a detailed press release following the G7 trade ministers’ meeting, which included the US, Japan, Germany, France, the United Kingdom, Italy and Canada. During that meeting, the G7 trade ministers “called for eliminating forced labor in global supply chains, expressed shared values in digital trade, and agreed to step up efforts to counter market-distorting practices.” According to the USTR, the G7 trade ministers “discussed priorities for a successful Twelfth Ministerial Conference of the WTO, and expressed their commitment to reforming the WTO and building a more viable and durable multilateral trading system.” The USTR said that “the G7 Trade Ministers have charted a path toward making trade a force for good,” adding that “our joint statement makes clear that we are united in support of a rules-based trading system with no place for forced labor. We must now turn our commitments into action.” Ambassador Tai said “the United States stands ready to work with allies, trade partners, multilateral institutions, and businesses as we pursue a race to the top to uphold human rights and international labor standards.” More importantly, the USTR said “we also clearly expressed our shared values and opposition to models of digital authoritarianism and digital protectionism.” She said the G7 trade ministers remain “concerned with the increasing use of digital trade measures to undermine freedom of speech and expression, as well as government use of surveillance systems that run counter to our shared norms and values, including human rights and a free and open internet.” “Our commitments on digital trade should contribute to inclusive growth and support innovation and align with a worker-centric, human-centric trade policy, and that the gains from digital trade are equitably distributed,” she said. Lastly, Ambassador Tai said that “the G7 committed to working closely with our allies and like-minded partners towards building truly fair international trade that enables healthy competition and confronts unfair market distorting practices. We must focus our efforts on designing tools that will effectively address this problem and consider new tools to confront, effectively, the non-market practices of state-enterprises.” The joint statement issued by the G7 trade ministers drew attention to data localization requirements, which it claimed are being used “for protectionist and discriminatory purposes, as well as to undermine open societies and democratic values, including freedom of expression.” The G7 trade ministers said “they will address unjustified obstacles to cross-border data flows, while continuing to address privacy, data protection, the protection of intellectual properties, and security.” 2001 MAY REPEAT ITSELF IN 2021 Significantly, last week’s meetings between the US and the EU as well as the G7 trade ministers’ meeting has raised the prospect of 2001 repeating itself all over again in 2021, said an analyst, who preferred not to be quoted. When they came to the fourth WTO ministerial conference (MC4) in Doha, Qatar, in 2001, the two trans-Atlantic trade giants were not on the same page on the so-called “Singapore issues”. These controversial issues included trade and investment, transparency in government procurement, trade facilitation, and competition policy. These four issues were first raised at the WTO’s first ministerial conference held in Singapore in December 1996, a year after the WTO came into existence in 1995. However, during the meeting in Doha, the former USTR Ambassador Robert Zoellick and the former EU trade commissioner Pascal Lamy suddenly announced a common strategy, which they were working on behind the scenes in the run-up to that meeting. Because of sustained opposition from a like-minded group of developing countries that included India and Malaysia among others, the turn of events at Doha were not completely in line with what the US and the EU had sought. On the “Singapore issues”, India introduced language to the effect that a final decision on the four “Singapore issues” will be decided on the basis of “explicit” consensus at the fifth WTO ministerial conference in Cancun, Mexico, in 2003. The Doha Declaration of 2001, contrary to the campaign launched by the US and the EU, also included a comprehensive package of developmental issues in agriculture, implementation issues on making special and differential treatment simple and effective, rules covering improvements in anti-dumping, regional trade agreements, and fisheries subsidies, among others. Yet, all these developmental issues raised by the developing countries were set aside during these past 20 years while the US and the EU pocketed the Trade Facilitation Agreement at the WTO’s 9th ministerial conference in Bali, Indonesia, in 2013. Subsequently, the US and EU opposed the continuation of the Doha work program at the WTO’s 10th ministerial conference held in Nairobi, Kenya while justifying the work on fisheries subsidies, which was part of the Doha Rules dossier, under the United Nations Sustainable Development Goal (SDG) 14.6. The UN’s SDG 14.6 mandates WTO members to, by 2020, prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, and eliminate subsidies that contribute to IUU (illegal, unreported, and unregulated) fishing. It also calls on WTO members to refrain from introducing new such subsidies. The SDG 14.6 has unequivocally argued that “appropriate and effective special and differential treatment for developing and least-developed countries should be an integral part of the WTO fisheries subsidies negotiation.” In their recent statements, the big subsidizers – China, the EU, the US, Japan, Canada, Korea, and Chinese Taipei – have moved away from UN SDG 14.6 to the sustainability agenda, in not mentioning UN SDG 14.6. The major subsidizers do not want to acknowledge the notion of “appropriate and effective special and differential treatment” in an attempt to bring about differentiation among developing countries. In effect, the US and the EU seem poised to bring all the new issues, as set out in the G7 trade ministers’ statement in London on 22 October, to MC12. Unless the developing countries face this onslaught with a shared commitment, collective purpose and strategy at MC12, they will find themselves being drowned in new trade issues that seem increasingly inimical to their trade priorities, the analyst said. During the WTO Director-General’s meetings with Indian ministers as well as the prime minister on 20-22 October, it has emerged that New Delhi will not budge from its positions on fisheries subsidies unless the imbalances and asymmetries in the proposed agreement on fisheries subsidies are corrected, said a source familiar with the development. The DG held one-on-one meetings with the Indian trade minister Mr Piyush Goyal, the finance minister Ms Nirmala Sitharaman, the foreign minister Mr Subrahmanyam Jainshankar, and Prime Minister Mr Narendra Modi. Given the strong messages delivered to Ms Ngozi Okonjo-Iweala about the need to ensure a balanced and credible outcome on fisheries subsidies and agriculture, the issue of food security apparently figured prominently during her meeting with Prime Minister Modi, the source said. In these meetings, the DG displayed a rather emotional stance, driving home the message about the need to preserve the multilateral trading system, particularly the need to deliver outcomes at MC12, the source said. She appeared to play “the-survival-of-the-WTO” card, saying that if there are no outcomes on fisheries subsidies and agriculture, then the WTO may not survive. As regards India’s proposal on fisheries subsidies, the DG conveyed that the Rules chair will include it in the negotiations but that India has to do advocacy for support, the source said. Ms Okonjo-Iweala is understood to have said that she is from a developing country and that she is aware of the importance of fish and food security, the source said. In her media remarks at the end of her visit to India, the DG said “India’s stand on fisheries and farm subsidies would be heard at the WTO ministerial conference (MC).” However, she failed to give an assurance that the country’s concerns would be addressed, according to a report in the Business Standard. On fisheries subsidies, the DG said that “I think there is a willingness. But I felt good spirit. India deserves to be heard and India will be heard, and then we’ll try to work to negotiate and see what comes. So, that’s the way I feel about fisheries subsidies. I think we’re ready to give it a go. So, giving it a go is not that I’m guaranteeing it. But this spirit to go for it gives you quite a bit of hope,” according to the Business Standard news report. In conclusion, it appears that when the US and the EU jointly attempt to push their trade priorities at MC12, the developing countries are bound to suffer the most.
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