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TWN
Info Service on WTO and Trade Issues (May22/13) Geneva, 12 May (D. Ravi Kanth) – As differences on the major deliverables for the World Trade Organization’s upcoming 12th ministerial conference (MC12) seem somewhat unbridgeable in various areas, the WTO Director- General Ms Ngozi Okonjo-Iweala apparently downplayed the overall prospects for MC12 in a virtual appearance at the annual global forum of the US Chamber of Commerce on 11 May. The DG appears to have conveyed to the US trade lobby that there will only be “one or two deliverables” at MC12, according to a report in the Washington Trade Daily (WTD) on 12 May. Ms Okonjo-Iweala said that members were hopeful last November before the emergence of the Omicron variant of the SARS-CoV-2 virus forced the postponement of MC12. Since then, Russia’s war in Ukraine has created various new problems, including food shortages. She appears to have glossed over all the mandated issues such as the permanent solution for public stockholding (PSH) programs for food security and the special safeguard mechanism (SSM) for developing countries, saying that the strategy now is to work on food security, the WTO’s response to the pandemic, fisheries subsidies and to “at least advance” the negotiations on agriculture. The aim, according to the DG as reported in the WTD, is to have “one or two deliverables” and develop a work program for the other issues to pave the way for their conclusion at the 13th ministerial conference, scheduled to take place in 2024. While the DG emphasized on a brand-new agreement on fisheries subsidies, her silence on the mandated issues in agriculture, particularly the permanent solution for PSH programs and SSM, indicates how developing countries are being treated at the WTO, said a person, who asked not to be quoted. Interestingly, the proposed fisheries subsidies agreement being pushed by the European Union and several other developed and some developing countries is also being linked to the WTO’s response to the pandemic, the person said. “GREEN ROOM” MEETING ON AGRICULTURE The DG’s comments at the US Chamber of Commerce on ignoring outcomes on agriculture for MC12 seem to reverberate from a “green room” meeting she held with select trade envoys on 10 May, said people who asked not to be quoted. The “green room” meeting convened by the DG was attended by more than a dozen countries, including the Cairns Group of farm-exporting countries, to apparently discuss the deliverables on agriculture, said people familiar with the development. However, trade envoys apparently remained sharply divided on negotiating any deliverables based on the controversial report (containing the draft text on agriculture) issued by the chair of the Doha agriculture negotiations, Ambassador Gloria Abraham Peralta from Costa Rica, on 23 November 2021. Trade envoys from the United States, the European Union, China, India, South Africa, Indonesia, Canada, Australia, Uruguay, and Brazil among others took part in the “green room” meeting to address the deliverables. The DG and the chair of the Doha agriculture negotiations also took part in the meeting. As reported in SUNS #9560 dated 22 April 2022, some major developed countries including the European Union and the US were toying with the idea of “freezing” outcomes on agriculture, including the mandated issues that are required to be concluded at MC12. Ever since the chair’s report (TN/AG/50) was issued last November, members remained sharply divided on several issues, particularly on the issue of allegedly altering the mandates on the outstanding issues as well as proposed new language on domestic support programs allegedly to suit the Cairns Group of farm-exporting countries, said people familiar with the development. At the informal Trade Negotiations Committee (TNC)/heads of delegation meeting on 4 May, the agriculture chair, Ambassador Peralta said “while all members agree that the WTO should deliver on food security at MC12, views continue to diverge on how this could translate concretely into an agricultural outcome.” She said “positions” on the PSH issue “still remain wide apart.” Even though more than 100 countries have pressed for an outcome on the mandated issue of the permanent solution for PSH programs, the chair once again appeared to show her “bias” towards the Cairns Group when she said at the informal TNC meeting that “among the priorities for Members, Domestic Support (which is mainly a Cairns Group issue) still remains on top of the list.” Ambassador Peralta said that “while a substantive outcome (on domestic support) at MC12 is clearly out of reach, many consider it important to have at least a work plan approved at MC12 to establish the way forward towards an outcome.” The proposed work plan on domestic support seems aimed at “destroying” the Doha agriculture agenda, including on domestic support, said people, who asked not to be quoted. At the “green room” meeting, trade envoys from several developing countries, except those from the Cairns Group of farm-exporting countries, opposed any declaration on export restrictions on grounds that they would need additional flexibility to take appropriate measures in the current context of food shortages and volatile prices, said people, who asked not to be quoted. Trade envoys of developing countries also insisted that they would like to avail of the existing flexibilities for providing farm subsidies due to the worsening food crisis in the wake of the Russia-Ukraine war, trade envoys said. The United States is understood to have said that if there are any convoluted provisions in the draft decision to remove restrictions on the procurement of food products by the World Food Programme (WFP), then Washington may not seek such a proposal, said a trade envoy, who asked not to be quoted. On the crucial issue of using the chair’s text as a basis for any further negotiations, while India apparently said the text should be dropped altogether, several other Cairns Group countries – Uruguay, Australia, Brazil, and Canada – said the text can be improved on for addressing several proposals, said people, who preferred not to be quoted. Furthermore, India, Indonesia, and South Africa appear to have stated unambiguously that Article 6.2 of the Agreement on Agriculture (AoA), which is referred to as the “development box” for developing countries, cannot be touched at all, said people, who preferred not to be quoted. For the past several years, the US along with members of the Cairns Group, repeatedly called for the review of Article 6.2 of the AoA. But many developing countries severely opposed the idea of reviewing Article 6.2, emphasizing that it cannot be brought under any review because it is a right that developing countries had fought for during the mid-term ministerial conference of the Uruguay Round negotiations in Montreal, said people, who preferred not to be quoted. Given the unbridgeable differences that surfaced at the “green room” meeting, it remains to be seen whether any deliverables can be agreed at MC12, particularly on the mandated issue of the permanent solution for public stockholding programs for food security. The DG is understood to have said that agriculture is very important, underscoring the need for making progress on this issue. UK’S FOOD SECURITY PROPOSAL Meanwhile, the United Kingdom along with around 30 other countries, including the United States, upped the ante on their proposal for “open and predictable trade in agriculture and food products” and “food security” that expresses “our support and solidarity with the people of Ukraine.” The proponents of the proposal include Albania; Australia; Canada; Chile; Costa Rica; European Union; Georgia; Iceland; Israel; Japan; Republic of Korea; Liechtenstein; Mexico; Republic of Moldova; Montenegro; New Zealand; North Macedonia; Norway; Paraguay; Singapore; Switzerland; The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; Ukraine; the United Kingdom; and the United States. From the list of the proponents, it appears to be clear that countries like the UK, Singapore, and the United States, which host large commodity trading hubs as well as several agri-corporations like Cargill, are the main drivers of the proposal for removing export restrictions and prohibitions on exports of food products, said people, who asked not to be quoted. The proponents expressed their grave concern about the current situation in the world economy due to Russia’s war on Ukraine, saying that “impediments to exports as a result of the conflict, especially given Ukraine is one of the world’s top exporters of key agricultural products (e.g. wheat, maize, barley, sunflower oil) and a major supplier to the World Food Programme, have significant local, regional and global effects on food security, adding to the already severe situation caused by COVID-19.” They reaffirmed “the urgency and importance of maintaining open and predictable agricultural markets and trade to ensure the continued flow of food, as well as products, services and inputs essential for agricultural and food production and supply chains.” The proponents said they are committed to the following principles: * working together to help ensure that sufficient, safe, affordable and nutritious food continues to be available and accessible at all times to all people, including the poorest, the most vulnerable, and displaced people; * keeping our food and agricultural markets open, predictable and transparent by not imposing unjustified trade restrictive measures on agricultural and agri-food products or key agricultural production inputs. The application of these measures, particularly unjustified export prohibitions and restrictions on agricultural and agri-food products, increases uncertainty and can result in a spiral of price increases and further restrictions; * ensuring emergency measures introduced to mitigate food security impacts should be as least-distortive as possible, targeted, proportionate and temporary, in accordance with WTO rules, in order to allow markets and the flow of food to operate as efficiently as possible; * providing information to the WTO as soon as practicable of any trade-related measures affecting agriculture and agri-food products where possible, to ensure clarity and predictability, and ensuring their consistency with WTO rules; * not imposing export prohibitions or restrictions on foodstuffs purchased for non-commercial humanitarian purposes by the World Food Programme and call on all Members to adopt a Decision to this effect as soon as possible; * improving transparency and monitoring of trade measures at the WTO, including through requesting a standing agenda item on trade and food security at the Committee on Agriculture and inviting the Secretariat to provide regular analysis of the current food crisis in cooperation with other relevant international organizations to inform Members in their policy-making. Stating their commitment to the Uruguay Round’s Agreement on Agriculture, the proponents said “ensuring open and predictable agricultural markets and trade is key to mitigating multi-faceted short- and long-term risks and achieving global food security. That requires greater action and engagement now more than ever, including at the 12th Ministerial Conference.” The UK proposal seems to be directed at curbing the policy space of developing countries in addressing the food shortages they are facing at this juncture, said people familiar with the development.
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