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Info Service on WTO and Trade Issues (Feb23/01) Geneva, 31 Jan (D. Ravi Kanth) — The chair of the World Trade Organization’s General Council, Ambassador Didier Chambovey of Switzerland, is holding a two-day informal meeting on “WTO reforms focused on Development Modalities” on 2 February, a meeting that could further polarize members on issues raised by developing and least-developed countries for improving and safeguarding special and differential treatment (S&DT) provisions in the ten Agreement-specific proposals, said people, who asked not to be identified. More intriguingly, the General Council (GC) chair’s move to club the issue of development with WTO reform discussions without first discussing the issues concerning the restoration of the two-stage dispute settlement system or controversial issues such as attempts by several developed countries to legalize plurilateral agreements, appears to have struck a discordant note, said people, who preferred not to be quoted. GC CHAIR’S NOTE In a restricted communication (Job/GC/334) sent to members on 24 January, the GC chair said the meeting will “focus on WTO reforms to discuss cross-cutting aspects of the development dimension.” “This would provide Members the opportunity to kick-start a frank discussion on, inter alia, cross-cutting aspects of the development dimension, with a view to finding mutually acceptable ways forward,” the GC chair said. He said, “the informal meeting will be structured with a view to ensuring full participation, inclusivity, and transparency.” Members will have the opportunity to brainstorm in breakout sessions facilitated by Ambassadors, he informed members. According to the GC chair’s proposal, “during the plenary on 3 February, each Facilitator will provide a brief summary of the discussions in their respective breakout sessions. Thereafter, Members will discuss the way forward.” The WTO’s Deputy Director-General Xiangchen Zhang, responsible for the issue of development in the WTO Secretariat, will facilitate the discussions in the plenary. The meeting will end with closing remarks by the WTO Director-General, Ms Ngozi Okonjo-Iweala, and the GC chair. The guiding questions for the breakout sessions and plenary meeting include: (1) How do members view development in the WTO? (2) How can the opportunities in the WTO system help Members achieve their development objectives? (3) Within the WTO context, what challenges need to be addressed to ensure that all Members are in a position to achieve their development objectives? (4) What concrete steps and actions are needed to use the opportunities in the WTO system and address identified challenges to achieve Members’ development objectives? The facilitators who will oversee the discussions include Ambassador Mr Ahmad Makaila of Chad, Ambassador Petter Olberg of Norway, Ambassador Ms Sofica Boza Martinez of Chile, and Ambassador Dr Muhammad Mujtaba Piracha of Pakistan. In what seems like increasing “Davosization” of the WTO negotiations, the chair also spelled out guidelines ostensibly to enable “interactive” conversations. The guidelines include: a. All sessions will be in-person only at the WTO premises. The composition of the groups will be circulated to Members on 1 February, the day before the informal meeting. b. A maximum of two participants per delegation can join the conversations (except for Ambassador-Facilitators who can have a maximum of three including the Facilitator). c. Participants are encouraged to prepare in advance. Members’ inputs in these conversations inform how we proceed with this aspect of our WTO Reform work. d. While no official notes or records will be taken during the breakout sessions, each Facilitator will be expected to present a brief summary of the discussions in their respective breakout group to the plenary. e. The dress code is smart casual to allow for a more relaxed environment. f. On 2 February, lunch will be hosted by the Chairman of the General Council in the Council Room Lobby at 13h00. On 3 February, the Permanent Mission of Sweden (currently holding the Presidency of the Council of the European Union) will host a coffee “Swedish Fika” in the Council Room Lobby at 09h00, just before the start of the plenary session. SERIOUS QUESTIONS The meeting appears to have raised numerous questions, particularly whether it is an attempt to undermine S&DT, which is an integral part of the architecture of the multilateral trading system, said several negotiators. It is somewhat odd to discuss development-oriented issues when the US and other major industrialized countries almost reneged on the Doha Development Agenda (DDA) mandate since 2001. The US, which has called for differentiation among developing countries for availing of S&DT provisions, is apparently now pursuing the “opt-out” route wherein developing countries on their own accord give up S&DT. The US succeeded at the WTO’s 12th ministerial conference (MC12) when it ensured that China did not avail of the Ministerial Decision on the TRIPS Agreement concerning vaccines. It remains to be seen whether China will opt out again on diagnostics and therapeutics during the negotiations to be held soon, said people, who asked not to be quoted. Several people, who spoke to the SUNS, sought to know whether the informal meeting being convened by the GC chair is yet another attempt to further polarize WTO members, a tactic that seems to be gaining ground since MC12 in June 2022. At a time when the US and several other developed countries have repeatedly refused to engage in any discussions for improving special and differential treatment provisions in the Group of 90’s ten Agreement- specific proposals, it is not clear what the meeting will achieve, said people, who asked not to be quoted. As previously reported in the SUNS, at a meeting at the WTO on 23 September last year, the Group of 90 developing and least developed countries had expressed grave alarm over the continued “disengagement” by the major developed countries on improving special and differential treatment (S&DT) provisions for realizing their development goals. G90’S ROOM DOCUMENT In an informal restricted room document issued at the 57th meeting of the Doha Committee on Trade and Development on 23 September last year, seen by the SUNS, the G90 members expressed their disappointment and unhappiness over the continued disengagement on the ten Agreement-specific proposals for improving special and differential treatment provisions. The G90 countries argued that at a time when the gains made by most of their economies are being reversed because of the “poly crises,” there has been no constructive engagement by the major industrialized countries. Worse still, the G90 countries said their “economies remain constrained in realizing equitable and meaningful gains from the “post-pandemic” recovery and in fully integrating into the global economy.” These countries are now forced to “contend with external shocks such as rocketing inflation, and the food and energy crises, and balance of payment challenges, among a host of threats to their economic recovery and development aspirations.” The global supply chains, which are concentrated in a few industrialized countries, have exposed the vulnerabilities and compounded the problems faced by the G90 countries, the document suggested. “This confluence of global economic shocks will disproportionately affect developing countries, including LDCs, for decades to come,” the G90 countries argued. They said “the policy flexibilities envisaged in the G90 submissions to date are critical to address the “poly crises” in a sustainable and inclusive manner.” “In the context of the current global economic climate characterized by multiple crises that threaten to reverse even the meagre gains that some developing economies had started to register pre-Covid-19, the exercise and objective to ensure that all Special and Differential Treatment (SDT) provisions are reviewed with a view to strengthening them and making them more precise, effective and operational remains not only relevant but all the more urgent.” So far, the US has simply refused to engage on the G90’s ten Agreement-specific proposals, while the other major industrialized countries took “diversionary” positions to deny any improvements in their specific S&DT proposals, said people familiar with the development. More importantly, the G90 has pointed out that it has been “consistent in its call for mainstreaming development in the WTO by making implementable, the various vague SDT provisions; and clarifying the SDT provisions that have some potential to address the real difficulties that developing countries, including LDCs find themselves in and that continue to inhibit their access to and ability to deploy developmental policies to advance their economies.” “The policy space and flexibilities that the G90 seek are not foreign concepts, including to developed economies whose advances were on the back of similar policies geared towards building resilient value chains and in support of their own industrialization objectives,” the group has said. The group pointed to evidence that suggests “a growing use of policy tools that are deployed by especially developed countries, including the adoption of measures to promote industrial development, supply-chain resilience, among others, to address particular vulnerabilities.” Against this backdrop, “delivering on the G90 proposals will ensure a meaningful and structured response by the WTO to provide policy space [that] developing countries, including LDCs need to respond to the crises and promote economic resilience.” The group said that “the Ministers’ commitment at the Twelfth Session of the Ministerial Conference of the WTO (MC12) and an objective appreciation of the current global economic environment and its challenges provides an opportunity for WTO Members to frankly reflect on the efficacy of policy tools within WTO agreements and to ask the all-important question whether they are congruent with the commonly stated desire to ensure that “… trade be conducted with a view to raising standards of living, ensuring full employment, pursuing sustainable development of Members, and enhancing the means for doing so in a manner consistent with Members’ respective needs and concerns at different levels of economic development”.” The improvements sought by the G90 coalition in the ten Agreement-specific proposals include:
Interestingly, the specific improvements sought by the G90 countries in the ASCM to enable them to undertake industrialization programs, are now being implemented by the United States and the European Union through the provision of hundreds of billions of dollars that seemingly violate their commitments under this agreement, said a person, who asked not to be quoted. The mid-term WTO budget review issued by the DG says that “work on development issues in the Committee on Trade and Development (CTD) and its various incarnations has been steadily increasing since 2012, providing an important forum for discussion and action.” According to the document, “on special and differential treatment (S&DT), negotiations in the CTD’s Special Session (CTD SS) led to the establishment, at MC9 in 2013, of a new subsidiary body of the CTD – the Dedicated Session on the Monitoring Mechanism on S&DT. Intense work in the CTD SS also took place in the run-up to the previous three Ministerial Conferences and can be expected to continue in the post-MC12 period on the basis of instructions given by Ministers.” Against this backdrop, it remains to be seen whether the informal meeting hosted by the GC chair will contribute positively to the G90 demands or insist that developing countries must pay for safeguarding the special and differential treatment provisions as part of the WTO reforms. +
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