|
||
|
TWN
Info Service on WTO and Trade Issues (May23/03) Geneva, 8 May (D. Ravi Kanth) — India has apparently called Brazil’s “bluff” that ministerial mandates have no sanctity and that they can be reversed by any member of the World Trade Organization after a large majority of developing countries unambiguously demanded an outcome on the mandated permanent solution for public stockholding (PSH) programs for food security by engaging in text-based negotiations, said people familiar with the discussions. During the dedicated meetings on 3 and 4 May on the permanent solution for public stockholding programs for food security and the special safeguard mechanism (SSM) for developing countries, India apparently hit back at Brazil on its allegedly “bellicose” position that there is little or no sanctity for the ministerial mandate on the permanent solution and that any one member can overturn it, said people, who asked not to be quoted. Members of the Cairns Group of farm-exporting countries, especially Brazil, and even the United States raised hurdles at the meetings on extraneous grounds. The dedicated meetings were convened by the chair of the Doha agriculture negotiations, Ambassador Alparslan Acarsoy of Turkiye, in the face of seemingly unbridgeable differences among members on starting text-based negotiations for finalizing an agreement on the mandated issues of the permanent solution for public stockholding programs for food security purposes in developing countries, and the SSM, which took the center stage for the umpteenth time, said people, who asked not to be quoted. Ahead of the dedicated meetings, Ambassador Acarsoy posed several questions for members to consider. The question on PSH is as follows: “Given the continued divergences among the positions, what are the three most important elements that should be addressed in order for Members to agree on a mutually agreeable solution consistent(ly) with the Ministerial Mandate on Public Stockholding?” On the issue of SSM, the chair asked: “Based on the discussions during the previous SSM Dedicated Session on 30 March, would Members be willing to organize technical thematic discussions in the SSM Dedicated Session starting with the following two topics: (i) experience with the implementation of the special agricultural safeguard (SSG), and (ii) possible design of a safeguard mechanism to countervail distorting subsidies?” Ambassador Acarsoy also convened a special session of the Committee on Agriculture to discuss two issues. They include: 1. What contribution could MC13 (WTO’s 13th ministerial conference to be held in Abu Dhabi next February) make to enhancing food security? 2. What do you consider as realistic elements of an Agricultural Package that would be acceptable to all Members? At the meeting on 3 May, Brazil along with the United States, Australia, Costa Rica, and several other members of the Cairns Group of farm-exporting countries appear to have adopted a highly inimical stand in that they are unwilling to discuss the issue on allegedly extraneous grounds, said people familiar with the discussions. In response to a call from more than 100 developing countries that include the African Group, the ACP (African, Caribbean, and Pacific) group, and the G-33 group of developing countries, coordinated by Indonesia, for text- based negotiations on the permanent solution for PSH programs, Brazil, the US and other Cairns Group members seemingly adopted “stonewalling” positions by refusing to enter into text-based negotiations. India, South Africa, and China joined the 100-odd developing countries in pressing for immediate text-based negotiations, said several people who took part in the meeting. At one point, a senior Brazilian trade envoy apparently claimed that there is no sanctity to the ministerial mandate for concluding negotiations on a mandated issue like the permanent solution for PSH programs, which has been left hanging in limbo since the WTO’s tenth ministerial conference (MC10) in Nairobi, Kenya, in December 2015. The Brazilian diplomat said a ministerial mandate, though adopted by consensus, can be overturned by any one member later. Brazil suggested that like other Cairns Group members, they are not prepared to accept text-based negotiations as demanded by the large majority of developing and least-developed countries, said people present at the meeting. Towards the end of the meeting on 4 May, India apparently “picked up the gauntlet” by challenging Brazil to submit its position in writing that it is ready to break the consensus of a ministerial decision. Protesting the continued “stonewalling” approach allegedly adopted by Brazil and other members, including the US, India said as long as they block text-based negotiations, there will be no forward movement because of their allegedly obstinate positions on ministerially-mandated issues, said people, who asked not to be quoted. Other opponents of the permanent solution for PSH programs – Costa Rica, New Zealand, and Thailand, as well as the US – appear to have challenged the large majority of developing countries seeking the permanent solution to come clean about their intentions on PSH. “STAR WARS DAY” – MAY 4 The US trade envoy, Ambassador Maria Pagan, began her statement with an unusual announcement that 4 May is “Star Wars Day”. It is not clear what is the significance of “Star Wars Day” for the unfulfilled and mandated issues like PSH and SSM, said a member, who asked not to be quoted. The US is understood to have said at the meeting that the Bali interim decision of December 2013 has allowed one member (possibly referring to India) to take advantage of allegedly unlimited levels of trade-distorting domestic support to such a degree that this member has been able to significantly increase their exports of that one commodity (rice) to now account for more than 40 percent of global exports in that commodity. In response to the US statement proclaiming “Star Wars Day” on 4 May, India apparently said that the movie Star Wars was watched more in the country where it had originated (the US), suggesting that it is more to do with fiction than addressing the real issues in agriculture, said people, who asked not to be quoted. India apparently suggested that real issues such as the continuation of the “anachronistic” External Reference Price of 1986-88, which was set in the Uruguay Round of trade negotiations, must be addressed on a war footing so that there is a clear picture of the underlying factors responsible for the rise in domestic support, said people, who asked not to be quoted. The G-33 group of developing countries, including India, submitted a proposal for changing the external reference price (ERP) from the 1986-88 base to recent levels in order to assess the domestic support as well as the de minimis levels of payments. India severely criticized the opponents of PSH for their obdurate positions in not addressing the core issues so far, said people who took part in the meeting. PROPOSAL ON PSH As previously reported in the SUNS, the G-33 group of developing countries offered several solutions, including placing the issue of PSH in a “peace (green) box”, as it is aimed at addressing the resource-poor, livelihood, and subsistence farmers. The last G-33 proposal was submitted a month before MC12 last June but it was vehemently opposed by the US and key members of the Cairns Group. The G-33 proposal, in the restricted document Job/Ag/229, was made in tune with a much-reduced version of the proposal that was submitted at MC11 in December 2017. In their nine-page restricted proposal (Job/Ag/229), the 80 co-sponsors stated unambiguously, in the chapeau, that “having regard to paragraph 1 of Article IX of the Marrakesh Agreement Establishing the World Trade Organization” and “taking note of the Ministerial Decision of 7 December 2013 (WT/MIN(13)/38 – WT/L/913), the General Council Decision of 27 November 2014 (WT/L/939) and the Ministerial Decision of 21 December 2015 (WT/MIN(15)/44 – WT/L/979), the ministers, recognizing the importance of public stockholding for food security purposes for developing country Members, including Least-Developed and Net Food Importing Developing Countries (NFIDCs), decide as follows: 1. Members agree to a permanent solution as set out in this Decision, for the use of public stockholding for food security purposes by developing country Members. 2. Notwithstanding any provision of the Agreement on Agriculture (AoA), domestic support provided by a developing country Member pursuant to public stockholding programs for food security purposes, shall be deemed to be in compliance with Articles 3.2, 6.3, and 7.2(b) of the Agreement on Agriculture (AoA), provided that the conditions set out in paragraphs 5 to 9 of this Decision are met. 3. Where public stockholding programs for food security purposes of a developing country Member include programs under which stocks of foodstuffs are acquired and released at administered prices, then, for the purposes of footnote 5 of Annex 2, the Aggregate Measurement of Support (AMS) shall be calculated based on the actual quantity of foodstuffs acquired at administered prices, and the external reference price in this regard shall be either of the following: (a) the three-year average price (f.o.b for a net exporter or c.i.f for a net importer) based on the preceding five- year period excluding the highest and the lowest entry for that product; or (b) adjusted for excessive inflation as per the methodology given in Annex Z. 4.1. This Decision does not preclude developing country Members from introducing public stockholding programs for food security purposes in accordance with the relevant provisions of the Agreement on Agriculture. 4.2. For greater clarity, paragraphs 5 to 9 of this Decision applies when a developing country Member concerned exceeds the applicable Aggregate Measurement of Support (AMS) limits under the AoA, i.e., the Member’s Bound Total AMS or the de minimis level, as applicable, as a result of the public stockholding programs for food security purposes covered under paragraph 2 of this Decision. (The de minimis limit for developing countries is 10% as per the AoA or Agreement on Agriculture. India has already breached the 10% limit for rice and sought protection under the perpetual “peace clause”). ANTI-CIRCUMVENTION/SAFEGUARDS 5.1. Stocks acquired under public stockholding programs for food security purposes covered under paragraph 2 of this Decision shall not substantially distort trade or adversely affect the food security of other Members. 5.2. Upon reference to the Understanding of rules and procedures governing the settlement of disputes (DSU), subparagraph 5.1. shall be applied only in accordance in full conformity with the meanings provided under relevant provisions of Part III, Part VIII, and Article 31 of the Agreement on Subsidies and Countervailing Measures. 6. A developing country Member shall endeavor not to export from acquired stocks, except for the purposes of international food aid, or for non-commercial humanitarian purposes, or when requested by Net Food Importing Developing Countries and least developed countries in the same geographic region or in any other region, or any member facing food shortages and higher food inflation during an international food crisis. NOTIFICATION AND TRANSPARENCY 7. The operation of programs referred to in paragraph 2 above shall be transparent and conducted in accordance with officially published criteria. 8. A developing country Member shall notify domestic support under these programs on an annual basis in accordance with their domestic support notification requirements under the AoA in accordance with document G/AG/2 of 30 June 1995. Supporting Table DS:5 shall be notified in accordance with paragraph 3 above. 9. Any public stockholding programs for food security purposes covered under paragraph 2, or modification thereof, shall be notified promptly under Article 18.3 as a DS:2 notification in accordance with document G/AG/2 of 30 June 1995. CONSULTATIONS AND DISPUTE SETTLEMENT 10. Any Member who has reason to believe that a developing country Member benefitting from this Decision has not met the conditions set out in paragraphs 5 to 9 of this Decision, may request consultations. The provisions of Articles XXII and XXIII of the GATT 1994 as elaborated and applied by the Dispute Settlement Understanding (DSU) shall apply to such consultations and consequent settlement of disputes under this Decision. The consulted developing country Member shall use the Annex to this Decision to provide information that shall serve as the basis for consultations.” In a similar vein, the G-33 group of developing countries submitted several other proposals, each time making their proposal more appealing to the opponents. SPECIAL SAFEGUARD MECHANISM As regards the discussion on the special safeguard mechanism (SSM), which has been hanging in limbo since the 2008 mini-ministerial meeting in Geneva, the opponents including members of the Cairns Group, and even the US, vehemently opposed the SSM on grounds that it is linked with the issue of market access. The proponents of the SSM, which is a mandated ministerial decision since 2013 and repeatedly blocked by the Cairns Group members, including the US, argued at the meeting that there is no connection between the SSM and market access. Indonesia, on behalf of the G-33 group of developing countries, along with India, China, South Africa, and Sri Lanka reiterated that SSM is a critical policy tool for developing countries to address unforeseen and sustained increases in imports of some major food items and price drops of these items. In fact, in 2008, an agreement was almost in sight to address both these two issues, but issues on domestic support and capping the US domestic support spending at $15 billion put paid to an agreement, said people, who asked not to be quoted. The opponents also opposed attempts to discuss the issue of parity, which the European Union and the US as well as several other countries continue to avail of since 1995, and the SSM for developing countries. The US apparently argued that the SSM was a natural outcome of members opening up markets to deal with the surge of imports, adding that the SSM must be based on the progress made in market access. Washington also suggested that the SSM is not the solution for reversing the impact of distorting subsidies, said people, who asked not to be quoted. The EU, which has been a traditional foe of the Cairns Group, however, agreed with the latter on opposing the issue of the SSM on grounds that it is “premature” to discuss designing an SSM and that the primary issue is reform of domestic support. On the issue of the External Reference Mechanism of 1986-88 prices (ERM), the Cairns Group and the US apparently developed “cold feet” in addressing the issue. Without changing the ERM, these countries want to discuss domestic support, G-33 members complained at the meeting. It is somewhat clear that the trans-Atlantic partners are not keen to advance the agriculture negotiations on the mandated issues of PSH and SSM, said people, who asked not to be quoted. At a time when the US national security advisor Jake Sullivan insists that Washington is “working with so many other WTO members to reform the multilateral trading system so that it benefits workers, accommodates legitimate national security interests, and confronts pressing issues that aren’t fully embedded in the current framework, like sustainable development and clean-energy transition,” it seems like a small wonder if the US pays little or no attention to the Doha agriculture negotiations, said people, who asked not to be quoted. Significantly, members also discussed the issue of export restrictions, improved transparency, and a food security package among other issues at the meeting. However, there was no consensus on any of these issues. With the US and EU allegedly uninterested in any significant outcome, the developing countries seem to be forced to wage a grim battle for securing a credible outcome at MC13. +
|
||
