TWN Info Service on WTO and Trade Issues (Jul23/15)
26 July 2023
Third World Network

Trade: WTO members show little convergence on WTO reforms
Published in SUNS #9829 dated 26 July 2023

Geneva, 25 Jul (D. Ravi Kanth) — At the end of the first half of 2023, members of the World Trade Organization on 24 July apparently showed little or no convergence on several issues, including WTO reforms, as they seemed to be stuck in their repeated positions and proposals, said people familiar with the discussions.

According to customary practice under Rule 12 of the Rules of Procedure for Sessions of the Ministerial Conference (WT/L/161), it is well established that: “During the course of each regular session a Chairperson and three Vice-Chairpersons shall be elected from among the Members. They shall hold office from the end of that session until the end of the next regular session.”

The customary practice has been that the Minister of the Government hosting a Ministerial Conference is elected as Chairperson, while three Vice-Chairpersons are selected from the other broad groupings of Members.

Thus, based on past practice, the WTO General Council, at a formal meeting on 24 July, apparently elected Dr Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade of the United Arab Emirates, as the Chairperson of the Thirteenth Session of the Ministerial Conference (MC13), to be held in Abu Dhabi from 26 to 29 February 2024.

However, it seems somewhat intriguing that Dr Zeyoudi is a minister from the UAE and not Abu Dhabi, said a member, who asked not to be quoted.

The General Council chair, Ambassador Athaliah Lesiba Molokomme of Botswana, also informed members (in her restricted document Job/GC/348 issued last week) that she would invite the coordinators of the African Group, the Group of Latin America and the Caribbean (GRULAC) and the developed countries to consult with regard to the respective nominations for Vice-Chairpersons of MC13 so that the General Council can revert to it at its next meeting.

GC MEETING “CONFOUNDED”

At the General Council (GC) meeting, which seems somewhat like the proverbial “dog’s breakfast” with various conflicting proposals on WTO reforms on the table, the minister from the UAE assured members that his country is “fully committed to working closely with all member states and ensuring the success of MC13.”

He apparently said with less than six months to forge consensus on a range of complex topics ahead of MC13, members must “ensure that our ministerial deliberations are both decisive and efficient.”

“It has become clear that trade policy extends far beyond the scope of trade itself,” the minister apparently said, adding that, “It is about shaping our common future that takes into account the environment, global health, and poverty.”

Though the minister mentioned that “it is our collective responsibility to contribute to a predictable, rules-based and open trade and investment environment that creates prosperity for all,” he seems to have already created a controversy by mentioning an “open trade and investment environment”, which is not part of the mandated issues at this juncture, said a participant who asked not to be quoted.

The General Council chair, Ambassador Molokomme from Botswana, praised the UAE’s Minister Al Zeyoudi, saying that the remarks he delivered “are a clear sign of your country’s commitment towards the Organization and our shared objective of a successful MC13.”

“We very much look forward to working with you as we prepare for the Ministerial Conference, and at the Conference itself,” she added.

WTO Director-General Ms Ngozi Okonjo-Iweala said the General Council chair, the Deputy Directors-General and herself would be working closely with the UAE minister and the forthcoming MC13 vice-chairpersons.

“We all look forward to this very fruitful collaboration and successful delivery,” she told members.

Earlier in the day, Ms Okonjo-Iweala and Minister Al Zeyoudi signed the 13th Ministerial Conference host Agreement.

The Agreement between the Government of the UAE and the WTO defines the roles and responsibilities involved in organizing the Ministerial Conference.

They also discussed various aspects of preparations for MC13 and reiterated the importance of a successful outcome for all WTO members, the UAE, and the wider region.

STATE OF PLAY ON WTO REFORMS

In her report on “State of Play – In WTO Councils, Committees, and Negotiating Bodies – “Reform by Doing,” the GC chair said members held on 16 June an Informal Meeting on WTO Reform, which was focused on the deliberative function and institutional matters.

Even though the African Group had expressed the sharpest concerns on the so-called “reform by doing”, the GC chair proposed that Members take note of the “reform by doing” work that had been undertaken and continue to advance and implement necessary measures to facilitate Members’ participation in WTO bodies without altering Members’ rights and obligations in the WTO.

The GC chair noted that “this would be with the understanding that work was evolving, and Members would continue to make suggestions on measures which could be modified or updated in the respective bodies, as necessary. In this regard and recognizing the differences in the nature and function of WTO bodies, practices and/or measures applicable to each WTO body could differ in light of respective mandates, terms of reference, and functioning.”

She also noted that “the General Council would continue to monitor progress and coordinate with WTO bodies as work advanced. In this regard, in addition to the reports by respective chairpersons of WTO Bodies, the Secretariat would continue updating the table in JOB/GC/345 ahead of every regular session of the General Council at least until MC13.”

REFORM OF DISPUTE SETTLEMENT SYSTEM

While many industrialized countries, particularly the European Union, supported the facilitator, Mr Marcos Molina, the deputy trade envoy of Guatemala, who is overseeing the informal discussions on dispute settlement reform, several developing countries, including the African Group complained about issues concerning transparency and the difficulties encountered by missions with a small staff in attending these meetings.

Incidentally, Mr Molina is expected to discuss with the Geneva-based Advisory Center on WTO Law (ACWL), which is funded by various European governments, on issues concerning access even though he is the vice-chair of the ACWL, said a trade official, suggesting that there are clear conflict of interests issues.

At the GC meeting, on the African Group’s proposal on dispute settlement reform, China’s trade envoy Ambassador Li Chenggang said: “We always believe that developing member’s participation is important.”

“At the end of the day, as we always believe, a good DS  (dispute settlement) mechanism means “small ones can win cases against big ones”,” he said, suggesting that “to bring the DS back to the normal function, ensuring all members can exercise equal opportunity in protecting their rights should be our priority.”

“We fully understand the restraint of small delegations,” the Chinese envoy said, adding that: “Sometimes, it could also be a challenge to big delegations. In the coming months up to MC13, a clash of meetings would happen more frequently.”

“Therefore, we encourage chairs and facilitators to have meetings well planned as far as possible,” China said.

On procedural issues, China suggested giving the “GC chair and the Secretariat leeway to work on procedural issues.”

China said that it “welcomes the list on horizontal measures recommended by the GC chair,” adding that “it is well-noted that some measures have already been applied by WTO councils and committees, including GC itself.”

As regards the ministerial conference, China said it has co-sponsored the proposal on “Maximizing the Value of WTO Ministerial Conferences”.

China said, “We should de-dramatize MC (Ministerial Conferences), at the same time, continue to preserve and enhance its decision-making function.”

On Brazil’s proposal to convene annual ministerial conferences, which is apparently being supported by a North American country, China said: “For the annual MC, we believe, when Ministers come to the meeting, they are expecting meaningful discussions and deliverables …. Otherwise, they may lose interest in it.”

As regards the EU’s proposal on reinforcing the deliberative function of the WTO to discuss some of the major issues in the global trading system, China said that it is “open to having discussions on trade-related emerging issues.”

However, said China, “For some controversial issues, like state intervention, before we decide to establish a dedicated discussion in the WTO, there needs [to be] a kind of basic education exercise through seminars, workshops and other informal formats to build common understanding on the issue we are going to discuss.”

Further, “such kind of informal exercise will also help us identify the appropriate approach for further work,” China argued.

“All in all, when we are going to launch discussions on controversial issues, we have to ensure they will be pragmatic, constructive, and result-oriented, rather than antagonistic,” China emphasized.

On controversial WTO reform topics, China said that revitalizing the WTO negotiation function has always been an important part of the WTO reform.

China said that “at the beginning of this month, here, in this CR (Conference Room), we successfully concluded the text negotiation on Investment Facilitation for Development,” adding that it counts over 110 participating WTO members, with more than two-thirds of WTO members, including more than 70 developing members, with 20 LDCs.

China said, “as an inclusive and pro-multilateral initiative, outreach will continue to be our next priority.”

“In the meantime, we will start discussions on the legal incorporation of this Agreement into the WTO legal architecture,” China said, adding that “in this process, we need intensive technical discussions.”

PROPOSAL ON STAKEHOLDER PARTICIPATION

Meanwhile, in a growing attempt to push the WTO into the realm of increased stakeholder participation under the alleged specious plea of addressing global challenges, a group of countries including Colombia, Guatemala, Israel, New Zealand, Peru, the Philippines, Chinese Taipei, Thailand and the United States on 24 July tabled a proposal (WT/GC/W/871/Rev.3), saying that “the WTO was established in part to provide a forum for Members to engage with each other to improve our understanding of how trade relations can support these broader economic and social objectives in pursuit of sustainable development.”

“Recent global challenges bring to the forefront the need to consider the broadest range of viewpoints to ensure that multilateral policy discussions and deliberations capture the complexity of cross-cutting issues and the differential impacts on diverse sets of stakeholders and interested persons,” these countries insisted.

The co-sponsors said they “believe it may be appropriate for Members to reflect on the adequacy of our current practices of engagement with stakeholders who are likewise confronting these same global challenges and are impacted by our actions at the WTO.”

According to the co-sponsors, “Our reflections may draw on practices and Members’ experiences with inclusive external engagement in other international organizations that may be relevant to consider in the context of improving our work in the WTO.”

The proposal cited the following example:

* The United Nations Sustainable Development Goals (SDGs) are frequently referenced in discussions among WTO Members. The SDGs reflect an interconnectedness and shared responsibility for action across many aspects of our societies with cooperation and coordination required from governments, non-governmental organizations, businesses, and civil society. SDG 17 is explicit in incorporating diverse cross-sectoral stakeholders in policy dialogues. Most United Nations organizations have incorporated and internalized multi- stakeholder engagement as part of their everyday work. WTO Members may want to examine the policies and practices of the United Nations system and identify for further discussion any practices they find relevant.

* Most of the world’s development assistance organizations, both bilateral and multilateral, have likewise developed innovative and sustainable multi-stakeholder engagement mechanisms to improve the delivery of development assistance and to ensure that outcomes can be comprehensively evaluated and that they achieve multi-faceted objectives.

* The WTO’s Public Forum and Aid for Trade Initiative are two examples of broad external engagement mechanisms used by WTO Members to gain wider perspectives on issues of interest across Members. Most WTO Committees benefit from the perspectives shared by the International and Regional Organizations granted Observer status. Committees also hold thematic sessions or Members organize individually sponsored events which enrich the Memberships’ understanding on current global issues. However, these mechanisms may not be sufficient. Multi-stakeholder events that discuss issues at the heart of the WTO’s mandate increasingly take place outside the WTO, and those voices are heard by only a small subset of Members, if at all.

Contrary to the African Group proposal, which cautioned about the inclusion of private and non-governmental stakeholders in a member-driven, rules-based, inter-governmental organization, the co-sponsors, led by the US, said: “Despite success in some areas, opportunities for sustained multi-stakeholder engagement at the WTO and within WTO Committees appear to significantly lag global best practice as established by other international organizations, international financial institutions, and development assistance providers.”

The co-sponsors said that they “are interested in reviewing and evaluating how Members may better use the WTO as a convening forum for engagement with diverse stakeholders and interested persons impacted by global trade challenges.”

According to the co-sponsors, “We are interested in hearing from Members what their experience has been with regard to external engagement in the conduct of committee and body work, with multi-stakeholder dialogues, and other opportunities they have had to solicit and incorporate diverse stakeholder interests and perspectives. We seek to understand what they perceive works, and what approaches are less effective. We intend to initiate an informal, Member-driven dialogue as a first step to solicit the interests and perspectives of other Members on multi-stakeholder engagement and to identify overlapping interests in search for common ground in order to strengthen the Organization’s relevance. We look forward to engaging with all Members in this dialogue.”

In short, MC13 seems to be gradually inching towards “hollowing out” the WTO instead of bringing developmental reforms to reflect the priorities and concerns of the large majority of its members, who hitherto remained marginalized in the previous ministerial meetings, said people, who asked not to be quoted. +