Revitalising negotiations

The seventh MC was being held after a gap of four years since the last MC at Hong Kong in 2005. The reason for this was that the major countries, namely, the US, EC, India and Brazil had failed to make any progress on modalities in Agriculture, NAMA and Services or any other issue since the Hong Kong Ministerial. As a result of this, the DG of WTO, Pascal Lamy, had suspended the Doha Round negotiations on July 23, 2006. To add to this lack of progress at the WTO, the global financial crisis, which originated in the US property market, had affected all countries and impacted world trade adversely. Many countries had resorted to protectionist measures and others were compelled to take actions that violated their WTO commitments. The customary letter of the Director General to the WTO, Pascal Lamy, to the journalists just before the 2009 MC was therefore cautious and likened this Ministerial to one of brainstorming, rather than negotiating. The theme of the Conference was in keeping with the mood of the time, and was titled ‘The WTO, the Multilateral Trading System and the Current Global Economic Environment’. The DG also underlined the importance of the Enhanced Integrated Framework, which was a multilateral framework to help LDCs gain from trade and Aid for Trade for developing countries and LDCs, which looked at ways to overcome supply-side and trade related obstacles.

Issues at the Geneva MC

As noted above, there were no active negotiations at the Geneva MC. The Chairman of the General Council, the Chilean Ambassador Mateo Matus stated as much. He said that the emphasis would be on full participation, transparency and inclusiveness and that a Ministerial Declaration would not be necessary. However, the real reason for the low key Ministerial was that the two biggest participants were not ready for serious trade talks. The US administration under President Obama was also preoccupied with problems in Afghanistan and Iraq and was still emerging from the financial meltdown of the previous year.

In all, two plenary sessions were planned (opening and closing plenary) and there were two working sessions during the MC.

In the first working session, Ministers reviewed the working of the WTO and the progress made on the Doha Work Programme. The DG of WTO also spoke on three important issues: Aid for Trade, Regional Trade Agreements (RTAs) and Accession. On Aid for Trade, he expressed anguish on availability of finance for the same when public treasuries were still emerging from the global financial crisis. On RTAs, he suggested that there should be a coherence between Members’ commitments in RTAs and multilateral commitments at the WTO. On Accessions, he reported that 29 countries have applied for WTO membership and pleaded for fast tracking the process.

The second working session discussed WTO’s contribution to recovery, growth and development. It also discussed the role of the WTO in monitoring and analysis as also issues of institutional reform within the WTO. The MC also agreed to extend the moratoriums on e-Commerce duties and on TRIPS non-violation cases until the next Ministerial meeting.

In the opening Plenary sessions, the Ministers made the right noises about concluding the Doha Round early. Developing countries emphasized that the ‘development’ aspect of the Round should not be diluted. The G20 and G33 groupings also released their communique underlining the importance of growth and development and the need to safeguard the livelihoods of farmers in developing countries. There was also a call to do away with trade distorting domestic support and export subsidies by developed countries.

Developing countries reiterated the issues that they raised in earlier Ministerial conferences, namely Cotton, Duty Free Quota Free access to LDC products, Special Safeguard Mechanism (SSM, an issue raised by G33), TRIPS-CBD and better access to service providers (or Mode 4 in WTO legalese). Most developing countries also singled out the US for not responding to the concerns and demands of developing countries in areas such as cotton subsidies, TRIPS-CBD and cutting domestic support and export subsidies in Agriculture.

In the closing Plenary, the Chairman of the Conference reaffirmed the need to conclude the Doha Round in 2010 and for a stock-taking exercise to take place in the first quarter of next year. In his words:

“There was support for asking Senior Officials to continue to work to map the road towards that point. Gaps remain on substance and there was wide acknowledgment of the need for leadership and engagement on the remaining specific issues over the coming weeks,” he added.

Most Ministers were in favour of a stock-taking exercise in the first quarter of 2010, except the United States. In his speech in the Closing Plenary, Ron Kirk, the US Trade Representative suggested that members engage in more bilateral talks and negotiations in all areas, rather than set artificial timelines. He also lamented the lack of any substantial market access offers in NAMA and Services, from the large developing countries, namely Brazil, India and China.

The 7th Ministerial Conference: A damp squib?

Some observers felt that the 7th MC was an exercise in futility and that Ministers just reiterated their positions in various areas of negotiations. There was no consensus even on the work programme or a stock taking in early 2010 and conclusion of the Round in 2010.

The MC did prove useful for a variety of reasons. One, it was important that Ministers interact even if to reiterate their respective positions. This was because the 2007 MC had been dispensed with and Ministers were meeting after a gap of four years. Two, Ministers agreed not to re-open text/issues, which were agreed on in previous meetings. Three, Ministers reaffirmed the consensus on the ‘single undertaking’, which meant that negotiations could not be concluded in silos. In other words, nothing was agreed unless everything was agreed. This was particularly important from the point of view of LDCs and developing countries.

Conclusion

The 7th MC was not intended to be a negotiating exercise but one of open discussion. It was also positioning the WTO in the current global economic environment. Since there were no goals and objectives and no text-based negotiation, the MC did manage to hit the ‘restart’ button. This was perhaps necessary because of a long four years that had lapsed since the last Ministerial. The MC was however being ambitious and even unrealistic when some Members and the DG set a target of concluding the Doha Round by end-2010 — particularly because wide differences remained in the main negotiating areas of Agriculture, NAMA and Services.

The writer is Additional Chief Secretary, Department of Mass Education Extension and Library Services and Department of Cooperation, Government of West Bengal.