Survey of the WTO negotiations

Some read­ers have accused me, offline, of describ­ing a dead nego­ti­a­tion as ‘just rest­ing’ (or, per­haps, “ ‘pin­ing for the fjords’ ”: I’m less pes­simistic than many com­men­ta­tors about remain­ing oppor­tu­ni­ties in these nego­ti­a­tions; but I’m not a“ ‘ressurec­tion­ist’ ”: For­tu­nate­ly, I don’t need to be. As I “predicted”:, the Direc­tor-Gen­er­al of WTO—tired of play­ing with an ‘alarm but­ton’ that is con­nect­ed to noth­ing but an alarm—has giv­en us a more bal­anced overview of where we stand with the whole pack­age of talks. A C+/-, I’d say I’ll lim­it this report to the salient extracts from Dr Supachai’s report to the Trade Nego­ta­tions Com­mit­tee, which is effec­tive­ly his last act as Direc­tor-Gen­er­al (Pas­cal Lamy takes over from him in Sep­tem­ber). You can find the “full report”: [MS Word file, about 140k] on the WTO web­site. Also, I’ve obtained Tim Grosser’s final report as Agri­cul­ture Nego­ti­a­tions Chair­man; you can down­load it “here(Groser July Report to TNC.pdf)”: from my site as a PDF file [about 20k]. h4. The goal for July 2005 bq. …we start­ed the year with a high lev­el of con­ver­gence on the need for a sub­stan­tial break­through in Hong Kong in five key areas.  These areas had first been mapped out by a num­ber of Min­is­ters at their gath­er­ing in Davos in Jan­u­ary, and my sub­se­quent con­sul­ta­tions across the broad spec­trum of the mem­ber­ship con­firmed the impor­tance of such a focus.  The areas which I set out at the TNC meet­ing in Feb­ru­ary were: ** modal­i­ties in Agri­cul­ture
** modal­i­ties in NAMA
** a crit­i­cal mass of mar­ket open­ing offers in Ser­vices
** sig­nif­i­cant progress in areas such as Rules and Trade Facil­i­ta­tion, and
** a prop­er reflec­tion of the Devel­op­ment Dimen­sion. h4. The achieve­ment in agri­cul­ture bq. …the neg­a­tive side of the ledger out­weighs the pos­i­tive.  My frank assess­ment is that we have a long way to go to achieve the goals I recalled ear­li­er.  The fact is that since July of last year, the progress made has been insuf­fi­cient h4. The future of the agri­cul­ture talks bq. I wish to rec­og­nize that over the past cou­ple of weeks major play­ers have come for­ward with con­crete and spe­cif­ic pro­pos­als in all areas under nego­ti­a­tion.  These are valu­able inputs.  What has been ham­per­ing our work in Gene­va is not so much a dearth of ideas but a cer­tain reluc­tance on the part of key play­ers to engage in real nego­ti­a­tions on the pro­pos­als put on the table.  This must change and it must change imme­di­ate­ly … At this stage, mar­ket access is the area in most urgent need of move­ment.  In his recent Assess­ment the Chair­man of the nego­ti­a­tions on Agri­cul­ture has clear­ly iden­ti­fied where, as an ini­tial step, we must get con­ver­gence now: the struc­ture of the tiered for­mu­la for tar­iff cuts cou­pled with fur­ther elab­o­ra­tion of cer­tain flex­i­bil­i­ties, in par­tic­u­lar the selec­tion and treat­ment of sen­si­tive prod­ucts and of Spe­cial Prod­ucts. h4. NAMA nego­ti­a­tions bet­ter focussed He went on to acknowl­edge that “the devel­op­ments of the last week” in the Non-agri­cul­tur­al Mar­ket Access (NAMA) nego­ti­a­tions had giv­en him “some hope” of progress on the chick­en and egg prob­lem of sep­a­rate­ly agree­ing on the relat­ed issues of the struc­ture of access improve­ments and the scale of the improve­ments.  bq. One inter­est­ing aspect is that diver­gences [in NAMA] seem to be main­ly relat­ed to the bal­ance between the lev­el of ambi­tion and the flex­i­bil­i­ties, rather than the struc­ture of the for­mu­la itself [like­ly to be a ‘har­mo­niz­ing’ or ‘swiss-type’ for­mu­la].  The Chair­man has sug­gest­ed that the way out of this sit­u­a­tion is to engage as soon as pos­si­ble on the actu­al num­bers, and I ful­ly endorse that.  A bal­ance between ambi­tion and flex­i­bil­i­ties will only be found if we go deep into the num­bers and engage in real dis­cus­sions and trade-offs h4. Improve­ment in the progress on Ser­vices bq. …I am pleased to report that the pace of the ser­vices nego­ti­a­tions has shown mod­er­ate signs of improve­ment, which is reflect­ed in the num­ber of ini­tial and revised offers sub­mit­ted over the past two months.  So far, 68 ini­tial and 24 revised offers have been sub­mit­ted.  The May date for the sub­mis­sion of revised offers has moti­vat­ed gov­ern­ments who had not sub­mit­ted ini­tial offers to do so.  Dur­ing the two months of May and June, 16 ini­tial offers were sub­mit­ted.  Adding the 24 revised offers, the total num­ber of all offers sub­mit­ted dur­ing the last two months is 40.  Con­sid­er­ing that the total num­ber of offers sub­mit­ted in the first two years was 50, it could be said that the pace of sub­mit­ting offers has recent­ly picked up…[but] the over­all qual­i­ty remains unsat­is­fac­to­ry.  Few, if any, pro­vide new busi­ness oppor­tu­ni­ties to ser­vice sup­pli­ers.  Most Mem­bers feel that the nego­ti­a­tions are not pro­gress­ing as well as they should (“Supachai”: h4. Sat­is­fac­to­ry progress on Rules, Trade Facil­i­ta­tion, Envi­ron­ment, Dis­pute Set­tle­ment and TRIPS The most con­tro­ver­sial issue is pos­si­ble changes in the rules on anti-dump­ing and the sub­si­dies agree­ment bq. The process should be sharp­ened by lim­it­ing work to pre­cise tex­tu­al pro­pos­als to improve the Agree­ments on Anti-Dump­ing and on Sub­si­dies and Coun­ter­vail­ing Mea­sures.  An intense and rig­or­ous process is need­ed to ensure that in Hong Kong we will have a sol­id basis for the final stage of the Round.  In this regard, I have not­ed the call by the Co-Chairs of the Dalian mini-Min­is­te­r­i­al for text-based nego­ti­a­tions to begin as soon as pos­si­ble, at the lat­est from Hong Kong onwards h4. ‘Devel­op­ment’ and ‘Spe­cial and Dif­fer­en­tial’ arrange­ments are still (most­ly) talk bq. What remains fun­da­men­tal­ly impor­tant in mov­ing for­ward on S&D is for Mem­bers to con­vert their com­mit­ment towards solv­ing the prob­lems faced by devel­op­ing and least-devel­oped coun­tries into tan­gi­ble and mean­ing­ful results.  Not mak­ing any progress in this area will give cre­dence to those who ques­tion the devel­op­men­tal thrust of the Round and could set back our efforts to fur­ther inte­grate devel­op­ing and least-devel­oped coun­tries into the mul­ti­lat­er­al trad­ing sys­tem. h4. Steps to Hong Kong The Direc­tor-Gen­er­al con­cludes by offer­ing some spe­cif­ic guid­ance for WTO mem­ber economies in the five months left before the Hong Kong Min­is­te­r­i­al meet­ing. The points he makes are implied by the remarks excerpt­ed above. He con­cludes with a state­ment that I think is right on the mon­ey—as you’ll see in the con­clu­sion of my book on the first ten year of WTO, due to be pub­lished by Cam­bridge Uni­ver­si­ty Press in October/November: bq. There is no mys­tery to the sub­stan­tive prob­lems in these nego­ti­a­tions.  The tech­ni­cal issues have been exhaus­tive­ly explored, the polit­i­cal choic­es have been iden­ti­fied and nar­rowed down.  How­ev­er, being under­stood appar­ent­ly does not make them eas­i­er to resolve.  I am seri­ous­ly con­cerned that we are still see­ing a ten­den­cy towards brinkman­ship among nego­tia­tors who should know bet­ter.  Recent expe­ri­ence, most painful­ly at Canc√∫n, has taught us that a mul­ti­lat­er­al deal in today’s WTO can­not be pushed through by a few Mem­bers.  This les­son needs to be ful­ly absorbed and act­ed upon.

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