Bridges Weekly Trade News Digest • Volume 9 • Number 3 • 2nd February 2005
Key Members Agree To Step Up Pace Of WTO Negotiations
Trade ministers from influential WTO Member countries agreed at a 29 January ‘mini-ministerial’ to focus on five key negotiating areas in order to make "concrete progress" in the ongoing Doha Round trade liberalisation talks before the Hong Kong Ministerial Conference scheduled for December this year. However, Members appeared to differ on what exactly is necessary in order for this progress to happen.
WTO officials said that the purpose of the afternoon-long informal meeting — held on the sidelines of the World Economic Forum in Davos, Switzerland and attended by representatives from around 25 Members, including the US, the EU, India, Brazil, Canada, and Australia — was not to make specific decisions, but rather to demonstrate that Members have the political will to bring the round to conclusion.
The current talks have progressed in fits and starts since they were resurrected following the collapse of the September 2003 Cancun Ministerial Conference by the ‘July Package’ framework agreement in August 2004. Just before the 29 January meeting, WTO Director-General Supachai Panitchpakdi had expressed his concern that Members had not made enough progress, failing to agree on the shape of a formula for reducing tariffs and subsidies. He said that whatever work had been completed thus far was not "enough to guarantee that Hong Kong will be the penultimate step to complete the round in 2006."
Mini-ministerial agrees to focus on five areas
According to a statement on the gathering prepared by host Joseph Deiss, Switzerland’s minister for economic affairs, the countries present agreed to direct particular attention to: modalities for agriculture; a formula for reducing tariffs on industrial goods; market-opening offers in services trade talks; progress on trade facilitation and strengthening WTO rules (such as anti-dumping disciplines); and a "proper reflection of the development dimension" of the negotiations. The ministers also agreed on the need for greater ministerial involvement throughout the year, and for the talks to "move from the clarification phase to real negotiations" on all issues.
Members agreed that Geneva-based negotiators should develop draft texts by the WTO’s summer break in August 2005. Deiss said that negotiators would then "narrow down differences," leaving only a few "major political issues" to be dealt with at the December Ministerial Conference.
Members disagree on what is required for progress
Although ministers at Davos generally agreed that it was possible to step up the pace of the negotiations, their statements before and after the meeting suggested that they have very different views on what is necessary to move the talks forward.
EU Trade Commissioner Peter Mandelson pointed to the EU’s agreement to eliminate agricultural export subsidies, arguing that this constituted a major concession that put the ball firmly back in the court of the larger developing economies. He called on countries such as India and China to lower tariffs on industrial goods and to offer special market access to least-developed countries (LDCs), declaring "we need… more people to put things into the round, not just take out of it."
Indian Commerce Minister Kamal Nath rejected Mandelson’s assessment, arguing that the promise to end agricultural export subsidies was merely one aspect of "reducing the artificiality" of agricultural prices. He said that India would require a proposed formula for reducing tariffs on industrial goods before negotiating liberalisation sector-by-sector. Furthermore, he warned that any attempts by Members such as the EU to create a category of ‘advanced developing countries’ could "delay the Hong Kong decision process."
Nath went on to emphasise that the services negotiations deserve as much attention as those on agriculture and industrial goods. As a result of its booming information technology sector and large numbers of trained professional workers, India stands to gain more from services liberalisation, especially through temporary permits for its workers to work in rich countries, than it does from improved access to developed-country agricultural markets. Many Members are disappointed with the depth of the market-opening offers to date.
LDCs, for their part, are concerned that reduced tariffs and agricultural subsidies will render insignificant their preferential access to rich-country markets.
Upcoming meetings; mini-ministerial, other gatherings planned
In spite of these differences, Members agreed that the mini-ministerial was a success. Brazilian Foreign Minister Celso Amorim, coordinator of the G-20 bloc of major developing countries, spoke positively of the meeting, as did Supachai.
Several mini-ministerials will be held this year to discuss the issue areas singled out at Davos. Kenya will host one such meeting from 2-4 March. Another will be held during the Organisation for Economic Cooperation and Development (OECD) ministerial summit in Paris from 3-4 May. China and Korea have offered to hold mini-ministerials during the second half of the year.
The G-20 countries, which held a separate meeting in Davos ahead of the mini-ministerial, will meet in New Delhi on 18 March to outline a common strategy for the year’s trade talks.
The WTO’s Trade Negotiations Committee will meet in Geneva on 14 February to review progress in the talks.
ICTSD reporting; "Trade heads urged to seek deal," GUARDIAN, 29 January 2005; "India against new category of developed countries," PRESS TRUST OF INDIA, 31 January 2005; "G-20 meet in India to chalk out WTO strategy" WEBINDIA123.COM; 1 February 2005; "Ministers seek to bring new life to Doha trade liberalisation talks," FINANCIAL TIMES, 29 January 2005; "Davos meet recharges Doha Round of WTO talks," ASIA TIMES, 1 February 2005; "Key WTO members agree to accelerate global trade talks," AGENCE FRANCE PRESSE, 29 January 2005; " Trade Ministers Issue Political Call For Doha Deal by ‘06 at Davos Meeting," WTO REPORTER, 1 February 2005; "WTO chief urges speed on trade pact," TAIPEI TIMES, 29 January 2005; "India presses for trade talks to keep Doha alive," INDIAN EXPRESS, 29 January 2005; "World Trade Organisation members try to spur talks on liberalisation treaty," CANADIAN PRESS, 31 January 2005; "Trade ministers commit more firepower to Doha," 29 January 2005.