Trade Ministers in Oslo Weigh WTO Options for Buenos Aires Meeting and Beyond

27 October 2016

Trade ministers from over 20 WTO members concluded two days of informal talks from 21-22 October in Oslo, Norway, aiming to help give some political momentum and guidance to negotiations on possible outcomes for the global trade body’s next ministerial in Buenos Aires, Argentina, in late 2017.

While officials termed the talks as productive and positive, many deemed it part of a longer process which will need both significant technical work and continued political engagement in order to yield credible outcomes.

Whether all of the items that were ultimately raised in the discussions could actually be turned into deliverables for Buenos Aires – or may instead be the subject of more long-term explorations, beyond next December – was also a question raised by some sources familiar with the talks.

Sources say that the Oslo meetings discussed a range of topics, including agriculture, fisheries subsidies, services domestic regulation and trade facilitation, non-tariff barriers, e-commerce, and how to make the international trading environment more supportive for smaller businesses. Other subjects raised included the role of regional and so-called “mega-regional” trade deals in the overall trading landscape. Some countries reportedly raised the issue of public food stockholding at the Oslo meet, some sources said, a topic that has been debated often in the WTO’s farm trade talks over the last several years.

“Given the range of issues raised, representatives in Oslo stressed the importance of proponents providing the impetus behind the issues that they want to take forward,” said WTO Director-General Roberto Azevêdo at the close of the event.

The WTO chief suggested that the Oslo talks would also give “useful inputs for the ongoing conversations in Geneva,” according to a statement released by his office following the meeting. 

The Oslo meeting was chaired by Norwegian Foreign Minister Børge Brende. His country holds the current chairmanship of the WTO’s General Council in Geneva, with the General Council serving as the organisation’s highest decision-making body outside the ministerial conference.

“The participants carried out constructive discussions on a great many issues surrounding the work in the WTO and further trade negotiations in both the short and intermediate term," said Brende.

Along with Norway, the meeting’s host, sources say that participants also included ministers or senior officials from members such as Argentina, Australia, Benin, Brazil, Canada, China, Colombia, the EU, India, Indonesia, Kenya, Japan, Lesotho, Mexico, Morocco, New Zealand, Pakistan, Russia, Rwanda, Switzerland, Singapore, South Africa, South Korea, and the US.

"I hope and believe that the Oslo meeting has provided new inspiration for further negotiations, and that we have laid a good foundation for concrete results,” said Brende.

Other “mini-ministerial” gatherings are reportedly envisioned throughout the coming year. This includes the usual meetings in Davos, Switzerland, in January, as well as a Paris meeting along the sidelines of the Organisation for Economic Co-operation and Development’s (OECD) annual spring gathering. Sources say that another such meeting may be held in September 2017, in a bid to help support the Buenos Aires preparations in their later stages.

EU fisheries proposal circulated

Just prior to the meet, the European Union circulated its proposal on a multilateral outcome on disciplining harmful fisheries subsidies.

“Fisheries subsidies, similarly to other types of subsidies, can only effectively be addressed through a multilateral agreement covering all WTO Members. The fact that the sustainability of global fisheries is at stake, further reinforces the need for multilateral action,” said the EU proposal, dated 20 October.

According to the proposal’s text, the EU is suggesting banning “capacity-increasing subsidies,” noting their negative ramifications in terms of overcapacity and overfishing. For example, it would ban state aid aimed at boosting a fishing vessel’s fishing capabilities, purchasing or building such vessels, or transferring such vessels abroad.

Such a prohibition would entail “special and differential treatment,” allowing poorer members to be exempted from the ban in certain cases. This includes exempting subsidies for subsistence fishing vessels that are less than 10 meters in size.

Under the EU proposal, another scenario where developing or least developed countries could provide subsides would be in cases where the relevant fish stocks are not recognised as overfished by the necessary authorities, with those stocks “managed on the basis of the best available science” and in line with conservation rules under international law. It outlines further details regarding both conditions. A management plan for “ensuring the sustainable exploitation of the stock” would also be needed.

The text further aims to tackle subsidies linked to illegal, unreported, and unregulated (IUU) fishing. “[This] would apply to operators whose vessels are included in the subsidising country's IUU-vessel list and/or that of a Regional Fisheries Management Organisations (RFMOs),” the proposal says

Lastly, the proposal calls for improving transparency in this area, specifically in terms of notification requirements to the global trade body. It then goes on to describe how such a multilateral accord could be structured.

Days later in Geneva, the US reportedly raised again its own past proposal to improve transparency in the field of fisheries subsidies, including on how the WTO’s Committee on Subsidies and Countervailing Measures might be able to help improve compliance with rules on notifying state aid.

Sources say that the US transparency initiative saw interest from various fellow WTO members at the 25 October committee meeting, while at the same time drawing questions from Japan and India. While the former asked specifically what might be included in improved subsidies notifications, the latter focused more on ensuring that poorer WTO countries still receive special and differential treatment.

Meanwhile, another area of interest for trade watchers will be how a multilateral endeavour, as advocated by the EU and some other countries, will advance in parallel to a separate negotiating initiative being advanced by a subset of the WTO’s membership. The latter initiative is currently being pushed by 13 WTO members, and was announced by the Office of the US Trade Representative last month. (See Bridges Weekly, 22 September 2016)

TISA update

The Oslo mini-ministerial also provided the opportunity for some ministers from the WTO group currently negotiating a Trade in Services Agreement (TISA) to gather in the margins to take stock of the talks, given the current target of concluding those negotiations by early December.

Sources familiar with the meeting noted that this event was not a full or formal TISA ministerial, in light of the fact that only some ministers were present – namely those that were already participating in the main Oslo gathering. The TISA talks currently include 23 participants, counting the EU as one, with approximately half of that number present in Norway.

The TISA-focused gathering in Oslo was chaired by Australia, officials confirmed. The timing of the event came just as TISA participants were due to submit revised market access offers, which were reportedly still under review at press time.

Along with market access, other areas of the talks also remain outstanding, with negotiators noting that much work still remains in order to resolve these issues in time for the current December target.

Such issues reportedly include how to resolve a disagreement over whether to exclude new services – in other words, those that have yet to be discovered or developed – from being automatically granted national treatment, in light of the fact that TISA uses a “negative list” approach for its national treatment commitments.

Under a “negative list” approach, all services sectors are included across the board, unless they are specifically excluded.

Sources say that the EU is among those advocating for a carve-out for such new services, in an interest to protect policy space in a context of a rapidly changing technological environment, which would specifically apply to those services that would not fall under existing classification categories, as outlined under the UN’s Central Product Classification.

Sources say that the EU’s position is that since the WTO’s General Agreement on Trade in Services (GATS) and the invention of the internet, there have not been any “new services” that do not fall under the UN classification, with technological changes instead affecting modes of supply – making the issue hypothetical in nature.

The EU reportedly aims to retain the option of reservations against national treatment – such as setting up establishment requirements – or against disciplines on local presence. The EU and others have also suggested that given reservations in existing sectors in TISA market access offers, it would be best to focus efforts on opening up those economically meaningful sectors.

The effort to carve out new services has reportedly been opposed by the US, among others, given that the overall accord currently envisions granting all sectors not specifically excluded with national treatment, under the “negative list” approach.

An expected EU proposal on data flows is also pending, sources say, partly in light of the need to resolve a separate matter in terms of attaining consensus across the bloc to sign a trade deal with Canada this week. (For more on the EU-Canada situation, see related story, this edition)

Crafting this data flows proposal has also involved ensuring how to make sure that digital data is appropriately protected. However, participants have debated whether the delay in receiving such a proposal should slow progress in other parts of the TISA talks.

While those issues have been the most high-profile in recent weeks, some trade sources note that these are not the only contentious topics, citing as examples differing views on Mode 4 commitments – the movement of natural persons – and maritime transport, among others.

Going forward, TISA negotiators have reportedly two rounds scheduled. One will be a 2-11 November round, chaired by the EU, while another one will begin in late November and continue through December, with the planned TISA ministerial set for 5-6 December.

A separate, informal meeting of ministers from some participants in a tariff-cutting initiative on environmental goods also met in Oslo this weekend, sources confirm. That process, known as the Environmental Goods Agreement (EGA), is also attempting to reach a successful conclusion this year. (For more on the EGA, see related story, this edition)

ICTSD reporting.

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