Piecemeal Progress Made in WTO Negotiating Groups

WTO Members met for their first full day of formal Ministerial discussions on 1 December.  Four out of the five mandated working groups came together, and aside from the release of some pared down and heavily bracketed texts in the areas of Agriculture, Implementation and Market Access, there were few advances made in reaching substantive agreement on most issues.

A preliminary Committee of the Whole comprised of representatives from all 135 Members and chaired by U.S. Trade Representative Charlene Barshefsky met in the morning on 1 December to begin the day's talks.  Barshefsky urged delegates to send senior officials with decision-making authority to the working groups.  Though she notified Members that she reserved the right to hold 'Green Room' meetings (usually consisting of major WTO Members as well as others who have substantial interest in certain negotiating areas), the USTR preferred an inclusive approach such as that afforded by the working group structure, which is now open to all Members.  Despite this, Members did meet in a number of informal country and bilateral sessions, as well as in what one WTO official has termed "mini Green Rooms", though none were led by Barshefsky.

In the Agriculture working group, an earlier draft submitted by the Cairns Group of agriculture-exporting countries and the U.S. emerged with added text that reflected traditional EU and developing country demands.  These included listing the multifunctional role of agriculture under non-trade concerns and a text bracket outlining reduction -- as opposed to elimination -- of all forms of assistance to exports under the section on Export Subsidies.  The section on special and differential treatment for developing countries also contained a large amount of bracketed text, apparently distilled from India's submission to the 19 October draft Ministerial Declaration.  Though these development issues -- including food security, rural development, poverty eradication, and technical assistance -- were not discussed on 1 December, they are on the agenda for 2 December, along with biosafety.  For further info, see related story this issue.

The Implementation working group released its own bracketed text, though it represented little drastic change on the proposed language in the last (19 October) version of the draft Ministerial Declaration.  The text did reflect a possibility that many of the implementation demands from developing countries would be contained in one or two annexes, though the areas outlined continued to cover the 'traditional' range of Implementation demands (including anti-dumping, subsidies, safeguards, SPS, TBT, TRIMs and TRIPs).  Among the issues discussed were the prospects for longer transition periods, more exceptions for developing countries, and renegotiation of certain agreements (notably subsidies, textiles and anti-dumping).  Japan and Korea expressed their desire to have a review of the anti-dumping agreement worked into the next round, while Iceland, backed by the U.S., proposed negotiations to remove fisheries subsidies, a suggestion which met with little enthusiasm from the EU.

Market Access discussions were somewhat less polarised than Agriculture and Implementation, and many observers were confident that a consensus could be reached by week's end.  The text released on 1 December reflected U.S. demands in areas such as forestry and fisheries liberalisation and expanding market access to cover all goods, rather than only non-agricultural products.  The EU, U.S., India and South Africa are all pushing for a short text, and Bangladesh is calling for all LDCs to receive bound duty-free access.

On Singapore Issues, Members discussed Investment and Competition, and while some Members (such as the EU) argued for inclusion of these areas in a Declaration, Members remained far apart on agreement, such that one WTO official noted that there was 'substantial opposition to going forward with this issue.'

On 2 December, WTO Members will meet in their fifth working group, on Systemic Issues, which include WTO rules and procedures and WTO-civil society relations. U.S. Trade Representative Charlene Barshefsky expressed optimism on 1 December that there will be progress on transparency.  "The key [for pushing transparency forward] is acceptance of the principle that openness and transparency aren't antithetical to an open trade system," she said.

EU Commission Grilled on Biotechnology Working Group

The environment ministers of France, the UK, Italy, Denmark and Belgium immediately issued a statement saying that the Biosafety Protocol negotiations "the only 'proper forum for deciding a multilateral approach to biotechnology issues' " would be undermined by the establishment of the WTO working group, which could potentially subordinate the Biosafety Protocol negotiations to discussions of the [Seattle] Round, thereby setting a precedent for the WTO's relationship with other MEAs'. UK Environment Minister Michael Meacher said on 1 December that the working party proposal was both unexpected and contrary to the agreed policy of EU members, who had made a considerable effort to finalise the Biosafety Protocol.

Speculation was rife as to what the EU might have received in exchange for the concession on the biotechnology working group, which had until then essentially been sought by the US and Canada. The latter two are vocal members of the Miami Group of biotechnology exporters, which wants to keep any potential trade restrictions out of the Biotechnology Protocol. Some conjectured that there was an understanding that the EU would find less resistance to the inclusion of the precautionary principle in WTO rules if it agreed to the working group proposal.

Clearly embarrassed by the insistent questioning of the EU's motives and the Commission's authority, Agriculture Commissioner Fischler stressed that the proposal did take into account the concerns of civil society (health, environment, development and consumer issues). A draft press release entitled Commission Thinking on Biotechnology . not yet officially issued . seemed designed to appease angry governments and civil society through a series of further details on the group's purpose. For instance, it specifies that the EU is not a demandeur for a WTO biotechnology working group, and that work should only proceed if, inter alia, 'all concerned, but notably the US and the Miami Group countries, commit themselves to working hard and constructively for very early conclusions to the biosafety talks'. The paper adds that the work of the group should be 'set up as a part of a comprehensive package of environmental elements for the WTO negotiating programme'.

Biotechnology and the precautionary principle also formed a major focus of several NGO events on Wednesday, 1 December.  At a meeting sponsored by the Royal Institute of International Affairs and the International Institute for Sustainable Development, panelists focused on both the practical and theoretical challenges faced in instituting the precautionary principle in international agreements, domestic policy and in trade policy. A meeting sponsored by the Consumers Choice Council on GMOs also discussed the precautionary principle and labelling issues.  But the meeting often looked outside the trade system and challenged many fundamental issues related to GMOs, including poverty and food security, public health, science and development, and cultural concerns.

A Greenpeace discussion on 1 December with UNEP Executive Director Klaus Töpfer revealed that Sweden, Norway and the Netherlands will have an important role in the negotiations on the precautionary principle as they seem the most likely countries to fully adopt it. They will be in a position to influence other delegations regarding this complex issue.

The EU Draft's Environment and Development Provisions

The 17-page draft Ministerial Declaration released on 30 November by the European Commission, Hungary, Japan, Korea, Switzerland and Turkey, contains substantial provisions in the areas of development, environment, agriculture and biotechnology (see related story above).

The General Objectives of the draft include sustainable development; 'the maximisation of positive synergies between trade liberalisation, environmental protection and economic development; and 'avoiding potential conflicts arising between continued trade liberalisation and sustainable development objectives'.   Paragraph 36 contains three additional environmental provisions: the consideration of the multilateral trading system and trade-related provisions of multilateral environmental agreements, as well as WTO rules such as article 5.7 of the SPS agreement; and 'measures taken for precautionary reasons in case of lack of sufficient scientific evidence as to the risk to health or the environment.'  The specific reference to the environment in this context would provide a much more secure base for both the precautionary principle and the environment in the WTO. Finally, the draft calls for the WTO to examine the relationship between the TRIPs Agreement and the U.N. Convention on Biodiversity.

The draft mentions development issues and the challenges of developing countries throughout the text in both general and specific references. Paragraph 3 bis sets the tone of the following provisions by stating: 'Trade liberalisation and further rule making should be pursued in line with the objectives of promoting development and poverty alleviation.' Additional provisions include the extension of compliance periods for three years with parts of the SPS and customs valuation agreements; and for a shorter period in the TRIMs agreement.  The establishment of a committee to review implementation difficulties is foreseen, as well as a review of special and differential treatment provisions.

The section on agriculture mentions the 'reduction of all forms of assistance to exports' and 'further reductions in trade-distorting domestic support'.  Non-trade concerns including the concept of multifunctionality are also included.  The draft's investment and competition policy provisions are not substantially different from the EU's earlier proposals.

Future WTO Head on Trade and Labour, Implementation

In his speech at the Ministerial Conference plenary session on 1 December, Thailand's Deputy Prime Minister Supachai Panitchapakdi, who will succeed Mike Moore when the latter's term as  WTO's Director-General expires in 2002, pleaded for 'flexibility, compassion and courage' that would lead to the 'launch of a successful Development Round', where 'early concrete results should be weighted more in favour of the developing countries'. While the round should be broad-based enough to contain benefits for all WTO Members, it should not stray too far from its original intent, Dr Supachai said.

He also said that the WTO should not shy away from addressing labour issues, although this should not be done through a working group or any other standing body. Instead, he felt confident that developing countries would welcome a high-level 'soul-searching' dialogue, convened by a neutral institution such as UNCTAD or the UN Economic and Social Council. This should be a non-politicised meeting on the relationship between labour standards and the trading system, including the question of social safety nets and other issues. Political leaders should be involved, as well as officials from international organisations such as the ILO and the WTO.

In a press conference, he confirmed that any talk on labour norms in the WTO – and in particular the use of trade sanctions against those who violate core labour standards – would confirm developing countries' worst suspicions, and would probably make them withdraw their support for the new negotiations altogether.

On implementation concerns, Dr Supachai urged Ministers to be 'magnanimous' in Seattle with regard to granting extensions to the TRIPs and TRIMs implementation deadlines for developing countries that are experiencing real difficulties in meeting them. While more detailed negotiations on the revision of existing Agreements should take place in Geneva, 'a certain review of specific portions of anti-dumping regulations might help resolve the prevailing suspicion on the conspicuous proliferation of anti-dumping measures'.

The Elusive ATL Initiative

The US and EU delegations gave conflicting versions on the EU's rumoured acceptance of the ATL initiative, i.e. 'early harvest' results on accelerated tariff liberalisation on eight sectors of non-agricultural goods, including forestry and fisheries products. The United States seemed confident that the European Union was ready to sign off on ATL provided that another two unspecified sectors were added to it. EU Trade Commissioner Pascal Lamy, however, said that the EU – as it had announced early in the preparatory process – would put all of its industrial tariffs on the negotiating table without prioritising the ATL or any other particular sector. The EU is also wary of the early harvest approach, which could take some of the issues out of the negotiations before the conclusion of the entire Seattle Round. Agriculture Commissioner Franz Fischler was evasive about the ATL, noting only that fisheries and forestry negotiations should not be conducted in isolation of other tariff negotiations (Japan and Korea have proposed the establishment of a separate working group on these in the context of the agricultural negotiations).

Environmental organisations oppose rapid elimination of tariffs on forestry products, because they fear lower prices would increase demand and thus lead to greater deforestation.

ACPs Concerned about Lomé Expiry during Seattle Week

The group of 71 African, Caribbean, and Pacific (ACP) former colonies of the EU are having problems negotiating trade contracts with importers due to uncertainty over whether the EU will succeed in finalising a waiver renewal text by the end of the negotiating week.  The EU's waiver at the WTO allowing a preferential market access scheme for the ACP (known as the Lomé IV agreement) runs out on Friday 3 December.  It is not clear at this point what is going to happen to the waiver, particularly since there is no consensus on what a successor to Lomé might look like.  The EU has been considering replacing its preferential agreement with a series of regional trade groupings.  The matter is further complicated on the one hand by the fact that the EU is currently preoccupied with its own negotiating stance at the Ministerial and on the other that the ACP is concerned that proposals from some developed countries for zero tariffs for LDC exports will split its members and make it more difficult for them to speak with one voice.

No Patents on Life: Workshop on the TRIPs Agreement

The Third World Network, The Council for Responsible Genetics, The Washington Biotechnology Action Group and the Institute for Agriculture and Trade Policy presented their case against the WTO on 1 December in a workshop on TRIPs. A grouping of African developing countries have submitted a paper to the WTO illustrating their disagreement on TRIPs, in particular with respect to article 27.3(b). Currently, the TRIPs Agreement could extend patents to allow multinational companies to own individual seed types, plants, and crops currently used by farmers and indigenous groups. The group wishes to protect farmers' and communities' rights, especially in developing countries.

The like-minded group has joined the African countries in demanding that amendments to Article 27.3(b) make clear distinctions between life and non-life forms. In addition, better mechanisms must be in place to protect developing countries against such issues.

Vandana Shiva (from the Research Foundation for Science, Technology and Ecology, India) labelled the TRIPs Agreement as "biopiracy".  She stresses the views of most NGOs dealing with patents and TRIPs that no one owns or can own life forms; and that they belong to everyone, not to multinational corporations or organisations.  Shiva argued that plants, seeds, organisms and other life forms cannot be sold or bought.