CTD Special Session Suspended Over Inability To Agree On Report

 With time winding down on the initial phase of the Committee on Trade and Development's review of special and differential treatment (S&D), Member delegates met informally on 10 and 16 July with the hope of bridging some of the gaps that still remained prior to the 17 July formal session. With a large amount of ground not covered by the end of the 16 July meeting, Members decided to resume on the morning of 17 July and then continue with the regularly scheduled meeting, where they hoped to secure consensus on the report that Ambassador Ransford Smith (Jamaica) is required to present to the General Council on 31 July. Divisions on the report however, proved so wide -- particularly on the section 'The Way Forward -- that the formal session was suspended, pending further revisions to the draft.

 The mandate given to Members in Doha, and passed on to special sessions of the Committee on Trade and Development (CTD) by the Trade Negotiations Committee (TNC), specifies two particular objectives on which the body is to "report to the General Council with clear recommendations for a decision by July 2002." These are, firstly, to identify those S&D provisions that are mandatory/non-mandatory, consider the legal implications of making non-mandatory provisions mandatory, and identify those provisions that Members consider should be made mandatory. Secondly, Members are to examine additional ways in which S&D provisions can be made more effective and to consider how developing country Members can make better use of S&D provisions.

 Circulating the first draft report

 The first draft report (TN/CTD/W/12, currently restricted), which was circulated on 12 July and was expected to be finalised on 17 July, represented what some (mainly industrialised country) Members considered a good balance based on the available information and analysis to date. Other (mostly developing country) Members expressed "disappointment" over the little they felt had actually been achieved -- pointing out that the report firmly supported only one of the 90 proposals put forward (see below). One African delegate, whose continent many trade experts feel is most in need of commercially valuable S&D provisions, noted that "this absence of progress on the specific [S&D] mandate given by ministers in Doha is not sending the right signals for making the Doha agenda truly a development one." This inability to move ahead so early in the agenda was further exacerbated by calls by the Quad Members of the US, Canada, the EC, and Japan to continue the discussions in an open-ended fashion, without providing a specific timeline for dealing with the proposals themselves.

 Overcoming differences

 One of the two main issues that sources indicated were problematic was the debate over when discussions on the objectives and principles of S&D should occur.  While most Members viewed such a discussion as necessary if S&D was to undergo the comprehensive review and amendment that was envisaged, there was a fair amount of divergence over when this discussion should happen, and what, if anything, should take priority over it. Most developing countries insisted that the mandate emanating from Doha did not provide for this broader discussion and that it revolved around specific proposals; thus making the proposals a priority. Furthermore, many adamantly rejected calls to move the proposal-specific work to subsidiary bodies as it was tasked specifically to the CTD. The EU, supported by most developed countries, countered this position by saying that in fact this discussion should form the core of the review, and thus should come prior -- or at least concurrent -- to the proposal-specific approach.  In that regard, they echoed developed country calls to have those proposals discussed in the relevant subsidiary bodies.

 One trade expert following the negotiations conjectured that this difference in perspective reflected the divergence over the depth of the review of S&D sought by Members. Most developing countries, the source continued, wanted to see movement on the 90 proposals made so far, and then engage in a dialogue on objectives and principles, with the final outcome being a substantial overhaul of the approach to S&D in the WTO system. Developed countries, the source speculated, would like to have the broader discussion first, hoping to narrow the focus of the review and thereby limit the scope of potential reforms and amendments in the long run.

 The second major stumbling block was the sensitive issue of a post-July timeline. The draft report offered two bracketed options for the special session to "fulfil its mandate and to report back to the General Council with clear recommendations [...]" -- namely to report either by 31 December 2002 or by 31 March 2003. The latter date was somewhat of a surprise, said one delegate, as the two dates initially discussed were the former and November 2002. Further, the draft report included a 31 October 2002 deadline, by which date Members will "endeavour to provide responses to the various Agreement-specific proposals [...]."

 Sources at the 17 July meeting noted that some developing countries, including India, Egypt, & Kenya, were resolute to see the November date prevail.  In addition, numerous developing country delegates noted their displeasure with the non-mandatory, exhortatory language of the deadline for responding to the agreement-specific proposals, with one adding, "it is this very type of 'best-endeavour' language that is causing a number of the problems that Ministers in Doha tasked us with fixing."  A few other suggestions were made for deadlines, including the Fifth Ministerial Conference in September 2003 (Switzerland) and the spring 2003 (EC).  The US and Japan, who contested the November 2002 date, called on Members to be "realistic" about what could be done.

 A potential implication of the December option would be to align S&D with the reports for appropriate action to be made to the TNC on outstanding implementation issues. This could, fear some developing country delegates, put S&D up for direct tradeoffs on other implementation issues -- and thus they are pushing for the November date.  One implication for the March 2003 option would be to align S&D with other negotiating deadlines -- specifically that of agriculture and services, which are to finalize modalities (agriculture) and have submission of initial offers (services) by this date. As one source familiar with the progress in these other areas of negotiations put it, this latter timeline would likely preclude S&D from making up any part of an early harvest in the Doha round.

 Background

 Over the course of the special sessions, dating back to March 2002 (see BRIDGES Weekly, 5 March 2002), Members have stumbled on various procedural and substantive issues. One that took up much time initially was whether the body was in fact a negotiating body or not -- something that recent comments >from delegates show is far from resolved. While tackling this and other procedural issues (such as how to report, how to plan for post-July, etc) Members submitted proposals on amendments to S&D language in over 90 WTO provisions. In recent weeks, the debate distilled into four primary areas: (i) agreement-specific proposals and issues; (ii) institutional issues; (iii) cross-cutting issues; and (iv) the way forward.  Three of these four areas (ii and iii were merged) formed the section headings for the draft report.  The report was augmented by three annexes, with the first listing the various submissions made to date, the second listing which proposals dealt with the major systemic cross-cutting elements, and the final one summarising which proposals touched on specific elements of WTO agreements.

 Monitoring mechanism the only item to receive firm support

 The only specific element of any of the 90 proposals to receive firm support in the draft report was that of the monitoring mechanism, as proposed in the Africa Groups submission (TN/CTD/W/3/Rev.1).  Members disagree however on the form and structure that the mechanism could take (see BRIDGES Weekly, 10 July 2002). Two other elements that do receive mention in the report, although not outright support, are the annual special session of the General Council on the participation of LDCs in the trading system and the Facility to ensure the financial backing required for effective utilisation of S&D provisions in the WTO agreements

 At time of press, no date had been set for the resumption of the formal special session. ICTSD will continue to monitor this process closely and report in future editions.

 ICTSD reporting.