EU trade chief calls for building on Nairobi momentum in Geneva

6 May 2016

The results from last December’s WTO ministerial conference went well beyond expectations, EU Trade Commissioner Cecilia Malmström said in Geneva on 2 May, reiterating recent calls for the organisation’s members to draw on this momentum and begin charting a clearer path toward the next ministerial and beyond.

Speaking at the Graduate Institute on Monday to a packed room of academics, ambassadors, and other trade watchers, the EU official highlighted the opportunities that may now be available in the wake of last year’s ministerial meet, while explaining that the 28-nation bloc is still considering its own position on many areas.

Last year’s ministerial conference, held in Nairobi, Kenya, saw WTO members agree on a series of deliverables ranging from agricultural export competition to several issues of relevance to least developed countries. At the December meet, WTO members also agreed to disagree on whether to reaffirm the Doha Round negotiating mandate, instead noting opposing views on the matter. (See Bridges Daily Update, 19 December 2015)

While some members reiterated their “full commitment to conclude the [Doha Round] on that basis,” various others pushed for taking on new approaches for reaching meaningful results.

Furthermore, the declaration says that “while we concur that officials should prioritise work where results have not yet been achieved, some wish to identify and discuss other issues for negotiation; others do not. Any decision to launch negotiations multilaterally on such issues would need to be agreed by all members.”

The result has prompted questions and speculation as to the next steps for the WTO’s negotiating arm, particularly given that the next ministerial is slated for the end of 2017.

“Trade for All” as inspiration

In a speech to civil society a week ago, the EU trade chief outlined a series of areas that, in her view, could be fruitful areas for WTO members to begin their post-Nairobi discussions. While stressing that the EU’s preference is for multilateral deals whenever possible, she also indicated that a next-best option would be plurilateral pacts on a most-favoured nation basis. (See Bridges Weekly, 28 April 2016)

“[The EU] wants to draw inspiration from Trade for All for our approach to the World Trade Organization,” she said on Monday in Geneva, referring to the EU’s vision document for trade policy which it released late last year. (See Bridges Weekly, 15 October 2015) “That brings me to a final European value that has always been at the heart of EU trade policy: multilateralism.”

Noting that the Trade for All document came a few months before the Nairobi ministerial – a time where prospects for an agreed outcome were mixed at best – she indicated that back then “we could only be hopeful” for what the event might accomplish.

“The results surpassed our expectations – on export competition in agriculture and information technology, but also by giving us the first chance in 15 years to adapt the WTO’s agenda of negotiations,” she said.

“That means we need to think about how to apply the principles of our trade strategy to the post-Nairobi work that has begun here in Geneva,” she added.

Relevance, inclusiveness

During her earlier speech to civil society a week ago, the EU trade chief put forward a series of areas for possible discussion at the multilateral or plurilateral level, including agricultural domestic support; digital trade; investment; fisheries subsidies; food security and public stockholding; domestic regulation in services; export restrictions on energy and raw materials; local content requirements; and state-owned enterprises.

She also flagged sectoral deals on market access and trade facilitation as areas where a plurilateral approach would likely be the only option, given the apparent lack of consensus among the WTO membership.

In Geneva on Monday, Malmström referred specifically to some of these issues, such as digital trade, investment, state involvement in the economy, and energy and raw materials.

These were referred to in the context of increased policy relevance, as ways to help bring the WTO rulebook “in line with 21st century realities of global trade.”

Calling also for making trade policy more inclusive, including for smaller firms, she suggested that domestic regulation of services and more work on regulatory and technical barriers affecting manufactured goods could be helpful areas to begin on.

Ultimately, though, she stressed that “multilateralism in itself is a value,” reiterating her point from last week’s speech that any new ideas discussed at the WTO should begin with a search for multilateral solutions.

“If the multilateral path doesn’t work then we can look at other approaches. And logically, that starts with plurilateral agreements, based on the most favoured nation principle, open to all, and subject to the WTO dispute settlement system,” said Malmström.

Moving forward, she indicated that the European Commission will both be refining its own approach on where next to proceed, including with planned discussions with trade ministers from EU member states, while also gauging the interest levels and positions of fellow WTO members.

“We haven’t landed yet. Multilateralism is a priority,” she said in response to questions on the subject. If multilateralism does not work for an issue, plurilaterals will be considered, “but it’s too early to say when, or where or with whom,” welcoming any input.

Broader trade context

The question-and-answer component of the Trade Commissioner’s visit covered a range of topics, with some trade watchers picking up on the WTO-related elements, while others raised questions on different areas involving EU trade policy, including the implications of the upcoming “Brexit” referendum in the UK this June, as well as the ongoing negotiations with the US for a Transatlantic Trade and Investment Partnership (TTIP).

Regarding the public debate on trade deals, including TTIP, the EU official noted that having a public debate on such topics is useful in making the process more inclusive, adding that people “are also concerned about trade in general.”

She added that the EU is aiming to address some of these concerns – such as on environmental and labour issues – through its Trade for All strategy, in order to make sure “that what we do in trade is consistent with our core values, which are also universal values,” such as democracy and transparency.

“There will be no lowering of our social and environmental protections,” she added.

In response to the EU’s approach in pushing for both multilateral progress while also pursuing bilateral and regional pacts, she told the audience that, “in trade, multilateralism makes sense,” given the value of having an outcome backed by over 160 members.

Regional and bilateral deals, however, can also prove very useful as “policy laboratories,” while again noting that the momentum from Nairobi could be powerful in pushing for new multilateral outcomes and regaining public trust on trade.

ICTSD reporting.

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