Asia-Pacific Leaders Press for WTO Outcome in Bali

10 October 2013

Success at the WTO's upcoming ministerial conference is of "utmost importance," leaders from 21 Asia-Pacific nations urged during their annual summit this past week, warning that a failure to clinch a deal for the December meeting could have lasting ramifications for the multilateral trading system. The political push comes as Geneva-based negotiators race to meet an end-October deadline to conclude their main negotiations.

"We are now at the eleventh hour to put the negotiating function of the WTO back on track," APEC leaders warned in Bali on Tuesday, noting that the next step will be "critical" for both the global trade body's role and the multilateral trading system as a whole.

Leaders also "strongly encouraged" all of the global trade body's members to show both flexibility and political will during the coming weeks in order to resolve the existing divides.

The Asia-Pacific Economic Cooperation - also known as APEC - summit had been touted as an opportunity to give additional political momentum to the WTO negotiations, in light of the limited time remaining before the 159-member body kicks off its biennial December ministerial, which will also be held in Bali.

WTO Director-General Roberto Azevêdo, who took the helm of the global trade body at the beginning of September, has been conducting a series of intensive consultations with members over the past month, in the hopes of facilitating an agreement in time for the ministerial. Though there have been reports of a new negotiating dynamic in Geneva, the new trade chief has warned in recent weeks that political engagement from capitals will be key to bringing the process to a successful close.

"It is a clear possibility: a first harvest is within reach," Azevêdo told APEC trade ministers last week, calling for their help. "But we are not there yet - in fact the challenges are still quite significant and time is running out."

The APEC summit is one of several international trips the WTO chief is making to build momentum for the Bali package. He attended the G-20 summit in Russia last month, and is next slated to attend the World Bank-International Monetary Fund Annual Meetings in Washington in the coming days.

Back in Geneva, negotiations have continued in the Director-General's absence. Reporting back to WTO members on Tuesday on the APEC conference, Azevêdo noted that Bali preparatory process will enter their final stages on Monday, urging them to be prepared.

"The moment of truth will have arrived," he said. "Starting next Monday, every hour is a working hour and every day is a working day."

ITA talks to resume

Negotiations to expand the coverage of the Information Technology Agreement (ITA), a plurilateral WTO pact that eliminates tariffs on trade in information and communication technology products, are also expected to resume in the coming weeks, following discussions involving some of the participants on the APEC summit sidelines.

The ITA dates back to the mid-1990s, and a subset of the group's participants have spent over a year working to develop a list of new products to add to the agreement's coverage in order to reflect the changes in world trade since 1996. A revised ITA had been touted as another possible deliverable for the WTO's ministerial conference in December.

However, the talks were suspended in July, due to differences between China and other participants over which products to include. Specifically, Beijing had indicated a series of product lines that it deemed too sensitive for inclusion. Other members - such as the US - in turn argued that China had asked to exclude too many items. (See Bridges Weekly, 18 July 2013)

China has now agreed to reduce the list of items it wishes to exclude from consideration, officials said, paving the way for the ITA talks to resume within the coming weeks.

"I'm pleased to announce that there is a hopeful sign this week of our ability to work creatively together to solve problems and make progress in the WTO," US Trade Representative Mike Froman told reporters on Saturday. "We were happy to work with China and others to get the information technology agreement talks back on track."

Global growth, trade prospects in focus

Discussions on trade at the APEC summit also brought into focus the latest developments on the global economic recovery, with leaders highlighting the various policy actions they have taken as a group, and individually, to limit risk and improve financial market conditions.

"Nevertheless, global growth is too weak, risks remain tilted to the downside, global trade is weakening, and the economic outlook suggests growth is likely to be slower and less balanced than desired," they warned.

With this in mind, APEC leaders extended their "standstill" commitment - a pledge to refrain from raising barriers to trade and investment - to 2016, as well as their promise to undo any recent protectionist measures that have been put into place during the crisis.

Environmental goods

This year's meeting also gave leaders an opportunity to reiterate their earlier goal to lower tariffs to five percent or less on a list of 54 environmental goods by 2015. Though non-binding, the environmental goods agreement reached in 2012 was touted as having the potential to both spur growth in the sector and potentially reignite discussions at the WTO on environmental goods and services trade, which have lagged for years.

Leaders pledged this week to "advance implementation" of last year's environmental goods commitment, while also announcing the establishment of an APEC public-private partnership on environmental goods and services. The partnership would build on their existing work on trade and investment in this sector, leaders said.

More information

The APEC countries encompass over half of the world's economic output, with their combined GDP hitting US$40 trillion in 2012, according to US government statistics. The regional grouping's 21 members include Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Chinese Taipei (Taiwan), Thailand, the US, and Vietnam.

ICTSD reporting.

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