Bridges Daily Update #3 | Doha Turning to Single Undertaking?

12 November 2001

After the first two days of talks, some Members have expressed concerns over the Committee of the Whole (CoW)/Friends of the Chair process adopted for the purposes of the Doha Ministerial. Speaking at a press conference, Uganda said that the way in which informal consultations had been constituted discriminated against the interests of LDCs, since none of their representatives had been selected as consultations facilitators. 'This was not a good start,' said Uganda's Trade Minister Rugumayo. India, Nicaragua, Bangladesh, Jamaica, Zimbabwe, Pakistan, Bolivia, and Tanzania have also had problems following the process. Some of their delegates say it is not always clear where meetings are held, and that there are too many of them. Complaints were also heard about way some facilitators chose to run the consultations, particularly the practice of focusing on small consultations that exclude large numbers of countries.

In the informal consultations on agriculture, developing countries expressed concern at the initial approach of the facilitator, Singapore's Trade Minister George Yeo. Yeo began his session by telling delegations the EU could not make any concessions on the agriculture text, and asked ministers to try and accommodate the European position. Many developing countries said that it was their job -- not that of the facilitator -- to say what they should accommodate or not.

The Friends of the Chair process will continue until facilitators come back to the Committee of the Whole with their conclusions from the consultations. This process is likely to last until Tuesday.

Agriculture

While it looks increasingly possible that a 'development box' might be created under the Agreement on Agriculture, its exact contents are likely to be a subject of intense and even acrimonious negotiations. Although only the United States is reportedly entirely opposed to it, many other developed country governments, particularly Cairns Group members, also want to proceed with great caution to ensure that the policies falling under its scope correspond to specific criteria, such as achieving food security and perhaps some clearly defined social objectives. Such criteria would most likely be developed during the post-Doha agricultural negotiations.

As to the proposed ultimate aim of the negotiations, the 'balance of unhappiness' remains such that trade officials likened the mandate to a house of cards that would crumble if a single card were removed. Although the positions of WTO Members remain as starkly contrasted as ever, the agriculture mandate may well emerge from Doha unchanged in spite of countless hours of negotiations.

Implementation

Pascal Couchepin, who chairs the consultations on implementation, reported 'some progress on some subsidy issues.' However, quarrels among Latin American countries over mechanisms for extensions under Article 27.4 of the Subsidies Agreement (SCM) consumed a significant amount of time during the implementation talks. Serious disagreements remain between larger economies, such as Colombia and Costa Rica, and smaller, mostly Central American countries, which support a differentiated approach based on language tabled on 27 October by the Chairman of the SCM Committee. Such an approach would extend eligibility criteria to countries with a Gross National Income below US$20 billion and/or share of world merchandise export trade not greater than 0.10 percent. Countries below those levels would be entitled to maintain subsidy programmes consistent with their economic, financial and development needs. Several Latin American countries make use of such programmes, not least through Export Processing Zone schemes, which puts them in competition with each other for investment.

Minister Couchepin admitted that market access for textiles remained a major stumbling block. While developing countries have said the concessions in the draft Ministerial Decision on Imple-mentation are insufficient, the US, Canada, Portugal, Spain and Italy want the draft's growth-on-growth provisions on textiles scaled back. At the Committee of the Whole, the Dominican Republic raised the issue of unfulfilled expectations of technology transfer under TRIPs Article 66.2, and Bangladesh called for increased technical and financial assistance for least-developed countries.

In spite of developing countries' insistence that implementation concerns must be addressed independently of the launch a new round of trade talks, the contents of the 'Doha downpayment' now appear firmly linked to progress on other issues on the Ministerial agenda. In one trade official's assessment, the discussions have already moved into a negotiation phase where there are 'no free gifts'.

Environment

The European Union appears to be stepping up rather than toning down its controversial demand for an 'operational negotiating man-date on clarifying WTO rules' on environmental issues linked to market access and labelling, as well as the relationship between the multilateral trade and environmental regimes. In recent days EU officials have repeatedly called this an 'extremely important, if not the most important' issue of the Doha Ministerial. However, the EU insists that the negotiations it is seeking would 'not change a single comma' in existing WTO rules, but would result in a clear common understanding on issues that might otherwise be left to dispute settlement panels to resolve. The EU is willing to show flexibility by delaying the start of the negotiations, provided that there is a firm commitment to launch the negotiations at the fifth Ministerial Conference in 2003.

The EU's quest is backed by Norway, Switzerland and Japan, but most other Members, and developing countries in particular, remain deeply suspicious. At the heads-of-delegation meeting, at least Zambia, Malaysia, Egypt, Guatemala and Botswana spoke against the EU's proposal, which goes further than the current Ministerial Declaration draft.

Speculation is rife on trade-offs. According to one theory, shared by several observers, one possibility is an expanded environmental mandate against dropping negotiations on the Singapore issues, on which talks appear in a serious impasse. However, the EU insists that the environment is an issue in its own right, and not a pawn in a strategic negotiations game.

Rules

Most of the discussions and consultations focused on anti-dumping provisions in the draft texts. Delegates and WTO officials reported little progress, mainly due to difficulties the US continues to have with any potential weakening of its trade remedy laws.

In a press briefing on Sunday, the EU highlighted its new-found willingness to 'analyse and identify problems' with fisheries subsidies within the framework of the WTO as an indication that its environ-mental agenda was not protectionist. In the heads-of-delegation meeting on rules, Peru requested further discussions on this topic

A group of countries including the Philippines, Iceland and the US have been pushing for negotiations on fisheries subsidies reductions since pre-Seattle days, but the EU, Korea and Japan have resisted such calls, arguing that the issue was under discussion in other fora, and that any further negotiations under the Agreement on Subsidies and Countervailing Measures should apply to all sectors.

TRIPs and Public Health

The TRIPs consultations facilitator, Mexican Trade Minister Luis Ernesto Derbez Batista, asked eight countries to draft compromise language on the two options outlined under paragraph four. The countries are New Zealand, EU, Canada, the US, Zimbabwe, India, Brazil, and Kenya. While there is a fair amount of ambiguity on parallel imports and compulsory licensing, sources say that all the other open questions on this point will be addressed relatively easily once paragraph four was resolved. Text should be released on Monday, when it will be forwarded to a larger group of some 20-odd countries for further discussion. After this process, the Minister Derbez will report the outcome of his consultations to the CoW.

Some developing countries now think that the best option would be to go back to a previous 'sovereign rights' paragraph submitted by developing countries in September that say they would prefer that the final text include either this or nothing.

According to one informed source, developing countries are coming on 'very strong and very unified' in opposition to Option 2 in paragraph 4. Sub-Saharan African countries and LDCs continue to reject Option 2, despite efforts by the US, Switzerland and others to entice them to that option with language in paragraphs 10 and 11 that would provide these Members with special rights not granted to developing countries. Many NGOs following this issue are concerned that proponents of Option 2 are trying to 'divide and conquer' developing countries, who are seeking an exemption from TRIPs commitments when they take measures to protect public health.

Oxfam International reports that the UK, Ireland, Italy and Denmark have confirmed their commitment to Option 1, which suggests a rift in the unified EU position. At a 10 November briefing, the EU seemed to be leaning more towards the second option.

N.B. Contrary to what was reported in yesterday's BRIDGES Daily Update, Peru did not formally submit the compromise language it had drafted on paragraph four.

Singapore Issues

According to sources, many developing countries, and LDCs in particular, continue to resist text committing Members to negotiations on investment, competition policy, government procurement and trade facilitation. This also applies to the opt-in / opt-out approach proposed in the current draft Declaration. Most of the discussions in the informal consultations focused on investment and competition policy, with countries holding to traditional positions.

WTO sources said these issues are perceived to be bunched together and at this point there is no question of splitting them up to salvage one or more of the less controversial ones, such as trade facilitation. WTO media director Keith Rockwell said that different solutions might be found on competition policy than from investment, meaning that each might be negotiated along different modalities.

Other Business

Members may bring any issue not covered by the Friends of the Chair process to the Committee of the Whole. On Sunday, the following issues were raised: labour standards (by the EU, see NGO News for more details); external transparency (by Canada, the US and the EU); improving the procedures for sequencing steps prior to trade retaliation procedures under the DSU (by Japan); the relationship between trade, debt and finance (by Pakistan, Malawi, Malaysia and others), industrial tariff negotiations (by Mauritius and other African countries, who requested that feasibility studies and analyses be undertaken before new negotiations in this area). Other topics included TRIPs and biodiversity and the Cotonou Agreement waiver, which does not appear anywhere in the Doha draft documents, but has been bogged down in the WTO's Council for Trade in Goods for well over a year. No conclusion was reached on any of these topics.

NGO News

Trade unions are worried that paragraph 8 of the draft Ministerial Declaration, as it currently stands, would preclude WTO from ever addressing the link between labour standards and multilateral trade rules. They are lobbying Member governments to either strike out the third sentence, which reads: 'The ILO provides the appropriate forum for a substantive dialogue on various aspects of the issue', or to substitute it by the following: 'We support the work begun in the International Labour Organisation on the social dimensions of globalisation, and we commit the WTO to working effectively with the ILO in a permanent working forum.'

According to labour activists attending the Ministerial, this proposal was submitted to the Committee of the Whole on Sunday by the European Union, and backed by New Zealand, Canada and South Africa. India and Pakistan rejected the new language out of hand, and said that if the third sentence of the draft paragraph 8 were cut, they would demand that the entire provision -- the only reference to labour standards in the entire document -- be removed. Should this happen, several trade union representatives said their constituencies were likely to join other vocal anti-globalisation groups, which would further weaken citizens' support for the WTO.

On Sunday, more than 90 parliamentarians from around the world called on the WTO to add language to the Ministerial Declaration aimed at 'associating Parliaments more closely with the activities of the WTO'. Parliamentarians identified several potentially acceptable structures for future discussion. Participants in the Parliamentary Conference also established a steering committee and began planning for a 2002 conference on parliamentary involvement in the WTO. The meeting was organised by the Inter-Parliamentary Union and the European Parliament.

Another panel discussion organised by CUTS-CITEE and partner organisations focused on the impact of standards on trade in developing countries. To counter the negative effect of sanitary, phytosanitary and other technical standards on developing country exports, participants suggested that developed countries should pursue capacity building in their own markets to persuade consumers there that 'everything in the South is not 'unhygienic and harmful.' For more information contact Pradeep Mehta at psm_cuts@rediffmail.com.

BRIDGES Daily Update (available in English, French, Spanish and German) is a daily news service covering trade and sustainable development on the occasion of the Fourth World Trade Organisation Ministerial Conference in Doha, Qatar. The publication focuses on news, activities and negotiations around the Ministerial from 9 to 13 November as they relate to sustainable development issue-areas. It is also distributed at various points around the Ministerial. ICTSD's Weekly and Monthly publications are on hand at the WTO Conference and on the ICTSD website. A number of key official documents including the Ministerial drafts, as well as NGO position papers, are also posted.

BRIDGES Daily Update is produced by: Hugo Cameron, Albert Cho, Anja Halle, and Ricardo Meléndez-Ortiz on location in Doha, Qatar. With support from Heike Baumuller, Christophe Bellmann, David Primack, Matteo Rizzolli, Alex Werth, Nicolas Lucas, Martina Schaub, and Monika Brinkmöller in Geneva, Quito, and Bonn. Support in Doha from Marcus Gehring and others is gratefully acknowledged. For further information contact ICTSD at: 13, ch. des Anémones, 1219 Geneva, Switzerland; tel: (41-22) 917-8492; fax: 917-8093; email: ictsd@ictsd.ch; web: http://www.ictsd.net

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