Trade Community Eyes Busy Autumn Negotiations Calendar on WTO, FTA Fronts

3 August 2017

The international trade community will have a busy calendar when the autumn semester begins in a few weeks, ranging from preparations for the WTO’s eleventh ministerial conference in Buenos Aires, Argentina, to the ramping up of trade and integration negotiations around the globe.

The year to date has already seen several developments that have shifted the geopolitical landscape on global governance and trade, including the inauguration of a new US president, the formal start of the Brexit negotiations, and elections in EU member states such as France and the Netherlands.

These developments have already shown some of their influence at international summits such as the G7 and G20, which have seen spirited debates over how to frame terms such as protectionism, as well as free and fair trade, along with how to address US President Donald Trump’s move to withdraw his country from the UN’s Paris Agreement on climate change. (See Bridges Weekly, 13 July 2017 and 8 June 2017)

What these changes will mean for other ongoing processes – whether at the WTO level, or within the regional, plurilateral, bilateral, or national context – may well become more apparent as the year comes to a close.

WTO preparations: countdown to Buenos Aires

At the WTO’s Geneva headquarters, the 164 members of the global trade club will have a busy 12 working weeks ahead of them when they return from the annual August break, which is a period allowing them to return to capital and consult on how to move forward in their negotiations at the organisation.

Last week, WTO Director-General Roberto Azevêdo urged members to redouble their efforts, telling them that “greater urgency is required across the board, if we are to see progress” in the preparations for the Buenos Aires ministerial this December. (See Bridges Weekly, 27 July 2017)

Informal negotiating group meetings in the area of “rules” – which deals with disciplines on fisheries subsidies, among other topics – as well as agriculture are already slated to resume during the second week of September. Additional meetings of those committees, as well as those devoted to market access, along with trade and development negotiations, are also planned throughout the month of September.

Negotiators on fish subsidies now have a “compilation matrix” of the various proposals under consideration within those talks, issued by Jamaican Ambassador Wayne McCook on 28 July. The 39-page document is designed to facilitate comparison among proposals as negotiators prepare for the next stage of talks this autumn, and is described in the chair’s introduction as being a “purely technical document.”

On agriculture, while a series of proposals have been put forward in different weeks from India and China, as well as the EU and Brazil. The former deals with eliminating countries’ “Aggregate Measure of Support” (AMS) before addressing other reforms to domestic farm support, while the latter proposes upper limits on trade-distorting agricultural support.

Various other submissions have also emerged in recent weeks, referring also to other farm trade topics such as public stockholding for food security, cotton, and transparency in agricultural export restrictions. (See Bridges Weekly, 20 July 2017)

How these issues may proceed remains an open question at this stage, with WTO agriculture negotiations chair Stephen Karau, Kenya’s WTO Ambassador, urging members to “significantly accelerate” their work in this area. (See Bridges Weekly, 27 July 2017)

However, questions remain on what might form a final set of ministerial outcomes, as debates continue over how to address issues such as e-commerce, services, and investment facilitation, which have been raised by some members as areas of interest. Formal proposals have been seen on these areas, including by some major country proponents.

While talks in the formal context of the e-commerce work programme have hit hurdles over the year, various submissions have been tabled both at the General Council and within some of the WTO’s regular bodies tasked with the existing work programme. Delegations pushing for ministerial outcomes in this area will seek to resume such efforts in the autumn, as well as an intense parallel process taking place outside the formal bodies of the WTO, led by the Friends of E-commerce for Development (FEDS), which has scheduled a series of informal meetings to the end of the year.

The Buenos Aires ministerial is scheduled from 10-13 December. Another key meeting on the docket will be a so-called “mini-ministerial” slated for the first half of October in Marrakech, Morocco, which could give signals for the direction of the Buenos Aires discussions.

The organisation’s dispute settlement mechanism is also facing its own challenges, given the increasing complexity and difficulty of WTO cases and a looming shortage of judges on the Appellate Body.

The expiration of the second term of one Appellate Body member, Ricardo Ramírez-Hernández, in late June; the impending expiry of Peter Van den Bossche’s term later this year; and now the news that Korea has named another Appellate Body member, Hyun Chong Kim, to serve as trade minister and therefore resign from his WTO post, mean that the WTO’s highest adjudicative body may soon be down three out of its seven judges, unless processes to fill those positions are launched promptly. (See Bridges Weekly, 27 July 2017)

While Argentina prepares for the Buenos Aires ministerial, it will also be gearing up to host the next G20 leaders’ summit in 2018, taking over from Germany, which held the rotating presidency this year.

Argentina’s G20 presidency will mark the first time that this forum meets in South America, and comes at a time where the country and the wider region is seeing heightened trade activity, including a renewed push for an EU-Mercosur trade deal, and additional collaboration between Mercosur and the Pacific Alliance.

FTA negotiations, US investigations and reports continue

While trade and climate action heats up in Geneva and Bonn, a host of other negotiation processes are also aiming to conclude – or at least advance substantively – later this year.

Among these will be the formal start of negotiations to modernise the North American Free Trade Agreement (NAFTA), the tri-country trade deal that includes Canada, Mexico, and the United States. Those talks are due to kick off on 16 August, with additional rounds planned throughout the autumn months. (For more on NAFTA, see related story, this edition)

A “special session” with Korea on their existing FTA is also forthcoming, but has yet to be formally scheduled.

Other key items on the US trade agenda include a release of a report on “trade agreement violations and abuses,” mandated in late April and requested by late October.

Meanwhile, the US executive branch is rumoured to be considering a possible “Section 301” investigation into Chinese policies involving “forced” technology transfers from foreign companies to domestic counterparts, though the probe had not been confirmed at press time. Section 301 refers to a 1970s-era piece of US trade legislation that allows for imposing measures on other economies for purported trade deal violations or “unfair” practices.

On the wider international stage, negotiators from the 11 remaining Trans-Pacific Partnership (TPP) countries are due to meet again in Australia in the coming weeks, most likely in September, though a formal set of dates has not been publicly announced. The TPP-11 is weighing next steps in light of the US’ withdrawal from the accord earlier this year.

Those TPP-11 efforts are part of a process set up during a ministers’ meeting in Hanoi, Vietnam, earlier this year on the sidelines of a separate ministerial gathering of the Asia-Pacific Economic Cooperation (APEC) Forum. The TPP-11 negotiators are preparing options for ministers and leaders to review in November in Da Nang, Vietnam, on the sidelines of the APEC Economic Leaders’ Week from 6-11 November. (See Bridges Weekly, 24 May 2017)

The 21-country APEC group will also have its own agenda to move forward, under the theme ““Creating New Dynamism, Fostering a Shared Future.” Much of this theme will focus on regional trade integration and liberalisation efforts, according to this year’s APEC hosts.

Separately, members of the Regional Comprehensive Economic Partnership (RCEP) are aiming to advance those negotiating efforts, with a twentieth round planned for Korea in October and a ministerial meeting set for the month prior. (For more on RCEP, see related story, this edition)

The EU’s negotiations with the Mercosur customs bloc and with Mexico, respectively, are gunning for a 2017 conclusion, officials say, while acknowledging that sensitive issues remain. (See Bridges Weekly, 27 July 2017 and 13 July 2017)

On the EU-Mexico front, officials are working to update the existing Global Agreement’s trade provisions, while negotiators from the EU and the four founding members of Mercosur are working to clinch a trade deal as part of their larger Association Agreement talks, now underway for 18 years.

The next EU-Mexico round is set for 25-29 September in Brussels, Belgium, while negotiators for EU-Mercosur are due to meet again in Brasilia, Brazil, from 2-6 October, according to the European Commission.

Brexit talks, EU elections

In Europe, the autumn months will also see work pick up in the Brexit negotiations, with EU officials hoping to agree the basic “principles” of the exit itself with London sometime between October and December, as a first stage in the larger talks.

EU leaders are due to meet on 19-20 October, which has been tapped as a possible date for this first stage to be completed pending sufficient progress. Completing those talks will be a precursor to determining future UK-EU relations, including on trade, officials say.

Meanwhile, economic powerhouse Germany is due to see federal elections in late September, with Chancellor Angela Merkel running for a fourth term against challengers such as former European Parliament President Martin Schulz, among others.

Current polls have Merkel’s party in the lead by a solid margin, though some weeks remain before the 24 September election.

The finalisation of the electoral processes in major EU member states this year has been cited as a reason for other major players – such as the US – to wait before decisions are taken on certain trade issues, such as how and whether to pursue the resumption of the Transatlantic Trade and Investment Partnership (TTIP), though that is not the only factor. (See Bridges Weekly, 29 June 2017)

ICTSD reporting; “South Korea names new trade minister amid U.S. push to amend FTA,” REUTERS, 30 July 2017; “German SPD, down in polls, gets personal with Merkel and minister,” POLITICO, 30 July 2017; “Brexit timeline: key dates in UK’s divorce with EU,” FINANCIAL TIMES, 14 June 2017; “Both sides want to speed up Brexit talks by meeting more frequently,” POLITICO, 17 July 2017; “US plans new trade remedies against China,” THE AUSTRALIAN, 2 August 2017. 

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