Reviving Trade Talks? Developing Countries expected to make the first step
By Alexandra Strickner Trade Information Project, IATP Geneva 29 October, 2003 Geneva
During the last couple of weeks, the WTO headquarters in Geneva has been an unusually calm and quiet place, after weeks of chaotic and untransparent negotiations just before the WTO Ministerial Meeting in Cancun. Since the collapse virtually all negotiating sessions have been canceled, with the exception of the services negotiations. According to various Geneva delegates, these negotiations proceeded only because negotiators from the capitals had already arrived.
Even at the informal Heads of Delegation meeting on October 14th and the General Council Meeting on October 21st, very few statements or interventions were made. The latter meeting, which was scheduled for two days, did not take longer than an hour.
The Chair of the General Council Carlos Perez del Castillo and WTO Director General Supachai Pantchpakdi have been trying to put the trade talks back on track. So far, they are holding consultations on Agriculture, Non-Agricultural Market Access (NAMA), Cotton and the Singapore Issues. The aim of these consultations is to explore with the different members the common foundation in the four areas, which could allow the restart of negotiations in 2004. However, they are continuing with the same pre-Cancun method of consultations for which they have been so severely criticized: informal, undocumented small group or country-by-country consultations where nobody knows who is meeting with whom and when and what has been talked about. From time to time, Perez del Castillo will then convene informal, undocumented Heads of Delegation meetings on the status quo of these consultations.
Right after the collapse in Cancun, civil society and the media claimed it was the US and the EU that were responsible for the breakdown, while these two big powers blamed others. They are now adopting a strategy that aims at shifting the responsibility of reviving the talks towards developing countries, avoiding their own responsibility to adjust their negotiating scope and mandate. Actually, the developing countries were the first to voice their willingness to continue negotiations under the Doha Round. Now, all parties, even the US, have signaled their willingness to restart negotiations as soon as possible except for the EU.
The EU has stated publicly in various occasions that it is not going to undertake any initiative to revive the talks. It is well known that the EU is still in its process of reflection as regards its commercial policy in general and its positions within the WTO in specific. However, Geneva-based delegates from developing countries interpret this posture as one suggesting that the EU wants them to make an initial offer that would bring the EU back to the negotiating table. Thus, by acting in this way, the EU aims to make developing countries feel responsible for the failure in Cancun and force a concession that would present a solution to the stalemate.
This posture is particularly problematic because the failure in Cancun was also due to the EU’s insistence on starting negotiations on all four Singapore Issues, despite the clear opposition of the ACP-AU-LDC countries. The EU’s offer in Cancun to drop at least two Singapore Issues came probably too late and at a moment where Agriculture - the most important issue for developing countries had not even been discussed. Yet in the post-Cancun context, the EU delegates in Geneva continue to insist on all four Singapore issues, although in increased number of EU Member States is willing to drop them from the EU agenda for the Doha Development Round.
The seriousness of the positive signals from the US side still needs to be proven by the outcome of the December 15th meeting of the WTO General Council. Allen Johnson, chief agricultural negotiator for the U.S. Trade Representative, stated recently in a breakfast briefing, that he sees a chance for the Doha Round to move forward, and that the US would like it to move forward.
Agriculture is certainly the most critical area for the US. Perez del Castillo is now exploring whether the Agricultural Framework included in the Annexes of the September 13th text can be the basis on which talks proceed. However, this text was never even discussed in Cancun. Comparing this framework proposal with the EU-US proposal of August 13th and the Group of 20 counter-proposal of August 20th reveals that most suggestions and wordings have been taken from the big players’ proposal. If the developing countries now restate their opposition to this framework, which ignores their positions articulated repeatedly over the past two years, the US can like Europe use this moment to blame the developing countries and their inflexibility for the continuing stalemate.
President Bush’s reelection is clearly his priority for 2004. Many commodity-growing states are Republican-voting states, which are extremely vulnerable to price fluctuations and are watching the WTO negotiations closely. As William Greider wrote just before Cancun in “The Nation”: “Soybeans are Missouri, Iowa and Arkansas. Beef is Kansas, the Dakotas and the Solid South. Oranges are Florida…Whatever gets said by the US Trade Representative, whatever declarations are issued at Cancun, count on this: There will be no agriculture deal for developing nations at least until long after the 2004 elections.”
These farm-state voters would not support a proposal that emphasizes subsidy reductions, and so far the talks have failed to address the real problem agricultural dumping. However as small farmers in the South continue to be forced out of their livelihoods due to this practice it is not developing countries that must be more flexible, but the US and the EU. It is time that the two big powers accept their responsibility for distortions in world agricultural markets and start addressing the problem of agricultural dumping.
If talks in Geneva are stalled until at least November 2004, it is critical that this time be used to review and analyze the causes of dumping and low prices in the commodity markets as well as to discuss policy measures needed and appropriate to end dumping. With the UNCTAD XI talks scheduled for June 13-18, 2004 in Brazil, there is a great opportunity to do so.
Alexandra Strickner Institute for Agriculture and Trade Policy (IATP), Geneva Office 15 Rue de Savoises 1205 Geneva Switzerland tel 41 22 789 0724 fax 41 22 789 0733