World Trade Organization (WTO)
Current Negotiations
Update on WTO Negotiations
Number 4 - April 2004
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WTO members are beginning to get the Doha Round of negotiations back on track
after the abrupt conclusion of the fifth WTO Ministerial Conference
in Cancun, Mexico, in September 2003.
In the fall of 2003, WTO Director-General Supachai Panitchpakdi
and General Council Chair Carlos Perez del Castillo conducted informal
consultations in Geneva. These discussions focused specifically
on the four issues that took centre stage in Cancun: agriculture,
cotton, non-agricultural market access and the four “Singapore”
issues (trade facilitation, transparency in government procurement,
investment and competition).
At the December 15, 2003, WTO General Council meeting, members
agreed that the individual negotiating groups and the Trade Negotiations
Committee (the group overseeing the negotiations) should resume
work in 2004 once new chairs had been selected for each negotiating
group. The General Council Chair observed that, while members had
expressed commitment to the multilateral trading system, little
change in positions had occurred since Cancun. He then proceeded
to highlight several key issues that remain to be resolved. For
example, how much of the text presented in Cancun should be used
as a framework for the negotiations, how the Singapore issues should
be dealt with and whether cotton should be negotiated along with
other agricultural products or on its own. In summarizing the state
of the negotiations since Cancun, the Chair concluded that “serious
negotiation” among members is needed to move the negotiations
forward.
In January 2004, U.S. Trade Representative Robert Zoellick sent
a letter to his WTO counterparts, aiming to inject new momentum
into the negotiations. In the letter, Ambassador Zoellick stated
that he did not want 2004 to be a “lost year” for the
negotiations. His letter was well received by other WTO members
including Canada. In February, Ambassador Zoellick also paid visits
to his counterparts in Asia, Africa and Europe to discuss possible
ways of moving the negotiations forward.
Canada’s Minister of International Trade, Jim Peterson, welcomed
the U.S. commitment to increased engagement in 2004, stating that
he was particularly encouraged by the U.S. call for WTO members
to show more ambition on agricultural trade reform and increased
market access. Minister Peterson also agreed with the United States
that it is important for WTO members to agree to set a date for
the elimination of all export subsidies in agriculture. Putting
an end to the export subsidies that distort world prices for agricultural
products is an important goal for Canada. While he was pleased with
Ambassador Zoellick’s overall observations and recommendations,
Minister Peterson made it clear that Canada does not agree that
new disciplines need to be placed on state trading enterprises such
as the Canadian Wheat Board.
Minister Peterson has been actively promoting progress in the negotiations
since his appointment to the International Trade portfolio in December
2003. In January 2004, Minister Peterson met with U.S. Trade Representative
Robert Zoellick in Washington, as well as with European Union Trade
Commissioner Pascal Lamy in Brussels, to discuss ways of moving
the negotiations forward. Support for the Doha Round of negotiations
was also one of many items discussed by Minister Peterson and Commissioner
Lamy during the Canada-European Union Summit that took place on
March 18, 2004.
In late January, while attending the World Economic Forum in Davos,
Switzerland, Minister Peterson met with many of his WTO counterparts
to discuss the status of the negotiations. Ministers showed a clear
desire to move forward, acknowledging the need for real engagement
by WTO members. Ministers also agreed that agriculture is the most
important issue to address if progress is to be made in the negotiations.
In February, senior officials from the European Union and the G20
group of developing countries (led by Brazil, India and China) met
in Geneva to discuss agriculture. Then in late February, Canada’s
Minister of Agriculture, Bob Speller, met with fellow ministers
in the Cairns Group to discuss how best to coordinate their approach
to the negotiations. (Canada is a member of the Cairns Group, a
group of developed and developing countries that seek a fair and
market-oriented agricultural trading system.) Minister Speller encouraged
the Group to continue pressing for an ambitious result in the agriculture
negotiations.
At the February 11 General Council meeting in Geneva, new chairs
were selected for the various WTO bodies (see the following article
on the selection of chairs for 2004). And in March and April, the
negotiating groups are meeting to discuss work plans for the year.
The next WTO Ministerial Conference is expected to take place in
Hong Kong, but members have not yet set a date. The next meeting
of the WTO General Council will take place on May 17 and 18, 2004.
Core Agenda
Agriculture
The Chair of the WTO General Council’s informal consultations
on agriculture focused on the draft framework text that was on the
table in Cancun. This framework agreement contains concepts but
leaves specific numbers for further negotiations, and would, if
accepted, guide the later development of modalities. The consultations
revealed no new flexibility among members, but they did identify
some key issues on which continuing work was necessary. At the February
General Council meeting, Ambassador Tim Groser of New Zealand was
selected as the new chair for the agriculture negotiating group,
and a work program for 2004 will now be developed. The next meetings
of the agriculture negotiating group were scheduled for the week
of March 22.
The key outstanding issues in the WTO agriculture negotiations
are as follows: agreement to set a date for the elimination of export
subsidies on all products; the extent of reductions that should
be made to trade-distorting domestic support; and how to achieve
substantial improvements in market access for all products, while
providing flexibility in how market access is improved for sensitive
products. Canada continues to seek the elimination of all export
subsidies on all products as quickly as possible; the elimination
or maximum possible reduction of trade-distorting domestic support;
and real and substantial improvements in market access for all agriculture
and food products.
Non-agricultural Market Access (NAMA)
Canada’s view is that the text on NAMA presented at Cancun
had the necessary structure and elements for a framework upon which
a consensus could be built. However, work remains on finding an
appropriate balance between ambition and flexibility. Although there
appears to be general agreement that a formula approach should be
used for NAMA negotiations, there is no agreement on what type of
formula to use or on how ambitious the formula ought to be. Work
also remains on defining sectoral components and on the most appropriate
way to provide extra flexibility to developing countries.
Rules
The Rules Negotiating Group held its first meeting since Cancun
on March 16, 2004. With a view to moving work forward, the Group
agreed to a work plan that will put more emphasis on informal meetings
and technical discussions to deepen understanding of the issues
put forward by members. Canada continues to seek clarification and
improvement of existing anti-dumping and countervailing rules and
disciplines with a view to lessening the scope for abuse of these
remedies. Canada also seeks to improve subsidy disciplines to ensure
fairer competition for Canadian exporters in foreign markets.
Services
Market access negotiations for services are progressing slowly,
because of lack of progress in other negotiating areas and the absence
of agreement on a date for the improvement of members’ initial
offers. Canada continues to encourage other countries to come forward
with market access offers and requests. Despite the lack of progress
in market access, much formal and informal technical work is under
way in support of the services negotiations. Canada will continue
to encourage this technical work, including in informal sectoral
groups. Canada will also be encouraging developed countries to provide
trade-related technical assistance to help developing countries
participate more fully in the ongoing market access negotiations.
Other Issues
Singapore Issues
Consultations since Cancun suggest that the four Singapore issues
will be dealt with individually. There is currently greater support
among WTO members for negotiations on trade facilitation and transparency
in government procurement than on investment and competition. Canada
would like to launch negotiations on trade facilitation and transparency
in government procurement as soon as possible. We also believe that
there is great value in addressing investment and competition concerns
within the WTO, and we are working to this end.
Cotton
WTO members continue to discuss how to address the concerns of
West African cotton producers who feel adversely affected by subsidies
provided to producers in developed countries. Discussions are under
way to address immediate financial concerns through multilateral
institutions, such as the World Bank, and the long-term adverse
effects of subsidies through the WTO agriculture negotiations.
General Council Selects New Chairs for WTO Bodies for 2004
At the February General Council meeting, WTO members approved a
new slate of chairs for regular and negotiating bodies, and they
elected Ambassador Shotaro Oshima of Japan as the new General Council
chair. The current Director-General of the WTO, Supachai Panitchpakdi,
will continue as chair of the Trade Negotiations Committee.
General Council: Shotaro Oshima, Japan
Main Bodies for the Doha Negotiations:
| Agriculture: |
Tim Groser, New Zealand |
| Non-agricultural Market Access: |
Stefan Johannesson, Iceland |
| Services: |
Alejandro Jara, Chile |
| Rules: |
Eduardo Perez Motta, Mexico |
| Trade-Related Intellectual Property Rights: |
Manzoor Ahmad, Pakistan |
| Dispute Settlement Understanding: |
David Spencer, Australia |
| Environment: |
Toufiq Ali, Bangladesh |
| Development: |
Faizel Ismail, South Africa |
The new chairs will serve until the Sixth Session of the Ministerial
Conference, a date for which has not yet been determined. The previous
Chair of the WTO General Council, Carlos Perez del Castillo of Uruguay,
did not propose chairs for any of the Singapore issues (trade facilitation,
transparency in government procurement, investment and competition).
He indicated that work will continue based on the understanding
reached by members in December that the Director-General, assisted
by Deputy Director-General Rufus Yerxa, will continue to “explore
the possibility of agreement on a multilateral approach” on
trade facilitation and transparency in government procurement, and
to consult on “possible future outcomes” on investment
and competition.
A complete list of chairs for all WTO bodies can be found on the
WTO
Web site.
Did you know?
Least-Developed Countries and the WTO
Canada believes that accession to the WTO and increased participation
in the world trading system will help least-developed countries
(LDCs) with their development efforts. Thirty-two LDCs are currently
members of the WTO. In December 2002, aware that no LDCs had completed
the accession process since the WTO’s establishment in 1995,
the General Council agreed to facilitate and streamline the accession
process for LDCs. The agreement calls for developed countries to
exercise restraint in the market access demands that they make of
LDCs and for LDCs’ concessions and commitments to be reasonable,
taking into account their individual development, financial and
trade needs. Among other things, the decision provides acceding
LDCs with priority access to the wide array of technical assistance
and capacity building provided by the WTO and other development
partners. Canada provides trade-related technical assistance to
acceding LDCs through the WTO Global Trust Fund and bilateral programs.
At the Cancun Ministerial Conference in 2003, the accession of two
LDCs, Cambodia and Nepal, was approved. On March 23, 2004, the Government
of Nepal ratified its terms of accession. Nepal will become the
147th member of the WTO and the first LDC to join the organization
since its creation in 1995. Eight other LDCs are currently engaged
in the accession process.
For more on accession to the WTO, consult the WTO accessions Web
page.
Trade-Related Technical Assistance
What is it and why is it important?
Open markets, strengthened international trade rules and liberalized
trade have contributed positively to global economic growth and
poverty reduction over the past 50 years. However, not all countries
have been able to take full advantage of the gains from liberalization—four
billion people in the world still live on less than $5 a day, and
1.2 billion live on less than $1 a day.
The Doha Development Agenda provides an opportunity to help lift
hundreds of millions of people in developing countries out of poverty—through
higher rates of economic growth and new opportunities that will
come from improved market access and greater integration into the
global economy.
While developing countries have much to gain from opening their
markets to trade, trade alone cannot be expected to lift nations
out of poverty. To reap the benefits liberalization has to offer,
certain fundamentals need to be in place, including strong domestic
institutions and domestic economic reforms. In this regard, trade-related
technical assistance can help developing countries to more fully
participate in and benefit from the international trading system.
Since 2001, the Government of Canada has provided over $185 million
in trade-related technical assistance to developing countries on
a bilateral basis. The types of programs we have funded include
seminars and training sessions (to enhance the ability of developing
country representatives to negotiate trade agreements), as well
as policy and institutional assistance (to help developing countries
manage the various rights and responsibilities associated with these
agreements). Canada also contributes to trade-related capacity-building
initiatives in local developing country economies.
Each year, the WTO issues “Annual Technical Assistance and
Training Plans,” which respond to needs of developing country
WTO members that have been identified by developing countries or
regions. The WTO then provides up to 450 different activities through
these plans, which are mostly funded by the WTO’s Global Trust
Fund. Canada has also contributed over $25 million in funding for
trade-related technical assistance through multilateral organizations
(including $1.7 million in contributions to the WTO Global Trust
Fund).
Ensuring trade-related technical assistance that is effective and
targeted to developing country needs requires a coordinated effort
on the part of donor and recipient members, as well as an integrated
approach with other international institutions. In this regard,
the WTO also provides assistance to least-developed countries through
its partnership in the Integrated Framework for Trade-Related Technical
Assistance, working alongside the International Trade Centre, the
World Bank, the International Monetary Fund and agencies of the
United Nations.
A trade capacity-building database has been developed jointly by
the Organisation for Economic Co-operation and Development and the
WTO to track trade capacity-building activities. The database will
help to ensure more effective and efficient delivery of assistance,
as well as track the fulfilment of commitments made by WTO members
at the Doha Ministerial Conference. Since 2001, over 8,000 trade-related
technical assistance and capacity-building activities—amounting
to over US$2 billion—have been delivered, and a further US$8.1
billion has been committed to help improve transportation, energy
and communications networks essential for international trade. This
database can be accessed at http://tcbdb.wto.org.
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