TRADE: Developing Nations Give WTO Negotiations a Push

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Jun 11 2003 (IPS) - A group of 26 developing countries has launched an action plan for reactivating the stalled World Trade Organisation negotiations, with sights on the ministerial conference to take place in Mexico in three months.

Their proposal aims to ensure the success of the meeting, Sep 10-14 in the south-eastern Mexican resort city of Cancún, and to energise subsequent trade talks, said Hernando José Gómez, Colombia’s representative to the WTO, who presented the plan.

The WTO has already missed nearly all of the deadlines it had set for achieving agreements before the Cancún meet, and has little progress to report. The three months remaining are also the last chance for member nations to reach "understandings".

The initiative of the 26 nations – including the two most populous, China and India, as well as several each from Asia, Africa and Latin America – calls for the finalisation before the ministerial conference of agreements on some of the most sensitive issues for the developing South.

The first problems that must be resolved, according to the group’s plan, are related to the implementation and reinforcement of "special and differentiated treatment", a mechanism intended to compensate for the disadvantages faced by developing countries in placing their goods on the markets of the industrialised North.

Another pending matter of crucial importance to developing countries is their access to medications, which they also hope to resolve before the Cancún conference.

In December, the United States blocked an agreement nearly finalised at the WTO for complying with the guidelines on drugs access established by the last WTO ministerial conference, which met in Doha, Qatar, in late 2001.

An accord on public health and trade would go a long way towards creating trust, the 26 countries say in their initiative, presented Tuesday.

As far as special and differentiated treatment, an agreement would also have positive repercussions for other areas of multilateral trade talks, according to the text.

The proposal of the developing nations comes at a crucial moment in the negotiations process of the multilateral trade system.

The WTO approved in 2001 the Doha Round of trade talks, which focuses on negotiations for agricultural and services trade, the implementation of elements of previous agreements that benefit developing countries, and the matter of special and differentiated treatment.

The world’s trade ministers gathered in Doha also established that the next conference, in Cancún, should establish modalities for subsequent negotiations in four areas that are of particular interest to industrialised countries: investment, facilitation of trade, competition and government procurement.

WTO director-general Supachai Panitchpakdi admitted Tuesday before the Trade Negotiations Committee, the body in charge of the Doha Round, that the deadlines for reaching accords on industrial tariffs and legal reforms had not been met.

The most dramatic failure occurred in farm trade negotiations, as the member countries could not even agree on the modalities that should guide these talks, which have a deadline of Jan. 1, 2005.

Most industrialised nations resist opening their agricultural markets, seeking to maintain their subsidies for protecting farmers. They spend a combined total of approximately a billion dollars a day on such state supports.

But the farm trade process could soon achieve some clarity, as the agriculture ministers of the 15 European Union countries this week are discussing an initiative for modifying the bloc’s subsidy regimen.

A reform plan for the EU Common Agricultural Policy aims to disconnect the flow of financing for production and shift it towards direct assistance for farmers.

This would ultimately withdraw from the international market large volumes of subsidised products, which have had the effect of pushing down prices – to the detriment of farmers in developing countries, which rely heavily on agricultural exports.

One of the arguments wielded against the EU agricultural reform is that direct aid would be psychologically problematic for the beneficiaries, European farmers who would receive payments without having to produce.

Carlo Trojan, EU representative to the WTO, commented that the meeting of agriculture ministers, which began Wednesday in Luxembourg, could turn into "marathon" sessions and stretch out for several days.

Colombian trade representative Gómez acknowledged that the European meet is of key importance, and noted that "the tonic for progress" in the WTO negotiations could emerge from it.

The 26 developing countries warned in their initiative that farm trade cannot be negotiated as an autonomous package.

The initiative’s signatories are Argentina, Bolivia, Botswana, Brazil, Chile, China, Colombia, Cuba, Dominican Republic, Ecuador, El Salvador, Gabon, Guatemala, Honduras, India, Malaysia, Mexico, Morocco, Nicaragua, Pakistan, Paraguay, Peru, Thailand, Uruguay, Venezuela and Zimbabwe.

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