Washington Trade Daily | Volume 10, Number 206, pt 1 | October 15, 2001
Singapore - In a dramatic display of solidarity, the United States and the European Union yesterday closed ranks to persuade 19 developing and other industrial countries to join negotiations on a new "development and growth agenda" (WTD, 10/12/01).
Instead of calling for a new round of trade negotiations, the two trade giants agreed with their counterparts to christen the new trade negotiations as a "development and growth agenda" round.
Issues on the agenda will include those spelled out in the "Harbinson" text -- which will be further refined in the next two weeks, but remain as the basis for the new negotiations, Singapore Trade and Investment Minister George Yeo said at the conclusion of an informal two-day trade ministerial meeting Saturday and Sunday.
Zoellick and Lamy
US Trade Representative Robert Zoellick and European Union Trade Commissioner Pascal Lamy succeeded in burying their high-profile differences on issues like negotiating mandate for global farm trade, the environment and antidumping in calling for the new round of trade negotiations.
Included in the meeting were major players like the United States, the EU, Canada, Japan, Australia, Brazil, Columbia, Mexico, Switzerland, South Africa, Tanzania, Gabon and Jamaica.
Mr. Zoellick praised the Harbinson text as the "touch stone" to make progress on still unresolved issues like agriculture, the environment and trade rules. On Implementation, the USTR made it clear that except for issues listed in annex I and annex II of the draft all other concerns will have to be renegotiated.
Singapore's Yeo, chief host of this meetine, said there was a high degree of acceptability of the political and strategic constraints faced by different members. He said there was almost 75 percent agreement on the Harbinson text -- with the rest likely to be solved in the next three weeks.
Singapore Prime Minister Goh Tak said the battle between globalization and protectionism is as intense as the one between civilized society and terrorism. He urged the 21 trade ministers not to miss the opportunity to launch a new "compact" that could stave off the world from the threat of global recession and protectionism.
Both Messrs. Lamy and Zoellick admitted that the Singapore meeting had resulted in frank, constructive and "purposeful" exchanges on a range of issues. Now trade officials will work closely to ease as much as possible political constraints.
Political Difficulties
Mr. Zoellick pleaded for ministers to understand the political difficulties and constraints faced by Commissioner Lamy on environment -- where some progress was made here. Similarly, Mr. Lamy called on his counterparts from Japan, South Korea and Brazil to appreciate the difficulties face by USTR Zoellick on antidumping and other trade rules.
A number of mostly developing countries noted that the two trade giants acted more aggressively to promote their stances this time around as compared to the Mexico meeting where they were in a self-admitted "listening mode."
In comments to the press, USTR Zoellick asserted that both Washington and Brussels have worked hand-in-hand toward the launch of a new round this year.
Trade ministers started with agriculture where many members -- particularly the EU, Japan and South Korea -- had raised concern over market access commitments going beyond simple reduction commitments stated in Article 20. EU's Lamy had said that the Community would not be in a position to agree to phrases like "substantial phase out" or "substantial reductions in domestic support programs."
South Korea offered a fresh proposal that suggested stronger language on non-trade concerns and changes in some phrases in domestic support porgrams. Switzerland said the Harbinson agriculture text was still not acceptable but Switzerland -- for one -- is prepared to work with other members to improve the language, officials said.
Agriculture
The United States reiterated that "it needs progress in agriculture to unlock other areas." A senior US agriculture official told WTD that his delegation would be seeking much stronger language on "substantial phase out" of export subsidies and substantial reduction in domestic support programs. Washington also will demand inclusion of tariff rate quotas, tariff peaks and escalation and state trading. The United States intends to oppose discussion of export credits -- insisting that the programs are mainly for humanitarian causes.
In a face-off between the Cairns group of farm trading countries on the one hand and the EU, Japan and South Korea on the other, the United States maintained that the existing draft must remain as the basis for making some little change "here and there." The broad thrust of the Harbinson draft goes in the right direction.
The EU maintained that terms like "substantial phase-out" amount to pre-negotiated text. Brazil opposed any change in the phrases. Brasilia would have like to use the term "elimination" in the farm text; Australia adopted a low-key stance here, preferring to remain silent.
India raised developing country concerns about agriculture. It appears that all 21 trade ministers have agreed that agriculture is not going pose any difficulties as was earlier envisaged. There is a broad agreement that the agriculture draft text prepared by World Trade Organization General Council Chairman Stuart Harbinson appears to be a "done deal."
The Environment
Positions remained far apart on the environment among the 21 delegations. The EU, which is the main demandeur for inclusion of the environment on the new round agenda, said it is an issue that must be tackled at any cost. The EU also referred to its two-part proposal involving either having negotiations within the Council for Trade and Environment straightaway or preparing a focused work program in the WTO Committee on Trade and the Environment that would be submitted to the next ministerial conference in 2003.
Developing countries were united in dismissing the EU proposal saying that either option has no place in the new negotiations.
The United States said members should consider the focused study option. USTR Zoellick also urged that the environment agenda address the removal of fishery subsidies and promote sustainable development programs.
EU's Lamy told reporters he remains confident that a deal on the issue would be worked out.
The focus on the so-called "Singapore" new issues -- transparency in government procurement, trade facilitation, investment and competition policy -- largely focused on the latter two. Tanzania said least developed countries are opposed to inclusion of the Singapore issues on the agenda. India questioned the relevancy to a "development agenda program."
Brussels introduced a fresh proposal on both investment and competition policy which gave developing countries the freedom to join in now or later. But many developing countries dismissed the EU's new proposal altogether. Accepting such a move on trade and investment would be "contagious" -- implying it would be repeated in other controversial issues such as the environment, according to some delegates here.
Washington agreed with the EU approach. Japan urged a two-phase approach that would involve identification of issues first and their possible consideration at the next ministerial two years hence.
© 2001 by Trade Reports International Group, Washington, D.C.Washington Trade Daily:
