Inside US Trade | November 15, 2001
The fourth ministerial of the World Trade Organization concluded on Nov. 14 with the U.S. and India offering conflicting interpretations of what had actually been agreed with respect to four areas of WTO work. India succeeded in obtaining a statement from the conference chair that it claims reverses the presumption in the final declaration that negotiations on government procurement, trade facilitation, investment and competition have been launched at Doha.
But a U.S. official insisted that the final declaration is the "governing" document for the ministerial, implying that the declaration carried more weight than the statement by Qatari trade minister Youssef Kamal in his role as the ministerial's chair. The official said that the declaration launches negotiations in those four areas but that ministers will make decisions on the subject matter and methods of negotiations at their next conference in 2003.
The declaration contains the same formulation for all four Singapore issues. It states that ministers "agree that negotiations will take place, after the Fifth Session of the Ministerial on the basis of a decision to be taken, by explicit consensus, at that Session on modalities of negotiations."
India pressed hard for the chair's statement in closed door sessions that held up the conclusion of the ministerial until Kamal made the following statement.
"My understanding is that at that [fifth ministerial] session, a decision would indeed need to be taken by explicit consensus before negotiations on [Singapore issues] could proceed," he said. "In my view, this would give each member the right to take a position on modalities that would prevent negotiations from proceeding after the fifth session of the ministerial conference until that member is prepared to join an explicit consensus." Kamal emphasized that his statement was made on behalf of the WTO.
Indian trade minister Murasoli Maran told reporters that this statement ensures no negotiations will start on the Singapore issues until India agrees, but that the WTO may continue to study the issues.
If the Indian interpretation holds, the declaration would launch negotiations on agriculture, services, industrial market access, a limited set of environmental issues, antidumping and subsidies, and WTO dispute settlement rules. If the U.S. interpretation prevails, the four Singapore issues have also been formally launched, with only a decision on modalities needed before actual negotiations could begin after the Fifth Ministerial.
India had pressed against negotiations on the Singapore issues repeatedly, seeking text that would have delayed a decision until 2003. Separately, African countries represented by Nigeria also sought to delay until 2003 negotiations on transparency in government procurement.
The final wording on investment and competition appeared in the last version of the declaration issued in Doha, a change from an earlier Nov. 13 version that foresaw a ministerial decision in 2003 on whether to launch negotiations for these two areas. The EU and Japan have been pressing negotiations for these two issues.
As part of the final declaration, the EU made a major concession on the declaration language covering the mandate for future agriculture negotiations. As part of the deal to get the EU to endorse a strong agriculture text, the final declaration included stronger text on the EU's primary objectives, which also included environment.
On agriculture, the EU agreed that these negotiations would lead to "substantial improvements in market access; reductions of, with a view to phasing out, all forms of export subsidies; and substantial reductions in trade-distorting domestic support.
The EU refused to accept the text as it had been proposed until it included a phrase saying the mandate is laid out "without prejudging the outcome of the negotiations."
This language, suggested by the U.S., is meant to address the limits of the EU mandate, which prohibits the European Commission from agreeing to agriculture negotiations whose outcome is preset. The Cairns group of agriculture exporters approved the compromise text early on the morning of Nov. 14.
Both sides of the agriculture issue claimed the compromise suited their interests. An Australian official said the language simply reiterated an accepted principle that the outcome of negotiations is not pre-determined by the mandate. On the other side, an agriculture spokesman for the EU, which has rejected the notion of phasing out farm export subsidies, said the language should "put an end to the discussion of the endpoint" of the negotiations.
A European industry source took a stronger view, saying the language "neutralizes the provisions" on market access, export subsidies and domestic support and could yield a result to negotiations where agriculture subsidies remain.
An Australian and a Japanese official expressed their support for the language, which is placed at a point in the text that modifies not only the export subsidies language but also goals on improvements in market access and reductions in trade-distorting domestic support. The Australian official said the positioning of the phrase showed that there was no special caveat for the phasing out of export subsidies.
The official from Japan said his country was satisfied that the language showed that outcomes on domestic support and market access barriers were not pre-determined.
This final compromise on agriculture was reached after the Cairns countries and the U.S. rejected new language floated by agriculture working group chairman George Yeo, Singapore's trade minister. He proposed text that negotiations would move in "the direction of phasing out" all forms of export subsidies, rather than "with a view to phasing out" these programs. The EU considered this proposal an improvement, but ultimately said it was too small a step.Inside US Trade:
