MC12

MC12 ‘on a knife-edge’ as General Council debates key dossiers

The success of the twelfth WTO ministerial conference in Geneva next week is currently poised “on a knife-edge”, in the assessment of WTO officials, with negotiations set to go to the wire on a number of key dossiers, write Chris Horseman and Rob Francis.

Heads of delegation convene today and tomorrow (22 and 23 November) for a General Council meeting which is intended to prepare the ground for the four-day conference next week.

But although the General Council in principle has the job of finalising draft texts for ministers’ approval, the reality is that discussions on many key points are so far from consensus that detailed discussions will need to continue right up until the start of the meeting on Tuesday 30 November – and in many cases beyond.

A Geneva-based trade official played down expectations for MC12 in a briefing that followed a meeting of the Trade Negotiations Committee – the steering group for the ministerial – on Friday.

“The outcome in a number of areas is on a knife edge. Some chairs [of the various sectoral negotiating committees] made clear that results would be disappointing,” the official warned.

“A positive outcome remains something that could happen – but it will require quite a lot of heavy lifting in the next few days,” he added.

Trade and Health: deadlock over TRIPS waiver

Ministers do look set to have something to deliver on the vital topic of trade in the current and any future pandemics – but it could lack language related to intellectual property.

Discussions around a proposed TRIPS waiver for Covid-related vaccines and medical products are currently being pursued on a separate track from the main trade-and-health declaration.

And positions appear as entrenched as ever, despite universal agreement from members on the importance of diversifying production of vaccines around the world.

WTO Director-General Ngozi Okonjo-Iweala herself reportedly said last week that any holistic approach to a WTO response to future pandemics must include a TRIPS element. She is pleading with members to reach agreement, warning that it will not be good for the WTO if ministers walk away from MC12 empty-handed.

However, a draft ministerial statement on “Covid-19 and beyond: Trade and health”, which has attracted 29 sponsors to date, does appear largely finalised – except for the references to TRIPS.

Signs of progress in fisheries talks

Years of painstaking negotiations on proposals to curb government subsidies to the fisheries sector may yet pay off at MC12, as officials start to voice (very) cautious optimism about the state of play on the draft multilateral agreement.

“It seems clear from what members have said that the revised text from 8 November  represents an improvement in terms of balance,” the Geneva-based official said.

“The text is heading into territory where it would be easier for ministers to deal with it than was the case a few weeks ago,” he added.

There appears to be consensus that least-developed countries will be completely exempted from the scope of the agreement – which represents a major concession.

But there are still divisions over other aspects of the deal, with the US’s demand for notifications on labour standards aboard vessels having gone down badly with some delegations.

Negotiations on the fisheries dossier have continued throughout the weekend and may well continue through to next weekend as well. The trade official called for compromise on all sides, quoting one member as saying: “Let’s not make the perfect the enemy of the good”.

Agriculture: progress has been ‘disappointing’

On agriculture, the chair of the negotiations, Costa Rica’s Gloria Abraham Peralta, has reported that progress in narrowing down the gaps between delegations had been “a bit disappointing”.

Peralta is working towards a revised version of the draft ministerial declarations tabled in July, – and it is now clear that the objective is to salvage as much as possible from the process by focusing mainly on ‘work programmes’ for agreement at MC13.

Although the agriculture negotiations are set to continue on an almost permanent basis up to the point where MC12 begins, there are few hopes for any substantive outcomes other than an agreement to exempt food aid purchased under World Food Programme schemes from any export restrictions.

JSIs: optimism on domestic services, progress on investment for development

There is at least some room for optimism when it comes to the various plurilateral agreements under discussion.

On domestic regulation in services, the official said that it “seems clear that an agreement is possible”.

So far 66 members have signed up to the statement, with 32 schedules from 58 members having been submitted. This would cover 90% of world trade in services and would, according to the OECD, result in US$145 billion in savings through easier access to domestic services markets.

A declaration will also be adopted on investment facilitation for development which will spell out what ministers expect to be able to do next year. The objective is to conclude negotiations on this topic by December 2022.

Some elements have also been agreed with regard to the plurilateral negotiations on e-commerce, but, as is customary in such negotiations, “nothing is agreed until everything is agreed”.

‘Joint ministerial declarations’ are also in the pipeline on both trade and gender and on MSMEs. The key question will be how many delegations choose to sign up to them.

Moratorium on digital trade tariff waiver ‘up in the air’

Discussions on the moratorium on applying tariffs on e-commerce are “still up in the air”, the official said.

He said there is currently no consensus to continue the moratorium on e-commerce, with India and South Africa continuing to raise objections. These two states say they would like more clarity on what the moratorium would cover, referencing the scope and the definition.

In terms of the likely outcome – some members would like the moratorium to be made permanent, while others want to roll over this discussion to MC13.

The problems which Pretoria and New Delhi have with the principle of plurilateral WTO agreements have been well documented – but the relative successes achieved by members in the plurilateral format has resulted in frustration from some quarters at the failure to achieve similar results at the multilateral level.

This theme was picked up by Director-General Okonjo-Iweala. Preparing for her first ministerial conference, the Director-General reportedly told members that they could not keep referencing the importance of multilateralism, and then failing to make it work.

Special and differential treatment for developing countries

The ministerial meeting looks set to approve language which would pledge to maintain the principle of special and differential treatment for developing countries as an integral element of existing and future trade agreements.

An initial proposal to allow least-developed countries to retain their trade privileges for up to 12 years when they graduate away from LDC status will be amended to give a transition period of 6-9 years.

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