Even after 16 years of hard negotiations at the World Trade Organisation ( WTO) on reforming agriculture and other tariff-barriers set in 2001 under the Doha Development Agenda (DDA), developing countries appeared to be fighting a losing battle at the 11th ministerial. WTO negotiators met on September 13-15 to formalise the agenda for the trade body’s 11th ministerial conference (MC) in Buenos Aires in mid-December.
In an understatement, the WTO put out a news release saying, “While most members signaled strong interest in achieving substantive outcomes in agriculture for the Buenos Aires meeting on several issues, gaps persist on what could be potential deliverables.” Even if the issues weren’t as thorny as they obviously are in a growing era of hostility to globalization, the United States, which has been the most important player in arguing for cuts in tariffs and other impediments to a more open global trade regime, can no longer be counted upon.
President Trump has displayed a deep distrust of the entire global trade regime. That is an indication that the WTO is likely to get the short shrift from the Trump administration. The administration’s US Trade Representative, Robert Lighthizer, made it clear that his target was to renegotiate the North American Free Trade Agreement (NAFTA).
The White House has also trained its guns on the US-South Korea free trade agreement and other trade regimes that have come under fire from the President. His first act as President was to avoid US participation in the TransPacific Partnership (TPP), which was the most comprehensive pact ever negotiated after the WTO itself.
Against that backdrop, WTO negotiators have stumbled on seven issues, comprising stockpiling stocks for food security; domestic price supports; cotton exports; special safeguard mechanisms for developing countries; export prohibitions or restrictions; and “other topics.” In other words, arriving at free trade in agriculture is a long way away.
The world had high hopes in 2001 when the DDA got underway under the auspices of then WTO Director-General, Mike Moore. After all, prior to the Doha round, the world had made steady progress towards reducing trade restrictions and tariffs. However, since that time, ministerial meetings have taken place in Cancun, Mexico, Nairobi, Kenya and Hong Kong, with related negotiations in Paris, Potsdam and Geneva.
The downward spiral ended in July of 2008 in Switzerland when disagreements caused a complete breakdown in negotiations. There have been repeated attempts to revive the talks, but such efforts ended in failure despite intensive negotiations. A group of industrialised countries and their allies in the developing world are considering plurilateral trade negotiations for establishing rules in investment facilitation, disciplines for small and medium enterprises, and even fisheries subsidies.
Such a scheme is being considered as part of a Plan B, if the Buenos Aires meeting fails to accomplish any substantive agreements on the outstanding DDA issues because of differences among key members, said a South African trade envoy. India has consistently opposed any negotiations on investment facilitation and disciplines for MSMEs (micro, small, and medium enterprises) on the grounds that they were outside the WTO mandate.
The Government of Indonesia, through its Permanent Representative in Geneva, has urged member countries of the WTO to immediately reach a global trade agreement to protect small and poor farmers. “WTO memberstates need to realise their political will to agree on a multilateral trade agreement in order to protect the interests of poor and small farmers,” said Deputy Permanent Representative II Geneva, Ambassador Sondang Anggraini in a statement during the session of the WTO’s Committee on Agriculture Special Session (COASS) on 19-20 July 2017. COASS is one of the forums in the WTO that addresses the multilateral trade regulatory reforms that regulate trade in global agricultural products.
Ambassador Sondang said the 11th WTO Ministerial Conference in Buenos Aires is expected to agree on two important trading instruments, namely Public Stockholding for Food Security Purposes (PSH) and Special Safeguard Mechanism (SSM). However, Indonesia as the G33 Coordinator consisting of 47 developing and underdeveloped countries consistently strives for PSH and SSM as an effective instrument in order to realise food and livelihood security.
The US along with other industrialised countries said on 14 September that they would not engage in any discussions for improving the special and differential flexibilities for developing countries in different WTO agreements in the Doha work programme, as demanded by more than 100 developing and least developed countries (LDC). India strongly supported the demands by the African Group, the ACP (Africa, Caribbean and Pacific), and the LDC group for improving special and differential flexibilities in different agreements.
The US Trade Representative, Robert Lighthizer, has signalled that the Buenos Aires meeting is “unlikely” to produce any negotiated outcomes. “There are some areas where the US would like to see action, but it appears that members are unable to agree on any issue,” Lighthizer said, according to a report in Washington Trade Daily on 19 September. “At best, the Buenos Aries meeting will end with agreement on an agenda for moving forward on issues next year,” he added.
Despite such strong signals from Washington, it is business as usual at the WTO. Roberto Azevedo, Director-General of the WTO, met the trade envoys of the European Union, China, India, Brazil, the US, and Japan, among others, on a one-on-one basis to elicit their assessment on the negotiations. On 21 September, the director-general convened an informal neeting of heads of delegations to issue an ambiguous report on how the negotiations will be conducted in the run-up to the Buenos Aires conference.
Azevedo called for prioritizing issues that are do-able in terms of negotiated outcomes and the unresolved issues that will require a work programme for further negotiations after Buenos Aires. He said these two baskets of issues must be finalised before the meeting. “Now, 12 calendar weeks until the Ministerial in Buenos Aires, it is imperative that progress be made,” said Kenyan Ambassador Stephen Karau during the mid-September meetings.
But given the magnitude of the issues faced by the global agricultural community, it is difficult to believe that any additional progress will be made. The meetings in Buenos Aires are likely to be another anti-climax to say the least, with seven issues remaining unsolved. Karau ended the meeting by quoting Winston Churchill: “Some people dream of success, while others wake up and work hard at it.
We need to work hard and we should all contribute if we want to achieve something at MC11.”
(The writer is author of World Trade Organisation: Its Selected Sections of Indian Economy. He is retired professor of International Trade)