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WTO General Council meets amid gloom of "No Outcome"
Martin Kohr July 28th

Service on WTO and Trade Issues (Jul05/13) 28 July 2005 Third World Network


The WTO General Council started its long anticipated meeting on 27 July. It had been scheduled to adopt "first approximations" of modalities for issues such as agriculture and non agricultural market access (NAMA). However, there had not been any agreements, so the meeting will instead only receive reports on the status of negotiations.

The first day was spent on regular agenda items. There was an exchange on the "permanent solution" to the problem of TRIPS and public health.

Below is a report of the first day of the meeting.

With best wishes
Martin Khor

General Council meets amid gloom of 'no outcome'

Martin Khor, TWN, 27 July 2005

The WTO General Council started its meeting today in an atmosphere of anti-climax as well as general gloom that its long-touted objective of coming up with 'first approximations' of modalities on key issues to give a boost to the preparations for the Hongkong Ministerial in December would not be fulfilled.

The Council meeting dealt with eight regular agenda items. The main item, discussion on a report from the Trade Negotiations Committee (TNC), will take place Friday. Before that, the TNC will meet on Thursday.

The failure of the WTO to meet yet another deadline had already been predicted in the past few weeks, and was finally confirmed when two meetings held Tuesday afternoon were told that wide differences remained in agriculture and non-agriculture market access (NAMA).

As a result, the General Council will not adopt any agreed texts that could have represented 'additional convergence' to add to the General Council's Framework Agreements of July 2004 (adopted on 1 August 2004).

Some trade diplomats and officials put on a brave front, saying that although there was no new agreement, there had been significant progress. The EU chief negotiator, Peter Carl, said that real advances had been made in agriculture. The chair of the NAMA negotiations, Stefan Johannesson of Iceland, remarked that a lot of ground had been covered and "all we need is to walk an extra mile."

But there is no hiding the fact of a major setback to the schedule, set early this year, of reaching concrete agreement on some key aspects in agriculture, NAMA, services and 'development issues' by end-July, so that after the August break there would be a good chance to settle the detailed 'modalities' before Hongkong.

A significant new uncertainty is that although he is reluctant to do so, the former New Zealand ambassador, Tim Groser, will almost certainly have to give up at the end of July his post as Chair of the Special Session of the Committee on Agriculture - where agriculture negotiations take place.

Whoever takes over (and the names mentioned are the new New Zealand ambassador, Crawford Falconer, and the Chilean Ambassador, Alejandro Jara, who now chairs the services talks) will find it difficult to quickly get to grips with the complex issues and establish relations of confidence with various delegations and negotiators.

This, say some diplomats and officials, might enable the incoming Director-General, Pascal Lamy, to take on (or offer to take on) a more prominent role in the agriculture negotiations than his predecessor, Supachai Panitchpakdi. How various delegations will react if this happens is uncertain.

The NAMA Chair, Amb. Stefan Johannesson is also reportedly scheduled to leave his Geneva post before the Hongkong Ministerial.

However, other observers of the WTO negotiations argue that there are still more than three full months after the summer break before Hongkong, and that traditionally the major decisions are taken at the last minute, just before the Ministerial or at the Ministerial itself (or in the case of Doha in 2001, at 'extra time' on an extended day after the scheduled end of the meeting).

The real intense negotiations can be expected to take place between mid-October and the end of November, according to this view.

It became clear Wednesday, that besides the lack of any outcome on agriculture and NAMA, there would be no result either at the General Council on the "development issues" - such as special and differential treatment, implementation issues, and TRIPS and Public Health.

The July 2004 framework had set a deadline of July 2005 for a review of all outstanding agreement-specific SDT proposals, with clear recommendations for a decision.

That ambition had been whittled down to settling just five proposals relating to LDCs. In the past week, several meetings had been held in an attempt to reach agreement on the issues. But this morning, senior diplomats admitted that it would not be possible to reach agreement this week on these five proposals.

On implementation issues, the July 2004 framework says that the General Council shall review progress and take appropriate action no later than July 2005. Last week, the Director General reported to the TNC meeting that there had not been progress on seven major implementation issues.

At today's General Council, he also reported that no agreement had been reached on geographical indications, one of the major implementation issues.

On TRIPS and Public Health, the General Council dealt with this issue, with the Chair of the negotiations, Ambassador Choi Hyuck of Korea, reporting that there had been no agreement on finding a 'permanent solution' to the question of ensuring supplies of affordable medicines to countries with no or inadequate manufacturing capacity. Choi hoped there would be some results soon after the summer break.

According to para 11 of the 30 August 2003 decision of the General Council on this issue, the TRIPS Council was to have adopted an amendment to the TRIPS agreement as a permanent solution, by end-June 2004. This and several other deadlines have been missed.

At the General Council meeting, after the Chair of the TRIPS negotiations had reported failure to find a solution, several developing countries spoke of their concern and disappointment.

Kenya expressed deep disappointment that two years after the August 2003 decision, no progress had been made. The main problem, it said, is that some countries want to transpose the August 2003 decision into the agreement (with which Kenya did not agree), whereas other countries wanted an amendment to the TRIPS agreement.

Kenya said the WTO members had to be faithful to paragraph 11 of the August 2003 decision, which clearly stated that there would have to be an amendment to the TRIPS agreement.

As the proposal by the Africa |Group was the only one on the table, it must be used as the basis for further work, concluded Kenya.

Cuba agreed with Kenya, adding that millions of people were dying of HIV-AIDS due to lack of access to medicines, and thus it was urgent that a solution be found.

Brazil stated that a statement of the Chairman of the General Council (just prior to the adoption of the 30 August 2003 decision) should not be part of the solution and asked that a reference to this statement (in a footnote of the Decision document) be dropped.

The US on the other hand said that the any movement on this issue should incorporate the August decision as a whole, together with reference to the Chairman's statement.

Thus, the three main manifestations of specific 'development issues' (i.e. SDT, implementation, and a permanent solution to an important aspect of TRIPS and Public Health) have made no progress, and have suffered through many missed deadlines.

These are also casualties of the failure of the July General Council meeting to make headway on the Doha agenda.

The Council dealt with eight items; besides implementation issues and TRIPS and Public Health, it also discussed six other issues, including small economies, special and differential treatment, aspects relating to rules of origin, waivers under Article IX of the WTO agreement, and the budget committee.

On waivers under Art.IX of the WTO agreement, the waiver requests for AGOA, Caribbean Basin Economic Recovery Act, and Andean Trade Preference Act were approved.

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