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OTN Special Update - _Doha Update - A Glimmer of Hope Dimmed _ 2011-07-13

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OTN Special Update - _Doha Update - A Glimmer of Hope Dimmed _ 2011-07-13

  1. 1. SPECIAL OTN Update  OFFICE OF TRADE NEGOTIATIONS   … for trade matters   July 13, 2011         A GLIMMER OF HOPE     DIMMED     While a glimmer of hope for the conclusion of the Doha were offered Chairmen’s reports coupled in some Round may have been apparent at the beginning of the   instances with minor modifications in the current year, at this current juncture, expectations have been draft texts. Rather than outlining a roadmap on the considerably muted.   way forward, the reports offered no clarity on the solution to the stalemate in the Doha negotiations. During the early months of 2011, the world witnessed   the rollout of a plan of action to push through the Doha What did emerge from the exercise was the   impasse. Conceptualised by the WTO Director-General troubling recognition that the primary roadblock of (DG)  Pascal Lamy, an intensive work programme for the negotiations resided in the NAMA Negotiating the various Negotiating Groups began earnestly in the Group. As DG Lamy expressed in an April 21 letter   January 2011 and was expected to culminate in the “a deal would be doable… but for NAMA, where the preparation of new draft texts by the end of the year’s   differences today are effectively blocking progress first quarter. and putting into serious doubt the conclusion of the   Round this year. This is a grave situation for the The intensified programme, sadly, did not realize the Round and for all of the efforts and aspirations it anticipated results. Most notably, the ambition of   embodies.” releasing revised texts in all Negotiating Groups by   Easter 2011 remained elusive. Instead, WTO Members   OTN UPDATE is the flagship electronic trade newsletter of the Office of Trade Negotiations (OTN), formerly the Caribbean Regional Negotiating Machinery (CRNM). Published in English, it is a rich source of probing research on and detailed analyses of international trade policy issues and developments germane to the Caribbean. Prepared by the Information Unit of the OTN, the newsletter focuses on the OTN, trade negotiation issues within its mandate and related activities. Its intention is to provide impetus for feedback by and awareness amongst a variety of stakeholders, as regards trade policy developments of currency and importance to the Caribbean. http://www.crnm.org
  2. 2.   2 At the core of the issues regarding NAMA negotiations Of these, the proposal to focus on facilitating an are the disparate views on the interpretation of the ‘early harvest’ for LDCs has gained traction. At the Doha mandate as expressed in the Doha WTO informal meeting of the Trade Negotiations Ministerial Declaration of 2001. On the one hand,   Committee (TNC) on May 31, 2011 it was proposed developed countries have posited that the last decade by the WTO DG that the creation of a package deal   of considerable economic growth experienced by on LDC specific issues should comprise part of a advanced developing countries like China, India and   three-stage approach to an eventual final resolution Brazil dictates that they be subjected to treatment of the Doha Round. DG Lamy has proposed that a   different to that which ought to be extended to other package addressed specifically to the interests of developing countries. Consequently, they argue that   LDCs would be fast tracked. This package, he the level of ambition regarding the liberalization of the suggested, should address duty-free quota free markets of advanced developing countries should be   market access for LDC exports, improved rules of much higher than what is currently on offer on the origin, the treatment of cotton, and a services   negotiating table. On the other hand, advanced waiver for LDCs that would allow Members to developing countries have maintained that   discriminate in favour of services exports from development is the core pursuit of the Doha LDCs.   Development Agenda (DDA) rather than narrow mercantilist interests of developed economies. In addition, an LDC-plus package is contemplated.   This ‘plus’ package would address additional issues The   entrenched elusiveness of a solution to the that have neared resolution in the Round. It has impasse has compelled a recalibration of the approach been proposed by DG Lamy that a ‘plus’ package to the negotiations, including the consideration of   include trade facilitation, a Special and Differential alternatives to concluding a comprehensive agreement Treatment Monitoring Mechanism, and Fisheries   at this time – the proverbial ‘Plan B’. subsidies.   The most longstanding suggestion of an alternative to It is further contemplated that other more a comprehensive Doha package has been the   challenging issues relating to NAMA, Services and selection of particular issues for conclusion under a Agriculture in particular would be left to be resolved   stand-alone agreement. This plan would involve the after the end of 2011. leaving aside of the more divisive issues such as those   under Agriculture and NAMA negotiations. Another The effect of the overall approach would be to forgo suggestion on the table has called for the prioritization   the frustrating attempts to conclude the Round by of the needs of least-developed country (LDC) the end of 2011, but at the same time, preserve the   Members. Such prioritization would engender the integrity, legitimacy and relevance of the establishment of an “early harvest” package for LDCs multilateral system by concluding an abridged Doha   which, amongst other things, would facilitate duty-free, package by December 2011 at the 8th WTO   quota-free market access for LDC exports. A third Ministerial Conference. proposed alternative recommended a temporary   suspension of the Doha Round.   OTN UPDATE is the flagship electronic trade newsletter of the Office of Trade Negotiations (OTN), formerly the Caribbean Regional Negotiating Machinery (CRNM). Published in English, it is a rich source of probing research on and detailed analyses of international trade policy issues and developments germane to the Caribbean. Prepared by the Information Unit of the OTN, the newsletter focuses on the OTN, trade negotiation issues within its mandate and related activities. Its intention is to provide impetus for feedback by and awareness amongst a variety of stakeholders, as regards trade policy developments of currency and importance to the Caribbean. http://www.crnm.org
  3. 3.   3 The notion of concluding the Round as a Single concessions to LDCs. Therefore, it appears that the Undertaking has however not been abandoned. challenge of reconciling development with Rather, the proposed process invokes a principle mercantilism that contributed to the Doha impasse   enshrined in Paragraph 47 of the Doha Declaration now threatens to undermine the successful which makes it possible to implement agreements   conclusion of a Doha ‘Plan B’. reached ahead of the conclusion of the Round on a provisional or a definitive basis. The understanding is   Additionally, there is no consensus amongst that such agreements will be taken into account in Members regarding the inclusion of fisheries   subsidies as Members such as the European assessing the overall balance of the negotiations. Consequently, the components of the December Union, Japan, Chinese Taipei and South Korea are   package should not be regarded in isolation from the of the view that negotiations have not sufficiently   issues that will remain to be resolved after the 8th matured in this area and should not be part of a WTO Ministerial. December package.   To   date, however, Members have been struggling to The June 22, 2011 TNC meeting certainly has not agree on what exactly should constitute the served to ameliorate the situation. The meeting did December package. It is perhaps the inextricable   not generate further guidance regarding the linkage between the December package, the proposals that had already been suggested for the   December package. Moreover, during that meeting, outstanding issues and the potential balance of the final results of the negotiations that has made it DG Lamy proposed the inclusion of yet another   difficult for the Membership to reach a Member final element to the LDC-plus package – Environmental   decision on the components of the December Goods and Services (EGS). The inclusion of EGS package. surprised most Members, as it is a component of   the contentious NAMA negotiations. Some developing countries such as China,   Bangladesh, India, and the African, Caribbean and The liberalization of EGS has been promoted as a Pacific States (ACP) have advanced a preference for   “win-win” proposition that would be advantageous focus on LDC specific package only. This has for trade as well as the environment. Not only   garnered no support from key developed countries would trade flows in environmental goods increase such as the United States of America. Developed but at the same time the increased opportunities to   countries have insisted that an LDC-only package obtain and use environmental goods and services   would not be saleable and that it would be necessary could reduce negative impacts of production to also establish an LDC-plus package that would activities on the environment especially within   include areas of interest to Members other than the developing countries. LDCs such as Trade Facilitation.   However, with respect to trade in environmental In response, developing countries have objected to   goods and services, the trade balance of the the inclusion of developed countries’ interests as part majority of developing countries is already   of the final December package as a ‘payment’ for negative. Further, given that most developed   OTN UPDATE is the flagship electronic trade newsletter of the Office of Trade Negotiations (OTN), formerly the Caribbean Regional Negotiating Machinery (CRNM). Published in English, it is a rich source of probing research on and detailed analyses of international trade policy issues and developments germane to the Caribbean. Prepared by the Information Unit of the OTN, the newsletter focuses on the OTN, trade negotiation issues within its mandate and related activities. Its intention is to provide impetus for feedback by and awareness amongst a variety of stakeholders, as regards trade policy developments of currency and importance to the Caribbean. http://www.crnm.org
  4. 4.   4 countries already apply low or zero tariffs on Relevant to this are the gains to the Region as environmental goods, their burden of effective tariff reflected in the current draft NAMA and Agriculture reductions would be relatively less than for texts regarding tariff reduction modalities, including developing   countries. The inclusion of the flexibilities for the Region as small vulnerable environmental goods and services in the LDC-plus economies (SVEs), as well as the facilitation of   package would therefore decidedly favour Haiti and Suriname to rebind their tariffs in a developed countries relative to developing   manner consistent with their CARICOM Common countries, at least in the short to medium term. It is External Tariff (CET) obligations without recourse to therefore not surprising that developing countries   GATT Article XXVIII. Under Article XXVIII, other such as Brazil and India expressed objections to WTO Members that would be adversely affected by   the inclusion of the item in the LDC-plus package. Suriname’s proposed tariff change would be   entitled to renegotiation of tariff concessions with   Suriname, and compensation. For the Caribbean   therefore, it is crucial that the negotiations which Implications for CARICOM   are expected to continue after the 8th WTO The advent of the WTO August recess does not Ministerial will be predicated on the draft texts.   provide a lot of time ahead of the 8th WTO Furthermore, the Region would be interested in Ministerial for Members to resolve their differences multilateralizing the ACP/EU/MFN Agreement on   and to finalize the December package. It is hoped Preference Erosion/Tropical products that that, in the rest of months ahead, a final solution   accompanied the conclusion of the longstanding will be resolved. In this regard, the WTO General trade dispute on bananas.   Council meeting which will take place July 27-28, With respect to the LDC-plus package, the 2011 may provide some indication of whether   reservations of some WTO Members regarding the agreement on the December package might be   inclusion of Trade Facilitation and Fisheries secured. subsidies have been noted. However, should these   The proposed three-stage process for ultimately issues be included in the ‘plus’ package, the resolving the Round does raise certain issues CARICOM Region will seek to (i) ensure that the   which will impact CARICOM’s interests in the Doha capacity building component of trade facilitation is negotiations. In the first instance, while the intention   included in the December package, and (ii) ensure to secure a December package is plain enough, the that the CARICOM Members as SVEs are   exempted from any disciplines on fisheries roadmap for resolving other contentious Doha issues in the post December 2011 period remains   subsidies given that the Region’s share of global unclear. This notwithstanding, during the post fishing catch is too miniscule to inflict environmental   December 2011 negotiation process, the Caribbean damage caused by over fishing. will  be interested in maintaining the developmental It is appreciated that the proposed facilitation of gains that have already been secured in the duty-free, quota-free treatment of LDC exports as negotiations.   well as the services waiver under the LDC package   OTN UPDATE is the flagship electronic trade newsletter of the Office of Trade Negotiations (OTN), formerly the Caribbean Regional Negotiating Machinery (CRNM). Published in English, it is a rich source of probing research on and detailed analyses of international trade policy issues and developments germane to the Caribbean. Prepared by the Information Unit of the OTN, the newsletter focuses on the OTN, trade negotiation issues within its mandate and related activities. Its intention is to provide impetus for feedback by and awareness amongst a variety of stakeholders, as regards trade policy developments of currency and importance to the Caribbean. http://www.crnm.org
  5. 5. 5would undoubtedly be beneficial to Haiti, the inter alia, intensifying economic diversification andRegion’s only LDC as designated by the UN. deepening the development and management ofHowever, the improved access of LDC services and their innovation systems in order to engender  goods exports to major markets could undermine expanded creation, export and marketing of highlythe margin of preference of other CARICOM   differentiated, value added products and services.Members within those markets. It will be important  for CARICOM Member States to adjust quickly tothe imminent effects of preference erosion by   *********recalibrating their industrial and external tradestrategies in order to maintain and improve their  competiveness in these markets. In this regard,  CARICOM Member States will need to consider,       Trade Negotiations Committee in Session Photograph: WTO    OTN UPDATE is the flagship electronic trade newsletter of the Office of Trade Negotiations (OTN), formerly the Caribbean Regional Negotiating Machinery (CRNM). Published in English, it is a rich source of probing research on and detailed analyses of international trade policy issues and developments germane to the Caribbean. Prepared by the Information Unit of the OTN, the newsletter focuses on the OTN, trade negotiation issues within its mandate and related activities. Its intention is to provide impetus for feedback by and awareness amongst a variety of stakeholders, as regards trade policy developments of currency and importance to the Caribbean. http://www.crnm.org

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