Another mini-ministerial meeting in Geneva to conclude the Doha Round of World Trade Organisation (WTO) talks will take place sometime after December 10. This time it is at the insistence of the US, Brazil, Australia, and the UK who managed to include language in the final G-20 statement.
“We strive to reach an agreement this year on modalities that leads to an ambitious outcome to the Doha Round of WTO negotiations,” it said.
Despite little progress during the sustained consultations held by the chairs of agriculture and market-opening for industrials since the failed mini-ministerial meeting in last July, these four countries along with WTO Chief Pascal Lamy succeeded in imposing their game plan, several trade envoys told Business Standard yesterday.
But will it succeed? Clearly, the outcome is uncertain and much would depend on a couple of factors. To start with, the two chairs overseeing the agriculture and market-opening for industrials will require revised solutions from the key players in order to table revised draft texts soon. Otherwise, they cannot produce texts in vacuum, said trade envoys.
But if the past two-and-half months are any indication, the answer is clear ‘no’, said a trade envoy who took part in both agriculture and market-opening for industrials.
In agriculture, for example, there are about four major issues — special safeguard mechanism (SSM) for developing countries, farm tariff simplification and the treatment of sensitive farm products in industrialised countries, and cotton subsidies in the US — that have showed no signs of convergence until now.
Meanwhile, new issues have surfaced in agriculture during the consultations held by the chair for Doha agriculture negotiations Ambassador Crawford Falconer in his ‘Walk in the Woods’ consultations, trade diplomats said.
Further, if one or two countries show flexibility and make appropriate compromises on those issues, surely, they would expect the same from others on other issues.
For example, if China and India show certain flexibility to resolve SSM that aims to protect its farmers from unforeseen surges in imports, they would expect the same from the US to do the same on reducing its cotton subsidies or the EU, Japan, Norway, Switzerland and other industrialised countries on removing all its opaque and complex farm tariffs or providing adequate treatment for its sensitive farm products through enhanced tariff rate quotas.
“This cannot be one-way street where the key developing countries make compromises and in return, they are told ‘don’t expect much in areas of your interest’,” said an Asian trade diplomat.
Second, when it comes to industrial goods, the industrialised countries led by the US want the big emerging countries like China, India, Argentina and South Africa to agree on the existing coefficients as well as an upfront commitment to participate in sectoral tariff negotiations, particularly chemicals, industrial machinery, electricals and electronics.
“The game here is that before recession becomes entrenched in the western countries soon, they want developing countries to sharply reduce their industrial tariffs as well as agree to zero tariffs in chemicals, industrial machinery, and electricals and electronics,” said a South American trade envoy.
On Thursday, China categorically said it will not participate in three sectors — chemicals, industrial machinery, and electricals and electronics — which are of importance to the US.
In industrial goods, developing countries, including India, will reduce their industrial tariffs by 10 per cent, while the industrialised countries would cut tariffs on their industrial products by 2 per cent based on the current proposals, trade diplomats said.
And if the US manages to secure what it wants on sectorals, China, India, Argentina and South Africa will have to reduce tariffs on chemicals, industrial machinery and electricals and electronics close to zero, trade diplomats said.