Bali, 09/12/2013 (Agence Europe) - The Bali package comes with a work programme to conclude a Doha Round that focused on rebalancing trade to the advantage of the developing world.
After a last-minute turnaround, the 159 WTO member countries finally concluded an agreement on the Bali package on Saturday 7 December. The previous day, a compromise between India and the agricultural exporting countries - led by the US - on food security unblocked the negotiations on the whole package. However, although a final agreement was in sight, Cuba, Nicaragua, Bolivia and Venezuela suddenly rejected the draft text of the agreement during the night of Friday to Saturday from which a reference to the US embargo against Cuba had been withdrawn in the chapter on trade facilitation. Despite this, WTO Director General Roberto Azevedo, who is a seasoned diplomat in WTO marathons, found the resources to settle the issue and on Saturday morning reached the consensus that everyone wanted.
The Bali package can be summed up as a set of measures to simplify trade, to offer developing countries more options in order to ensure food security, and to stimulate the trade of least developed countries (LDCs), and, more generally, to support development. This historic agreement - the first multilateral agreement since the WTO was created in 1995 - could generate gains of US$1 trillion for global GDP.
The key point of this partial agreement on the Doha Round - complemented by a work programme to implement in 2014 in order to realise the vast programme of trade liberalisation launched in 2001 - is an agreement on trade facilitation, which includes a set of binding rules to simplify and ease customs procedures and thus facilitate trade flows. The gains expected are estimated at US$400 billion in savings per year in customs charges.
This partial agreement on the Doha agenda also includes a development package - comprising decisions on preferential rules of origin for LDCs, decisions on the operationalisation of the waiver concerning preferential treatment to services and service suppliers of LDCs, decisions on duty-free and quota-free market access for LDCs and the monitoring mechanism on special and differentiated treatment, and measures for LDC cotton producers.
Lastly, this partial agreement resets the clock on the agricultural chapter of the Doha Round. As well as a memorandum of understanding on the tariff rate quota administration provisions of agricultural products and a decision on export competition to remove all forms of export subsidies in tandem, it includes a decision on public stockholding for food security purposes.
The chapter on food security was set out as the main issue to be resolved if the Bali conference was to be a success. India - which wanted to guarantee the implementation of a food programme, decided upon this summer for the poorest in its population, without risking appeals at the WTO from third countries - had linked to the Bali package a proposal aiming to enable developing countries to build stocks of essential foodstuffs for food security purposes, despite the 10% production limits imposed by the WTO on domestic support for agriculture. The Indian request raised a hostile response from the agricultural exporting countries and neighbouring countries like Pakistan, which feared that the stocks for the domestic market might then be exported to international markets at low prices. At one point, India's intransigence in refusing a four-year peace clause, proposed by the US, blocked an agreement. However, India managed to obtain the peace clause being automatically renewed for four years if a lasting solution to this issue is not found at the WTO by 2017, and India thus ensured the sustainability of its food programme.
The success of the conference is a personal victory for Azevedo, the new WTO director general from Brazil, who took up his post on 1 September and who has achieved success where his predecessor, Pascal Lamy from France, failed in the two mandates of his post. “For the first time in our history, the WTO has truly delivered”, Azevedo said with tears in his eyes after the official approval given by the ministers of the 159 WTO member countries. Nevertheless, while this is “an important step” towards completion of the Doha programme, the Bali package is “only a beginning”. The member countries will now have 12 months to establish a roadmap in order to conclude a much more ambitious liberalisation programme covering agriculture, industrial products and services.
The host of the meeting, Indonesia's Minister for Trade Gita Wirjawan, was pleased that the place chosen - the paradise-like Hindu island of Bali - had contributed to giving a breath of fresh air to the Doha Round, which has been in stalemate since failure in Geneva in 2008. “We've done it!” he said, quoting Nelson Mandela in order to pay tribute to him. “It always seems impossible until it's done!” “Bali marks a new dawn for the WTO. It is a historic success which will represent a true boost at a time when growth and employment are sluggish”, Gita added.
European Commissioner for Trade Karel De Gucht said he was “relieved”. “Today marks the return of the WTO from the darkness of multilateral irrelevance into the light of multilateral action and success. Today, we have saved the WTO and the Bali package. We have avoided throwing away the potential benefits that this package of measures will have for all of us - but notably the developing world. That has been the objective of the EU from the outset”, he concluded.
India's Trade Minister Anand Sharma was delighted. Before returning to New Delhi with an agreement in favour of his troubled government which will hold general election in India in 2014, Sharma said: “It is a victory for the WTO and for the global community to have arrived at a mature decision. We are more than happy. It is a great day. It is a historic day.” (EH/transl.fl)