Brussels, 10/05/2004 (Agence Europe) - The trade ministers of WTO countries who attended the WTO meeting in Cancun will be meeting on Thursday 13 May, on the fringes of the OECD summit in Paris. Believing consensus exists to enable the WTO talks under the Doha Development Agenda (DDA) to be concluded by July in a mid-term agreement, and in order to inject new momentum into the talks, Commissioners Pascal Lamy and Franz Fischler have sent a letter to their WTO counterparts. In the letter, the European Trade and Agriculture Commissioners outline three areas where the EU is prepared to go the extra mile, namely farming, where the EU is prepared to put on the table all export subsidies, provided the EU gets full parallelism and a balanced overall package on agriculture as long as the EU's partners make similar moves and an 'acceptable' outcome is achieved in the other two farming 'pillars' of market access and domestic support; new flexibility on Singapore issues (the creation of new rules on trade facilitation, transparency in government procurement, investments and competition); and as Pascal Lamy explained in Dakar (Senegal) last week (see EUROPE of 5 May, p.11), the EU is prepared to make a package on concessions for the poorest and weakest WTO members (essentially G-90, the poorest Africa, Caribbean and Pacific states).
As a press conference on Monday, Lamy highlighted that with its series of moves, the EU has demonstrated that it is prepared to go the extra mile to conclude half of the round of negotiations by July 2004, but noted that while the EU wanted success, it could not go it alone. He called on all other WTO countries, both developed and developing, to turn their expressions of political commitment into concrete, tangible gestures if they really want to reach agreement on the details of the DDA by July. The European Trade Commissioner said that the EU was sticking its neck out with this gesture, noting that they were aware that it is always dangerous to make moves in negotiations if the others fail to move. Some EU Member States, particularly France, do not seem to accept the farm concessions (see below). Quizzed about this, Pascal Lamy said that his initiative was supported by most of the College of Commissioners and Member States. He said discussions had been held with the Member States on Friday and there was general consensus about the usefulness of the initiative.
In a press release, the EU notes: “Following the collapse of the Cancun Ministerial conference in September 2003, the EU committed to reviving the Doha Round of world trade talks. Its policy of focusing on the multilateral, showing real flexibility and working to achieve swift results was set out in the Commission Communication of 28 November 2003 ('Reviving the DDA Negotiations- the EU Perspective') and endorsed by EU Member States on 9 December 2003. The EU believes that 2004 is not- and cannot afford to be- a lost year for trade policy. To this end, strong alliance- building efforts have been maintained with all WTO members, and intensive contacts have particularly been made with developing country groups such as the G20 and G90.”
Tackling all types of export subsidies. “It is clear that the objective of eliminating all forms of export subisidisation is one which is shared by the great majority of participants. Before Cancun, the EU already offered to eliminate export subsidies on a list of products of interest to developing countries, and we subsequently made clear that there would be no a priori exclusions, so all our export subsidies are effectively on the table. However, the list approach has not worked” notes the Commission in a press release, adding that this was why the EU has taken the decision to be ready to move on export subsidies, if an acceptable outcome emerges on market access and domestic support and non-trade concerns, and if we get strict parallelism for all forms of export subsidisation in return, warned Pascal Lamy. "This bold initiative proves that our commitment to the Doha Round is more than words. Agriculture is key to its success, so we are ready to show flexibility. Provided we get a balanced deal on market access, domestic support and non-trade concerns and strict parallelism on export competition, we are ready to put all the export subsidies on the table. This means that our American, Australian or Canadian partners have to make clear that they will fully match the EU on the forms of export support they use, such as export credits, abuse of food aid or state trading enterprises", Franz Fischler, EU Commissioner for Agriculture, Rural Development and Fisheries said. The EU is also ready to play its part on domestic support, as shown by the recent reforms of the EU agricultural policy. The EU proposes a very substantial cut in trade-distorting subsidies, the elimination of the de minimis loophole support for developed countries, new rules which would prevent subsidising countries from transferring subsidies between and within boxes and greater transparency. The EU also needs a clear commitment that non-trade distorting green box subsidies remain free of restrictions. It is now up to other big subsidisers of agriculture, notably the US to show ambition and courage and follow the EU's lead, comments the Commission.
Greater flexibility on the Singapore issues. “The EU has already indicated its readiness to treat each of the four Singapore issues on its own merits, ie to keep within the Doha Agenda only those for which there is consensus to launch negotiations within the WTO. Today there seems to be a clear readiness to launch negotiations on trade facilitation. There is clearly no consensus to launch negotiations on investment and competition. The picture is less clear on transparency in public procurement, but the EU is ready to join the consensus view on this either way.”
A free trade round for G-90 countries. The EU also proposes a special deal for the poorest (least developed) and weakest WTO countries essentially the so-called G-90 group (an alliance of Least Developed countries and African, Caribbean and Pacific states). These countries would not be called upon to further open their markets while they would benefit from improved access to developed and rich developing markets for their agricultural and industrial products. Under the proposed plan vulnerable economies would benefit from improved access to all other markets, including the richer developing countries, which would compensate them for the erosion of the preferences that G-90 countries enjoy in certain developed countries, notably the EU.
In addition to providing movement on these three issues, Pascal Lamy and Franz Fischler's letter also reiterates a call for a substantial cut in tariffs on trade in industrial products, according to a general and simple formula with a limited set of exceptions; urges other WTO members to help the EU to move forward the negotiations to open trade in services, which are currently stalled. “More and better offers are needed” note the Commissioners, hoping “that this opportunity to move ahead will not be missed. It also looks forward to the response of other WTO Members in terms of new ideas and additional flexibilities so that framework modalities (which is what WTO members wanted to achieve in Cancun in September 2003) can be adopted by July this year.”