Brussels, 21/12/2006 (Agence Europe) - There is already a taste of “déjà vu” hovering over the long-awaited meeting to be held between some thirty trade ministers, including G-6 negotiators (EU, United States, Brazil, India, Australia and Japan), on the sidelines of the World Economic Forum in Davos from 24 to 28 January 2007. Nearly one year ago, the same players were to be found in the Swiss ski resort to launch talks already well behind the initial schedule. They were to establish a roadmap for 2006, fixing the 30 April deadline for finalising arrangements (such as figures and other provisions) on agriculture and manufactured goods (NAMA = Non-Agricultural Market Access) for a comprehensive agreement which, it was thought very optimistically, could be sealed at the end of 2006. One year later, since their formal suspension in July as the G-6 failed to reach a compromise on agriculture, talks are to be relaunched. Also, as the Trade Promotion Authority is to expire at the end of June 2007, the negotiating brief allowing the US administration to negotiate trade agreements before they are submitted to vote in Congress without the latter being able to amend them, only increases the threat that the round of talks will be buried for another few years yet.
Although it only reached a last minute consensus on a few of the chapters of the Round, deferring an agreement on arrangements until 2006, the Ministerial Conference in Hong Kong in December 2005 had nonetheless given rise to considerable hope. Developing countries obtained a date for the end of export subsidies for farm products from rich countries and, painfully, a development package was agreed albeit below expectations. Under pressure from negotiating groups of the G-20 (emergent countries), G-33 (producer countries of special products) and G-90 (African Union, ACP and LDC), the EU had in fact agreed that export subsidies should be phased out by 2013 on condition that there be strict parallelism with disguised export subsidies practised by Australia, Canada and New Zealand (State-owned commercial farms) and the United States (export credits and food aid). Also, with great reticence, the United States and Japan had agreed, as all rich and emerging countries had done, to grant duty-free and quota-free access to their market for 97% of exports from all developing countries.
On the strength of these results, the 149 WTO members went back to work to swiftly conclude the following stage: - that of finding a compromise on arrangements for agriculture and NAMA, following negotiations on services, trade rules and trade facilitation in parallel. In Davos, in January 2006, the trade ministers gave themselves until 30 April to finalise the arrangements. The G-6 met in March in London but to no avail. On 24 April, the WTO General Council adjourned its ministerial meeting till July for validating the hoped-for compromise. In the meantime, the decision by Washington to replace its negotiator, Rob Portman, by his deputy, Susan Schwab, only darkened prospects that were already somewhat gloomy. Then came Peter Mandelson's announcement in May that the EU could come closer to the G-20 requirements by giving greater flexibility to its agricultural offer regarding market access, reawakening the hope that talks might possibly succeed in July. This hope was maintained in June despite the feeble content of the draft compromise on arrangements circulating in Geneva, when President Bush hinted that Washington could accept greater constraints on internal subsidies and moderate its demands regarding access to the agricultural market.
Things turned out quite differently, however. Denounced by all participants at the restricted ministerial meeting in Geneva from 29 June to 2 July, Washington's maximalist approach to market access and its refusal to give greater flexibility to its offer on domestic subsidies froze all hope of compromise. The United States denounced the many loopholes to market opening - sensitive products for rich countries, special products and special safeguard measures for developing countries. The member nations then called on WTO Director General Pascal Lamy to proceed to consultation at the very highest political level in order to break the deadlock. Despite the call made by the G-8 in Saint Petersbourg mid-July, negotiations finally stalled after an unfruitful meeting of the G-6 in Geneva on 23 July. If some negotiators are to be believed, there were clearly fewer differences on the agricultural front and, after months of reticence fuelled by fear of the Chinese “giant”, G-20 emerging countries were even ready to accept larger customs duty reductions than hoped for on NAMA. They had come very close to an overall agreement.
On 27 July this year, the WTO General Council suspended the Doha Round until further notice. In September, the Rio and Cairns meetings did not allow talks to be resumed before the end of the year. However, after the Democrat victory at the US Congress early November and given the many calls (from the APEC in particular) for negotiations to be resumed, Pascal Lamy convinced the WTO General Council on 16 November to approve resumption of formal talks at the level of the negotiating committees. On 15 December, Lamy was, however, still admitting that the prospect of formal talks being resumed was still uncertain. Indeed, since July, all G-6 trading powers have been sticking to their positions, and none of them has been willing to make fresh concessions. In such circumstances, it is difficult to imagine an overall agreement being reached in 2007. (eh)