Brussels, 16/10/2007 (Agence Europe) - This will be a crucial week in Geneva where negotiators from the 151 member states of the WTO will attempt to overcome the persistent differences between rich and developing countries on modalities for liberalising trade in agriculture and industrial products (NAMA). Following a new session of the agricultural negotiation committee on Monday 15 October, its president, Crawford Falconer, will hold informal consultations during the week before a second formal meeting on Friday. The president of the negotiating committee on NAMA, Don Stephenson, has called for informal consultations in an attempt to make the demands of developing countries on NAMA, more flexible. In Geneva, as in other capitals, specific attention will also focus on the summit of heads of states and governments from the governments of South Africa, Brazil and India on Wednesday 17 October in Pretoria.
In a common position reached by groups of negotiators on NAMA-11 (led by South Africa, Brazil and India), ACP, African countries and small vulnerable economies, 110 developing countries created a strain by calling for substantial modifications to the text of the Stephenson compromise on NAMA, as well as to the formula on tariff reductions. They are demanding bigger percentage reductions in these tariffs than those demanded by developed countries. They affirm in their declaration that, “The Doha Round is about development of developing countries, especially Least Developed Countries…Centrality of agriculture in the Doha Ministerial Declaration cannot be wished away….significant progress in this area is critical for establishing a fair and equitable global trading regime and to obtain a balanced and development friendly outcome from this Round”. These countries add, “Agriculture determines the ambition of the Round. NAMA modalities have to be built around and lead to a result comparable to what is achievable in agriculture”. The paper also explains that, “The crucial aspect of the formula or the tariff reduction modality is that it must require from developing countries 'less than full reciprocity in reduction commitments'…According to this principle, reduction commitments shall be in percentage terms and shall be higher for developed countries than for developing countries…proposals that seek to impose reduction commitments on developing countries, including the SVEs, which are higher than that for developed countries, cannot be accepted”. The Stephenson draft compromise on NAMA is based on a “Swiss formula” consisting of two distinct tariff reduction co-efficients applicable to the rich countries and advanced developing countries. These co-efficients are located in bands of between 8-9 for the first and between 19-23 for the second. However, if the developed countries demand a tariff reduction coefficient of 15 (as opposed to 10 for themselves) applicable to developing countries, most of the emerging countries united under the NAMA-11 banner are refusing to go below a co-efficient of 30, indeed 35, applicable to themselves. On the other hand, the front of emerging countries is not homogenous given that a group of 8 countries led by Chile, Mexico and Singapore, are said to be read to concede more on NAMA than the countries from NAMA-11.
This position taken by the developing world immediately provoked alarm from the EU and US, which again appealed to South Africa, Brazil and India to reaffirm, during their tripartite summit in Pretoria, their commitment to conclude the round and support the compromise proposed by agricultural and industrial mediators at the WTO. On 11 October the Commissioner for trade, Peter Mandelson, warned, “developing countries risk dealing a terrible blow to long delayed global free trade talks that are nearing a moment of truth”. He added that, “For such developing country leaders as Brazil, India and South Africa now to reject the chair's industrial tariffs text would do terrible injury to the current negotiating process, and drain the negotiations of what confidence and momentum remains in them”. He affirmed that the most vulnerable economies really needed protection and that the most competitive economies like India should only have to meet a modest opening up of their economies, as in accordance with the draft compromise currently on the table. Mandelson concluded that, “The formula to cur tariffs only applies to some 30 developing country members of the WTO. These countries are being asked for a modest contribution: bind most of their remaining unbound tariffs; reduce their peak tariffs; consolidate duties to the levels that are actually being applied; and for some countries, make limited adjustments of 1 or 2% to the tariffs presently applied - over a period of ten years. If that isn't modest, I don't know what is”.
In Geneva, a new revised compromise text on agriculture and NAMA is being awaited for the beginning or middle of November. On the negotiations on services, things are shifting. Speaking on Monday at the London School of Economics as part of a conference organised by the European Services Forum, Pascal Lamy, reaffirmed the importance of services in the Doha Round. Accounting for 68% of world GDP and global trade worth $2800bn in 2006, services have as much weight as agriculture and industry, insisted the WTO Director General. (E.H)