WORLD TRADE ORGANIZATION, FOURTH MINISTERIAL MEETING
Meeting rescued from collapse by concessions
> BY ROBERT E. SULLIVAN and DEVIKA SAHDEV
Copyright © 2002 by The Earth Times. All rights reserved

"We're [WTO] an organization that sets up a system of rules that we believe will unify the multi-lateral system," said Mike Moore, WTO Director General, at a news conference following the final plenary. "I think that signal was a very important one to give the world economy at the moment. Developing countries fought for 50 years to have negotiations on development that are meaningful."

This round of negotiations, according to Moore, did serve the needs of developing countries, especially in the area of agriculture especially in the area of agriculture and implementation. The document approved by the ministers commits the WTO's members to phasing out agricultural export subsidies, a liberalization of patent policies that will allow poor countries more access to pharmaceutical drugs, and an entire new round of WTO negotiations now to be called "the Doha Round" after Doha Qatar, where the fourth ministerial-level meeting concluded Wednesday. The WTO also formally voted to bring China and Taiwan into its membership, after some 15 years of often-contentious negotiations.

The final document was delayed 18 hours past deadline, and agreed to by the 142-member body only after some behind the scenes arm-twisting by tough-talking WTO Director General Mike Moore on a group of recalcitrant members led by India, and reportedly late afternoon telephone calls from President George W. Bush and British Prime Minister Tony Blair.

The World Bank has calculated that a new round, with only conservative estimates of success, coupled with associated market reforms, would add $2.8 trillion to the global economy by 2015, with some $1.5 trillion going to developing countries.

An ad-hoc 80-member bloc of developing countries working together turned one of the most contentious issues going into the meeting last Friday into one of the first to be resolved: They won recognition of the rights of poor countries to more access to western-patented drugs, including those designed to treat HIV/AIDS, when governments decide that public health demands it.

"This meeting was a political coming of age for developing countries," said Annemie Neyts-Uyttebroeck, President of the Council of European Ministers, making it plain she was speaking for all of Europe.

Nigerian Commerce Minister Mustafa Bello told Conference News Daily "the ACP (African Caribbean Pacific group) is happy."

"We have a good deal for the developing world," said Bello, making clear he was also speaking not only for the ACP, but also for the sometimes overlapping group of Least Developed Countries (LDCs) and the Organization of African Unity (OAU), who together made up the largest single bloc to pull together in the elaborately decorated halls of the Sheraton Hotel.

ACP spokesman Hegel Goutier, noting that Africa had won an extension of a waiver of free trade rules giving special treatment to African banana exports said, "If this waiver affair was raised some years ago we would have lost, because we didn't have unity and solidarity." Indeed, it was the concerns of the less developed countries, particularly India and Nigeria, that delayed the final agreement, which must be reached by consensus. A single nay vote would have destroyed the agreement.

At the last minute India, led by Commerce Minister Murasoli Maran, made a strong case that member countries should first commit to honor and to begin implementing clauses in the previous, so-called Uruguay round, which would have benefited Indian textile exports, but which have largely been ignored. India and its colleagues objected to language that called for new negotiations on investment and competition-discussions which they believed had no place in trade negotiations, and could be used by the developed countries to further permeate their markets. The countries said the wording could lead to a "de-industrialization" of their countries.

Specifically, according to WTO observers, the argument broke down to the inclusion or not of a single phrase referring to the "modalities" of the presumed pending negotiations. On the one hand the industrialized countries, led by the European Union, wanted terminology that presumed the negotiations on the issues would begin in the next two years, and on the others, the Indian-led group believed they should not be presumed to begin at all.

In back-room negotiations, India won a delay of two years on the negotiations, in a move that nongovernmental organizations claimed was "brinkmanship" on the part of the Europeans. John Hilary of Save the Children said that the whole controversy over the terminology was a red herring to keep the developing countries' negotiators away from European gains in farm subsidies and the environment.

Europeans won a delay on phasing out farm subsidies-an important point for the French government, facing elections, and an official link connecting WTO regulations to concern for the environment.

Also late Tuesday night a senior Nigerian delegate, claiming to speak for all of Africa, attempted in a closed-door heads of delegation session, to "re-open negotiations on every single paragraph the text," according to a diplomat who was present.

A WTO official said that Moore, a New Zealander who is a lame-duck Director General with his successor-Supachai Panitchpakdi of Thailand- already appointed, pulled Maran from a marathon heads of delegation meeting and pressed him hard for an agreement. The Qatar-based al Jazeera TV network said that while the last minute talks were going on in Doha, US President George W. Bush and British Prime Minister Tony Blair called Indian Prime Minister Atal Bihari Vajpayee to persuade him to instruct the Indian delegates to sign.

Maran late Wednesday told the diplomats "We have expressed particular concern about entering into commitments in areas such as investment, competition and environment which are also not really trade issues."

Maran said that he had offered what he termed "minimal" changes in the draft final document and added, "in case even these minimal amendments are not carried out, we will not be in a position to join any consensus in the adoption of the draft declaration."

Wednesday evening, after the announcement of a WTO agreement had been announced, Maran said that the two-year exemption on investment talks was more than what was on paper, adding that "At the next Ministerial (meeting) nothing will happen. In WTO jargon this is called 'constructive ambiguity.' Nothing will start."

"The study process will go ahead," he said, implying that no true negotiations would be undertaken on the issues to which he objected.

Earlier in the meeting the delegates had settled most of the previously contentious issues. The argument over the patent issue, or the officially labeled "Trade Aspects of Intellectual Property Rights (TRIPS)" centered on two words: "Should" now reads, "While reiterating our commitment to the TRIPS agreement, we affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO members' rights to protect public health and in particular to promote access to medicines for all."

Although Western diplomatic sources said that the difference in the wording was marginal, the less developed countries pushed hard for the "should."

On agriculture, the document calls for "reductions of, with a view to phasing out of all forms of export subsidies, and substantial reductions in trade-distorting domestic support."

The United States has repeatedly contended that the loans it extend exporters are not "subsidies" but credits alone and that its extensive farm support program, including a $l70 billion package voted last month, do not "distort" the market and are allowable under WTO regulations. Developing countries have vehemently disagreed on both points and the issue remains unclear.

In a surprise move the Americans agreed to the document provision which stated that "Members will exercise particular consideration before initiating investigations in the context of anti-dumping and remedies on textile and clothing exports from developing countries."

The United States has been the most frequent invoker of the anti-dumping instruments, particularly in protection of its steel industry.

In the resolution of a potential banana war, European countries agreed to extend the waiver of free trade regulations that give preference to imports from Africa, despite the objections from Latin American countries that preferences of any sort go against the spirit of the WTO and in any case are highly detrimental to their own exports. The final declaration involves provisions that could allow appellate claims if the Latin American nations can show serious damage to their livelihoods.

The WTO meeting itself came under criticism last week when it accepted a decision to appoint six "friends of the chair" (FoC) to take the pulse of the membership on key issues and report back to the plenary.

Developing countries pointed out that none of the "friends" was elected by anyone and that their deliberations with members were behind closed doors.

The United States delegation came under private criticism and public praise-criticized for literally bulling its way around the forum with crew cut security agents knocking into delegates, while the US was praised for its honest broker assistance on some of the toughest issues.

"The United States applied absolutely no pressure" on the banana negotiations, for instance, said Bello. "Those days are past."

Diplomatic sources said the countries joining India in the complaints against the investment wording included, Jamaica, Barbados, Zambia, Cuba, Zambia, Dominican Republic, Belize, Uganda, Kenya, Gambia, Guyana and Grenada.