The New Delhi ministerial, starting Thursday, is expected to give out signals for the medium-term future of the World Trade Organization. PASCAL LAMY, WTO Director-General, in an email interview with Jyoti Mukul & Sudheer Pal Singh, stresses the need for flexibility by members to achieve the aim of concluding the Doha Round of talks. Excerpts:
How far do you think the Delhi meeting will pave way for a conclusive ministerial on the Doha Round?
Events like the Delhi Ministerial are occasions for ministers to build trust and examine together how to take the negotiations forward; They are not about taking decisions, since this can only be done by the entire WTO membership. What will be discussed in Delhi is how to translate statements of political support for the Doha Round into concrete progress at the negotiating table. Governments need to examine how they wish to proceed towards building a global package. We will need to discuss issues such as how to accelerate work in other areas, including services, for example. When to conclude agreements in agriculture and industrial goods trade. How much ministerial oversight is required in the coming months. Answers to such questions will help sharpen our focus in the coming months, as we work to overcome the obstacles to a deal.
The Delhi meet is focused on processes and not content, in that it will bring all the groups together for concluding the Doha Round. Do you think key issues should also be discussed?
Often in such negotiations, the talking process is a proxy for talking substance. This distinction is, therefore, somewhat artificial.
What are the key changes in approach and attitudes of members since last year? Will that help in closing the Round by 2010?
With the US and Indian elections behind us, we have seen an intensification of political attention. The economic crisis has focused minds on the dangers of protectionism. Technically, work has continued in Geneva but, clearly, we will need to step up the pace if we are to get to a deal in 2010.
Will the sequencing of agriculture and Nama, followed by services, rules and other issues change?
Members have not agreed to the change in the sequencing but they have realised that we need a much clearer picture in areas like services, rules, trade facilitation, trade and environment or TRIPS. This means accelerating those negotiations, so that we get a better sense about the global Doha package.
Against the backdrop of economic slowdown, there has been a view that WTO negotiations would take a back seat, especially since there has been a move towards protectionism. Do you agree that recession and the ever-changing political positions of negotiators are the key impediments in the successful completion of the round?
I don't agree on either of these points. The recession has made concluding the Round more difficult in some ways, but also more imperative to contribute to growth and, thus, to development. Moreover, positions on matters of substance have not been "ever changing", but have remained firmly entrenched. There has been difficulty, but we have already agreed on 80 per cent of the substantive elements. We should concentrate on the remaining 20 per cent.
The reason we have not been able to conclude the Round is because we have a long list of 20 complicated topics on the negotiating table and we have over 100 members participating actively. This is without precedent. Moreover, many of the areas where convergence is needed are complex and politically very sensitive. Special Safeguard Mechanism (SSM) is one, the sectorals another, but so too are fisheries’ subsidies, Mode 4, anti-dumping or trade and environment. But these difficulties are not insurmountable. We can get to a deal with leadership, flexibility and a sense of common endeavour, which are at the heart of multilateralism.
Certainly, there has been some protectionism here and there, and we have to be vigilant against things turning more aggressive in this area. But to date, governments have not applied the sorts of heavy-duty protectionism that so crippled the global economy in the 1930s. They have not, largely, because WTO rules constrain them from doing so. Instead, they used a series of lower-intensity measures which are within the scope of WTO rules, at least for the most part. If anything, the economic slowdown has made the case for a Doha deal even stronger. We know that if we are to keep trade open, we have to keep opening trade, and so, that is what we are trying to do. Intellectually, ministers know this. Economically, it makes eminent sense. But in many governments, further trade opening at this time is not easy politics.
Do you think the December texts of Agriculture and NAMA should be the basis for further talks, or a change in the texts is required?
No one agrees with all elements of either text. But these documents represent years of work, immense effort and some very clever compromises. As G20 leaders said when they met in London last April, we should build on those texts to get to a final deal.
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There has been a lack of interest from the US so far in the development round. According to US reports, a majority of trade-related political positions remain unfilled in the US administration. It appears to be adopting a "wait and see" approach and pushing developing countries to draft concrete commitments even before modalities are agreed. Do you think priority is being given to trade enforcement, rather than trade policy formulation?
You have made several premises here which I don't necessarily accept. It would not be correct to say that the US in not interested in the development round. The US has already accepted a number of measures which will be of great benefit to developing countries – certainly on reducing subsidies and opening markets – and Washington has been an important player in Aid for Trade, contributing billions of dollars to developing country trade capacity building. It is true that the US needs to fill a number of important posts, including the post of Geneva ambassador. But Ron Kirk has been clear that the US has full negotiating capacity and is ready to engage and look for solutions. What we need now is to see negotiations in action, to test the words given by leaders and translate these into deeds.
The purpose of SSM to shield vulnerable agriculture sectors against unfair competition seems to have been forgotten, with attention being on a mechanism that is primarily volume-based, cross-linked to price declines and riddled with complicated conditions. Don't you think SSM should be made more easily implementable, with developing countries getting to control the impact of sudden agricultural import surges?
Everyone is clear that developing country farmers should be shielded from big import surges. Everyone is equally clear that exporters – including many in other developing countries – should not have normal trade flows disrupted by injudicious use of a safeguard. These two points are acceptable to everyone. The question is how that should be accomplished. We have a bit more work to do on the architecture – including how to ensure that the SSM can be employed easily, but not abusively – and on the numbers. But negotiators are working on this and a solution will be found.
India has raised concerns at various WTO fora in the past. Do you see easing of its position now?
To conclude a deal, all WTO members will have to show greater flexibility in the coming months, including India. But I do not see any indication that on matters of strategic national interest, India has changed her objectives.
India has made it clear that it will not agree to any change in the approach to Doha negotiations, referring to the recent proposal of skipping the modalities stage. The Indian commerce minister has called these approaches ‘euphemisms’. What are your views?
I don't think anyone is proposing skipping modalities. I think negotiators are interested in transparency. They want to know what they will get in terms of subsidies’ cuts, market access opportunities and so on. Some of these discussions take place bilaterally and there is a degree of probing to try and determine where sensitivities lie and where ambition can be achieved. Every government is seeking to determine this in some aspect of the negotiations or another. But such bilateral or small-group testing is nothing new. It's been going on since the Round commenced and it has been part of every multilateral round ever negotiated. At the end, it is about binding commitments. And who binds what needs to be known to all.
India wants the interests of least developed countries (LDCs) to be taken on board. Do you think so far this is an area which has not got much attention?
The issue of LDCs may not get much attention in newspapers, but in WTO these issues are on the front line. LDCs have already succeeded in making the case for much of what they originally sought – this is why they are the most vocal about concluding the Round. LDCs are not required to reduce tariffs or subsidies, nor to make offers in services. We know the LDCs will receive duty-free, quota-free, treatment in developed countries for at least 97 per cent of their exports. We know that in cotton – a product of considerable interest for many LDCs – subsidies will be cut even more deeply and faster than for other agricultural products in developed countries and that exports to those countries will be duty-free and quota-free. LDCs would like the cotton issue resolved and agreement implemented right away. These questions will be raised in Delhi, I'm quite sure.