Supachai pessimistic on HK ministerial

The "level of optimism" over the likely outcome of the Hong Kong ministerial has dipped, World Trade Organisation Director-General Supachai Panitchpakdi has said.

With no agreements in sight on a number of technical issues, he warned that if things were not sorted out by July, there would not be enough time to finalise issues in time for the Hong Kong ministerial. Much, however, depended on the outcome of the OECD ministerial to be held in Paris.

"I have toned down my level of optimism mainly because the chairmen, despite working very hard, have not been obtaining the kind of results that they should be.... We need to break some deadlock at the OECD meeting," he told journalists in Geneva recently, adding that some of the problems holding up progress required political intervention.

The urgency is over the fact that the Trade Promotion Authority, which gave the Bush administration the mandate to negotiate on bilateral and multilateral trade issues without clause by clause approval by the Congress, is slated to end in 2007.

After that, multilateral negotiations will become difficult, given the issues the US Congress is involved with at the WTO.

Also, with each round taking longer to settle than the previous one, the issues needed to be settled fast, Supachai said.

It is expected that the issue of converting specific duties to ad-valorem duties in agriculture, which has been holding up progress in agriculture, will be settled at the OECD meet in Paris. After that, negotiations can move forward on other issues as well.

The five major issues are: agriculture, non-agriculture market access, services, rules, including trade facilitation, and special and differential treatment. The Hong Kong meeting, to be held between December 13-18, is to take a decision on these issues.

"There is a need to have a good first approximation by July, so that Hong Kong is not a repeat of Cancun (where too many things were left to the last minute). This round has more issues than previous rounds, which focused only on tariffs. This is a highly complicated round," Supachai said.

Adding that if this was not achieved by July, there would not be enough time to move through the autumn to finalise a deal by December.

Supachai, however, said not enough had been done in respect of special and differential treatment for developing and least developed countries.

"I am calling for a balanced treatment, of all five issues. But at the moment, I am relatively more concerned with how we handle the development dimension. Delegations are still debating procedures. In other areas, we are into actual negotiations," he said.