World Trade Organization (WTO)

WTO Doha Round Bulletin - Update

Week ending 25 November 2005

Key Issues

State-of-play in the WTO Negotiations

With less than three weeks remaining till the 6 th WTO Ministerial Conference in Hong Kong (on 13-18 December) there are still wide differences in members’ negotiating positions, particularly on the issue of agricultural market access. As a result expectations for the Hong Kong meeting have been lowered, but members are still maintaining high levels of ambition for the outcome of the trade Round itself. With the gathering of Ministers from 148 member states, the Hong Kong meeting is an important opportunity to demonstrate political commitment to bridging the differences on key outstanding issues and paving the way for the successful conclusion of the Round in 2006.

In Geneva this week the Chairs of the separate negotiating committees are releasing their status reports on the areas of convergence and divergence in each of the negotiations, including in agriculture, non agricultural market access (NAMA) and services.

Agriculture

On 22 November, the Chair of the agriculture negotiating committee issued, on his own responsibility, a draft report providing a “factual summary” of where the agriculture negotiations sit at this point in time. The report highlighted the extent to which urgent progress is now required on market access, a core concern for the Cairns Group. While it seems to be generally accepted that members’ positions are currently too far apart for agreement to be reached on “full modalities” (the rules by which members will implement their commitments) in Hong Kong, there is widespread commitment to achieving as much as possible, and to setting a path for negotiations to be concluded by the end of 2006.

Non-Agricultural Market Access (industrial products)

On 22 November, the Chair of the Negotiating Group on Market Access (NGMA) distributed a factual status report on the negotiations, including an outline of elements on which Ministers may wish to focus in Hong Kong, based on a range of informal meetings held recently. In the report the critical objective for Hong Kong is for Members to reach a common understanding on the formula for tariff reductions, the flexibilities available for developing countries to exclude some lines from full formula reductions, and the method for converting unbound rates to base rates (for formula reductions). Furthermore, those three key issues are to be addressed in an “interlinked fashion”, with agreement on a detailed work plan for the period after full modalities have been established. The report also highlighted areas where there had been some convergence of views, mainly on technical issues such as determining ad valorem equivalents of non-ad valorem tariffs and the base year and reference periods for data. The Member-driven approach to sectoral negotiations was emphasised, while on Non Tariff Barriers (NTBs) the Chair noted the need for specific negotiating proposals. The Chair’s report will be incorporated into the WTO-Director General Lamy’s over-arching report, to be released shortly.

Services

In order to identify ways to improve the quality and coverage of services offers at the 6th WTO Ministerial Conference in Hong Kong, the Chair of Services Negotiating group has produced a well developed draft text for a Ministerial Declaration. The section of the services text dealing with objectives sets out, on a best endeavours basis, modal targets (cross-border supply, consumption abroad, commercial presence, and movement of natural persons), as well as systemic elements such as clarity in scheduling/classification, removal of GATS Most Favoured Nation (MFN) exemptions and elimination of economic needs tests.

In Australia's view, the draft Ministerial text needs elaboration in relation to the concept of complementary approaches, particularly setting targets for levels of ambition and plurilateral (sectoral) negotiations that identify the issues and sectors of most interest to Members. Complementary approaches are necessary to build on the existing request-offer process and deliver more ambitious outcomes. While three-quarters of the membership have participated in the request-offer process, the number of offers remains low and their quality is poor. To date, only 69 initial offers (covering 94 Members) and 29 revised offers (covering 54 Members) have been submitted by WTO Members.

Increasingly, progress in services negotiations is linked to developments elsewhere in the Round. The EC, for example, has linked strong outcomes in services to its ability to offer market access in agriculture. Brazil, on the other hand, has said that progress in services cannot be expected ahead of an indication by the EC that there will be a better offer on agriculture than the one it tabled on 28 October. Australia's services offers (initial for June 2003 and revised for May 2005) are amongst the best on the table and have allowed us to promote our services market access interests, as well as support our ambition in agriculture negotiations.

WTO Rules: Trade Remedies

The Negotiating Group on Rules (Anti-dumping, countervailing measures, subsidies and fisheries subsidies) has intensified discussions in the lead-up to Hong Kong, holding informal, smaller-group discussions in addition to the formal negotiating sessions. On 22 November the Chair of the Negotiating Group on Rules submitted a Draft Ministerial Declaration on Rules. The draft text proposes that the Negotiating Group accelerate the negotiating process on the basis of detailed textual proposals, and completes the process of analysing proposals on the Anti-dumping (AD) and Subsidies and Countervailing Measures (SCM) Agreements as soon as possible. It also proposes that the Chairman be authorised to prepare consolidated texts of the AD and SCM Agreements that shall be the basis for the final stage of negotiations.

Anti-dumping and countervailing measures are the most active area of the Rules negotiations. Some WTO Members want a substantial overhaul of the anti-dumping system, to lessen the right to such trade remedies to respond to imports which are injuring domestic industries. Others seek to defend their flexible use of anti-dumping measures. Australia’s position is in the middle of the spectrum. We are both a user and a subject of anti-dumping measures. Australia has sought to encourage transparency and clarification of anti-dumping practices, rather than prescriptive, mandatory rules which favour one practice over another.

Subsidy issues have received less attention from Members than anti-dumping, with a smaller number of proposals and fewer Members involved. The thrust of proposals have sought a strengthening of disciplines on prohibited subsidies and a clarification of the definitional aspects of subsidies. At the November/December negotiating session Australia will present an elaborated proposal on prohibited export subsidies.

While there is support for disciplines on fisheries subsidies to be strengthened, there is a need for more specific discussions on the structure of future disciplines and textual proposals. Members agree that special and differential treatment for developing countries needs to be included in any future disciplines.

Trade Facilitation

The Negotiating Group on Trade Facilitation continues to make good progress. After extensive consultations, members adopted a report by the Group which provides a summary of the progress of the negotiations to date and lays down clear markers for the path ahead after the Hong Kong meeting. The report includes language which enables the Group to move to text-based negotiations early after the Sixth Ministerial Conference, which should allow for a timely conclusion of the negotiations. It also reaffirms special and differential treatment, technical assistance and capacity building as key elements of the negotiations. The Chair’s report will be incorporated into WTO Director-General, Lamy’s over-arching report to the WTO General Council in early December.

Sixth WTO Ministerial Conference: 13-18 December Hong Kong, China

Information on preparations for the Sixth WTO Ministerial Conference

Meetings in Geneva (as at 23 November 2005)

NOVEMBER

24 Council for Trade in Services - Special Session

28 Dispute Settlement Body

28-29 Committee on Trade and Development

28 Trade Policy Review Body - Romania

29 Council for Trade-Related Aspects of Intellectual Property Rights

30 Trade Policy Review Body - Romania

30 Trade Negotiations Committee

DECEMBER

1 – 3 General Council WTO/AIR/2721

13 – 18 SIXTH MINISTERIAL CONFERENCE HONG KONG, CHINA

Contact Us:

Trade Policy Section
Office of Trade Negotiations
Department of Foreign Affairs and Trade
BARTON ACT 0221
Fax: (02) 6261 3514

or email trade.consult@dfat.gov.au

[More WTO Doha Round Bulletins]