HOPES FADE FOR DOHA MODALITIES MINI-MINISTERIAL IN MAY

WTO Members "have only a few weeks, not months" in which to conclude framework agreements on agriculture and industrial goods trade if they are to have any hope of concluding the Doha Round this year, the head of the global trade body said this week.

"This is a very tight schedule, but it is still doable," Director-General Pascal Lamy told the WTO General Council on 7 May. He claimed that the ongoing global food price crisis underlined the necessity of completing the round as soon as possible. "The conclusion of the Doha Round is more urgent today than it was yesterday," he said.

May "extremely difficult"

However, hopes are fading for bringing trade ministers to Geneva by the end of May to finalise 'modalities' deals with formulae and figures for subsidy and tariff cuts, as well as the terms for contentious exceptions to these. Slow progress in the farm trade talks has pushed back the release of a crucial negotiating text from the end of April to the middle of May.

That text, along with a companion draft deal on manufacturing trade, is supposed to become the basis for a 'horizontal' negotiating process of cross-sectoral tradeoffs, first among senior officials, and ultimately among ministers.

Following the meeting, WTO spokesperson Keith Rockwell acknowledged "it would be extremely difficult under this time constraint and given the importance of substance to this process to have such a meeting in May," reports Agence France Presse.

Echoing comments he made to ambassadors last month, Lamy told the WTO's top permanent decision-making body that "it is clear that the primary focus of the next weeks has to be on modalities in agriculture and NAMA." He pointed to ongoing work on services trade, where developed countries in particular have been eager to see signs of progress in parallel with the agriculture and NAMA negotiations (see related story, this issue).

Lamy added that the chair of the rules talks would come up with a "document which would not prejudice Members' positions" on controversial issues such as anti-dumping rules and fisheries subsidies. He repeated that Members risked a "big clash" during a modalities push over differences on whether to extend additional intellectual property protections to geographically-linked foods such as Roquefort cheese, as well as on whether patent applicants should be obliged to disclose any biological resources or traditional knowledge used in their inventions (see BRIDGES Weekly, 23 April 2008, http://www.ictsd.org/weekly/08-04-23/story2.htm).

High food prices raised

Sources report that many countries that spoke at the meeting alluded to global financial market instability and record high food prices as reasons for why it was particularly urgent to conclude the round.

China said that although negotiations in recent months had made "some progress," it was still "far from satisfactory."

"It would be difficult for us to succeed in the negotiating process if Members fail to bridge the gaps in the key areas of agriculture and NAMA," the Chinese ambassador said.

Paraguay stressed that rich country farm subsidy cuts should not be made conditional on exaggerated demands in return.

Taiwan urged countries currently searching for compromises on three crucial areas in the agriculture negotiations - 'sensitive' products eligible for gentler tariff cuts, expedited liberalisation for tropical products, and addressing preference erosion - to hurry, so that their work could be incorporated into the chair's forthcoming draft deal.

Brazil, one of the countries at the heart of those sensitive product discussions, said that the agriculture talks were moving in the right direction, but that industrialised nations needed to be more flexible on manufacturing trade.

The EU stressed the need to conclude the round by the end of 2008. EU Trade Commissioner Peter Mandelson this week called for the draft agriculture and NAMA texts to be circulated by "mid-May". Speaking to journalists in Brussels, he said that "If people ask me now or later, I say there may not be a later for this deal - it's got to be now." Mandelson said that the need for greater speed arose from the necessity of wrapping up a Doha Round agreement in time for US President George W. Bush to sign off on it before he leaves office in January 2009.

Lamy said that many Members shared the end of year target, and stressed that "putting the modalities in place very soon" was the only way to achieve it, "since it would leave us just enough time for scheduling [specific liberalisation commitments] in agriculture and NAMA and to wrap up the negotiations in the other areas."

Trade sources expect some haggling over the scheduling process, as countries express dissatisfaction with how their trading partners choose to translate the modalities into liberalisation commitments.

Directly addressing global food prices, Lamy said that "although the WTO cannot provide anything immediate to help solve the current crisis, it can, through the Doha Round negotiations, provide medium to long term solutions."

"A WTO deal could help soften the impact of high prices by tackling the systemic distortions in the international market for food," he explained. Trade barriers and trade-distorting subsidies, particularly in developed countries, "have hampered food production and investment in agriculture in many developing countries." These barriers and subsidies stand to be reduced as part of any Doha Round deal.

Once the draft agriculture and NAMA texts are released, sources expect them to be reviewed in the respective issue-specific negotiating committees (although some countries would prefer to skip this step). If all goes smoothly, the horizontal process will then begin.

As for the potential timing of a ministerial meeting, officials were until recently saying that if there was not a gathering in May, one might not be possible before late June or even July, due to Asia-Pacific Economic Cooperation (APEC) and Organisation for Economic Cooperation and Development (OECD) summits, followed by the 7-29 June European football championship in Switzerland and Austria. Now, different schools of thought exist on the matter, with some suggesting that a June meeting might be possible.

ICTSD reporting; "WTO sees no ministerial meeting in May as trade talks still bogged down," AGENCE FRANCE PRESSE, 7 May 2008.