DDG Agah’s speech at the 8th Ordinary Session of the African Union Ministers of Trade
24 October 2013

Mr. Kebede Chane, Minister of Trade of the Republic of Ethiopia,

Madame Fatima Haram Acyl, Honourable Commissioner for Trade of the African Union,

Mr. Carlos Lopez, Executive Secretary of UNECA,

Dr. Mukhisa Kituyi, Secretary General of UNCTAD,

Madame Arancha Gonzalez, Executive Director of ITC,

Honourable Ministers of Trade,

Distinguished Ambassadors,

Delegates,

It gives me great pleasure to address the 8th Ordinary Session of the Conference of African Union Ministers of Trade.

I am here today representing the Director-General of the WTO, Roberto Azevêdo who has been unable to participate in this meeting. This has been communicated to the AU Commissioner, Madame Acyl.  Before I start with my formal statement, allow me to deliver, at the request of DG Azevêdo, a special message to you.  It reads as follows:

 

SPECIAL MESSAGE FROM THE DIRECTOR-GENERAL

Honourable Ministers,

Please accept my sincere apologies that I cannot be with you today. As you know, negotiations towards an agreement for the 9th Ministerial Conference of the WTO are reaching a crucial stage. So instead of joining you today in Addis Ababa, I am working for you day and night here in Geneva; doing everything I can to achieve a successful outcome for Bali, which has Africa’s interests at its heart.

There are significant development issues on the table, which recognise the needs of developing countries and of the least-developed countries. But I believe what is truly at stake here is not contained in the articles and declarations of whatever is decided in Bali. What is at stake is the future of the WTO and the future of the multilateral trading system itself.

I believe that this system serves you. Developing nations stand to gain the most from the multilateral trading system, and smaller nations, which have fewer options open to them, are particularly at risk if the system fails. So it is vital that we make it work. We have to make sure that the system can deliver for you.

In order to do this, it is essential that we reach agreement at the Ministerial Conference in Bali. That agreement would breathe new life into the WTO and allow us to move forward together and address the broader issues which are so important to you, but which have been stalled for so long. 

The position of African Union members is well understood in Geneva. You should continue to be tough and voice your concerns. And let me assure you that your messages have been heard — loud and clear.

But, at this late stage, points must be made in a way that allows us to find convergence. We are now in the final moments of the negotiations for Bali, and the position is finely balanced. Now is not the time to be drawing hard lines. Now is the time for convergence. This is zero hour — this is the time to find solutions.

I believe that we can secure the outcome that the multilateral trading system needs, but of course my role is simply as a facilitator. The decisions lie with you, our members.

I wish you success in your deliberations in Addis Ababa, and hope that we can all meet in Bali to adopt the package. I look forward in the very near future to reporting back to African Union Ministers, in person, on an agreement in Bali and working with you post-Bali to finalise negotiations on the entire Doha Development Agenda and to start tackling other issues that members feel need be addressed. 

I urge you to seize this opportunity.

Madame Commissioner, I request that through you, this message also be conveyed to the Chairperson of the African Union Commission.

Yours sincerely, Roberto Azevedo.

This concludes the message from the Director-General.

Building on the Director-General’s message, I would like to provide you with some more detail on the state of play in Geneva today.

But before I do so, let me take a few moments to pay tribute to the valued and much respected relationship the WTO has with the African Union Commission and its Permanent Representative Office in Geneva. 

The WTO works very closely with the African Union office in Geneva — under Ambassador Ehouzou’s astute stewardship. The WTO, as some of you may know, hosts the WTO African Group’s weekly coordination meetings — allowing the group to discuss topical issues of interest and, where possible, to agree to common positions. 

In my view, this has been an important factor in the African Group’s ability to influence various negotiation areas, not only in the Doha Development Agenda as a whole, but in the Bali preparations in particular. This is a mutually beneficial relationship — and long may it continue.

Turning again to Bali, I want to echo the Director-General’s message — success will depend on convergence and, therefore, on political will. 

Let me now spend a few moments on the issues that WTO members are dealing with for Bali.

On agriculture, members are working on ways to enable developing countries to respond to their food securityneeds.

I know that the need to preserve food security and the interests of Net Food Importing Developing Countries are central to the African Group’s priorities. 

The G-33 — of which some African Group members are also a part — has led this discussion — and the parameters for a solution are developing.

Members are zeroing-in on what can be termed a “due restraint” solution — which will, on an interim basis, allow them to meet their food security needs, as the broader negotiations on agricultural reform continue.

I am aware that you have a deep interest in the longer-term solution. But the logic of banking this solution now is compelling. We can then look towards a longer term solution, which I believe many members are prioritizing for post-Bali work.

Members are also seeking to improve the administration of tariff rate quotas — which, we must recall, are a core tool in managing global agriculture trade.

In addition, members are tackling issues around the 2005 Hong Kong Ministerial Decision to eliminate export subsidies by 2013. 

The African Group has traditionally been an ardent supporter of agriculture reform and, in particular, of eliminating export subsidies to give a fairer chance to producers to compete. 

I urge you to support this work, so that we can lay the foundation for a broader discussion that can hopefully address this issue in a more sustainable manner post-Bali.

Let me now turn to trade facilitation. 

As you know, the numerous behind-the-border measures, bureaucratic hurdles, customs procedures, formalities and unclear rules governing various aspects of trade represent some of the key barriers to international trade.

Indeed, they are also identified as key stumbling blocks for priority action in the African Union’s Action Plan for boosting intra-African trade. A WTO Trade Facilitation Agreement is widely seen as positive in locking in the much needed reforms that will, over time, improve trade efficiency of all WTO members.

I know you are concerned that the proposed Trade Facilitation Agreement should be internally balanced. And I urge you to engage on what a pragmatic solution might look like.

In this context, it is worth recalling the novel approach to special and differential treatment that is proposed in the draft Trade Facilitation Agreement — that is to say, the notion of self designation in the scheduling of commitments in section II.

The fact that you will decide individually which of the commitments come into force, and when, is extremely important and should not be overlooked.

I am aware that there are concerns about how to resolve the need for technical and financial assistance to support implementation of the proposed measures. Linked to this is how to deal with situations in which assistance is not forthcoming.

I encourage you to continue discussions on these issues with members to see how you can find a mutually satisfactory conclusion. 

To that end, you may wish to empower your negotiators to consider all possible options, including on how to provide African countries with an honest and fair independent assessment of their acquisition of capacity to implement as well as additional flexibilities for least developed countries (LDCs).

The WTO has worked with many African countries to identify, confidentially, what the situation is with regard to trade facilitation measures, and where the gaps are, so that there can be clarity on countries’ needs. 

Members should think creatively about how to make use of the results of these needs assessments as a blueprint for support for implementation. 

I would also like to take this opportunity to note and welcome the recent Statement by the Heads of the World Bank, IMF and the Regional Development Banks — including the African Development Bank. 

They pledged their commitment to prioritize funding to support implementation of a WTO Trade Facilitation Agreement. 

The recent call for proposals for the African Development Bank’s Africa Trade Fund (AfTra) is a very welcome initiative.  The trade facilitation focus of some of the projects that could be funded, such as the creation of one stop border posts, modernization of customs and ports systems, development of corridors, and enhancement of border management, rings very closely with the trade facilitation measures you are negotiating in the WTO. This is a very timely and much welcome initiative.

Next, let me turn to the development aspects of the negotiations.

In this area, members are in the final stages of defining the terms of reference, scope and functions of a Monitoring Mechanism on special and differential treatment. This evidence-based and neutral Mechanism will keep a spotlight on special and differential treatment, allowing you to bring challenges of implementation to the fore, for consideration by members. 

The fact that deliberations in the Monitoring Mechanism could result in recommendations, including for opening negotiations on special and differential treatment provisions, is important — giving you an avenue to correct inadequacies where they are found.

Finally, regarding the LDC package, members are in the closing stages of considering the rules of origin proposal which sets guidelines to preference grantors that can be used in preferential market access to LDCs. 

LDCs have also tabled their proposal on implementing the services waiver which details a post-Bali process that will kick-start the implementation process. 

We have also been consulting on other issues like duty‑free and quota-free market access and I am hopeful that we can have a result which adds value. I would encourage the Cotton 4 to make haste in sharing their positions with members.

So that is where we stand today.

I know I do not need to reiterate the importance of this package or the urgency of the task at hand.

But let me repeat this point — the post-Bali agenda, which we all want to talk about, would be lost without Bali itself. We have to make this work.

Success in Bali is critically important in allowing the WTO to once again take its place at the centre of the world stage, managing global economic stability through setting and developing global trade rules.  

We all know the alternative: regional trade pacts. But you would agree with me that a multilateral approach holds wider benefits for all. I believe that the interests of African countries are far better served by the multilateral trading system.

So we need a strong WTO, and an urgent step in ensuring this happens is a successful outcome in Bali.

To conclude, Honourable Ministers, I urge you to throw your weight behind the success of Bali. The Director-General has written to all of you, seeking your political support for success in Bali. I am confident that you will respond positively to this call.

Thank you.

 

DDG Agah’s speech at the ACP Ministers Meeting
9 October 2013

Honourable Ministers,

Distinguished Ambassadors,

Delegates,

Ladies and Gentlemen,

It gives me great pleasure to address this Opening Session of the meeting of ACP Ministers responsible for international trade.

I bring you greetings from the Director-General of the WTO, Mr Roberto Azevêdo, who would have loved to be here in person, but has had to be elsewhere. You will recall, however, that he was part of your preparatory meetings in Geneva on 25 September — and had the opportunity to interact with your Ambassadors and experts on that occasion.

The WTO has a long-standing relationship with the ACP — and the two have a lot in common.  Both organizations advocate free and open trade, and both are convinced about the important role that trade can play in economic development. I believe this meeting is evidence of the importance the ACP attaches to the multilateral trading system. The ACP Group is one of the most effectively coordinated groups in the WTO, and this has allowed you to impact on various negotiation positions. I would, therefore, like to take a moment to congratulate Ambassador Wayne McCook for the effective manner in which he handles this group.

Today, I come to you with a call for political will for success in Bali. With barely 38 working days left to the Bali Conference, your Ambassadors and senior officials have been working intensely in various configurations. We have made progress, but a lot of work remains to be done. You, Honourable Ministers, would need to throw your weight behind this — for the success of the multilateral trading system.

Let me spend a few moments contextualising what is at stake. And here, I would like to remind you of the overall economic context in which we are operating — and how success in Bali would contribute to steadying the ship towards a global recovery. Let me emphasize that the contrary, that is, no success in Bali, would spell further turbulence for this ship — which should not be a preferred option for any of us.

Recently, the WTO reviewed downwards its estimates for world trade growth. For 2013, we predict a growth rate of just 2.5 per cent, down from the 3.3 per cent forecast in April and closer to the 2.3 per cent rate seen in 2012. For 2014, trade growth is expected to accelerate, but there too, the rate has been revised down to 4.5 per cent from the earlier 5.0 per cent forecast. Predictably, these downward revisions in trade are accompanied by a slight downward revision of world GDP estimates.

However, it is not all bad news. The green shoots for a trade recovery are beginning to surface. For example, developed economies are starting to show signs of recovery; demand for imports in developing countries has remained resilient and continues to offset the drop in developed economy imports. Trade is registering some acceleration, but it remains below the 5.4 per cent average growth rate of the past 20 years. 

Of course, there are many reasons for the downgrading of the estimates of world trade growth. To a certain extent, it has to do with macroeconomic shocks. But the steady increase in protectionist measures is also playing its part in holding back the recovery.

While the latest WTO report on G-20 trade measures showed that the cumulative trade impact of import restrictions since October 2008 is estimated at around 0.2 per cent of G20 trade, this should not create the impression that protectionism is no longer a threat. Protectionism remains a major threat to global trade and increasingly gets more complicated as its conduit is no longer the tariffs, export subsidies and other traditional trade policy tools that we have all got accustomed to seeing. The new face of global trade protectionism lies in complex regulations behind the border, which manipulate grey areas in WTO agreements.

Against this backdrop, the conclusion of the Doha Development Agenda (DDA) is more significant now than ever before. We should put an end to the cumulating delays in its conclusion. The delay in concluding the current round of negotiations has produced a disconnect between trade disciplines and trade practices, often eroding the liberalization gains achieved in previous rounds. The monitoring and dispute settlement functions of the WTO have been crucial in keeping protectionism at bay, but we need to urgently re-activate the rule-making pillar of the WTO to close the gaps that allow protectionist measures to seep through.

Success in Bali is, therefore, a critically important shot-of-faith into the multilateral trading system — that will allow the WTO to get back to its centre-stage place in managing global economic stability through updating the global trade rule book. 

The ACP Group needs little convincing of why the multilateral track is the most optimal solution for trade liberalization and regulation. We have seen the plethora in free trade agreements (FTAs) and we have also seen that smaller players like the ACP — still at the margins of global trade — are left out. 

Bali is therefore a necessary first step in what can be viewed as the re‑igniting of our collective effort to continue tackling trade barriers — the most sensitive of which, as we have all seen, are only doable in a multilateral context.

While the issues currently on the table for Bali may not directly address all market access and regulatory concerns, they are nevertheless important. In fact, Ministerial approval of these issues will send the crucial political signal necessary to give back to the multilateral trading system its proper place in managing global economic stability.

Let me now take a few moments to touch on some of them.

On agriculture, members are working on ways to enable developing countries to respond to their food securityneeds. The G-33 — of which some ACP members are also a part — has led this discussion — and the parameters for a solution are developing. Members are zeroing-in on what can be termed a “due restraint” arrangement — which will, on an interim basis, allow them to meet their food security needs, as the broader negotiations on agricultural reform continue. Members are also seeking to discipline the administration of tariff rate quotas — which as you know, is a core tool in managing global agriculture trade.

Thirdly, members are tackling the feasibility of a down-payment on the 2005 Hong Kong Ministerial Decision to eliminate export subsidies by 2013. Overall, things are moving, but nothing is agreed yet, and there is very little time left. I would hope that the ACP — which has always been an ardent supporter of agricultural reform — sees the opportunity of this incremental but important step in the broader picture of reforming global trade in agriculture.

Let me now turn to trade facilitation. As you know, the numerous behind-the-border measures, bureaucratic hurdles, customs procedures, formalities and unclear rules governing various aspects of trade represent some of the key barriers to international trade. A Trade Facilitation Agreement is widely seen as positive in locking in the much-needed reforms that will over time improve trade efficiency of all WTO members.

I know that you have had some concerns about section II of the proposed Trade Facilitation Agreement — in particular, the need for a strong commitment on the provision of technical and financial support for implementation. I know your group has tabled some proposals in this regard, and I encourage you to continue discussions with members to see how you can concretely bring closure to this issue. On our part, we have been trying to ensure that the work is organized in such a manner as to accommodate the interests of all delegations, especially the smaller ones, and that there is a balanced allotment of time for discussions on both section I and section II in the hope that this can allow the opportunity for members to make progress on both issues.

Let me also point out the novel approach to special and differential treatment that is proposed in the draft Trade Facilitation Agreement. The fact that you will decide individually which of the commitments come into force and when they do is extremely important — and should not be overlooked. The WTO has worked with many of your countries to identify, confidentially, what the situation is with regard to trade facilitation measures, where the gaps are so that there is clarity on what the needs are. Members need to think creatively about how to make use of the results of these needs assessments as the blueprint reference point for support for implementation. I can assure you of the Director-General’s commitment, in his capacity as Chair of the Trade Negotiations Committee, to finding ways to resolve this outstanding issue. 

As you know, we are also working on development issues — and in this area, members are in the final stages of defining the terms of reference, scope, and functions of a Monitoring Mechanism on special and differential treatment. I am encouraged by the flexibility that is being demonstrated on all sides and I hope that concluding this soon will free up some bandwidth to finalise other issues on the table for Bali.

Regarding the LDC package, members are having technical discussions on the rules of origin proposal that was submitted by least developed countries (LDCs). They are also waiting for more proposals on implementing the services waiver, duty‑free and quota-free market access and on cotton. I would just point out that time is not on our side and I encourage LDCs — many of whom are also in the ACP Group — to make haste in sharing their positions with members. We all know that Bali cannot fail to deliver for the weakest segment of the global trading community.

Overall, I would say the road is getting clearer and members have a sharper sense of the remaining issues. But time is not on our side. We have barely 38 working days to reach consensus. Ambassadors and experts in Geneva are engaging intensely. Now we need your support as Ministers.

The Director-General has written to all of you, seeking your political support for success in Bali. I am confident that you will respond positively to this call.

Thank you for the invitation, and for your attention.