Chairman's Introductory Statement

Since the last formal TNC in July, we have continued and intensified our work aimed at establishing modalities in Agriculture and NAMA. Throughout the autumn, this work took on a new importance and urgency in the light of the global financial crisis, which continues to deepen day by day. From the discussion we had on 12 November at our informal Heads of Delegation meeting on the impact of the global financial crisis, the importance all Members attach to resisting calls for protectionist measures and to countering financial chaos by further organized, regulated and balanced trade opening through the Doha Round was very clear.

This was further amplified in the Declaration by the Leaders of the G20 when they met at their summit on the world economy and financial markets in Washington on 15 November. The Leaders underscored the critical importance of rejecting protectionism and not turning inward in times of financial uncertainty, and committed themselves to striving to reach agreement this year on modalities.

This Declaration by the G20, coupled with similar political exhortations at the highest level, including at the recent meetings of APEC Leaders and of LDC Ministers, provided the political impetus which we needed to advance our process aimed at establishing modalities. As I noted in the fax to delegations on 17 November, our task was thus to translate the political commitment into convergence on substantive issues in the short time available before the end of the year.

Over the last weeks, the efforts of the Agriculture and NAMA Chairs, the Chairman of the General Council and myself have been aimed squarely at this — convergence on substance. We have continued the tried and tested process we have used so far — bottom-up, inclusive and step-by-step.

On 6 December, revised texts were issued by the Chairs of Agriculture and NAMA. Those texts reflected the real progress we had made over the past months, and they were generally well received and brought us closer to our objective. This was followed by several rounds of intensive consultations to undertake a political testing of the chances of bridging the remaining substantive gaps in three key areas — Sectorals, the Special Safeguard Mechanism (SSM) and Cotton. These were not the only issues still open, not even the most important for many delegations, but without advancing solutions to these three, we would not stabilise the modalities texts overall.

At an informal TNC meeting last Friday, I reported that individual positions — and the position overall — had not changed significantly enough. My full report at that informal meeting was circulated to delegations in document Job(08)/132.

In my report, I noted that from a purely technical perspective, Members had not been that far from an agreement on those issues. But the assessment the Chairs and I made was that we had not detected the political drive to make the moves which would give the final push to the establishment of modalities.

In conclusion, I suggested that unless this dramatically changed in the following 48 hours — which was a time frame for which some leaders had asked — the reality was that calling Ministers to try to finalise modalities by the end of the year would be running an unacceptably high risk of failure which could damage not only the Round but also the WTO system as a whole.

I recognize that this situation is a disappointment for everyone, one that I fully share. However, we need to face reality and act in a way which is consistent with the responsibility we all share for the well-being of the multilateral trading system.

Looking ahead, our aims should not change. I do not believe that either the political will to preserve the achievements so far or even the necessity to do so will go away, even more so with the continuing deterioration of the economic situation. On the contrary, it will also become more and more important to reaffirm and defend the basic values of the multilateral trading system and to respect not only the letter but also the spirit of the rules.

In the light of this, I suggested last Friday that we should now focus on seeing how we gather the necessary political energy into next year and I have been holding consultations with this focus with the Chairs and a wide range of delegations since then.
From what was said in my consultations, it is clear that the goal which we all share is not only to consolidate the progress made across the negotiations, but also to strengthen the relevance of the WTO as a system which is more than a forum for negotiations.

In this respect, there are three underlying assumptions for our work on the DDA in early 2009 that stem from my conversations with Members:

1. We have a clear DDA mandate which should remain unchanged;
2. On Agriculture and NAMA we have two texts on the table that are result of thousands of hours of consultations; these should be preserved and work should continue starting from them; and
3. Starting in the New Year work should continue on Agriculture and NAMA to close the gaps which remain, but also there is more to the agenda than these two issues and that work should also benefit from new impetus on the rest of the areas.

Under these three assumptions, which I think are reasonably consensual, what I would put forward for your consideration is the following: a frame which would allow us to move on two fronts, on the negotiations but also on the wider front.

On the front of the negotiations:

• The Agriculture and NAMA Chairs should resume work at the beginning of the year, focusing on the areas which remain open and helping Members forge consensus; they will consult with delegations on how best to do this depending on the area and on the item; in Agriculture, I think we all know where the gaps remain and the Chair will be consulting on how to bridge them; in NAMA, the Chair will hold similar consultations, but I believe it is also worth digging a bit into numbers in order to have a better sense of the value of what is on the table and what remains to be done; the Chair will also be taking this forward with delegations at the beginning of the year;

• The Chairs of other Negotiating Groups will also proceed with their work; the nature of their work is different: some areas are already text-based, others are moving towards text-based, some require requests and offers, but I would suggest that they all build on the good work done until now from January onwards, and we will hear their reports shortly; and

• Some of you have also mentioned the idea of some sort of early outcomes and have mentioned areas such as Trade Facilitation, Duty-Free Quota-Free Market Access, Cotton or the banana issue. Trade facilitation is the one on which I have detected more consensus. My own sense is that whether we harvest it earlier or not, at the end of the day this pleads for accelerating the work on these areas in the coming months, starting with Trade Facilitation.
   

On the wider WTO front, I would like to put forward three elements for your consideration, which also stem from our discussions since Friday:

First, I believe that the WTO has a particular responsibility to follow up on the trade measures which been taken in the wake of the financial crisis; you all know that I have set up an internal Task Force to produce regular updates of these measures so that we have a better sense of the trade consequences of the financial crisis.

I am ready to report to you periodically on developments on that front in writing, as suggested by Egypt on behalf of the Arab Group and by Japan, also with the support of a number of other Members. My first report could come already this week.

I also believe it would be useful to provide a forum where this WTO radar picture could be discussed collectively; I do not think we need to reinvent the wheel so we could use one of the existing forums in the house to this effect: the Trade Policy Review Body. I have discussed this with the Chair of the TPRB, Ambassador Agah of Nigeria, and he is agreeable to this. We will be looking into a date during the second part of January when a first review among Members could be held on the basis of this radar picture.

Second, I believe we need to keep reviewing developments in the area of trade finance where the WTO early interventions have been useful in mobilising resources for this important area; trade finance is an area which seriously impacts trade flows for developing countries and we should remain vigilant and active.

Third, I believe we need to have a clear roadmap for work on Aid for Trade in 2009, culminating with the second Global Review before the summer break. We need to keep the focus on mainstreaming trade into Members' development policies and we also need to keep pressure on the mobilization of funds, which has been reasonably successful but where more could be done, in particular in view of the current financial crisis.

Looking into 2009, some of you have mentioned your desire to brainstorm over issues which are beyond the scope of the negotiations but which relate to areas interfacing the WTO. I agree with this. The only point I would make is that this may be a useful exercise, provided it does not distract us from our main objective of advancing the Round. I suggest we come back to this in the General Council sometime at the beginning of 2009.

A final point: in the New Year we will also have to discuss the next WTO Ministerial Conference, by which I mean our regular mandated Ministerial Conference; my own sense is that this need not be the big jamboree we have seen in the past, but rather a venue where Members take a strategic look at the future and steps to advance the goals of the organisation. On this issue, the General Council Chairman will consult with Members to get their views and take this forward.

In sum, while the year may end in disappointment, we should now gather ourselves and work in 2009 to demonstrate that the WTO remains as necessary and credible as ever. The world trading system needs the Doha Round to better respond to the needs and aspirations of its Members. Concluding the Round should remain our focus in 2009. But this endeavour takes place within a more global portfolio of WTO activities in which we need to keep investing. This task starts today.