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Report by the Chairman of the Trade Negotiations Committee

When I reported to the General Council in December last year the focus was on reviewing and evaluating the year 2009. In my report I noted that, overall, last year saw technical progress across the WTO’s negotiating agenda, but that the necessary political will to propel us to the finishing line remained absent. During their deliberations at the 7th Ministerial Conference in December, Ministers were unanimous in calling for 2010 to signal a change of gear and endorsed a continuation of the senior officials process which had provided an important forum for discussion in the last quarter of 2009 following the Delhi meeting.

In my report to you today, however, I wish to look forward as we move towards the stocktaking exercise at the end of March. In this context, let me provide you with a brief overview of my most recent activities as Chair of the TNC [Trade Negotiations Committee], including the activities during last week's meetings among senior officials.

As you all know, the President of the Swiss Confederation hosted the traditional informal ministerial meeting at Davos at the end of January. I understand that the Swiss mission has circulated the personal concluding remarks of Mrs Leuthard. The purpose of the meeting was to assess where we stand in the Doha Round and what is needed to reach our target. From the discussions among Ministers present in Davos as well as from my meetings with individual members a number of important messages were underlined.

First, in relation to the DDA [Doha Development Agenda], I detected an unwavering commitment to the progress achieved to date as the basis for entering into the last stage of the negotiations. Unravelling the hard-won progress made in the negotiations would not be an option if we want to conclude the Round. There was genuine concern that time is not our friend and that further delay will only increase the risks of back-tracking.

Second, Ministers at Davos reiterated the importance of continued ministerial attention over the coming weeks as senior officials intensify their work in order to prepare for such an exercise.

Third, in the context of the global economic crisis Ministers pledged to continue to resist protectionist pressures. I informed Ministers that at the last TPRB [Trade Policy Review Body] meeting on 22 January 2010, all members had welcomed the contribution made by the WTO's monitoring of trade and trade-related measures and had asked me to prepare two reports for this year - one in June and a second one in November. I also informed them that, in addition to the general monitoring of relevant measures taken by members and Observer Governments, the WTO Secretariat will continue to prepare (jointly with the OECD and UNCTAD Secretariats) reports on G20 trade and investment measures, as requested by G20 leaders. The next such report is expected to be ready in early March and, as usual, it will be made available to all.

Since then I have had meetings with a number of Ministers and leaders, including members of the Australian government and the new EU Trade Commissioner. These meetings have re-enforced my sense that capitals remain engaged and committed to injecting momentum from the political level into the Geneva process.

Last week I held consultations in various formats, including a Green Room meeting. The purpose of these consultations was to briefly share with participants our impressions of where we stand in the negotiations at this point and to initiate preparations for the stocktaking, including an exchange of views on its purpose, its content and its format. Even if we do not need to close on all the details of the stocktaking at this stage, I think that we now have a clearer sense of the direction in which we are moving.

The stocktaking was meant to assess whether or not a conclusion of the Doha Round in 2010 would be doable and we collectively thought this had to be done after MC7 [Seventh Ministerial Conference]. In my view, the 2010 question has two components — a solid technical preparation and a political determination.

On the state of play in the bilateral and multilateral processes my sense is that, although some progress is taking place, gaps remain. At this stage we do not yet have a clear sense of the size of these gaps and we would certainly need to have a better sense by the stocktaking at the end of March.

On the latter point, the political decision about 2010, I believe this is a judgement that belongs to Ministers and that, on this specific issue, engagement will be needed. Given where we are right now, it is also clear, however, that the end of March is too early for that.

Given where we are, I believe the stocktaking provides an important opportunity to inject the political energy and momentum in the negotiations so that we can hopefully chart the path for cracking the remaining nuts. I believe that this exercise is best undertaken by senior officials at this stage.

At the stocktaking we should identify progress made until now at the technical level and the outstanding gaps. On the multilateral side this could be done by the Negotiating Chairs in factual reports to the TNC under their own responsibility according to standard practice. With respect to the work taking place bilaterally among a number of you, I believe that by the time of the stocktaking, and given the bilateral engagement taking place in the meantime, we should have a clearer sense from participants on the gaps in their positions as well as a clearer sense of a negotiating dynamic to address these gaps.

At the stocktaking we would therefore have a better sense of where the gaps remain, the size of these gaps, as well as the dynamic to address them. This would enable you to report to your Ministers and decide after further consultations on how best to address the next steps post-stocktaking, which will need political guidance.

In terms of timing, the dates being considered for the stocktaking are 29 and 30 March. This would provide delegations and Chairs with the week starting 22 March for any further consultations to prepare the stocktaking.

This, Mr Chairman, is my sense of where we stand at this juncture vis-à-vis the stocktaking. Let me now turn to a brief outline of the state of play in the different negotiating groups.

In Agriculture, work continues on two tracks — templates and on the bracketed or otherwise annotated issues in the draft modalities. On templates, and on the associated work on base data, Step 2 has been engaged to draw up drafts of the actual proposed formats for the scheduling process and members are actively involved. There has been progress on base data and its verification. In particular, there is an agreed definition of the Value of Production, which is fundamental to commitments on OTDS [overall trade-distorting domestic support]. On the modalities, the Chair has continued his consultations, especially in the area of SSM [Special Safeguard Mechanism] where some technical issues are under discussion, including on the basis of submissions from members. Consultations are also continuing on tariff simplification, TRQ [tariff rate quota] creation, tropical products and preference erosion.

Ambassador Walker will again convene open-ended informals in the first weeks of March on templates and base data. In addition, he will consult on the bracketed and otherwise annotated issues in the draft modalities, including again SSM, other market access matters and also cotton. During this period he also will engage with members on the work plan. And, of course, he remains available for “confessionals” on technical ambiguities in the draft modalities.

On NAMA [non-agricultural market access], the Negotiating Group on Market Access met during the first week of February to pursue discussions on several NTB [non-tariff barriers] proposals. I understand that the exchanges were good, business-like with members engaging. Clearly NTBs is not an area where results can be achieved quickly and there is a need for much more discussion and clarification. But I understand that we are moving into a text-based discussion on some of these proposals. The Group is meeting again the week of 15 March where the objective will be to make further progress on these texts in order to get them to a higher level of maturity. The Chairman has called for input which takes account of the work done during this recent NAMA week and I hope that members will be in a position to respond by the end of this month.

I understand that the Chairman has categorized NTB proposals into Wagons I or II of a train. Wagon I proposals are those which have been highlighted as meriting particular attention in the draft modalities text as well as the two more recent proposals which look at the cross-cutting issues arising from the TBT [technical barriers to trade] related sectoral proposals. The Wagon II proposals comprise all the other remaining NTB proposals. The Chairman intends to hold consultations on how to address this group after the 15 March NAMA week.

Since the beginning of the year, the Services negotiations have addressed market access, rule-making and the text of a draft waiver for LDC [least-developed countries] preferences. A two-week negotiating cluster was completed last week, during which these three topics were fully covered.

On market access, there have been few surprises. Little if any substantive progress has been made. What progress there is has been mainly in the nature of technical clarifications of offers, or of signals made by Ministers in July 2008. On rule-making, there has been some forward movement. The Chair of the Working Party on Domestic Regulation will issue an annotated version of the Chair's text to serve as a basis for future negotiations. In the Working Party on GATS [General Agreement on Trade in Services] Rules, there is now agreement to proceed with the gathering of information on services subsidies to serve as a basis for future discussions on this subject.

The Chairman of the Special Session held consultations in late January on the issue of a waiver mechanism to grant preferences to LDCs. The small consultative group led by Norway has produced a draft text of a waiver, which was circulated to all members and discussed at the Special Session held on 9 February. The text contains several elements on which agreement has yet to be reached, not least of which are the scope of the waiver and its duration. In the weeks ahead, the Chairman of the Special Session intends to continue his efforts to drive forward the discussion on this topic.

Looking ahead, members have agreed to a further meeting of the Special Session on 15 March, that will focus on the issue of an appropriate input for the stocktaking. In the meantime, the Chairman of the Special Session will continue to consult on this matter, including through his usual Enchilada consultations.

In the Rules area, the Negotiating Group continued its work with a meeting in late January dedicated to horizontal subsidies and fisheries subsidies. Having completed its review of the fisheries subsidies roadmap late last year, the Group at that meeting began consideration of new proposals from delegations presenting alternative approaches to fisheries subsidies disciplines. The Group's next meeting, to take place in the first week of March, will complete the Group's review of the Chair text on anti-dumping, with a discussion of the remaining bracketed issues. A further Rules cluster, covering all three areas, will take place in early May, back-to-back with the Rules Committees. At that meeting, the Group will continue considering proposals from delegations presenting alternative approaches to fisheries subsidies disciplines, including on special and differential treatment. In conjunction with that meeting, the Chair has also scheduled a panel discussion with the FAO [Food and Agriculture Organization] on international fisheries management instruments and their implementation.

With regard to Regional Trade Agreements, the Chair will hold a meeting in March 2010.

On Special and Differential Treatment, work in the CTD [Committee on Trade and Development] Special Session, has resumed in 2010 with the consideration of elements of the Monitoring Mechanism. This work is continuing on the basis of the Chairman's revised non paper of November 2009 with the objective of bridging the remaining gaps and removing brackets, wherever possible. There are still a number of areas where members will need to find common ground. The Chair plans to intensify work in the meetings scheduled through February and March and based on the progress made, he hopes to revise his non-paper by the time of the stocktaking.

The Chairman has indicated that he is also prepared to revisit the Agreement specific proposals, on some of which areas of divergence are quite narrow, as soon as members are ready to put forward new ideas and language that will enable progress. The Chairman will also be working in close collaboration with the relevant Chairpersons to determine the best way to coordinate and ensure progress on the Category II proposals which are being addressed in other WTO bodies.

In the area of Trade and Environment, consultations have been conducted by the Chair on different aspects of the mandate since the beginning of the year, and the Committee held an informal open-ended meeting last week on 18-19 February.

On the issue of the relationship between WTO and Multilateral Environmental Agreements (MEAs), the Work Programme calls for text based negotiations to begin and, to this end, further work will have to be undertaken in the coming weeks, based on the proposals on the table, to develop language that can be acceptable to all.

As regards the mandate on environmental goods and services, a number of new submissions — such as that of Saudi Arabia, the Philippines, Japan — were put forward and discussed at the CTESS [Committee on Trade and Environment Special Session] meeting last week. These submissions further contributed to the process of identifying environmental goods of interest to members pursuant to the Work Programme. As a next step, the Chair will be working towards developing a compilation document based on members' inputs on environmental goods of interest to delegations.

In the area of Trade Facilitation, members were able to make a considerable step forward by coming up with a first draft consolidated negotiating text (TF/W/165). While still work in progress, with a significant amount of further negotiation yet to be done, this marked a clear sign of advancement in that delegations are now in a position to base their future work on a single, legal text.

The current draft still requires a lot of refinement and “cleaning-up”. Members had an opportunity to advance this process during the second week of February with a first run through the consolidated text. This will be continued, and intensified, in the context of the Group's second meeting cluster, which is scheduled to take place at the beginning of March.

By the time of the stocktaking, members will have been able to complete their first round of revisiting the entire negotiating text. Opportunity for subsequent, in-depth reviews will be given in the course of two further meetings in the period up to July. This process aims at advancing the substantive work of the Group that still needs to be done. The current text needs to be streamlined by reducing the number of square brackets and eliminating duplicative elements. Negotiations have to intensify on all elements of the draft, especially with respect to the area of special and differential treatment.

As far as the DSU [Dispute Settlement Understanding] negotiations are concerned, a first round of discussion of all issues has now almost been completed, based on the Chairman's text of July 2008. At an open-ended informal meeting of the DSB [Dispute Settlement Body] Special Session on 5 February, the Chairman reported on the most recent work and took stock of the state of play and way forward. He noted that it has been useful to discuss all the draft legal text and consolidate the basis for the work.

On that basis, the Chairman proposed to start a more intensive process, in which it would be necessary for delegations to engage on the basis of the comments received in the previous phase. Over the coming months, he proposed that the work be conducted around group meetings in variable geometry depending on the topic to be discussed. This would combine meetings convened by the Chair and space for meetings among delegations.

With respect to TRIPS [Trade-related Intellectual Property Rights] Special Session, informal group consultations were held on 4 February, followed by an open-ended informal meeting on 5 February. Delegations reiterated their appreciation of Ambassador Trevor Clarke's report contained in TN/IP/19 as a fair and balanced reflection of the state of play and remaining challenges. While the five guiding principles for the way forward that are suggested in that report were considered as useful for future discussion, the view was expressed that they should not be used as a basis for negotiations nor as a reason to continue rhetorical debates on certain issues such as the meaning of “to facilitate protection” or “multilateral system”. It was generally agreed that the Special Session would proceed by clusters of issues as has been done in the past and that technical work on practical examples of, or concerns with, the implementation of the different proposals in different countries would be most useful. Several delegations indicated willingness to make or further develop case studies, examples and scenarios. The Special Session will hold a formal meeting on 4 March well ahead of the stocktaking.

Turning to the two TRIPS issues on which I have been mandated to pursue consultations as Director-General, not as Chair of the TNC — the relationship between TRIPS and the Convention on Biological Diversity and the extension of Article 23 GI [geographical indications] protection — I would like to refer to the report I made at the 17 December 2009 meeting of the General Council. It is my intention to convene another round of consultations on 5 March and to report to delegations at an open-ended informal meeting on 12 March.

Mr Chairman, I believe this overview should leave nobody in doubt about the determination with which our Negotiating Chairs pursue their work in the respective areas. In each of our Negotiating Groups there is a forward-looking agenda which will ensure that the Geneva process remains ready to translate political movement into concrete and substantive progress.

I will, of course, continue to meet frequently with the Negotiating Chairs as we move towards the stocktaking. At a time when many members in this organization are getting frustrated at the time it takes to realise the gains of this Round for them, the Negotiating Chairs and I can and will chart a path for your engagement. But however good this path is, you yourselves have to walk it by engaging in negotiations with each other. It is also necessary to underline once more that bilateral contact, important though it may be, cannot be a substitute for a strong multilateral engagement at all levels.

2010 cannot be a wasted year and my consultations last week confirmed that the determination to ensure that we use this year wisely and fruitfully is very present among delegations.


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