Director-General Roberto Azevêdo’s statement
Informal Trade Negotiations Committee meeting,
30 September 2013
As mentioned in the convening fax of 26 September, the purpose of today’s meeting is to report back to you on recent consultations on the three DDA Bali issues — Trade Facilitation, Agriculture and Development/LDC issues.
As with last week’s TNC, I am asking you to keep today’s meeting focused and business-like. Please only intervene if you have a real need to do so — many of you have had the opportunity to voice your views in the intensive meetings of the last few weeks so we know each other’s views.
The focus of our work in the second phase of the Room D and E consultations has been to make advances where we can, on the most critical issues. In the past week, we had four sessions (that is four half days or two full days) on trade facilitation; a session on the Monitoring Mechanism and a session on the G-33 food security proposal.
In addition, consultations were also held by Chairs in different settings to help efforts in the Room D/E format. I also understand that delegations were engaged amongst themselves to try and work towards convergence on the issues on the table.
So clearly, there has been a lot of activity in the past five days. The question is — what additional advances have we made?
In a nutshell, I continue to be encouraged by the level of the engagement and the efforts being made to move our work forward. But we are not moving fast enough and things will need to change — and change quickly — if we are to achieve our objective of success in Bali.
Let me start with a more detailed report on Development, starting with the Monitoring Mechanism. We continued our deliberations taking up three issues:
i. The frequency of meetings of the Mechanism; that is how often should it necessarily meet each year and how, if required, Members could convene additional meetings;
ii. The non-negotiating character of the Mechanism, the deliberations of which would not impact the legal nature of Members’ rights and obligations, notwithstanding its ability to make recommendations for initiating negotiations, and
iii. The focus of the review in the Mechanism, that is how broad its review should be, focusing not only on the effectiveness of the implementation of the provisions, but also on the reasons for any shortcomings, including the provision itself.
Discussions have been positive and we have managed to close a number of conceptual gaps. The Chair and I shared some language on all three elements, which Members were willing to consider as a basis of future work. This is necessarily a difficult conversation, but we are pointed in the right direction.
I understand that the Chairman of the CTD SS is planning to hold open-ended meetings of the Committee periodically to brief the wider membership on the progress and developments in the various consultations.
Regarding the revised submission from the LDCs on preferential rules of origin, the Facilitator, Ambassador Smidt, began his consultations last week. I understand that there is broad convergence among Members to work out a meaningful outcome on rules of origin associated with LDC preference schemes. I am optimistic about the current engagement and the progress that we can make. However, I would like to, once again, take this opportunity to urge Members to continue to engage in a constructive manner so that this work is accomplished in time for Bali.
I am also fully aware of the other deliverables being sought by the LDCs and we will pursue these remaining issues under the LDC package. As I noted in my last report there are two areas, namely cotton and the operationalization of the services waiver, where we are awaiting specific proposals from the LDCs. Regarding DFQF market access, I would urge LDCs as well as other interested Members to reflect upon what is doable before Bali.
Work on Agriculture has continued on various fronts. Consultations have continued on the G-33 proposal concerning public stockholding for food security and domestic food aid, in the Room D format. The Chair has also held consultations on the G-20 proposals on export competition and on TRQ administration in different settings.
Turning to the discussions on the G-33 proposal, last week’s consultation concentrated on two elements of the interim — due restraint — solution: Element 4 (transparency and reporting) and Element 5 (safeguards to minimize the distorting effects).
The earlier discussions on Element 4 had indicated the need for additional information specific to the public stockholding food security programmes on the part of those that intend to benefit from the peace clause. These would complement the regular domestic support notifications. There had also been support for developing a template that Members wishing to benefit from the provision could be asked to complete.
Therefore, to advance the discussions on transparency further, draft template elements were circulated to Members. These included — among others:
a. The description of the programme for which flexibility is being sought;
b. Measures in place aimed at minimizing any production or trade distortive effects;
c. Statistical information; and
d. On-going reporting requirement.
Members had the opportunity to clarify and debate all these elements of the template one by one.
The second item debated was Element 5 on safeguards. There has been less work on this element than on transparency. Therefore, the debates were more conceptual in nature and were looking at deepening the discussions about what would be doable or not. Many Members underlined again the trade distorting potential of these programmes, as well as their potential impact on the food security of other Members. Calls were made to be practical when handling the issue, not to over-engineer the response and to look at the relationship with existing WTO provisions.
On export competition, the Chair held a consultation last Thursday. These discussions constituted a useful step in the process towards the identification of a realistic and credible outcome on export competition in the Bali package.
On one hand, the debates confirmed that clear divergent views remain at this stage between Members on the two following topics:
i. First, whether a step forward on export competition disciplines, of the kind proposed in the G-20 proposal, could be part of a realistic outcome for Bali;
ii. Second, how the whole pillar of export competition should or could be addressed in Bali, including areas such as export credits, export credit guarantees or insurance programmes, state trading enterprises and food aid.
On the other hand, Members started engaging more in depth with a view to identify the possible content of some elements on which growing convergence could emerge.
Finally, on this issue like on the other issues to be incorporated within the Bali package, the question of the nature and the form of the outcome is a very important one, which can of course not be seen in isolation from the content of this outcome.
Last but not least, on the TRQ administration proposal many Members continue to see this proposal as one that could realistically be part of a balanced outcome at Bali. Consultations have confirmed that the transparency elements of the TRQ administration proposal are generally acceptable to Members.
Still, the S&D treatment proposed in the underfill mechanism remains unresolved and with divergent views.
During the coming weeks, the Chair is envisaging holding meetings in various configurations on all three agriculture proposals on the table for Bali. An open-ended Special Session is planned for the week of 7 October.
Let me conclude this overview of the state of play with Trade Facilitation where work continues to intensify, covering several negotiating tracks. We had a series of meetings last week, both as part of the room D process and in the framework of activities by the Friends of the Chair. I have also been consulting delegations bilaterally.
In the room D format, we covered all pillars of the Draft Consolidated Text. Discussions touched upon various elements of articles 3, 4, 7, 10 and 12 as well as on section II. Within the first section, special time was given to the issue of customs co-operation as an area requiring more work.
Taken together, this work allowed us to make good progress on the Draft Text. In some areas, we were even able to find common ground on how a respective provision would read. At the same time, it became very clear that there is a considerable amount of work still ahead. It is also uneven in that there are parts which are more advanced than others, especially on the crucial elements of S&D and customs cooperation, which are clearly less developed than many other parts of the Draft Agreement.
As far as the next steps are concerned, I count on the Friends of the NGTF Chair to use the time until the continuation of the Room D/E process for intense consultations in whatever format they consider appropriate. I also urge Members to continue their exchanges amongst themselves. The Chair and his Friends will be available for delegations wishing to consult with them as well. We will then have to assess the situation and to decide on the road ahead.
This concludes my overview of the state of play in the three Bali issues.
Now finally a few words on the forward process. I continue to be encouraged that we are making some progress — but at the current pace we simply are not going to meet our target of having all landing zones clearly identified by the end of October. Things are going to have to change. Barely 20 working days remain, yet the amount of ground to be covered is still very large. However, I am convinced that it is not impossible.
So what needs to be done?
Firstly, political engagement of capitals is becoming increasingly critical. This is why today I am sending a letter to each of your Ministers to emphasise the need for their personal and active engagement in the process from now on. Ministers and Senior Officials need to give you the additional room you need to genuinely look for convergence in each of the three areas. I am also asking your Ministers to consider the bigger picture — the fate of our negotiating arm and with it, the DDA. But more importantly, as I have repeatedly stressed, at stake is the credibility of the multilateral trading system itself. I am also underlining that the Geneva process is very much alive, but that the time available to show results is increasingly limited. The letter is being sent this afternoon through your respective missions — I would ask you to forward it to your Minister as a matter of priority.
Let me be clear. We need to stand by our end of October target — too often I have seen such deadlines come and go — but time does not allow this now. This is necessary for proper finalization of our work in November. But it means that from now on, we have to count every day as a working day. This is why I am asking the three Chairs; LDC Facilitator and Friends of the Chair on TF, to operate on a continuous basis over these two weeks. Intensive consultations in a variety of formats, aimed at deepening and extending convergence and rapidly closing gaps should be undertaken. I equally request Ambassadors and your necessary officials to be continuously available. In short, negotiators should be on call on a permanent basis.
For my part, I will be continuing to reach out to Ambassadors as well as engaging with Ministers at a number of different meetings in the coming days.
We will then be in the final countdown mode from the week of the 14 October to the end of the month. We will commence this phase with a meeting of the TNC on 14 October which I will confirm in due time. As I said, we will have to realistically assess our prospects for success in Bali and set the course for the final stretch. How precisely we do this will depend on the progress that can be made between now and 14 October.
In the final analysis, this is and will remain a negotiation among you, the participants. It is you who hold the key to success in Bali. I therefore urge each and every one of you, to engage directly with each other at every level with a compromising attitude, sense of urgency and above all the responsibility required for the realization of our Bali goals. We will not get there by the work of magic, but by our collective determination and effort to breach remaining gaps and find consensus on time.