WTO NEWS: SPEECHES — DG ROBERTO AZEVÊDO

Director-General Roberto Azevêdo’s remarks on the multilateral trading system


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G-20 leaders asked us, quite clearly: how can the WTO work better? They expect an answer when they meet in Antalya in November, so here are a few thoughts on where we believe the answer lies.

First and foremost, we must respond to the most immediate and pressing issues at the WTO today. We have at least two of them.

First is implementing Bali.

On the LDC-focused elements we are seeing progress, but there is still a lot of work to do to reach convergence.

Next is public stockholding for food security purposes. Members are making no progress here. We need both sides to engage more in a solution-finding mode. I know that December is not the hard and final deadline, but it would be important to begin to instil a more positive attitude in these conversations and to start building trust in a good faith negotiating effort.

On the implementation of the Trade Facilitation Agreement - I received just yesterday, here in Istanbul, the European Union’s ratification. This is great news, which coincides with the acceleration of notifications in Geneva.

With this, we now have confirmation from 48 WTO members; almost one-third of members. Two-thirds are required before the agreement can enter into force, so we are almost half way there. We have to maintain this momentum.

The second immediate challenge is our forthcoming ministerial conference in Nairobi. I will come back to Nairobi a bit later.

Before that I’d like to address two other elements also at the core of any discussion about how to make the multilateral system work better.

First I’d raise the issue of RTAs and how they interact with the multilateral system.

This was another question asked to the WTO by G-20 leaders given the high levels of bilateral and regional activity globally. 

This issue is all the more current at the moment given the news we heard from Atlanta with the TPP negotiations, but the TPP is just one of many such regional initiatives taking place around the world. 

This is why it is important that these initiatives work together with the multilateral system.

We have been undertaking some detailed analysis of existing RTAs, looking at transparency and to what degree they truly complement the multilateral system. So here are a few preliminary comments about our study.

It is important to recognise that all of the RTAs being negotiated take as their starting point the basic GATT structures in areas where there are GATT or WTO rules. In such cases, RTAs mostly maintain WTO standards. This applies to issues such as anti-dumping, and, to a lesser extent, safeguards, technical barriers to trade, SPS measures, and rules of origin in services.

In market access in goods and services, generally RTAs liberalize further, as expected.

For issues where there are no well-defined or specific WTO rules, RTAs clearly introduce new standards.

There has been a steady increase in the number of RTAs that also cover “behind the border” issues such as investment, competition, labour, environment, and electronic commerce.

So I believe that we must soon draw conclusions from all of this if we are to properly answer the questions put to us by the G-20 leaders.

Let me now turn to an obvious element inherent to the question that leaders put to us on how to improve the system. That is: how can we advance negotiations within the WTO?

We are increasingly seeing that innovation and flexibility are crucial in making progress.

The WTO membership is now a very diverse group. So our approach must reflect that. We can’t have a monolithic, rigid outlook if we want to have a truly multilateral agreement, one where all WTO members are participants.

In such truly multilateral efforts, we need to have flexibilities inbuilt into agreements, which allow members to take on obligations at an appropriate pace according to their capabilities, and even providing assistance to help them to do so when necessary.

The Trade Facilitation Agreement is an example of precisely this. I think we have seen the last days of the “one-size-fits-all” approaches.

On the other hand, if we want to be more ambitious and rigid in terms of the disciplines, with little flexibility and few - or no - S&D provisions, we have seen that initiatives by groups of members can be a successful alternative.

Sectoral agreements provide an important avenue for members to tackle specific issues of significance to them.

The agreement in July to expand the Information Technology Agreement is a good example here.

So we need to find ways to continue providing space for innovation and flexibility in the WTO without compromising the core principles of non-discrimination and universality.

I’m quite confident that we can find innovative ways of building on these two general approaches to negotiations.

Now, to conclude, let me go back to our most pressing issue: Nairobi.

Of course the biggest thing we could do to help the system now would be to deliver in Nairobi.

We are at a critical juncture in defining whether or not we can achieve positive outcomes in Nairobi.

We have been negotiating intensively for some months now, in a wide range of formats. Progress has been very hard to come by — particularly on the core DDA issues of domestic support and all aspects of market access: agricultural, non-agricultural and services.

Despite this I think there is a clear desire to deliver outcomes in Nairobi. And, particularly as this is the first ministerial in Africa, there is a clear desire to deliver for Africa and for LDCs (most of which are in Africa).

In recent weeks it has become clear that some issues look more attainable than the rest. Without prejudice to whatever else we can conclude by Nairobi, I would say that these potential deliverables include:

  • export competition,
  • a package of development and LDC issues,  
  • and some transparency provisions.

These are promising areas, but they will still require a lot of work.

Some members don’t seem ready to give up on some of the core issues we were negotiating and some new ideas have been suggested. Maybe they could provide some inspiration. Time will tell. I’m not terribly optimistic but while there is hope to make progress in the core areas we must do our best.

Nonetheless, two months before Nairobi, it seems that, whatever package we deliver in Nairobi, it will not be viable, or credible, to announce it as the conclusion of the DDA single undertaking. This seems to be a consensual view.

In this scenario, the unavoidable question is: what to do with the DDA issues that are not properly addressed in the Nairobi package? So, the post-Nairobi landscape is already part of our conversation. 

At this point, there are divergent views on what happens after Nairobi. Many say that if there is no consensus to end the Doha Round then it will simply continue - and that we should state this clearly. The other side says that if we do not deliver Doha by Nairobi then that will be it - even without a formal statement affirming its demise, the DDA will be over for all practical purposes and we will see no further engagement on Doha after Nairobi.

Clearly these views will be extremely difficult to reconcile.

However, I think we cannot disregard important commonalities when thinking the way ahead. 

For instance, I think we all agree that:

  • We want to deliver something in Nairobi.
  • Whatever we deliver will not be enough to formally and consensually conclude the DDA.
  • We are still ready to keep pursuing the core issues of the DDA and their development dimension after Nairobi (although there is no agreement on how to do this: whether under the DDA framework, or whether under a reformulated architecture).

The question is whether we can - or whether we want - to capture these and other possible commonalities in a consensual text in Nairobi.

In Geneva, we have started a discussion on the type of document that could result from the Ministerial. It could be:

  • a Ministerial Declaration;
  • a non-consensual Chairperson’s statement;
  • or a hybrid of some sort.

From an institutional point of view, the best option is to have at least some agreed language on the outcome Nairobi document. I am not sure it is possible though. We must find out.

Last week we started exploring the idea of beginning the process of drafting in a very gradual and inclusive manner, in a way that takes on board all views.

Many delegations have underlined that the major players have a special responsibility to make Nairobi work. Inevitably, many in Geneva will be anxiously looking out for the signals that come out of this meeting.

I think the most valuable thing that you could do today is:

  • First: give us guidance on whether you are willing to proceed on the basis of a package of specific issues which is DDA-minus;
    • if so, could we immediately intensify our work on the more promising issues that I outlined earlier, without prejudice to the other items we were already negotiating?
  • Second: consider whether we should start work on a final Nairobi document immediately.
    • If so, this would not prejudge the outcome of this exercise, either in terms of substance or format.

We have the opportunity today to markedly increase the chances of success in Nairobi — and therefore to strengthen the system for the future.

So I look forward to hearing your views.

Thank you for listening.

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