Mood of uncertainty in WTO on production of Ministerial text and process

Following the decision last week to lower expectations on what the Hong Kong Ministerial meeting will achieve, there is an atmosphere of uncertainty as to the process between now and the Hong Kong meeting, as well as after.

The uncertainty covers the nature and substance of the text that will be brought to the Ministers in Hong Kong, as well as the meetings to be held before, at and after Hong Kong.

Before last week's decision for "recalibration" of the ambition of the outcome of Hong Kong, it was expected that the Chairs of the various negotiating bodies would draft texts relating to their areas, "on their own responsibility" if necessary, and pass these to Pascal Lamy, the WTO Director-General and Chair of the Trade Negotiations Committee, who would then produce an overall draft of the Ministerial Declaration.

However, some of the Chairs have now indicated that they will not be producing Ministerial texts as such, but reports arising from the negotiations. The exact nature of these reports is not known, and could vary from Chair to Chair.

They could range from being merely factual descriptions of the positions of countries, to having analysis of the state of play and the convergences and divergences on various issues, to containing recommendations for solutions, and even to containing some texts.

In the case of services, the Chair of the negotiations, Ambassador Fernando de Mateo of Mexico, has already produced two drafts of a Ministerial text on services, the latest one on 3 November. Before that he had also produced versions of "elements of a draft."

At meetings to discuss the drafts, there had been differences in positions expressed by many delegations on several aspects. The most controversial relates to the item "numerical targets and indicators", a term to denote the "benchmarking" proposals of the developed countries.

Many developing countries, including those in the ACP Group, the African Group, the LDC Group, as well as a group of 14 countries that presented a joint paper, have rejected any mention of this in a Ministerial text, and requested its removal from the draft, at several meetings since September.

Despite this, the item has kept reappearing, and without brackets. The Chair had explained that he cannot remove any item that has been proposed, a reason that the developing countries could not agree to. The Chair even reportedly said that he could make an alteration only if there is a consensus to do so.

Other contested items in the services draft include the mention of the sectoral approach, the plurilateral approach and qualitative benchmarks in the various services modes.

At some small consultations and "confessionals" (WTO language for individual delegations meeting with the Chair), Mateo has told some delegations that he will stick to his decision of continuing to include items and language in future drafts even if they do not enjoy consensus, according to diplomatic sources.

The Chair of the agriculture negotiations, Ambassador Crawford Falconer of New Zealand, was originally also expected to produce a draft text for Hong Kong. However, on 3 November, he told an informal meeting on agriculture that members he consulted asked him not to produce a Chairman's draft text, saying that they preferred that members themselves produce their own draft.

And on 11 November, at another agriculture meeting, the draft to be produced had changed from being a Ministerial text to a report. The report, to be produced by the Chair on his own responsibility, would give a "fair, balanced and accurate account" of the state of play in the negotiations.

How little or how much the report will contain is still to be seen, as it is expected to be "more than a simple chronicle of the situation". Falconer himself said it would sum up the degree of progress and what remains to be done. There would, however, not be numbers or modalities. It is not clear if he will include recommendations and if so, how specific these will be.

Last Friday, Falconer indicated that his report would be issued on Wednesday

(16 November). However, it had not yet appeared by late Wednesday afternoon, and some diplomats expect it to come out only on Thursday or even Friday.

The chair of the NAMA negotiations, Ambassador Stefan Johannesson of Iceland, had also been expected to produce a draft text. However, at a meeting on 8 November, he said the state of negotiations was "bad" and the picture was becoming "more confused".

Concerning a possible text for Hong Kong, the Chair said he would not produce texts on elements on which he did not see some convergence. He wanted this to be a "truly bottom up approach" (a term denoting that members should take part themselves in drafting) and unless members give him something to work on, "the process is doomed to fail."

According to diplomatic sources, Johannesson is also now expected to produce a report on the state of the negotiations, and not a draft Ministerial text.

It is not known whether the report will be a Chair's report or a report of the negotiating group, or whether it will be a factual account of the negotiations, or also contain operational language or recommendations.

Some diplomats had expected the report to be issued on Tuesday (15 November), but as of Wednesday it had not yet been issued. An informal NAMA meeting is now expected on Friday, but it is not known if the report will be given out at the meeting, or even before that.

Meanwhile, the Chairman of the Trade Facilitation Negotiating Group, Ambassador Muhamad Noor Yacob of Malaysia, presented two draft documents at the group's meeting on 9-11 November.

The first is a draft report of the Negotiating Group, which contains not only an account of the negotiations but also operational recommendations, for example, on issues that will form the basis of future negotiations.

The second is a "draft Ministerial language" on trade facilitation. In the brief paragraph, the Ministers note the report of the Group and also endorse the recommendations contained in 5 paragraphs of the report and "invite the Negotiating Group to implement them."

At the meeting, members could not agree to parts of the report, and they did not start discussion on the Ministerial draft text.

It can be seen from the above that there are differences in approach in the various negotiating bodies. In services, the Chair has produced his own text, and in a very top-down approach, he has amended successive drafts only to the extent he deems it appropriate, while a broad range of members (developing countries) are obviously exasperated and have expressed dissatisfaction with both the draft text and the top-down process.

In trade facilitation, the Chair has drafted a report of the Negotiating Group itself and not a Chair's report, as well as a draft Ministerial text.

The report is not only an account of the state of play, but also contains recommendations, and the Ministerial text not only takes note of the report but endorses the recommendations.

In agriculture, the Chair will be producing his own Chair's report under his "personal responsibility", with members to be given an opportunity to make comments. It is not known yet whether it will contain operational proposals and whether there will be further drafts taking account of members' comments.

In NAMA, it is not known yet whether the Chair will be producing a report under his own responsibility or a draft report of the Group, which the Group will have to negotiate on.

From other negotiating bodies responsible for other issues such as special and differential treatment, rules, TRIPS and trade and environment, there will also have to be either reports or texts or both.

Ultimately, the documents from the various bodies will have to be put together in a draft Ministerial text, probably with a main body, and annexes that contain either texts or reports of the individual areas of negotiations.

Originally, the overall Ministerial draft text was expected to be issued by 15 November. The date was pushed to 20 November and now another date, 25 November, has been mentioned.

There will in any case be very little time for delegations and capitals to look at the draft, before the General Council meeting of 1-2 December.

It is also not known if the text will be issued in the name of the Director-General, or the Chair of the General Council, Ambassador Amina Chawahir Mohamed of Kenya. In previous Ministerials, the text coming from Geneva has been primarily known to be the Chair's draft. Thus the draft for Seattle was known as the Mchumo text, and the Doha draft, as the Harbinson text, and the Cancun draft as the Castillo text.

However, it is known that Lamy will coordinate the putting-together of the Hong Kong draft. It would be a new factor in the recent history of the WTO, that the Director-General produces the draft, even if it is in his capacity as TNC chair.

According to diplomatic sources, there is likely to be a Ministerial meeting of the four major members (US, EU, India and Brazil) in Geneva sometime next week, if the Ministers can agree on a date.

And at the Geneva mini-Ministerial Green Room on 8-9 November, there was some agreement that some Ministers would again meet before or during the General Council meeting of 1-2 December.

Whether that will happen, and if so, which delegations are invited to ask for their Minister's presence, is still a matter of speculation.

There is also uncertainty over the process after Hong Kong. During the Geneva mini-Ministerial last week, some Ministers (including Kamal Nath of India and Celso Amorim of Brazil) had raised the possibility of a second Ministerial meeting to be held in the first quarter of 2006, with March being mentioned.

Since then, another possibility has been rumoured, that at Hong Kong the Ministers may instruct the General Council to finalise the modalities and other aspects that the Hong Kong meeting would have failed to accomplish.

This would be similar to the Cancun and post-Cancun developments. At Cancun, the Ministers instructed the General Council to take over the job, and in July 2004, the Council adopted the July package.

That Council meeting had actually been dominated by the presence of a minority of selected Ministers who in fact dictated the terms of the July Package through a super Green Room.

Those that are managing the affairs of the WTO could be attracted to using this same model of the Super Green Room of selected Ministers, tied to adoption of text by the General Council, as the process to use to finish what Hong Kong is unable to do.

That would, however, be to the severe disadvantage of the developing countries, as they would turn up in force at a full Ministerial, but very few of them are invited to a mini-Ministerial meeting or a mini-Ministerial Green Room. The imbalanced outcome of the July Package or Framework is a sign of the disadvantage suffered by developing countries under such a decision-making model.