WTO Head Says Progress Needed in Run-Up To Hong Kong, Renews Warning on Services

GENEVA--World Trade Organization Director-General Supachai Panitchpakdi reiterated May 19 the need to step up efforts in advancing the Doha Round of trade talks, despite an agreement among WTO members earlier this month resolving a long-standing feud over the conversion of agricultural tariffs.Supachai told a meeting of the WTO's Trade Negotiations Committee that prospects were 'somewhat brighter' since the May 4 deal at a WTO 'mini-ministerial' in Paris on procedures for converting specific tariffs and other non-ad valorem tariffs into ad valorem equivalents, an issue that had delayed the farm trade talks (86 ITD, 05/5/05) .

'Recent gatherings at the ministerial level have renewed the impetus in some areas of our work,' Supachai declared, 'but the point I made at the last TNC [meeting on April 28] about the need for a greater sense of urgency remains valid and I must underline it again. We are still well behind where we should be, and time is not on our side' (82 ITD, 04/29/05) .

Picture Not Good Enough

'Overall, the picture is probably better than the last time we met, but not good enough,' he added. 'Concrete progress is also needed, and although we have started to make some, we need to make more, and we need to do so quickly.'

WTO members are due to come up with a 'first approximation' by the end of July of a draft ministerial statement for the organization's important ministerial conference in Hong Kong next December, where governments are to decide on issues such as the formulas and figures for reducing tariffs on agricultural and industrial goods and cutting farm subsidies.

Supachai said WTO members needed to be clear about what can be realistically achieved in July for the first approximation.

'We are obviously not in the same situation as last July,' Supachai said in reference to the negotiations which led to the Aug. 1 'framework package'for advancing the Doha negotiations. 'I do not think any of us envisages a package of decisions such as we had then.'

'However, from my participation in the various ministerial gatherings, it is clear that ministers are expecting more than just a set of progress reports,' the WTO chief added. 'In some areas of the negotiations, this will mean providing as much specificity as possible at that point in time on the shape of the likely outcome in Hong Kong. In other areas, the level of specificity will, necessarily, be lower.'

Sluggish Services' State of Inertia

Supachai also sounded a further warning about the sluggish state of the Doha Round talks on services. Revised market access offers are due to be submitted by the end of May, with Canada becoming the first to submit its revised offer on May 18.

However, Alejandro Jara, the Chilean ambassador chairing the Doha services negotiations, told members in a separate intervention that 39 countries that were due to submit initial market access offers back in March 2003 have still failed to do so.

'I wrote to ministers in January about the state of inertia that we risk falling into if we do not get more offers on the table, as well as substantive improvements to those already submitted' Supachai told the TNC meeting. 'I am now sending another, stronger letter to ministers of those members that have not yet submitted an initial offer, asking them to do so quickly. The letter also serves as a reminder of the broader implications for the overall [Doha] negotiations.'

Jara noted that there was 'some indication' that the request-offer approach used in the services talks was requiring a lot of time and that the negotiations were already very far behind, a further signal from the chairman that members are looking for ways to go beyond request-offer and develop some new means to advance the negotiations.

Under the request-offer approach, WTO members put forward market access requests to countries of potential interest, and those members then respond to the requests with offers of their own, with the negotiations then taking place on a bilateral basis to narrow the gaps between the requests and the offers.

Jara announced April 27 after the last negotiating session on services that he would hold informal discussions with member governments in order to sound out ideas on how to jump-start the services talks, including examining new 'tools' or 'benchmarks' to help spur the negotiations.

Deputy U.S. Trade Representative Peter Allgeier conceded May 17 that the request-offer approach has failed to sufficiently advance the current round of talks and suggested 'supplementing' the approach with a new initiative designed to bring other countries up to U.S. standards (95 ITD,05/18/05) . Allgeier added that U.S. negotiators have been discussing the initiative with a number of other WTO members, including the European Union, Canada, and Japan.

No Convergence in NAMA Talks

In another intervention, the chairman of the Doha talks on market access for nonagricultural goods (NAMA), Iceland's WTO ambassador Stefan Johannesson, warned that members still had work to do on narrowing their differences over what formula to use for reducing tariffs on industrial and consumer goods.Johannesson noted that five proposals have been put forward on possibleformulas: one from the United States; one from the European Union; one from Norway; a joint proposal from Argentina, Brazil, and India; and a joint proposal from Mexico, Chile, and Colombia.

While these proposals have had a 'positive effect' on the negotiations, convergence among the membership on a single approach 'is not taking place,' officials quoted him as saying at the meeting.

Trade ministers attending the May 4 meeting in Paris said they expected negotiators in Geneva to come up with the 'concrete shape' of a tariff-reduction formula for the NAMA talks in July, including a 'range of values' for the coefficients in the formula as well as a 'clear indication'of the flexible terms to be offered to developing countries.

In addition, the ministers said they expected the chairs of the negotiating groups on agriculture, NAMA, services, and other issues to produce the drafts of the first approximations for their sectors in time for the next WTO mini-ministerial scheduled to take place in China in early July.

Chinese officials in Geneva said the July 12-13 mini-ministerial, scheduled to take place in Beijing, was now being moved to the northern coastal city of Dalian, where China's current commerce minister, Bo Xilai, was mayor for eight years.