WTO Ministerial Unable To Cut Deals; Members Set Up Plurilateral Groups On E-Commerce, Other Issues

The 11th Ministerial Conference of the World Trade Organization (MC11) ended without a joint ministerial declaration and without progress in some of the important agenda points on the table. Instead several groups of “friends” announced they would push ahead independently, with 71 members including the United States and the European Union announcing they will “initiate exploratory work together toward future WTO negotiations on trade related aspects of electronic commerce.”

The e-commerce initiative is a reaction to the lack of a real consensus on the way forward in this area during the MC11. Eight different proposals were sent to the Ministerial on the issue (from Russia, India, Bangladesh, the African countries, Singapore and cosponsors, Costa Rica and cosponsors, the EU and cosponsors, and China), differing mainly on the depth of the mandate. While many developing countries favoured the continuation of the existing work program, a number of western countries wanted to see the setting up of a working party that can enter into negotiations.

US Trade Representative Robert Lighthizer welcomed the e-commerce initiative, one of the few topics to which the US added its support. The digital economy serves as a critical engine of domestic and global economic growth, Lighthizer wrote in a press release, and all countries would benefit from the development of strong, market-based rules in this area.

“The launch of this initiative marks a significant milestone, with a large group of countries now working together to move forward in this important area within the WTO,” he said. “Initiatives like this among like-minded countries offer a positive way forward for the WTO in the future.”

Similar initiatives have been announced for cross-border investment facilitation as well as on trade barriers for micro, medium-sized and small enterprises. The US is not participating in any of these groups of friends.

Director General Roberto Azevêdo and the Argentinian Chair Susana Malcorra during the closing press conference said they were disappointed, but that difficult negotiations had been expected even before the meeting. Malcorra during the closing press conference said her main disappointment was the creeping “distancing from multilateralism” as she herself was a “convinced multilateralist”. She pointed to the statements of many ministers during the conference who felt the organisation was at a crossroads. At least “it did not break,” Malcarro said.

Azevêdo called the external, pluriateral initiatives on e-commerce, investment and small companies “a display of dynamism.” He only asked that the plurilateral groups stay open, “because in the end we want to have all 164 members negotiating.”

Asked during the press conference if he blamed the US for some of the failures at the conference, in particular the failure to agree on the final implementation of the Doha Round agreement, Azevêdo said: “You can‘t credit one player for success, and you can’t credit one only for failure.”

He also tried to calm the waves with regard to the crossroads situation, as he said he remembered the many times the WTO had not had any outcomes during their conferences. “That did not mean we stopped,” he said. “Especially where we have a mandate, we don‘t give up. We have to continue and we have to persist.”

Azevêdo also applauded the first ever business conference held alongside the WTO ministerial. For some declarations, it was the private sector who partnered with those member states supporting declarations on individual issues, for example the empowerment of women in trade.

A sober statement on the results of the Ministerial was made by EU Trade Commissioner Cecilia Malmstroem during the final hours of the conference. “We could and should have taken a real first step on an issue which connects the WTO with the Sustainable Development Goals, fisheries subsidies. We could and should have taken long overdue steps in the direction of agricultural trade reform,“ she said.

Also the WTO members could have officially initiated work on new issues, yet the WTO members had to face the sad fact, Malmstroem acknowledged, that “we failed to achieve all our objectives, and did not achieve any multilateral outcomes.” Malmstroem, who has currently a large number of bilateral free trade agreements on their trade agenda, hoped that “all delegations reflect carefully about the message this sends to our citizens stakeholders and our children about the state of the WTO.”

 

Image Credits: WTO