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Ministers preparing for WTO crisis meeting told they need to compromise and
Texts: state of play in WTO farm talks and the crisis-meeting invitation
Posted by Peter Ungphakorn
DECEMBER 1, 2023 | UPDATED DECEMBER 5, 2023
The supposed “crisis” meeting of about 25 World Trade Organization ministers on November 28, 2023 showed no sign of breaking the deadlock in the WTO agriculture negotiations.
With barely two working months to go members now face the real risk of no outcome at all on agriculture at the February 2024 Ministerial Conference.
According to sources, the three-hour online meeting consisted only of a series of prepared statements echoing what delegations have been saying in the negotiations. No minister made any attempt even to edge towards compromise, even though they had been urged to do so before the meeting.
Nor did the chair attempt to encourage a dialogue, or to explore possible compromises. The presiding minister was UAE Foreign Trade Minister Thani bin Ahmed Al Zeyoudi, who will chair the Abu Dhabi Ministerial Conference.
The ground rules gave each minister no more than three minutes. But according to sources, India asked to speak first and then spent over 20 minutes on a presentation justifying its demand that three issues be absolute priorities at the Ministerial Conference.
They are: a new decision relaxing subsidy disciplines for procurement into food security stocks; a new special safeguard mechanism allowing developing countries greater freedom to raise tariffs as contingencies; and a technical issue — updating the period for reference prices used to measure trade-distorting domestic support.
Sources say some countries complained that India was allowed to speak well beyond the 3-minute limit, particularly since the presentation repeated one that India had given in the agriculture negotiations.
Those taking the opposing view repeated their position that the three issues had to be negotiated as part of new disciplines on domestic support and market access.
The ministers were asked to answer two questions:
- Whether the issues that India and its allies consider to be priorities can be handled as individual stand-alone questions, or whether they have to be part of broader agreement to reform domestic farm support and possibly market access and topics related to export subsidies. Members are split on this and the ministers simply reiterated their countries’ positions, sources say
- What political guidance ministers can give to ensure a meaningful outcome at the Ministerial Conference. Again no or few new ideas seem to have been suggested.
Sources say China did suggest members focus on topics that might more easily be agreed such as on export restrictions.
This was the first mini-ministerial meeting specifically on the WTO agriculture negotiations. Officially, it was convened by the UAE minister, but there is speculation that the original idea came from delegations, either India or developing countries in the Cairns Group, an opposing camp.
WTO Director-General Ngozi Okonjo-Iweala referred to scepticism that an agreement could be reached on agriculture in the 1986-94 Uruguay Round. Negotiators eventually succeeded, she observed. “I believe they can do it again with a constructive mindset, bearing in mind the importance of the agricultural sector to all members.”
According to accounts of the meeting, there were no signs of any changes in mindset.
About 25 ministers are said to have spoken in the meeting. Many were top-level ministers, including Katherine Tai of the US. They included:
India, EU, Australia, Costa Rica, Samoa, UK, New Zealand, Cameroon, Peru, Nigeria, Paraguay, Indonesia, United States, Japan, Switzerland, Canada, Russia, Saudi Arabia, South Africa, Argentina, Senegal, Brazil, China, Egypt and Türkiye.
Some of these countries may have been speaking for groups of WTO members: Samoa (African-Caribbean-Pacific Group), Cameroon (African Group), Indonesia (G33), Switzerland (G10) Senegal (least-developed countries)
Also attending were: Thani Al Zeyoudi (UAE, who chaired the meeting), the WTO director-general, and the chairs of the agricultural negotiations and General Council.
Work in the WTO will wind down in the second half of this month (December) and resume in January. That means negotiators have little more than six to eight working weeks to settle their differences before they disperse to prepare to travel to Abu Dhabi.
The agriculture negotiations’ final meeting of the year on December 13 is scheduled to hear the talks’ chair’s proposed plans for how to proceed in the year.
- The WTO Secretariat’s report on the state of play in the negotiations is here
- It includes a list of members’ latest proposals here
“PSH”: A MISLEADING NAME
Subsidising purchases into food security stocks is nicknamed “public stockholding for food security in developing countries” or just “public stockholding” (PSH) for short.
The name is misleading because WTO rules do not prevent stockholding. They only discipline subsidised procurement. Even that is allowed, so long as the developing country stays within its subsidy limit, usually 10% of the value of production, which can be a large amount.
This could be described as something like “over-the-limit subsidies used to procure food security stocks”.
The practice is not widespread. A 2022 paper by a Canada-led group found tentatively that since 2013 “only five members notified expenditures […] for stocks acquired at [a supported] price at least once” and only nine since 2001.
Only one country — India — has exceeded its domestic support limit when using subsidies to buy into stocks, and for only one product: rice. For 2021–22, the fourth successive year of the breach, India’s subsidy was calculated at $7.55bn, exceeding its $5.0bn limit by 52%. (The following year the excess subsidy fell back to 20%.)
An “interim” 2013 WTO ministerial decision modified by another decision in 2014 — called a “peace clause” — has protected India from facing a legal challenge despite breaching its WTO commitment.
One problem is that the peace clause is only available to countries with “existing” programmes in December 2013. The few covered include China, India, Indonesia, Pakistan, Philippines and Taiwan, according to a November 2023 WTO Secretariat summary.
The present deadlock is over an unresolved permanent solution originally intended to replace the interim one in 2017. Details are here.
(Updated April 22, 2024)
Updates
December 5, 2023 — adding links at the end to the state-of-play report and to the list of latest proposals
Image credits:
Not listening | Monstera Production, Pexels licence
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