By Aileen Kwa
With the Cancun ministerial less than sixty working days away, the WTO — in characteristic fashion when under pressure — has shifted into a more secretive and non-transparent mode of consultations. The process is characterized by ‘flexibility’ — that is procedures are invented on the spot to suit the interests of the powerful — and opacity. The process is tightly controlled by the Secretariat and Chairs of negotiating bodies, as opposed to being only facilitated by them, and the focus is on Ministers, as opposed to Geneva technical experts who are more familiar with the ‘devil’ lurking in the details of the very technical language.
To cap it all, there is no draft text for the Ministerial and developing country Members do not know when such a text will finally emerge. Members have been told that there will only be clarity on 24 July, just three working weeks before Cancun, hence leaving developing country delegations with little time to respond to the text and coordinate amongst themselves.
THE STAKES AT CANCUN
The stakes are high for this Ministerial. The fact that important deadlines on the “development” issues of special and differential treatment, implementation, and TRIPS and health were missed last year, has raised questions about how genuine the major players in the WTO are – especially the US and EU – in actually delivering a “development” agenda. The public image of the WTO is on the line and the WTO Secretariat, the US and the EU, are looking to minimise the damage. Cancun will be a decisive point in whether they win or lose the battle to whitewash the WTO.
Furthermore, modalities on the agriculture negotiations were meant to be agreed at the end of March and there is still no agreement in sight, and decisions on the whether or not to initiate negotiations in investment, competition, transparency in government procurement and trade facilitation (the Singapore issues) also must be made in Cancun. The major drivers of the WTO do not want to see Cancun turn into another Seattle where no agreement was reached. Aside from the public relations disaster, such a scenario could bring the negotiating ’round’, supposed to be completed by December 2004, to a halt. (Both EU Trade Commissioner Pascal Lamy and US trade representative Robert Zoellick are due to leave their positions at the end of 2004 and would no doubt like to see “success” achieved before they go.) Yet in agriculture, the US and EU continue to hold their seemingly irreconcilably different positions. On the new issues, Geneva discussions have only highlighted the wide the differences between the developed and developing countries. As a result of the stalemate in agriculture, developing countries are also holding back in General Agreement on Trade in Services (GATS) negotiations. Almost two months after the start of the “offers” round, when countries indicate the sectors they are willing to liberalise, few are forthcoming and those that intend to make offers will only put forward minimalist positions.
This stalemate is not foreign to trade negotiators: It is part and parcel of the negotiating strategies of the big players – to hold extreme positions, negotiate on the side with equals (the US and EU will come to their own private deals), offer some carrots and wave some sticks to developing countries, and mix in a large dose of personal contact with Ministers, with heavy servings of persuasion or coercion. Clearly, pulling off a “consensus” at the end is possible (as seen at the Doha Ministerial in 2001), but controlling the process by a few becomes of utmost importance if the “right” outcome is to be achieved. Transparency and inclusiveness in the decision-making process in the run up to the Ministerial and at the Ministerial itself, are not conducive to this as was proved in Seattle where the draft text was a Members’ text, as opposed to a Chairman’s text, and reflected the variety of different positions held by the Membership. Instead, marginalisation, exclusion and opacity are necessary, but again, this must be cleverly orchestrated so that there is at least the appearance of inclusiveness to keep the marginalized from revolting.
This is exactly what is unfolding today in Geneva as 146 nations prepare for the Fifth Ministerial to take place in September.
CHARACTERISTICS OF THE PROCESS TO CANCUN
1. Flexibility -No Clear Rules of Procedure
Since March this year, there were already murmurings about how the preparations for the Ministerial would proceed in Geneva, including a lot of talk that the Cancun Ministerial would fail and the Round would have to be prolonged. Various ideas were bandied around about how to approach the Ministerial in such a way that consensus could be achieved – a declaration, a communiqu้, a progress report, or no declaration at all, but there was no proper discussion of these issues by the entire membership. On May 8, rather than consulting the members, the Director General, Supachai Panitchpakdi and the Chair of the General Council, Uruguayan Ambaassador Carlos Perez del Castillo called Heads of Delegations (i.e. Ambassadors) for an informal off-the-record “information” meeting where they were “informed” on what the process would be.
Instead of outlining a clear approach for negotiations towards Cancun, Castillo said that while all Members had a strong interest in having “as clear and predictable a schedule as possible over the next several weeks… I am sure you will understand that it is not possible today to predict each step or its timing with certainty… We will need to retain the flexibility necessary to manage an evolving process, while of course operating in a transparent and orderly way” (JOB (03)/88, 9 May 2003).
The ‘flexibility’ he refers to was at the heart of a fierce debate after Doha. The Like Minded Group of countries (LMG), which included Cuba, Dominican Republic, Egypt, Honduras, India, Indonesia, Jamaica, Kenya, Malaysia, Mauritius, Pakistan, Sri Lanka, Tanzania, Uganda and Zimbabwe, insisted that there should be proper rules of procedure before and during Ministerials (WT/GC/W/471, 24 April 2002). For instance, their suggestions on the preparatory process before Ministerials included:
– Any negotiating procedure to be adopted in the preparatory phase should be approved by Members by consensus at formal meetings.
– The draft agenda should be drawn up only after Members have been given an opportunity to express their views.
– There should be frequent formal meetings of the General Council to take stock of the progress in the preparatory work and minutes should be drawn up of such meetings.
– There should be sufficient time for delegations to consider documents to facilitate proper consideration by and consultation with the capital.
– The draft ministerial declaration should be based on consensus. Where this is not possible, such differences should be fully and appropriately reflected in the draft ministerial declaration… If the majority of the mem
bership has strong opposition to the inclusion of any issue in the draft ministerial declaration then such an issue should not be included in the draft declaration.
– In the preparatory process for the Ministerial Conference the Director-General and the Secretariat of the WTO should remain impartial on the specific issues being considered in the ministerial declaration.
The list goes on and is shocking not because of its demanding content but because the requests are so basic. These procedures should be a taken-for-granted part of the workings of any rules-based international institution.
The LMG effort was a reaction to the nasty experience that developing country negotiators faced at the Doha Ministerial. Murasoli Maran, then India’s Commerce Minister, summed his experience of the last two days of the Doha Ministerial:
“Only a handful of WTO members were requested to participate (in the Green Room meetings). Even during discussions on the entire night of the thirteenth to the fourteenth of November, the non-stop session lasting for 38 hours, texts were appearing by the hour for discussions without giving sufficient time to get them examined by the respective delegations. Who prepared the avalanche of draft after draft? Why? We do not know. In the eleventh hour – probably after 37 hours 45 minutes – they produced a draft – like a magician producing a rabbit out of his hat – and said that it was the Final Draft.
‘The tactics seemed to be to produce a draft in the wee hours and force others to accept that or come nearer to that. Has it happened in any other international conference? Definitely not. Therefore with pain and anguish, I would say that any system which in the last minute forces many developing countries to accept texts in areas of crucial importance to them cannot be a fair system. I would strongly suggest that the WTO Membership should have serious introspection about the fairness of the preparatory process for Ministerial Conferences.” (Speech at the India Economic Summit, 4 December, 2001).
However, the LMG position paper was fiercely countered by a group of developed countries. Led by Australia, the group, which included Switzerland, Canada, Korea, Mexico, New Zealand, Singapore (WT/GC/W/477, 28 June 2002) called for “flexibility”. They argued that
“Prescriptive and detailed approaches to the preparatory processes are inappropriate and will not create the best circumstances for consensus to emerge in the Cancun meeting. In a Member-driven organization processes need to be kept flexible. We need to avoid rigidities”.
The LMG did not have the political weight to bring their views to bear on the institution in the consultations which ended in 2002. One country, which was a signatory to the paper, said that the paper has since gone into “deep freeze”. They have told the Uruguayan Ambassador to commence consultations once again on behalf of the LMG, but are unsure of his level of commitment.
It is disturbing that a supposedly rules-based international organization ignores, flouts or invents procedures on the spot in order to suit the situation that will produce an outcome that is in the interests of its most powerful Members.
2. Obfuscation and Opacity
This kind of ‘flexibiliy’ leads to obfuscation and opacity. The process of negotiations right now is clouded with unknowns, which can only lead to surprises as the Ministerial draws nearer or at the Ministerial itself. This would put developing countries on the back foot, forcing them to react to rather than control the process.
At the same HOD meeting on 8 May, the DG, Supachai told Members that the overall package will only come together at the level of the General Council on 24 July. In the meantime, negotiations will continue in the various negotiating groups. Developing country delegates are not clear whether some kind of draft declaration will then be released on 24 July. One delegate, referring to the Canadian Mini-Ministerial, to which only about 25 Members will be invited and held most likely in late July, was of the opinion that a draft declaration will only be out by early or mid-August, depending on the outcome in Canada.
The WTO closes for the summer for two weeks from 26 July till 10 August. Any draft released after the break will give delegates about three weeks to react. Combined with how legal texts are now being drafted by Chairs (see next section), the shortness of time is a cause of concern. Usually, delegates should have enough time to send the drafts back to their capitals, co-ordinate with other developing countries and give their feed back in General Council sessions. Three weeks seems specially designed to short-circuit these responses, so that the most important decisions will be brought to Cancun to be decided by Ministers, whose handle on the complex technical trade issues cannot be compared with their trade experts in Geneva.
3. Chairman’s Text Rather than Members’ Text, Chairs Dictate Rather than Facilitate Negotiations
In the time of the GATT as well as the first years of the WTO, it was unheard of that a Chairman would bring out a Chairman’s text that gave his best judgment on where a compromise between Members could be. Traditionally, the role of the Chair is to facilitate negotiations between Members in order to work through differences. If differences persist, negotiating texts produced by Chairs invariably reflected the differences in opinions, by putting the various options in brackets. The product would be a “Member’s text”.
Stuart Harbinson chaired the General Council before the Doha Ministerial when he held the position of Ambassador for Hong Kong. He made a serious departure from negotiating procedures of international organizations by taking it upon himself to produce a “Chairman’s text” in the run up to the Doha Ministerial. Instead of reflecting the various positions in his draft, he went against international and GATT/WTO norms by presenting his “best judgment” of a compromise position. This technique worked against developing countries’ Ministers in Doha since the text made invisible developing countries’ positions, particularly on the contentious New Issues, and only reflected the EU/US joint position.
Unfortunately for the WTO, this dangerous precedent has been repeated since Doha in all the key areas of negotiations. Texts on TRIPS and health, agriculture and on non-agriculture industrial tariff negotiations have been produced in the “Harbinson fashion”. Developing countries, which raised objections pre-Doha (for instance Nigeria which denounced the Harbinson text, India, the LDCs, African Group etc) seem to be suffering from resistance-fatigue and seem increasingly resigned to such strategies.
Unfortunately, Members can expect more of the same before Cancun. DG Supachai promised Members no less at the 8 May meeting, when he said that “the negotiating group chairs are currently working hard to fulfill their mandates… The General Council Chairman and I will be working closely together with them to maximize the chances of success of this multi-level, integrated process…” (JOB(03)/88, 9 May 2003).
His comments were echoed by US Ambassador Deily to the TNC on 9 May where she said, referring to the Ministerial in Cancun, that “We will have to go through a systematic review of the requirements of Doha, that is well prepared in advance by the DG and Chairman Perez del Castillo” (Statement of Ambassador Deily to the TNC, May 9 2003).
Commenting on the current situation, a former Ambassador to the GATT/WTO said, “Chairpersons are supposed to facilitate negotiations between Members, not divine on negotiations and expound their interpretation of a compromise position. We would never have dared to do such a thing before. We were much more prudent. We would never have dared to put our best interpretation of a compromise position when Members were still holding divergent positions.
“By virtue of the fact that Chairs are chosen because they are closer to the major players or have the ears of the major players, they would have certain viewpoints. Therefore, for Chairs to come up with their text invariably means that the positions they take would reflect more the interests of certain players rather than others.”
4. Mini-Ministerials/ Green Room Meetings and Lobbying In Capitals
Critical also to the pre-Cancun negotiating process is lobbying of Ministers in capitals and what some representatives in Geneva see as the sidelining of Geneva Ambassadors and experts.
Since Doha, two Mini-Ministerials where only about 25 Members are invited have already been held in Sydney and Tokyo, and two more are in the pipeline – Egypt in June and Canada in July.
Some rather heated criticisms were heard in Geneva following the OECD Council of Ministers meeting in Paris at the end of April. Some developing country delegates, including the DG, joined the OECD members in an exclusive meeting on the WTO in Paris. Upon their return, those not invited were ‘briefed’ about what had taken place, prompting some to complain about how the Geneva process had been sidelined.
An informal Mini-Ministerial is to take place on June 21-22 in Sharm el-Sheikh, Egypt. Ministers from only 27 Members (counting EU as one) have been invited. They include: Australia, Bangladesh, Brazil, Canada, Chile, China, Costa Rica, Egypt, European Union, Hong Kong, India, Indonesia, Japan, Jordan, Kenya, Lesotho, Malaysia, Mexico, Morocco, New Zealand, Nigeria, Senegal, Singapore, South Africa, Switzerland, Thailand, United States.
The Mini-Ministerial, focusing on market access issues — industrial tariffs, agriculture and services — and TRIPS and special and differential treatment, as well as the Singapore issues over a dinner session will no doubt be a critical political moment in deal-making and the forging of ‘consensus’ with developing country Members. The Canadian Mini-Ministerial will be even more pivotal. Before Doha, the Mini-Ministerial in Singapore led to delegates in Geneva feeling that “things were different”. The outcomes from that Singapore Mini-Ministerial were not unlike what was finally agreed on in Doha. A similar scenario is clearly being planned.
These Mini-Ministerials are illegitimate, given that they exclude about 100 Members in the WTO. It is ironic that a “Development Agenda” is being negotiated with the majority of developing country Members absent from the table. Whilst the co-ordinators of developing country groups – namely the LDCs and the African Group – will be attending the Egypt Mini-Ministerial (Bangladesh and Morocco respectively) they have not been mandated to negotiate on behalf of the others.
Unfortunately, this kind of Ministerial contact are opportunities for co-option or arm-twisting. Overseeing a broader agenda, Ministers of less powerful countries are at a disadvantage in these negotiations. It is also patently anti-democratic for decisions to be made amongst a small group, only to be presented as a fait accompli to the broader Membership.
One pro-New Issues developing country diplomat had this observation about the Geneva-capital divide:
“We are now at an impasse. The Ambassadors here are not willing to take decisions. There is too much at stake and they don’t want to be the ones giving the house away. So they leave the decisions to the big guys. And then they complain that the Geneva process is being bypassed.”
5. Geneva Negotiations Proceed in Informal Mode
The “information” Heads of Delegations meetings that are taking place in Geneva in preparation for Cancun are also happening in informal mode. This again is worrying and this concern was expressed by India and several other developing countries at the 8 May HOD meeting.
The WTO has a propensity of having off-the-record informal meetings. In the run-up to Doha, preparatory meetings at the General Council level were held informally, sometimes followed by formal meetings (although the frequency of formal meetings was still less than satisfactory). Since these formal meetings were recorded, countries’ positions were made public. These public positions at least added to the transparency of the institution, and it was possible after the Doha Ministerial, to compare countries’ final positions with their initial positions. The differences in their pre and post-Doha positions shed some light on what might have happened in the back-room.
In terms of institutional memory, formal on-record meetings are also very important since it can inform those who come later what the circumstances were which shaped the present agenda. This is also important given the fact that WTO language is often ambiguous in order to accommodate varied positions. Records can help to shed light on the meaning behind the ambiguous words. Countries which are politically weaker are on the loosing end without these records.
6. Bilateral Pressures
The unequal power equation between developed and the majority of developing countries is a major factor determining whether, and to what extent, developing countries exert their preferred positions in negotiations.
Although consensus means that in theory, any one country can oppose the package presented to it, and hence hold up negotiations, not one developing country, not even India, is able to do so in practice. Each and every developing country has at least an area of vulnerability vis-เ-vis the US, EU, and/or Japan. This could be in the area of exports, aid, debt, IMF loans which might be withheld, preferential access (particularly the ACP countries’ arrangement with the EU, or African countries vis-เ-vis the US in the African Growth Opportunity Act (AGOA)). Threats that exports and trade will be hurt are everyday realities for Ministers, as well as Geneva negotiators. Some countries presently in bilateral free trade negotiations with the US are also particularly cautious. According to their level of dependence or vulnerability, delegates from the South temper their tone in the negotiations.
If these are not enough to silence negotiators adequately, the jobs of Ambassadors of course are put at risk. Oftentimes, pressure is put on countries to withdraw their representatives. A handful of vocal Ambassadors have been removed post-Doha, and this has considerably weakened developing country groupings in Geneva. (A very recent example of this in the UN context took place in New York, where the Chilean Ambassador was withdrawn due to his opposition to the Iraq war.)
The larger political situation today – the willingness of the United States to be openly unilateralist – and the displays of military might, are also factors which will invariably weigh on the minds of developing country Ministers engaged in WTO talks.
One developing country diplomat from the Americas informally commented “The current process is as non-transparent as the last Ministerial. To tell you frankly, the problem now (as compared to pre-Doha) is that developing countries are weaker than before, as a result of bilateral pressures and the larger political situation”.
According to an African diplomat, efforts by some Africans to get others on board to a more critical position on domestic supports in the agricultural negotiations in Geneva earlier this year led to phone calls in the capitals. He said, “When they get a call from one of Pascal Lamy’s boys, they know that it is sensitive stuff they are dealing with”. As a result, the initiative was dropped and what is currently on the table looks to be another raw deal for developing countries.
NEW ZEALAND: MORE TRANSPARENCY WILL DRIVE NEGOTIATIONS UNDERGROUND
Rather unexpectedly, on 9 May at the TNC meeting, the New Zealand Ambassador Timothy Groser warned developing countries not to push for greater transparency in the decision-making process. With a membership of 146, Groser warned that if every decision-making process were to involve the entire membership, the process would go nowhere. Efforts to attain internal transparency, he said, would be counterproductive and would push the negotiating process underground.
For a supposedly “democratic” nation, one would have expected rather a different tune from NZ. In any case, the process already seems to have gone underground, since it is entirely in the control of the DG / Harbinson team, and the Chair of the General Council, in alliance with the major players.
Unless international organizations creating international rules are only institutions that exist in today’s world in order to legitimize the will of the powerful, what is happening in the WTO is a grave aberration from the aspirations of “multilateralism” that the majority of Members in the WTO most likely aspire to. Rather than standing up for the weak, the WTO is doing well at institutionalizing the will of the powerful.
Perhaps it all boils down to what John Musonda of the Union Network International in Zambia says:
“It’s the same old colonial equation. Our people own nothing, control nothing. Their (the North’s) people are developed, now they want to expand trade. Our people are not developed, we can’t expand trade” (Khan, Farah, IPS 24 May 2003 ‘A Strategy for the Next WTO Meeting in Mexico’).
Trying to force upon the majority in the South a corporate expansionist agenda can only take place under circumstances of marginalisation, obfuscation, “rule-less” procedures and “persuasion”.
* Aileen Kwa is a policy analyst working with Focus on the Global South in Geneva.