IUST: Davies Says Nairobi Must Acknowledge Doha Deadlock, Without Burying Round

NAIROBI – South African Trade Minister Rob Davies on Thursday (Dec. 17) acknowledged that the Doha round is not likely to be reaffirmed in a ministerial declaration here due to conflicting views among World Trade Organization members, but made clear that the differences must be expressed in a way that is not interpreted as burying the Doha mandate.

In an interview with Inside U.S. Trade, Davies said there is a danger that including language in the declaration stating that there is a divide between members on whether to reaffirm the Doha mandate could be interpreted by some as legally ending the round if even there is no political declaration to do so.

“That may not be political, but we'd have to make sure that doesn't legally bury [the round] as well,” he said. “And we'd have to see what the formulations that have been proposed are. ... We haven't seen the text yet as we've seen on agriculture.”

The U.S. has made clear that it would consider the lack of consensus on reaffirming the Doha round apparent here as meaning the round is over. Asked about the U.S. position, Davies said that was exactly his point. “We won't be part of anything that records something that is then interpreted as meaning it's ended,” he added.

Davies said he planned to deliver a similar message to U.S. Trade Representative Michael Froman during a bilateral meeting later in the day Thursday.

When pressed why language reflecting the lack of consensus on continuing Doha would legally kill the round, Davies did not provide a clear answer. “All of those issues and questions … require us to be sure of the legal interpretation of what's written as well as the political interpretation,” he said.

Davies identified the post-Nairobi work program and how to deal with the Doha Round as the “biggest issue” at this ministerial, overshadowing what he described as a “modest” package of agreements on agriculture. He said a potential ministerial declaration would not likely define the future work program in any detail, leaving the conversation to continue after the meeting.

As of midday Thursday, trade ministers here had not held substantive discussions on how the Doha round should be addressed in the ministerial declaration, but were slated to do so Thursday evening. A senior Swiss official told Inside U.S. Trade that this is because ministers have focused on the agriculture talks and cannot tackle both issues at the same time.

The lack of progress on the Doha issue was evident in a revised draft ministerial declaration circulated to WTO members here Thursday morning. The document, dated Dec. 16, shows no reduction in the number of brackets that address the future of the Doha round.

In the interview, Davies argued that the Doha round architecture needs to be preserved because it prioritizes the issues of development and agricultural trade reform and enshrines key concepts such as “special and differential treatment” and “less than full reciprocity.”

Asked why it was not acceptable to merely state that these issues remain priorities in the WTO's future work without reaffirming the Doha round, Davies indicated that the Doha architecture provides developing countries with greater assurances that these issues will be addressed, how they will be addressed, and that they will not fall off the agenda as other WTO members try to add new issues.

“I think that for us the preservation of the Doha mandate is important because it does shape the work program and shape a set of principles, and if we just allow that to be buried here in Nairobi, either politically or legally … then we will be back to square one, and we will not know the framework within which those issues are going to be addressed, the way they're going to be addressed or anything like that, and in practice we could find that there will be demands for a whole series of other issues, which would marginalize those issues,” he said.

U.S. Trade Representative Michael Froman has made the opposite argument, claiming that dropping the Doha round architecture would free up WTO members to tackle the Doha issues with fresh approaches and discuss new issues such as e-commerce and the role of small businesses in trade. He reiterated that view in a plenary speech to his fellow ministers on Thursday.

"Freeing ourselves from the strictures of the Doha framework would allow us bring new, creative approaches to those issues, as well as allow us to explore emerging trade issues, revitalizing the WTO and the multilateral trading system," Froman said.

Asked to respond to the U.S. talking point that the Doha round should be ended because it has not delivered results in 14 years, Davies implicitly blamed developed countries for the deadlock. He said that what was on the table on agriculture in Doha incorporated the sensitivities and realities of countries that benefited from the existing agriculture trade regime, but similar flexibilities were not provided on issues like industrial tariffs that are sensitive for developing countries.

The U.S., by contrast, blames the Doha deadlock on advanced developing countries like China, India, Brazil and South Africa, which it views as being unwilling to make concessions in at the WTO commensurate with their weight in the global economy. This is particularly true in the areas of domestic agricultural subsidies, which the U.S. says China is unwilling to limit even though it has now become a major subsidizer.

Some in the U.S. believe that it may take a failure in Nairobi to convince developing countries that multilateral trade negotiations cannot succeed if they do not make bigger concessions.

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