WTO: Day 4 in Hong Kong–The Doha Dance–Two Steps Forward, Then One or Two Back

By December 16, 2005Trade

Daily Updates from Hong KongHere is part five of Frank Vargo’s daily update–from the front lines–in Hong Kong for the Sixth WTO Ministerial Conference:

Herding baby chicks is child’s’ play compared to the job that Hong Kong Ministerial Chairman Tsang and WTO Director-General Pascal Lamy have. Somehow they have to fashion an agreed document that lays out a set of instructions to negotiators, while meeting the demands–often conflicting–of 149 countries. But that’s what they are charged with doing, and that’s what they are slowly piecing together.

The WTO runs on paper. Everything depends upon “texts” — statements of what is agreed, and what commitments have been made. Draft texts are put together in an effort to see how much agreement there might be on the words in those texts. Typically, the texts are resoundingly criticized, with countries saying they could never agree to the provisions — and then the process of pulling together another text begins.

Tsang and Lamy have several “facilitators” to help them — as well as a lot of other people who try to help. The two officials and their facilitators talk to individual ministers and groups of countries and then try to fashion a document that more or less captures what most people might be able to agree with. That process is going on now, and we expect to see a new text Saturday.

The NAM certainly hopes that the manufactured goods part of the text will meet what we have been lobbying for — a tariff-cutting formula that would result in reductions in the real tariffs imposed on U.S. manufactured goods exports, provision for sectoral agreements allowing tariffs to be eliminated in industry sectors that want this, and progress toward agreements to reduce non-tariff barriers. We are waiting eagerly.

For the first time, I see a little hope in this Ministerial that things may be inching forward. A difference is emerging between the public posturing and press statements on the one hand, and what ministers are telling each other privately. The private conversations indicate some serious probing as to possible compromises. That’s good news.

After the new proposed text comes out, we’ll do the trashcan count. If all the trashcans in the Convention Center are full, we’ll know the Hong Kong Ministerial is in real trouble. But if they are less than half full, that means delegates liked the text enough to continue seeking common ground in yet the next version of the text.

NAM President John Engler arrived in Hong Kong today, and had a head-spinning day of meetings with trade ministers, press briefings, and still more meetings with senior U.S. officials, and leaders of the NAM’s foreign counterpart manufacturing organizations. Those counterpart meetings were particularly interesting, and we found a large amount of common ground among the NAM, Japan’s Keidanren, Canadian Manufacturers and Exporters, the Korean trade association (KITA), UNICE (European Industry Association), the Australian Industry Group, New Zealand industry and others.

As Governor Engler and the other industrial leaders talked, it became obvious that we all wanted basically the same thing out of the Doha Round — deep cuts in high tariffs so that our companies can compete on a level playing field. And we are all focused on the same markets — China, India, Brazil and other advanced developing countries that have tariffs up to10 times higher than ours.

But our common ground wasn’t just limited to cutting high tariffs. All of us also want non-tariff barriers reduced. We want an end to standards and testing procedures that make it expensive to sell in other countries. We want more common testing procedures. And we want other improvements that would lower the cost of exporting and doing business around the world.

We are finding that our close cooperation in Hong Kong is making a difference for manufacturers and helping all our members. After all, our associations represent about 60 percent or so of all global manufacturing production. We may well want to continue this process of dialogue and cooperation after the Hong Kong Ministerial — and maybe even after the Doha Round.

That would be a good thing. Manufacturers need their voices heard more clearly on international trade. More active cooperation among foreign industry groups could be one way to do this. Strengthening our ability to work together as global manufacturers, then, could be one unexpected — and very important — result of Hong Kong.

FYI, here’s a link to a press release from today.