Report from Geneva, VII

By July 28, 2008Policy Experts, Trade

Two steps forward, and one step back. Or is it one step forward and two back? At any rate there was no forward movement in the WTO talks today. This morning, the U.S. had some very pointed words for India and China, stressing that the Lamy text was the only way forward. If countries were to reject the text or backtrack, there is no chance for a deal. Nobody is completely happy with the Lamy text (including the NAM), but if there are to be negotiations, the Lamy text is really the only basis on which to have the terms of negotiation. (Lamy’s update for July 28 is available here.)

The U.S. is not the only delegation concerned. Press reports indicate that France continues to pressure the EU delegation to resist agricultural changes and Germany is now understood to be pressing on the industrial side, saying German industry is not getting enough market access. China and India pushed back, saying they are being asked to do too much, and then they all went back into a “Group of Seven” (G-7) meeting – ministers only this time, no note takers or observers, so the ministers could frankly exchange views.

The G-7 met most of the day, broke up, and reconvened. So far, without resolution. The big issue is “SSMs – special safeguard mechanisms by which developing countries can clamp down on agricultural imports if there is a surge. They want, in fact, to be able to slap tariffs on that are higher than their legal WTO bound rates. Wow! That would in essence destroy one of the longest-standing pillars of the WTO, going back to 1946-47 when the GATT was first agreed. Big issue. But not just a theoretical issue. U.S. farm interests are extremely concerned about the protectionist possibilities here.

The issue is so serious that the whole Ministerial meeting could come unwound. We’ll see.

The other hot issue is the question of whether Brazil, India, and China will sign on to Annex Z and participate in sectoral negotiations. Brazil doesn’t seem to have a serious problem here, but China and India are still very resistant. My tea leaf readings, though, indicate that the degree of loudness of “no” is diminishing. Some questions are being asked about the nature of sectoral negotiations, whether if you start the process you are bound to finish it, etc. These are good and useful questions.

But first we have to get past the SSM issue, and that seems to be as big as Mont Blanc, which looms in the distance from Geneva.

NAM’s Man in Geneva
Frank Vargo

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