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U.S. Again Warns of Insufficient Progress in WTO Trade Facilitation Talks

Monday, June 03, 2013
Sandler, Travis & Rosenberg Trade Report

A senior U.S. trade official warned last week that the World Trade Organization is again in danger of failing to conclude a trade liberalization agreement at this December’s ministerial meeting in Bali, Indonesia. With the long-running Doha Round negotiations at an impasse, WTO members are working to craft a more limited agreement covering trade facilitation, agriculture and least-developed country issues, but even that is proving to be difficult.

Just a month ago, U.S. Ambassador to the WTO Michael Punke told attendees at a May 29 meeting of the Organization of Economic Cooperation and Development, more than a dozen WTO members “came forward in a spirit of compromise, tabling more than 50 specific examples of new flexibility” in the ongoing negotiations. There was hope that “we could start with modest steps, establish traction over the course of May, build mutual confidence, and remove some of the ground clutter that might clear a path to bigger results.” Today, however, “we see an opportunity to make modest progress has been frittered away.”

Punke blamed the situation on unnamed WTO members who are “holding hostages in this negotiation” by “refusing to allow progress in one area, trade facilitation, until they get all they want on agriculture.” He asserted that to be able to conclude a trade facilitation agreement this year “there must soon be a dramatic reduction in the nearly 600 brackets [signaling areas of disagreement] currently littering the trade facilitation text.” He added that current proposals from various emerging and developing economies on agriculture are overly ambitious and need to be scaled back if there is to be an agreement at the ministerial meeting.

Punke also reiterated his concern about the impact of a potential failure this year on the WTO as a whole. “If Bali succeeds, including a high-quality trade facilitation agreement, stakeholders will see that the WTO is once more a functioning forum for negotiations” and “it will be possible to make a credible case that more difficult Doha Development Agenda issues can be tackled,” he said. “If Bali fails … many countries will continue their efforts to create new trading opportunities bilaterally and plurilaterally” and “the WTO as a negotiating body will continue to fall behind.” He therefore called for all WTO members “to make one last-ditch, good-faith effort to save the Bali package.”

Press reports indicate that following Punke’s remarks other trade ministers participating in a “mini-ministerial” on the sidelines of the OECD meeting agreed to intensify technical discussions on trade facilitation in an effort to remove the existing brackets in the draft agreement text. Ministers are expected to evaluate progress by the beginning of August.

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