SME Editorial
With the US going back on its commitment to find a permanent solution to the public food stockholding issue, the talks at the 11th ministerial conference of the World Trade Organisation (WTO) in Buenos Aires collapsed, bringing disappointment to developing countries like India. As the US refused to engage, the 164-member WTO failed to reach a common ground for resolving the food security issue, a demand raised prominently by India.
The fate of the ministerial conference was sealed after assistant US trade representative Sharon Bomer Lauritsen said in a small group meeting that permanent solution to the food stockholding issue was not acceptable to America.
The four-day conference, which ended without a ministerial declaration or any substantive outcome, did manage to make some feeble progress on fisheries and e-commerce by agreeing to work programmes.
Even after hectic parleys, intense lobbying and prolonged posturing, the member nations failed to break an impasse over public food stockholding, disappointing a number of member states, especially the developing ones.
Following the breakdown of talks, there was no ministerial declaration, though conference chair and Argentinean minister Susana Malcorra made a statement highlighting the developments. For India, failure to successfully push the food security issue was a disappointment, but the officials took comfort from the fact that the country did not yield any ground on other issues and kept its defensive interests in various fields intact. “Unfortunately, the strong position of one member against agriculture reform based on current WTO mandates and rules led to a deadlock without any outcome on agriculture or even a work programme for the next two years,” read a statement issued by India at the end of the conference.
A dejected WTO director general Roberto Azevedo expressed disappointment over the way the negotiations progressed and called for soul-searching among the member countries. In multilateral negotiations, he added, “You do not get what you want, but you get what is possible.” Admitting failure, Malcorra said, “We fell short on various issues, but there is life after Buenos Aires… We need to find ways for removing deadlock and move forward.”
The Indian team, led by commerce and industry minister Suresh Prabhu, in cooperation with the G-33 grouping, had pitched hard for a permanent solution to food security issue, as it was crucial for livelihood of 800 million people across the globe.
Under the global trade norms, a WTO member country’s food subsidy bill should not breach the limit of 10 per cent of the value of production based on the reference price of 1986-88. Apprehending that full implementation of food security programme may result in breach of the WTO cap, India has been seeking amendments in the formula to calculate the food subsidy cap. As an interim measure, the WTO members at the Bali ministerial meeting in December 2013 had agreed to put in place a mechanism, popularly called the Peace Clause, and had committed to negotiating an agreement for permanent solution at the 11th ministerial meeting in Buenos Aires.
However, as no agreement was reached at MC 11, the Peace Clause will continue and also the existing mandate to find a permanent solution. “… [T]he existing mandates and decisions ensure that work will go forward, and the members will continue to work on issues such as the permanent solution on public stockholding for food security purposes, agriculture Special Safeguard Mechanism and agriculture domestic support,” read India’s statement.
Decisions to set up a work programme on fisheries subsidies and continue with the non-negotiating mandate of the existing work programme on e-commerce were in line with the positions pursued by India at the conference. Several developed countries wanted to bring the issue of e-commerce to the negotiating table, but India opposed it on the ground that WTO rules on this emerging sector would restrict the policy space necessary for promoting domestic players. It was also decided to continue with the current practice of not imposing customs duties on electronic transmissions for another two years till 2019.
On the other hand, no agreement was reached on new issues, like investment facilitation, MSMEs, gender and trade in absence of consensus. India was against pushing new issues on the negotiating table, as it would dilute the commitment to deal with the existing ones.
According to officials, the ministers could not arrive at an agreed ministerial declaration, as a few of them did not support reiteration of “key underlying principles guiding WTO and various agreed mandates”. India wanted explicit reference on commitment for completion of the Doha Development Agenda (DDA) and affirmation of faith in multilateralism. As some members did not agree to India’s submission, the ministerial declaration failed to pass the muster.
India, the statement said, “stood firm on its stand on the fundamental principles of the WTO[,] including multilateralism, rule-based consensual decision-making, an independent and credible dispute resolution and appellate process, the centrality of development, which underlines the DDA and special and differential treatment for all developing countries”.
In 2014, after a long impasse, India and the US had reached an understanding at the WTO that they would find a permanent solution to the problem of public stockholding, which is vital to ensuring food security in India. But, the US went back on the commitment on agricultural reform. The US statement that it would not accept a permanent solution disappointed developing countries, which want reforms on the problem of food subsidies.
The fact is that the US, under President Donald Trump, has no faith in multilateral agreements and prefers bilateral deals or agreements among small groups, say analysts. They say that it is likely that the US would also champion a change in WTO decision-making from consensus among all members to a mixture of plurilateral agreements that like-minded countries can opt into and even decisions by majority.
(PTI)
