Capture Progress and Continue Work, WTO Members Say

(World Trade Organization)

Issues settled in nine days of talks among ministers should be preserved and work in the Doha Round should continue despite the ministers’ talks collapsing the previous day, WTO members said on 30 July 2008.

They were speaking on the record, in a formal meeting of the Trade Negotiations Committee, the forum for the full membership to oversee the negotiations. The focus was on the talks among ministers, which broke down on 29 July when a small group of them could not agree on details of a new “special safeguard mechanism” for developing countries (explained below).

The members were echoing WTO Director-General Pascal Lamy’s opening comments in the meeting.

He spoke of “a collective responsibility” to reflect on next steps. The progress made in agriculture, non-agricultural market access and other subjects should be preserved, Mr Lamy said. “This represents thousands of hours of negotiation and serious investment by all the members of the WTO. This should not be wasted.”

Special safeguard mechanism

The talks among minister broke down on 29 July over the special safeguard mechanism (SSM). What exactly was the problem?

This is not about protecting poor farmers in general – that is already covered by what has been agreed on the formula for cutting tariffs, smaller or no cuts for “special products”, different treatment for small and vulnerable economies, recent new members and special cases such as Bolivia, exemptions for least-developed countries. It was not even about the SSM itself. This is about one particular circumstance.

The SSM would allow developing countries to raise tariffs temporarily to deal with import surges and price falls. The blockage was only about import surges, and in a particular instance of that.

Agreed already: All WTO members have agreed that developing countries will have an SSM. They have more or less agreed on how big the import increase would be to trigger the temporary tariff rise, and they have agreed on how high the rise should be in general.

The blockage is about the situation where the SSM raises tariffs above commitments countries made in the 1986–94 Uruguay Round – the “pre-Doha Round bound rates”. In the case of new members, that means commitments made in their membership agreements.

So, essentially, the blockage is about the SSM reaching into a disputed zone: above pre-Doha bound rates. More details can be found here and here.