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India's proposal for WTO reforms supported by a large majority of countries

26 Jul 2019

A large majority of countries on Wednesday endorsed a joint proposal by India, South Africa, and seven other countries for reforming the World Trade Organization, in the face of existential threats to the survival of multilateral trading system, say trade envoys.


The joint proposal, based on a concept paper prepared by India, called for the immediate resolution of the impasse at the highest adjudicating body for global trade disputes. It calls for prohibiting unilateral trade measures. It asked for “development-centric" reforms that would strengthen the 164-member trade body.


But the United States severely opposed the joint proposal saying it will unravel the Uruguay Round agreements that established the WTO, according to a trade envoy, who asked not to be quoted. “The US remains opposed to resolving the impasse at the Appellate Body while seeking fundamental changes in the architecture of the WTO," envoy maintained.


Earlier this week, the US trade envoy Ambassador Dennis Shea told informal group of developing countries that President Donald Trump has “personal interest" in bringing about what is called differentiation at the WTO for availing special and differential flexibilities among developing countries.


However, several other industrialized countries, particularly Norway, supported the joint initiative saying it offers a way-forward for strengthening the WTO in the face of a sustained assault on multilateral trading system, the envoy said.


At a General Council meeting of the WTO, India introduced the joint proposal by South Africa, Bolivia, Cuba, Ecuador, India, Malawi, Tunisia, Uganda, an Zimbabwe saying the proponents want to “bring balance to the on-going discussions on WTO reform by reaffirming the importance of development to the work of this organization".


With WTO reforms being at the centre-stage of discussions for salvaging the global trade body in the face of unilateral trade measures, Ambassador J S Deepak, India’s trade envoy to the WTO, pointed that“as the original proponents of reforms to correct the asymmetries in the covered Agreements, developing Members are more than willing to engage constructively in these discussions."


India expressed sharp concern over “a one-sided narrative" being advanced by major developed countries, especially the US, that disregards “issues of importance and concern to developing countries." Moreover, the one-sided narrative “erodes the core principles of consensus-based decision making, non-discrimination and Special and Differential Treatment (S&DT)," India warned, chiding the proposals “to differentiate between developing Members; impose punitive strictures for noncompliance with notification obligations; and do away with S&D in negotiations on fisheries subsidies are illustrative of the lack of balance in the reform proposals that have been tabled."


The concept paper circulated by nine developing and least-developed countries, according to Ambassador Deepak, aims to “ensure that issues of their interest are not side-lined in ongoing discussions on WTO reform."It states emphatically that “the Marrakesh Agreement establishing the WTO recognizes that international trade is not an end in itself, but a means of contributing to certain objectives including ensuring that developing countries and LDCs secure a share in international trade commensurate with the needs of their economic development."


Therefore, discussions on WTO reform, India cautioned, “should be premised on the principles of inclusivity and equity, and not serve to widen existing asymmetries in the covered agreements". Without naming the US, the joint proposal calls for “disciplining laws and regulations of WTO Members which mandate unilateral action on trade issues that are inconsistent with WTO rules". It says there is an urgent need for “strengthening the multilateral character of the WTO, especially through the preservation of the practice of decision-making by consensus".


“Our immediate priority in WTO reforms should be to resolve the ongoing impasse in the Appellate Body to address the unilateral measures as these pose serious existential challenges for the organisation," India maintained.


China’s trade envoy Ambassador Zhang Xiangchen commended “India and other co-sponsors for their efforts in putting forward" the joint proposal, saying"China shares similar views on various issues raised in the paper, on which we have clearly expressed our positions in China’s Proposal on WTO Reform". “ In particular, we agree that WTO reform does not mean accepting either inherited inequities or new proposals that would worsen imbalances," the Chinese envoy said and maintained that “reforms must be premised on the principles of inclusivity and development".


South Africa’s trade envoy Ambassador Xolelwa Mlumbi-Peter castigated the US’ suggestion that the Doha Round is dead. Unless WTO members formally declare the closure of the Doha negotiations, they will continue even if the US opposes them, she argued.

Source: Live Mint

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