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WTO NEWS: SPEECHES — DG SUPACHAI PANITCHPAKDI

Dakar, Senegal, 4 May 2004

Address by the Director-General to Third LDC Trade Minister’s Meeting

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Your Excellencies,

Thank you for inviting me to join you today. This meeting comes at a critical time for the Doha Development Agenda and for our current efforts to keep it alive. Along with the wider WTO Membership, you have set yourselves a target to make meaningful progress in the negotiations by this July.

This involves a number of priority issues, at this point in time, including agreeing on frameworks for modalities in agriculture and non-agricultural market access as well as reaching a modus vivendi on the way ahead for the Singapore issues and cotton. These issues, as you know, were the most difficult to resolve at Cancún. They were the focus of intensive consultations during the last quarter of 2003 and they remain central to unlocking progress in other areas of the work programme. Achieving these relatively modest advances this summer will help put the negotiations as a whole back on track. Failure to do so will certainly mean that 2004 is a wasted year, and perhaps a good part of 2005 as well.

This does not mean that the other DDA issues are forgotten; on the contrary a clear message has to be given that they will be fully part of the final package. We will continue to work hard on all of them.

I would like to say a few words here about Special and Differential Treatment, since I know that the issue is close to your hearts.

Special and Differential Treatment was given a very prominent place in the Doha Ministerial Declaration which launched this round of negotiations. It is, indeed, no exaggeration to say that it permeates the Declaration. In Agriculture, for example, it was stated that Special and Differential Treatment would be an integral part of all elements of the negotiations. The framework text on Agriculture at Cancún indicated, to mention just one part of this, that LDCs should be exempt from commitments to reduce tariffs. Furthermore, account was to be taken of the importance of preferential access which developing countries including LDCs enjoyed in other markets. The framework text on Non Agricultural Market Access indicated that LDCs should not themselves be required to apply the formula reduction to their tariffs or to take part in any sectoral approach.

These are very tangible elements of Special and Differential Treatment. They, and others like them, are still on the table. In addition to that, of course, there is the separate exercise to make existing Special and Differential Treatment more precise, effective and operational. There is a strong body of opinion that favours giving prominence to this in the July package.

I want to stress the urgency of the task facing us in the next few weeks. A loss of momentum in the Doha Development Agenda will have a direct impact on the areas in which Least-Developed Countries have a key interest — among them: liberalization of the cotton sector and agricultural reform generally; the efforts I have referred to, to make special and differential treatment provisions more concrete, precise and operational; and issues being addressed in the work programme on LDCs. There is much to be gained or lost in the agriculture negotiations. If we can reach agreement on a framework by July, we have a foundation for future work which will lead to conclusion of the negotiations. Without that foundation we face drifting and another lost opportunity.

There are, of course, broader considerations also to bear in mind. If governments and their constituents lose faith in the ability of the DDA to deliver results we shall, no doubt, see a growing imbalance between multilateral and bilateral deal making. This could rock the foundations of non-discrimination and transparency upon which the multilateral trading system is built. These core principles not only help level the playing field between developed and developing countries, but also make the international trading environment a more predictable and less complex place to do business. I am convinced that the world’s poorest and most vulnerable countries would be the biggest losers from a focus on bilateral deals at the expense of multilateralism.

I would therefore like to strongly encourage you to use this meeting to focus on how you can contribute to achieving a meaningful WTO result in the summer. Together, least-developed countries account for over one fifth of the total WTO Membership.

You have shown your ability to stand tough and participate actively. Your voices have been heard and heard quite clearly. Already we have seen a lot of progress on issues of importance to LDCs both within and outside the negotiations. I would cite for example:-.

  • Never before in the history of multilateral trade negotiations have issues of importance to developing countries been given such prominence — cutting across the length and breadth of the Doha Work Programme. This was very much a result of the collective action of developing and least-developed countries.
      
  • The Agreement on TRIPS and Public Health was the major achievement of last year. Hopefully this will be of significant and enduring benefit to LDCs in your valiant fight against the scourge of AIDS and other public health crises.
      
  • In September 2003, Members reached a Decision on the Modalities for the Special Treatment of LDCs in the Services Negotiations. I urge you to build on the efforts you are already making and be more proactive and, at the same time, realistic in articulating the specific sectors and modes of priority to you, both here and in Geneva.
      
  • At the Cancún Ministerial Meeting — consultations produced revised versions of what has become known as the “Derbez text”. While this was not agreed upon by Members, it never-the-less gave a strong indication that Members are sensitive to the needs of LDCs and prepared to accord them “special” treatment along the lines I have mentioned.
      
  • Also at Cancún the Word Bank and the IMF reaffirmed their offer of assistance to provide financial and technical support for implementation of the Doha Round. In parallel, IMF and WTO staff have worked together to address the issue of the availability of adequate and affordable trade financing for developing countries, particularly in times of financial crisis. Recently, a new initiative called the Trade Integration Mechanism has been created by the IMF to help finance adjustment costs arising out of the DDA negotiations.
      
  • A total of 28 WTO Members have, on an autonomous basis, announced measures to improve market access opportunities for LDCs. There remains a high level of political commitment to granting quota free and duty free access to LDCs.
      
  • Since the launch of the DDA, technical assistance activities by the WTO Secretariat have been ramped up with priority being given to LDCs. Over half of the activities in the 2003 Technical Assistance plan were for Least-developed countries. During 2003, 109 officials from 40 LDCs participated in training courses organised in Geneva. Many LDC officials also took part in the three month trade policy courses in Africa which are designed to give African negotiators intensive training on WTO agreements and build up human capacity in the region. The Integrated Framework programme for least-developed countries has been expanded. The JITAP programme has also been extended to a further eight African countries, six of whom are LDCs.
      
  • In December 2002, agreement was reached on guidelines for LDC accessions. Only ten days ago, Nepal became the first LDC to join the WTO since its creation in 1995, after negotiating accession under Article XII of the WTO Agreement.
      
  • Efforts have also been made to make headway on the cotton issue. Last month the WTO hosted a Workshop on cotton in Benin focusing on the development assistance aspects of this sector. Selected development agencies, the EU and the US will be meeting soon to discuss how to implement the outcomes of the workshop, in coordination with a representative from the African cotton producing countries. Consultations on the trade policy aspects are underway both in Geneva and between high-level officials from cotton producing countries and their counterparts in their major export markets — the EU and US. It is, in itself a major achievement to have raised the profile of cotton to such an extent. It is clear that this issue is being taken very seriously. Here, let me say that the optimum path for making headway on the trade policy aspects of the cotton issue undoubtedly lies through the agriculture negotiations. We have a golden opportunity to get these negotiations going, including cotton, by agreeing on an ambitious framework by July. On the other hand, if we fail to reach a framework agreement on agriculture in July, it is difficult to see how else we are going to make real progress on cotton.

Building substantially upon the efforts to integrate LDCs into the multilateral trading system can only be achieved through progress in the Doha Development Agenda. It is essential that all Members do not take purely tactical and inflexible positions now. The July package we are endeavouring to achieve is not the end of the DDA, but an important stepping stone in the overall process. The Declaration that emerges from this meeting in Dakar must, of course, be a reflection of your interests and priorities, but sufficient flexibility must also be given to your negotiators to strike the compromises needed to move the negotiations over the coming weeks — particularly in the areas of agricultural and non-agricultural market access, cotton and the Singapore issues.

On the Singapore issues, I think you do need at this stage to build in a little more flexibility in your position if we are going to reach a consensus in July. Others have already shown considerable flexibility in this area. In a spirit of goodwill you need to go part of the way to meet them.

Let us remember that in important areas such as agriculture we are talking about framework agreements only as a platform for finalising the negotiation. Key elements, notably the actual figures for reduction commitments in the three pillars of domestic support, export competition and market access will remain to be negotiated later on. The July package is, I repeat, not the end of the DDA.

Now is the time for all WTO Members to show realism, flexibility and a determination to make progress. From my own personal contacts with LDC Ministers since Cancún — both in Geneva and at ministerial gatherings I have attended in Cairo, Mombassa, Cotonou and Abuja — it is clear to me that the LDCs place a high value on these negotiations and are fully and totally committed, both to participating actively and moving the DDA forward. I count on your constructive engagement and your leadership at this important juncture.

Thank you Mr Chairman.