The Ministerial Conference is the top decision making body of the World Trade Organization (WTO).
Recently, 11th Ministerial conference of WTO held in Buenos Aires, Argentina to discuss substantive issues such as the food security right of developing countries and the centrality of development in multilateral trade negotiations.
Since Doha Round, US and other developed countries are striving to negotiate on Agreement on Agriculture (AoA) to enhance their export on agriculture. So they are pressurizing others to accept De-minimis, subsidy and other similar conditions.
However, the developing countries, particularly G33, have vehemently opposed this. To circumvent this, US is now acting shrewdly to adopt other means such as negotiating trade terms on bilateral basis to avoid formal dispute resolution mechanism of the WTO.
WTO Issue-1: Food Security right of developing countries
What is food security?
-> It refers to the availability of food and one’s access to it.
-> Food security has 3 elements => Food availability + Food access + Food utilization.
Role of WTO in achieving food security:
-> Work on food security at the WTO takes place in the Agriculture Committee.
-> Its key responsibility is to monitor how WTO members are complying with their commitments.
Agricultural Market Information System (AMIS):
-> The WTO also contributes expertise to an Agricultural Market Information System (AMIS), as recommended by the United Nations High Level Task Force on the Global Food Security Crisis, to which the WTO is a member.
Public stockholding programmes:
-> Since 2013, WTO members have agreed to negotiate and find a permanent solution to the issue of public stockholding programmes for food security purposes.
-> Under these programmes, developing countries purchase and stockpile food, and distribute it to people in need.
-> However, some of these programmes involve support to farmers and are therefore considered to distort trade.
Why agreement on food security has been a failure?
-> U.S creates a hurdle: The U.S. blocked the demands of more than a 100 developing nations, including India and China, to implement their food security programmes without difficult conditions.
-> Public stockholding: Despite best efforts, the members of WTO could not meet the deadline on public stockholding for food security purposes. The members could not even agree on more detailed programmes in many areas.
-> Centrality of development: They also could not agree on the centrality of development, which underlies the Doha Round, as well as special and differential treatment for all developing countries.
-> Since all major decisions in the WTO need to be taken by ‘the membership as a whole’, even a single country can end up being the deal-breaker.
How WTO would handle the failure of agreement on food security?
-> The only way to get an outcome in these very difficult issues is when every side shows flexibility.
-> There should be a free flow of cooperation and understanding among its members.
-> There should be a livelihood and food security box which recognises that agriculture in many developing countries including India is not a commercial enterprise but the backbone of livelihood security of a large population.
-> WTO should recognise support to achieve SDG2 ‘End hunger, achieve food security, improved nutrition’.
-> It should promote sustainable agriculture & this should be the basis of negotiation in agriculture.
-> Members of WTO should first resolve outstanding issues of the ongoing Doha Round negotiations that began in 2001 with a ‘development agenda’ before considering ‘new issues’.
WTO Issue-2: Centrality of development in multilateral trade negotiations
The recent trends in global trade negotiations seems to suggest that developed countries led by USA are moving away from multilateral institution and negotiating trade terms on bilateral basis so as to get favourable terms and avoid dispute resolution through international mechanisms. These actions have posed an existential threat to WTO.
Challenges posed by US to WTO:
-> Raising new issues of e-services, trade facilitation, gender equality, labour laws without resolving previous Doha issues.
-> Delaying appointments of judges to dispute resolution body of WTO.
-> Giving less importance to multilateral institutions, and acting shrewdly to adopt other means such as negotiating trade terms on bilateral basis to avoid formal dispute resolution mechanism of WTO.
-> The particular stance of USA of new rules on farm subsidies, the elimination of support for unsustainable fisheries, and the regulation of e-commerce is capable of making negotiation process nearly impossible for G-33 and other supporting countries.
Challenges for India:
1) Subsidies given for public stockholding programmes to bolster food security has been consistently opposed by developed countries.
2) Fisheries has remained a contentious issues. The WTO talks have focused on crafting a ban on subsidies towards illegal, unreported, and unregulated (IUU) fishing. India too support IUU but approves subsidy to smaller fishermen.
3) India seeks complete exemption to the subsidies that it gives to support poverty alleviation programs and MSPs.
4) India wants peace clause to continue indefinitely till an agreed solution is reached by consensus.
Trade negotiations when done under umbrella of WTO provide greater opportunities to less developed and developing nations but the protectionist stance of countries like USA will promote regionalism and bilateralism and the net effect will be trade distortions and loss of an inclusive process.