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Ministers Strike 'Historic' Deal in Nairobi Vol. 15, Issue no. 37 December 21, 2015 Charles Akande, Editor Ministers Strike ‘Historic’ Deal in Nairobi After five days of intense negotiations in “It’s fitting that our work in Nairobi delivered a Nairobi, Kenya, WTO Members successfully meaningful package that will aid development around concluded their 10th Ministerial Conference the world,” U.S. Trade Representative, Michael (MC10) on December 19, 2015. Froman, said of the MC-10, which welcomed two new LDCs – Liberia and Afghanistan. The agreed package includes issues of importance to developing countries – particularly least- The Nairobi Package developed countries (LDCs), but also decisions on three high profile agricultural issues: the special The Nairobi package features ministerial decisions on safeguard mechanism (SSM), public stockholding agriculture and several LDCs issues including: for food security purposes, and export competition. • Preferential rules of origin that would allow The latter had been the hardest fought topic as LDCs’ exports to benefit from the preferential Members held strong views on when to eliminate market access available to them through non- export subsidies as well as how to deal with other reciprocal preference programs. The decision issues included in this agriculture pillar; export enhances the transparency of Members’ credits, food aid, and state-trading enterprises preferential rules of origin regimes, by committing (STEs). them to notify the measures being taken to After two long nights of negotiations on implement the decisions’ provisions by December agriculture, Ministers ultimately agreed to a 31, 2016. package that was lauded as “historic” due mostly • Duty-free quota-free market access benefits for to the consensus reached over the elimination of LDCs’ cotton and a commitment to continue export subsidies, but also the symbolic aspect meeting twice a year to discuss the latest carried by the agreement – the first development developments on market access, domestic support, package deal struck on the African continent. and export subsidies for cotton, particularly from “This is the WTO’s most significant outcome on LDCs, and provide assistance to support the cotton export competition in agriculture” said WTO sector in developing countries. In addition Director General, Roberto Azevêdo at the end of developed countries would immediately eliminate the conference. “It includes the ending of export their export subsidy for cotton and developing subsidies that many Member countries have long countries would end theirs on January 2017. been calling for” he added. • Extending the timeframe for the participation of “I am pleased with the package we have LDCs in services trade until 2030 during which concluded. It will contribute to the growth of all preferences may be extended to LDCs under the developing countries, including the LDCs, the LDC services waiver. small vulnerable economies and the Cotton 4 • An agreement to pursue the transition period for (Benin, Burkina Faso, Chad, and Mali), said LDCs to implement specific intellectual property Amina Mohamed, the Kenyan Minister for Foreign rights (IPR) rules for medicines until 2033. Affairs and Trade, who chaired the MC10. The agriculture portion of the Ministerial decisions • On SSM, the Nairobi decisions reiterate the right includes: for developing countries “to have recourse” to the mechanism and urge Members to further discuss • An immediate elimination of all export subsidies - this in Geneva. On public stockholding the Nairobi by developed countries, except Canada, Declaration also reaffirms the continuation of the Switzerland, and Norway, which have been given discussion on the provision until a permanent until 2020 to end theirs as long as they do not solution is reached which is expected to be reached concern products exported to LDCs. Developing at the time of the MC11 (December 2017). countries will end their subsidies in 3 years (2018) with an exception to use them until 2022 for those Much Needed Breathing Room for the MTS which have notified their support to the WTO. In The WTO was under huge pressure to deliver in Nairobi addition, developing countries will be allowed to as many – delegates and observers alike – saw the use limited export subsidies for transportation and MC10 as the last chance to save the multilateral trading marketing until 2023 (article 9.4) subject to certain system (MTS) and particularly the negotiating function conditions. LDCs and net food importing of the WTO. developing countries (NFIDC) have until the end of 2030 to eliminate their export subsidies. “Our work to secure a global ban on export subsidies will help level the playing field for American farmers Canada, Norway, and Switzerland fought hard for and ranchers,” Froman stressed adding that “the WTO’s their exception as they continue to provide subsidies actions in this area will put an end to some of the most for processed products, dairy products, and swine trade distorting subsidies in existence and demonstrates meat. Although all three agreed to eliminate their what is possible when the multilateral trading system export subsidies, the group voiced concerns with comes together to solve a problem.” respect to the impact the immediate effect would have had on them. Nevertheless even with that exception, “We have also been successful in renewing the the U.S. stressed that the provision “ensures an end to multilateral system,” Amina Mohamed said at the end Canadian dairy and Indian sugar export subsidies, of the conference. “We are ready to work hard over the while also preventing export-oriented countries like next two years so that we can do more at the next Brazil from taking advantage of such measures going Ministerial Conference than we have done today.” She forward.” added. • Developed countries and particularly the U.S. However, this objective already looks like huge have been granted an 18 months maximum challenge for Members as they disagreed in Nairobi as repayment period for export credits, three times to whether the ministerial declaration should include the longer than the 180 days proposed in the draft reaffirmation of the commitment to conclude the 2008 agriculture modalities (Rev. 4). This is seen remainder of the Doha Development Agenda (DDA) on as a big win for the U.S. although its current the basis of the current mandate. legislation allows repayment of up to 24 months. “We recognize that many Members reaffirm the Doha • Food aid is another area seen as a big win for the Development Agenda, and the Declarations and U.S. as the Nairobi decision seeks to minimize or Decisions adopted at Doha and at the Ministerial eliminate impacts on commercial markets. “These Conferences held since then, and reaffirm their full new disciplines ensure that the United States is commitment to conclude the DDA on that basis. Other able to continue to provide recipient countries Members do not reaffirm the Doha mandates, as they with food assistance through programs currently believe new approaches are necessary to achieve operated. This will multilateralize the United meaningful outcomes in multilateral negotiations. States’ best practices in food aid delivery and Members have different views on how to address the ensure emergency feeding and agricultural negotiations,” the declaration reads. development objectives are met,” the USTR India and Venezuela, in particular, voiced concerns with stressed in a statement. respect to the non-commitment to continue the • Members also agreed to minimize the trade- negotiations under the DDA, especially when it comes distorting effects of agricultural export state- to agriculture domestic support, market access, as well trading enterprises (STE) and to work towards as NAMA and services, the other two legs of the so- the elimination of the export monopoly powers of called tripod. The U.S. and the EU, meanwhile, have these entities. made clear that a change was needed in the way the negotiations will be tackled in the future, effectively “As WTO Members start work next year, they will be demanding the end of the Doha mandate. The U.S. also freed to consider new approaches to pressing unresolved wants new issues, such as investment, to be addressed at issues and begin evaluating new issues for the the WTO organization to consider,” Froman said in a statement. “Members agreed on a series of important outcomes on “While we concur that officials should prioritize work agriculture and development, and very importantly, where results have not yet been achieved, some wish to started a new phase in the WTO’s evolution;” USTR identify and discuss other issues for negotiation; others Michael Froman said. do not. Any decision to launch negotiations multilaterally on such issues would need to be agreed by “In the midst of feverish work this week on the Nairobi all Members,” the Nairobi Declaration stresses. Package, Members engaged in honest and focused conversations on the limitations of the Doha “Success was achieved here despite members’ persistent Development Agenda framework. While opinions and fundamental divisions on our negotiating agenda – remain divided among the WTO Membership, it is clear not because those divisions have been solved. We have that the road to a new era for the WTO began in to face up to this problem. Members must decide – the Nairobi,” the USTR continued. world must decide – about the future of this Many believe that the U.S. and other developed organization,” Azevêdo said. countries’ objective is to continue slicing the Members
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