WTO Trade Negotiations Pause after Cancun

By Wilson, Edward | International Economic Review (Washington, D.C.), January-February 2004 | Go to article overview

WTO Trade Negotiations Pause after Cancun


Wilson, Edward, International Economic Review (Washington, D.C.)


Members of the World Trade Organization could not reach agreement at their September 2003 ministerial meeting in Cancun, Mexico, on how to move forward with the Doha multilateral trade negotiations. Ministers were to set the terms, or "modalities," for the specific negotiations that were scheduled to conclude the Doha trade talks by January 2005. Instead, negotiators reached an impasse largely over agricultural subsidies and whether to open negotiations on new issues such as investment, competition policy, government procurement, and trade facilitation of customs matters. Consultations in subsequent months were to develop plans to renew the multilateral trade negotiations, but as the year 2004 began many of the original disagreements from the Cancun conference remained unresolved.

Introduction

Members of the World Trade Organization (WTO) held their Fifth Ministerial Conference from September 10 to 14, 2003, in Cancun, Mexico, where they could not reach agreement on how to move forward with the multilateral trade negotiations that opened in November 2001 in Doha, Qatar-known as the Doha Development Agenda. Ministers expected to conduct a midterm review-of-progress in the negotiations, followed by setting terms and structure (so-called negotiating modalities) for the specific individual negotiations that were to follow in 2004, with an eye to concluding the Doha trade talks by January 1, 2005.

Instead, negotiators found themselves early in the conference unable to reach agreement in the critical area of agriculture over the issue of agricultural subsidy reductions. The impasse arose largely due to an uncompromising stance taken by a recent grouping of approximately 20 developing countries-generally called the "G-20" although membership has varied. (2) The inability later in the conference to reach agreement in another significant area-the so-called Singapore issues of investment, competition policy, government procurement, and trade facilitation-led the conference chairman to close the ministerial meeting following consultations that indicated entrenched negotiating positions held by many delegations were not likely to allow a consensus to emerge in the time remaining at the conference.

The ministerial statement concluding the Cancun conference directed the officials of WTO members to continue work on outstanding issues, in coordination with the WTO Director-General and the chairman of the WTO General Council. The statement called for a WTO General Council meeting to be convened at the senior officials level no later than December 15, 2003 to take the necessary action to move toward a "successful and timely conclusion of the negotiations." (3)

Modality and Other Deadlines Slipping by 2003

During 2002 and 2003, Doha negotiators were working to reach agreement on negotiating modalities in their respective groups, although largely without success. Negotiators on agriculture were to reach agreement on a first draft of their modalities by March 31, 2003, but at that time the chairman confirmed that the group had failed to reach a set of common modalities and that-without guidance from participants on possible areas of convergence-there was no scope to attempt another draft. (4) The group was to prepare a comprehensive draft of commitments in time for the Cancun meeting, once negotiating modalities were agreed. The nonagricultural market-access group was to agree on modalities to conduct negotiations on tariff and nontariff barriers by May 31, 2003, but this deadline also passed with developed and developing country participants unable to agree over the scope set in the chairman's draft text on modalities. (5)

In the services negotiations, progress appeared more forthcoming. Initial requests for market access in services began to be tabled by July 2002 and initial offers for services market access by April 2003. Services negotiators also managed to adopt a draft text of "Modalities for the Treatment of Autonomous Liberalization" in March 2003, a portion of their negotiating agenda.

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