Outcomes of the WTO Ministerial Conference

Why in news?

The 11^th biennial ministerial conference of the ‘World Trade Organisation (WTO)’ recently ended.

What is the divide between developing & the developed world?

In the late 90s, it was felt that the rules of the emerging global free market economics was tilted in favour of the industrialised and developed countries.
As WTO was also ushering such a world order, the developing world countries raised their grievance in WTO’s Doha Ministerial of 2001.
These prominent issues raised were –

Agriculture - Undoing the trade-distorting subsidies provided in the developed countries for farming
Medicines - Relaxing IPR norms for life saving drugs in developing countries
SDT - Special & Differential Treatment was sought for goods from the weaker countries (to make them competitive internationally)

While, negotiations on most of these issues haven’t concluded, the developed countries have been keen to move on to newer issues like ‘e-commerce’.
On the contrary, the developing countries want the Doha issues to settled first before taking up newer things as it might distract focus.

How did the current ministerial go?

Developed countries - They wanted the ministerial to see the fast-tracking of e-commerce talks but they didn’t make much headway.
US, EU & Japan issued a joint statement aimed at China, on trade-distorting practices such as over-capacity and mandating technology transfer policies.
The U.S. even argued that the ‘Developing Nation’ tag was being misused by some countries that were rich in absolute GDP terms.
Developing Countries - Contrarily, India and China also submitted a joint proposal to end the trade-distorting farm subsidies of Western nations.
For India, although none of its ‘offensive’ interests were achieved, its ‘defensive’ interests remain protected.
Hence, despite the stalemate, it has been regarded a partial success for India.

What are the major issues?

Food Security Issue - Currently, a temporary ‘Peace Clause’ is in effect.
This bars countries from lodging complaints with the WTO against the subsidised food security programs of the developing world.
In this backdrop, India pushed for a ‘permanent solution’ to replace the ‘Peace Clause’ and to safeguard its grain stockpiling & public procurement programs.
While a permanent solution was thwarted by the US, the current ‘peace clause’ remains in place – thereby retaining status quo.
Fishing subsidies – These are provided mainly by the developing world yo help their fishermen who are predominantly subsistence fishers.
These subsidies has been alleged to be distorting the markets as it affects the businesses of the high-tech industrial fisher countries like Japan & Canada.
The developed countires also stressed that, unsustainable fishing was on the rise due to such subsidy policies.
Due to opposition from the developing world, this issue has been pushed to the next ministerial in 2019.

What are the challenges ahead?

US Withdrawal - Trump administration’s disregard for multilateral forums and agreements was more than visible in the conference.
Previously, the US had blocked the reappointment of judges to the appellate body of the WTO. Such moves could weaken the WTO structurally.
Lack of concensus – The stubborn positions of the negotiating blocks has led to certain issues pending for decades.
These could effectively render WTO as an inffective forum of engagement.
India’s issue – While India’s GDP may be growing, the country has hundreds of millions living in poverty and without food security.
It has been facing an increasing rough WTO table as it tries to balance its soverign responsibility to feed its millions and the pressures against subsidies.

Source: The Hindu