GENEVA — After weeks of intense diplomacy, the World Trade Organization has circulated a “draft framework” in a bid to revive the stalled global trade talks by the end of July.
Cotton subsidies and reaching agreement on how to cut or eliminate tariffs on industrial goods, including textiles, apparel and footwear, are viewed as the most contentious aspects of the draft, as well as the perennial issue of agriculture, WTO trade ambassadors said.
Negotiators have until the end of a meeting, scheduled to begin next Tuesday, to jockey for advantage and fine-tune the draft, senior officials said. A failure to agree on a framework by the end of this month may deliver a serious blow to the global trade system and set back efforts to lower barriers to global commerce, the officials said.
The global trade talks, derailed last year after a meeting in Cancún, Mexico, resulted in a stalemate. The situation will not affect the elimination of apparel and textiles quotas agreed upon a decade ago and set to occur Jan. 1.
Supachai Panitchpakdi, WTO director general, told reporters last week he was “more encouraged by the outcome” because a “strong foundation has been laid.”
Panitchpakdi said in a statement Monday, “It is only member governments which have the power to bring about convergence.” He said the draft paper “is not an agreed text, but a negotiating document. We expect that it will evolve over the coming days.”
But he warned the 147 member countries that a “failure this month means the continuation of an unsatisfactory status quo, certainly for the remainder of this year and next, and possibly for years to come.”
U.S. trade officials said Monday they were “studying the text carefully,” and added, “We think its important to move forward in the negotiations. Cutting global subsidies is good for all concerned.”
Similarly, the European Union ambassador to the WTO, Carlo Trojan, said the draft WTO text “is a basis for further negotiations.”
On the issue of cotton and the subsidies paid by rich countries to their farmers, which Brazil and many West African nations say is unfair, the text states: “Cotton continues to be a vital issue for a number of members. It will be addressed ambitiously and expeditiously as an integral part of the agriculture negotiations.”
Some diplomats said the draft text falls too short of the demands of West African cotton producers — Benin, Burkina Faso, Mali and Chad — for the issue to be examined on a stand-alone basis and reflects the wishes of the U.S. and the EU that it be addressed in the farm talks segment. Others said the language is ambiguous and could be interpreted to mean cotton may be fast-tracked in the farm talks, which is the goal of the African nations.
Matthew Nwagwu, Nigeria’s WTO ambassador, speaking for the Africa Group, said, “Cotton should be treated as a stand-alone issue and not part of the overall negotiations on agriculture.”
The ambassadors noted that trade ministers from the four cotton-exporting nations will hold talks in Washington this week with senior U.S. officials on the cotton question.