GS Paper III

News Excerpt:

The WTO's 13th Ministerial Conference (MC13) took place from 26 February to 2 March 2024 in Abu Dhabi, United Arab Emirates. Ministers from across the world attended to review the functioning of the multilateral trading system and to take action on the future work of the WTO.

What are the Key Outcomes of WTO’s 13th Ministerial Conference?

Ministers representing WTO Members of very different levels of development, and with very different (geo-)political views, met to discuss a plethora of important topics, ranging from food security and e‑commerce to fisheries subsidies and reform of the WTO, as well as domestic regulations of services and investment facilitation.

• Accessions: On the first day of MC13, ministers endorsed the accession to the WTO of two least-developed countries—Comoros and Timor-Leste. This brings the organization’s Membership to 166, representing 98 percent of world trade.
• WTO reform: At MC13, ministers endorsed progress on the WTO reform process, which covers the organization’s deliberative, negotiating and dispute settlement functions.
  • Dispute settlement reform: At MC13, ministers reviewed the valuable contributions made towards fulfilling the commitment of reform. This includes a 36-page draft, setting out reforms to the WTO’s dispute settlement system.
  • Reform of the deliberative and negotiating functions: At MC13, ministers welcomed the work already undertaken to
    • Improve the functioning of WTO Councils, Committees and Negotiating Groups
    • Enhance the organization’s efficiency and effectiveness
    • Facilitate Members’ participation in WTO work.

• E-commerce: At MC13, ministers decided to renew the e‑commerce moratorium until MC14 or 31 March 2026, whichever is earlier.
• TRIPS non-violation and situation complaints: The ministers also decided to extend a moratorium on so-called “non-violation” and “situation” complaints under the TRIPS Agreement.
• Special and differential treatment: Ministers adopted a decision to improve the use of special and differential treatment (S&DT) provisions, particularly those in the Agreement on Technical Barriers to Trade and the Agreement on Sanitary and Phytosanitary Measures. The decision enhances training opportunities and endorses steps to make the S&T provisions more effective and operational.
• Plurilateral agreements and initiatives: At MC13, Members failed to reach consensus on agriculture and food security as well as further disciplines fisheries subsidies. Plurilateral initiatives (covering less than the full Membership) are, therefore, becoming more prominent.
• Covid 19 related TRIPS waiver: At MC12, ministers broadened compulsory licensing for Covid-19 vaccines and mandated negotiations for expanding coverage to diagnostics and therapeutics. At MC13, due to lack of consensus, these rules won't apply to diagnostics and therapeutics. Ministers urged ongoing work on pandemic lessons and future solutions.
• Fisheries subsidies: At MC13, ministers welcomed the progress over the past 20 months towards the Agreement on Fisheries Subsidies (AFS)’s entry into force. As of 1 March 2024, 71 Members have ratified the agreement. A further 39 ratifications are needed to reach the threshold of 110 for the agreement’s entry into force.
• Agriculture and food security: Although updating WTO disciplines on agriculture has been on the agenda of Members since 2000, little progress has been made. Prior to MC13, there appeared to be a more positive dynamic. Yet, ministers failed again to reach consensus on the scope, balance and timeline of agriculture negotiations.

What are the issues associated with the 13th Ministerial conference of WTO?

• Fisheries Subsidies Agreement: The Fisheries Subsidies Agreement has not yet come into force due to insufficient ratifications.
• Additionally, negotiations on Part II (the remaining important provisions governing supportive subsidies, such as for fuel), particularly concerning supportive subsidies like those for fuel, faced challenges with major members seeking exemptions. Illegal, unregulated, and unreported fishing continue to deplete ocean fish stocks.
• Agriculture Negotiations: Despite a 30-year-old pledge to proceed with negotiations, there is still no agreement. Climate change and extreme weather events exacerbate food insecurity, with the lack of WTO rules governing food sharing between countries worsening the situation.
• Dispute Settlement System: Agreement on a single, binding dispute settlement system remains elusive. While some clean-up amendments are moving toward consensus, core issues such as binding outcomes, national security exceptions, and the existence of an appellate level remain unresolved. Attempts to address these issues have been hindered, reportedly by the United States and a few others.
• Future Agreements: The Agreement on Investment Facilitation for Development has been concluded by interested parties, aiming to streamline procedures without market access obligations. 
• However, challenges arise as some members, such as India and South Africa, question the negotiation's approval process and its recognition as a WTO agreement. The issue of non-participating vetoes obstructing progress needs to be addressed for effective rulemaking within the WTO.
• Concerning free and fair trade: Despite a more contentious atmosphere around the trade laws the WTO aims to uphold, there was growing optimism that the 13th Ministerial Conference would fulfill its mandate. 
• The World Trade Organization is still having difficulty promoting fair and unrestricted trade, nevertheless.
• Inward-looking tendencies: In addition, a growing trend of nationalism has sparked isolationist and tariff-heavy trade policies, which run counter to the WTO's main objective of open trade for the benefit of all. 
• Though not much has been accomplished, the Abu Dhabi proclamation does mention some of the difficulties, such as the requirement to guarantee open, inclusive, and robust supply chains.

What is India's stance on the 13th Ministerial Conference of the World Trade Organization (WTO)?

• Support for Accessions: India supported the accession of Comoros and Timor Leste to the WTO, emphasizing the importance of the organization's expansion.
• Focus on Sustainable Development: India stressed the need to avoid fragmentation of the multilateral trading system and highlighted the importance of remaining focused on trade-related issues rather than mixing non-trade topics with the WTO agenda.
• Policy Space for Industrialization: India advocated for appropriate policy space for developing countries to address their concerns, particularly regarding industrialization. It expressed concerns about attempts to merge longstanding development issues with new topics like trade and industrial policy.
• Trade and Inclusion: India cautioned against mixing non-trade topics like gender and MSMEs with WTO rules, arguing that these issues are better addressed through contextual and targeted national measures. India emphasized that such measures could lead to trade distortions and negatively impact the interests of developing countries.
• Commitment to Multilateralism: India reaffirmed its commitment to multilateralism and the rules-based global trading system, underscoring the importance of adhering to WTO rules.

Way forward:

• Reformative Approach:

• Establish a comprehensive, long-term strategy focusing on reform to uphold the efficacy of global trade governance.
• Emphasize adherence to a rule-based order among WTO members to foster stability and predictability in international trade relations.

• Regular Meetings:

• Facilitate frequent gatherings between WTO members and the Appellate Body to foster dialogue and maintain transparency.
• Ensure that regular meetings enable efficient communication channels, allowing for the swift resolution of disputes and grievances.

• Resolution of Disputes:

• Advocate for the restoration of the WTO's dispute settlement mechanism to its previous operational effectiveness.
• Prioritize the needs of developing nations within the dispute resolution process to address asymmetries in legal resources and expertise.

• Consensus-based Decision-making:

• Promote a consensus-driven approach to decision-making within the WTO to enhance legitimacy and inclusivity.
• Guard against unilateral actions that may undermine the spirit of cooperation and compromise essential for effective global trade governance.

• Addressing Developing Countries' Needs:
• Tailor WTO rules and reforms to accommodate the unique challenges and developmental priorities of developing and least-developed countries.
• Ensure that trade policies and agreements incorporate provisions that support capacity-building and economic growth in these nations.

• Adapting to a Changing World:

• Continuously monitor and adapt to shifts in the global economic landscape, including advancements in technology and changes in trade patterns.
• Integrate considerations for environmental sustainability into trade policies to address emerging challenges and promote responsible global commerce.

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