- WTO Members chart course for autumn negotiations on fisheries subsidies, other issues ahead of MC12
- Services trade slump persists as travel wanes; other service sectors post diverse gains
- US joins services domestic regulation talks, participants move closer to MC12 outcome
- WTO members note updates on implementation of Trade Facilitation Agreement
- WTO publishes list of bottlenecks and facilitating measures on critical COVID-19 products
- Members review draft MC12 declaration on trade and environmental sustainability
WTO Members chart course for autumn negotiations on fisheries subsidies, other issues ahead of MC12
At a meeting of all WTO delegation heads on 23 July 2021, Director-General Okonjo-Iweala called on members to bring focus and flexibility to intensive negotiations scheduled for the autumn so they can strike meaningful agreements in areas such as fisheries subsidies, agriculture and pandemic response ahead of the 12th Ministerial Conference (MC12).
On the negotiations in the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Council on the proposed waiver of standard intellectual property protections for COVID-related vaccines, therapeutics and diagnostics, she urged members to “move with a sense of urgency – people’s lives are at stake.”
With regard to special and differential treatment, Director-General Okonjo-Iweala emphasised it is a “central tenet” of the WTO agreements.
She also urged delegations to find a common understanding on the reforms they want to see in the dispute settlement system so that a post-MC12 work programme can advance in that direction.
The Chair of the Negotiating Group on Rules, Ambassador Santiago Wills (Colombia), outlined his plans for a two-stage negotiating process for the “final lap” negotiations on fisheries subsidies. The first stage would focus on the main differences among members to collectively improve the text, followed by line-by-line, text-based negotiations. He also said members should aim to arrive at a complete agreement text no later than early November.
Services trade slump persists as travel wanes; other service sectors post diverse gains
Global services trade remained sluggish in the first quarter of 2021, falling 9% year-on-year after posting a 21% decline for the full year of 2020 driven by continued weakness in travel services. New COVID-19 variants have further delayed the recovery of international travel; however, other services sectors, such as transport, are starting to bounce back, with variations across regions due to the uneven distribution of vaccines and differing rollback of pandemic restrictions.
Travel remains the most affected services sector, down 62% year-on-year both in 2020 and in the first quarter of 2021. Sharper declines were recorded in the first three months of 2021 in Asia (-67%). International travellers’ expenditure was down 71% in Latin America and the Caribbean where, prior to the pandemic, travel receipts made up 43% of total services exports.
By contrast, transport rebounded quickly. World transport exports were still down 14% year-on-year in the fourth quarter of 2020 but bounced back to its 2020 value in the first quarter of 2021.
Other services – such as construction, recreational, legal and financial services – increased on average by 6% year-on-year in the first quarter of the year. Computer services continued its impressive growth, up 19% year-on-year.
Latest figures further show that the cumulative values of services exports of most economies in the period of January-May 2021 remained well below their 2019 levels, with sharp contractions recorded particularly in Australia (-36%) and Uganda (-29%). In the United States and in the Russian Federation, services exports were down 19% and 17% respectively compared to values from two years ago. By contrast, China’s services exports were up 23% boosted by transport exports, computer and business services. European countries showed an uneven performance. Luxembourg’s services exports were up 13%, sustained by financial services, while large tourism exporters in the region continued to struggle.
US joins services domestic regulation talks, participants move closer to MC12 outcome
The United States announced it is joining the negotiations on services domestic regulation at a meeting of the initiative’s participants on 20 July. Over one-third (64) of WTO members are now working towards establishing new disciplines regarding licensing and qualification requirements and procedures for services suppliers as well as technical standards. An outcome is eyed for the 12th Ministerial Conference (MC12), taking place the final week of November.
The US said that after having carefully monitored the negotiations, it is now committed to joining others in striking an agreement by MC12 and underscored the benefits of improved transparency and regulatory processes. The US also highlighted the instrumental role that the provision on non-discrimination between men and women will play in enhancing economic opportunity for workers. This will be the first time that a WTO discipline contains such a provision.
The US encouraged other WTO members to join the talks to broaden the benefits that an outcome would bring for services suppliers globally and urged participants to set the ambitious goal of having most of the top 50 services trading WTO members join the talks.
WTO members note updates on implementation of Trade Facilitation Agreement
WTO members took note of trade facilitation commitments due to be implemented by year end at the 20 July meeting of the Committee on Trade Facilitation. Members also continued their work on the first review of the Trade Facilitation Agreement (TFA).
According to an update the WTO Secretariat provided at the meeting, 36 members have committed to implementation dates for 136 TFA commitments, such as publishing trade procedures or hastening the release of perishable goods, ranging from 1 July to 31 December 2021. For the period until end-2022, the number increases to 389 implementation commitments from 74 members.
The deadlines are based on members’ determinations of their own implementation schedules, which they previously notified to the Committee. Developing country members and least-developed countries (LDCs) can self-designate which provisions they will implement either immediately (Category A), after a transition period (Category B), or upon receiving assistance and support for capacity building (Category C). Developed countries were required to implement all provisions of the TFA from its entry into force on 22 February 2017.
The next formal Committee meeting is scheduled for 19-21 October. The dedicated session on technical assistance and capacity building support will take place on 21 October.
WTO publishes list of bottlenecks and facilitating measures on critical COVID-19 products
The WTO Secretariat has issued an indicative list of trade-related bottlenecks and trade-facilitating measures on critical products to combat COVID-19, including inputs used in vaccine manufacturing, vaccine distribution and approval, therapeutics and pharmaceuticals, diagnostics and medical devices. The list is being released in advance of a High-Level Dialogue by the World Health Organization (WHO) and the WTO on 21 July on expanding COVID-19 vaccines manufacturing to promote equitable access.
One common theme that emerges from the list is that essential goods and inputs need to flow efficiently and expeditiously to support the rapid scaling up of COVID-19 production capacity worldwide. The delay of a single component may significantly slow down, or even halt, vaccine production given the globally integrated supply chains that underpin COVID-19 vaccine manufacturing.
The Secretariat indicative list of “Trade-related bottlenecks and trade-facilitating measures on critical products to combat COVID-19” can be found here:
Members review draft MC12 declaration on trade and environmental sustainability
WTO members taking part in a new initiative on trade and environmental sustainability provided their first comments on 19 July on possible elements for a joint statement which participants hope to issue at the WTO’s 12th Ministerial Conference (MC12) later this year.
The draft elements for a ministerial statement discussed at the third meeting of the Trade and Environmental Sustainability Structured Discussions (TESSD) underscore the role of trade policy in helping address climate change and other environmental challenges. They also set out commitments on future work and objectives as well as a work programme for the TESSD discussions for 2022.
Launched in November 2020, the TESSD is intended to complement the existing work of the Committee on Trade and Environment and other relevant WTO committees and bodies. The initiative seeks to promote transparency and information sharing, identifying areas for future work within the WTO, support technical assistance and capacity building needs, particularly for least-developed countries, and work on deliverables for environmental sustainability in the various areas of the WTO.
TRIPS Council agrees to continue discussions on IP response to COVID-19
At a meeting of the Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS) on 20 July 2021, WTO members agreed to continue consideration of the proposal for a temporary waiver of certain TRIPS obligations in response to COVID-19 and other related proposals. Members approved a status report which they tasked the chair to deliver at the General Council at its next meeting on 27-28 July.
The report will provide a neutral and factual account of discussions held at the TRIPS Council since India and South Africa first introduced on 15-16 October 2020 document IP/C/W/669, requesting a waiver from certain provisions of the TRIPS Agreement for the prevention, containment and treatment of COVID-19. The proposal has since been co-sponsored by the delegations of Kenya, Eswatini, Mozambique, Pakistan, Bolivia, Venezuela, Mongolia, Zimbabwe, Egypt, the African Group, the Least Developed Countries Group, the Maldives, Fiji, Namibia, Vanuatu, Indonesia and Jordan.
The two texts discussed in the TRIPS Council reflect that positions remain divergent. While delegations remain committed to the common goal of providing timely and secure access to high-quality, safe, efficacious and affordable vaccines and medicines for all, disagreement persisted on the fundamental question of what is the appropriate and most effective way to address the shortage and inequitable access to vaccines and other COVID-related products.
Unable to complete the consideration of the revised waiver request, the TRIPS Council will therefore continue discussions, including through small-group consultations and informal open-ended meetings, and report back to the General Council as stipulated in Article IX:3 of the Marrakesh Agreement. The TRIPS Council also agreed to continue in the same manner the consideration of the other related proposals by members.
The next formal meeting of the Council is scheduled for 13-14 October, but the chair stressed the possibility of convening a formal meeting ahead of that date if required.