Digest Content
- Global trade’s recovery from COVID-19 crisis hits record high
- E-commerce negotiations advance, delve deeper into data flow issues
- DG Okonjo-Iweala calls on WTO members to tackle vaccine inequity
- The webinar examines challenges, opportunities in the use of trade preferences
- Webinar to address delivery of medical technologies, vaccines to their final destination
Global trade’s recovery from COVID-19 crisis hits record high
World trade’s recovery from the COVID-19 crisis hit a record high in the first quarter of 2021, increasing by 10% year-over-year and 4% quarter-over-quarter, according to UNCTAD’s Global Trade Update released on 19 May:
https://unctad.org/system/files/official-document/ditcinf2021d2_en.pdf
According to the report, the impressive rebound in Q1 2021 continued to be driven by the strong export performance of East Asian economies, whose early success in pandemic mitigation allowed them to rebound faster and to capitalize on booming global demand for COVID-19 related products.
«Global trade has recorded a faster recovery from the recession caused by the pandemic than in the last two trade recessions», said UNCTAD economist Alessandro Nicita, who worked on the report.
He said it took four quarters after the start of the pandemic-induced recession for world trade to return to pre-recession levels. By the fifth quarter – Q1 2021 – global trade was higher than pre-crisis levels, with an increase of about 3% relative to Q4 2019.
By contrast, it took 13 quarters for global trade to recover from the 2015 recession, which resulted from structural changes in East Asian economies and declines in commodity prices, and nine quarters to bounce back from the 2009 recession caused by the global financial crisis.
The report says in Q1 2021 the value of trade in goods was higher than pre-pandemic level, but trade in services remains substantially below averages. «Global trade in COVID-19-related products remained strong during the quarter», it says.
E-commerce negotiations advance, delve deeper into data flow issues
At a meeting on e-commerce negotiations held on 20 May, co-convenor Ambassador George Mina (Australia) urged WTO members to move the work of the small groups to a phase of “stronger and more intensified convergence”. He said that the time left between now and the 12th Ministerial Conference is “very critical” if members want to realize their shared ambition of achieving substantial progress by December this year.
Updates from small group discussions
The facilitators of small group discussions shared updates on progress made in the work to bridge the differences in areas such as open internet access, open government data, online consumer protection and paperless trading.
The co-convenors — Australia, Japan and Singapore — believe that a “clean” text on identified four topics is within reach by the summer break.
The initiative has so far finalised two negotiating texts on unsolicited messages, otherwise known as spam, and electronic signatures and authentication. A new small group was established on electronic transactions frameworks and will start working based on proposals submitted by members.
Flow of information
Participating members focussed their discussions on flow of information, which was last discussed at a plenary meeting in October 2019. Members revisited text proposals on cross-border data flows and localisation of computing facilities — servers used to store and process information. Members acknowledge the importance of the free flow of data across borders as an enabler for business activity and a facilitator of digital trade.
Ahead of the discussion on data flow, Ambassador Hung Seng Tan (Singapore), co-convenor of the initiative, highlighted the need to have clear rules in this area to spur digital innovation, provide business certainty and support post-pandemic economic recovery.
To help deepen members’ understanding of the issues, the participating members heard presentations from the WTO Secretariat, the Organisation for Economic Co-operation and Development, the Brookings Institute and Singapore’s Infocomm Media Development Authority.
In his concluding remarks, Ambassador Kazuyuki Yamazaki (Japan), co-convenor of the initiative, said provisions that enable and promote the flow of data are key to a high standard and commercially meaningful outcome for the negotiations. He added that the initiative needs to ensure appropriate policy space that accommodates different circumstances of the participating members.
DG Okonjo-Iweala calls on WTO members to tackle vaccine inequity
Speaking to G20 leaders and the heads of international organizations on 21 May, Director-General Ngozi Okonjo-Iweala said WTO members could contribute to greater equity in the global distribution of COVID-19 vaccines by lowering supply chain barriers, fully using existing production capacity, and addressing issues related to intellectual property, access and innovation.
DG Okonjo-Iweala, who has described equitable access to COVID-19 vaccines, diagnostics and therapeutics as “the moral and economic issue of our time,” told the Global Health Summit that the pandemic had made clear that “policymakers need to think of preparedness, response, and resilience as one interconnected package”.
International cooperation on trade is important for all three elements of this package, she said, arguing that trade has been a “force for good” in the pandemic by enabling access to much-needed medical supplies. Even as the value of global merchandise trade shrank by more than 7% last year, trade in medical supplies increased by 16%, and by 50% for personal protective equipment, she noted.
With regards to the WTO’s role in addressing the global vaccine scarcity, DG Okonjo-Iweala said members could act on three fronts.
“First, tackling supply chain issues holding back vaccine production, from export restrictions and excessive customs bureaucracy to problems accessing raw materials or hiring skilled workers. The WTO can help with supply chain monitoring and transparency.”
The second action is helping manufacturers scale up by “keeping supply lines open and matching underused capacity with unmet needs,” which DG Okonjo-Iweala declared as “necessary to save lives now”.
Finally, DG Okonjo-Iweala said WTO members “must address issues related to technology transfer, knowhow and intellectual property,” including the proposed temporary waiver from WTO intellectual property rules for vaccines and other pandemic-related products.
“I am hopeful that by July we can make progress on a text and by our 12th Ministerial Conference in December, WTO members can agree on a pragmatic framework that offers developing countries near automaticity in access to health technologies, whilst also preserving incentives for research and innovation.”
Webinar examines challenges, opportunities in the use of trade preferences
WTO members exchanged views with public and private sector experts on the growing challenges and opportunities facing businesses in the use of trade preferences, with a particular focus on product origin requirements. The discussion took place at a webinar entitled “What Drives the Utilization of Trade Preferences?” hosted by the WTO Secretariat on 19 May.
According to the WTO’s Preferential Trade Arrangements Database, 24 WTO members have 36 schemes in place providing non-reciprocal preferential market access for products originating from developing countries and least developed countries (LDCs). In addition, there are over 300 reciprocal regional trade agreements (RTAs) in force. As the number of preferential trade arrangements grow, product origin requirements under these agreements are also increasing and becoming more complex. Many recent agreements have increasingly tailor-made, more specific and tighter rules of origin, which increase trade costs and diminish the appeal of the preferences for businesses.
Preferential rules of origin are a set of requirements needed to attribute one country of origin to each product. They are a central pre-requisite for implementing trade preferences.
While the linkages between origin requirements and the utilization of preferences have been at the centre of the work of the WTO’s Committee on Rules of Origin in the past few years, with a focus on LDCs, the webinar also explored other factors driving the utilization of trade preferences, such as the difference between preferential tariff rates and the most favoured nation (MFN) rates, awareness by businesses, and compliance costs.
The webinar attracted almost 600 registrants, with representatives from the World Bank, the UN Conference on Trade and Development (UNCTAD), the InterAmerican Development Bank and the European Commission as well as national experts from South Africa, Japan, Switzerland and Belgium among those sharing their views.
Reporting on the discussion to a 20 May meeting of the Committee on Rules of Origin, the chair of the committee, Mr. Han-Ming Huang (Chinese Taipei), said that with the multiplication of preferential trade agreements, there is a real demand for knowledge, quality data and best practices regarding origin requirements.
Further the Committee on Rules of Origin continued to focus on the needs and concerns of LDCs.
Members reviewed recent developments in relation to preferential rules of origin for LDCs as well as efforts by preference-granting members to implement the 2015 Nairobi Decision on Preferential Rules of Origin for LDCs. The 2015 decision set out multilaterally agreed guidelines to facilitate LDC exports that qualify for preferential market access granted by WTO members.
Tanzania, speaking for the LDC Group at the WTO, said the group intended to put forward a proposal for the 12th Ministerial Conference later this year calling for a mandate to continue work within the committee on transparent rules of origin for LDCs.
On other issues, members once again discusseda joint proposal for enhancing transparency in non-preferential rules of origin, which aims at introducing a template to notify rules of origin used in the application of most-favoured-nation (MFN) treatment and other non-preferential commercial policy instruments, as well as any other practices with respect to certification of origin for non-preferential purposes.
The chair said members were not far from finding a common understanding on the proposal and proposed another round of consultations in order to find agreement on the initiative, which has been on the committee agenda for about three years.
The next meeting of the Committee on Rules of Origin will take place on 14 October.
Webinar to address delivery of medical technologies, vaccines to their final destination
A panel of experts will explore on 26 May 2021 the factors determining the successful delivery of medical technologies and vaccines to their final destination. Webinar forms part of a series of events to mark the 25th anniversary of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
The webinar will focus on a wide range of issues, such as: trade in health-related goods and services during pandemic times; measures undertaken by WTO members and work in WTO bodies; experiences of express delivery, including challenges and potential solutions; and the perspective of the industry on successful delivery of products to their final destination.
The webinar is an integral part of the “Virtual Course on Trade and Public Health with a Special Focus on the COVID-19 Pandemic” and is open to the public. It will take place on 26 May 2021, from 13:00 to 15:00 (CET).
Registration for the webinar is available here:
https://worldtradeorganization.zoom.us/webinar/register/WN_8Pg9L1lZTL6VMJM4pOYViw
To mark the 25th anniversary of the TRIPS Agreement in 2020, the WTO Secretariat organized a commemorative event on 24 November 2020, followed by a series of webinars continuing into 2021. These allowed relevant stakeholders to reflect on the past, present and future of the most comprehensive multilateral treaty on intellectual property protection and enforcement.
The full series of events scheduled to commemorate TRIPS@25 is available here:
https://www.wto.org/english/tratop_e/trips_e/trips_at25_e.htm