U.S. Statement at the Informal Meeting of WTO Heads of Delegation
As Delivered by Ambassador Michael Punke,
U.S. Permanent Representative to the World Trade Organization
May 9, 2016
Thank you, DG.
We appreciate this opportunity to engage frankly on our path forward. While our current situation may be somewhat unusual, the recent period of reflection and consultation has probably been more useful and insightful than if we were engaged in frantic activity immediately after Nairobi.
Now, however, we are almost five months out from Nairobi and it seems that the time is approaching for more explicit discussion of possibilities going forward.
The fact that this recent period has not involved a heavy schedule of meetings doesn’t mean that it’s not been critically important. In fact, we are sorely in need of discussions that are deliberative, informal, and not overly burdened with structure. We are convinced that it is through such informal discussions among members that we will find the best paths forward for the WTO’s ongoing work, including its negotiating work.
And a period of relative quiet in the meeting rooms of the WTO doesn’t mean that there is a lack of thinking taking place.
In fact, our sense is that we are at the beginning phases of seeing some ideas start to gel in useful and meaningful ways, at least on some issues. Members are meeting together and exchanging ideas. Key developing country groups have held retreats to consider the outcomes from Nairobi and how to define the way forward. Overall, while the pace may still be a bit subdued, we know that more and more is going on under the surface.
We are, in short, in the middle of a moment of opportunity, and the United States, like many others, is not standing still. Not a moment has passed in recent years – from the build up to Bali, the period between Bali and Nairobi, and now since Nairobi – in which we have not been fully engaged in seeking paths forward in the WTO. And that remains our commitment going forward from here.
While our internal deliberations on many key issues in light of Nairobi are still preliminary, and it’s difficult to get too specific, today I’d like to offer a few insights into some of our priorities and thought processes during this current period.
Our interest, above all, is to search for new ways of achieving results within this organization. Our resistance – and this resistance will be firm – is to falling back into old ways of working that have demonstrably failed to produce results on too many important issues. Nor do we accept that the WTO and its members should disenfranchise themselves of the opportunity to discuss issues that all of us know are important to the 21st century economy.
Let me briefly mention a few specific areas where the U.S. sees strong potential for work that can breathe new energy into the WTO.
First, the United States, along with the vast majority of participants, is determined to conclude the EGA by the time G20 Leaders meet in China. This agreement will offer tremendous benefits in opening environmental technologies markets to all WTO Members and presents an example of how a group of WTO Members can strike deals that will increasingly re-establish the negotiating credibility of the organization.
Second, the United States regards the area of fish subsidies as requiring particularly urgent and ambitious attention, given the very real threats to the resource in question. And this is an area where bridges can clearly be built across the “developed versus developing” lines that, regrettably, too often characterize our debates. This is not an area, unfortunately, where fully multilateral discussions have been successful. At Nairobi, despite extensive efforts and discussion, there was failure to achieve multilateral agreement even for transparency, the lowest of low hanging fruit.
Fortunately, something else happened at Nairobi, little noticed amid the flurry of activity. A path-breaking group of 28 WTO Members demonstrated that results on fish can be achieved. These Members, including the US, Argentina, Fiji, Haiti, Mexico, Uruguay, Peru, Paraguay, Senegal, Vanuatu, and members of the OECS Economic Union among many others came together to announce political commitment to actual disciplines on fish subsidies — prohibiting their use for fishing in support of illegal fishing or in overfished stocks. This group of Members even wrestled successfully with the thorny issue of special and differential treatment.
This is a hopeful development, and we are convinced that we can build on it, even though some major players clearly are not yet ready and may not be ready for some time. Fish, for reasons we all know, is one issue that cannot wait for all Members to be ready.
Third, the United States wants to work with other Members to devise new and more promising ways of dealing with our work on trade and development. We don’t have all the answers but we are ready to engage with others in asking the right questions. Unfortunately, we know from experience that the Doha era discouraged this kind of discussion. One useful starting point might be a better understanding of best practices – which Members have been most successful in using trade liberalization to promote development?
We are interested in participating with other Members in beginning to define more clearly possible areas of work touching on SMEs and on aspects of digital trade. We all know that these “baskets” of issues are deeply relevant to the economy that surrounds us. We should look at ways to ensure that our rule book is keeping pace – or, more to the point, that the rules are catching up to our current realities. With respect to digital trade, it strikes us that making permanent our current moratorium against applying duties on e-commerce transactions could be a sensible step to examine. Indeed, interest in this issue would provide a good, initial gauge of the degree of interest in fully multilateral outcomes. We look forward to working with all Members, and we hope to find the broadest coalitions possible.
Obviously agriculture, services, industrial tariffs, and other outstanding issues continue to be important, and we hope to hear from others on what new ideas they may have that will allow us to avoid the impasses of the past. If there is to be meaningful engagement and progress in the near future, it will require new thinking and new openness to creative ideas. For example, the United States put forward a new idea on domestic support last fall, founded on a simple premise: All major subsidizers should find ways to contribute to lessening distortions in global markets. Acknowledgment of this principle would be a good step toward a new, more constructive discussion on domestic support.
Agricultural market access is also a long neglected part of the attention in the WTO. While much of the discussion in Geneva has focused on domestic support, the World Bank estimates that 90% of distortions in the agriculture sector come from tariffs. It is also noteworthy that developing countries collect 70% or tariffs from other developing countries, a figure that should not surprise us in an era of rising South-South trade. In market access, too, we will need to find the balance that we all know is necessary to agreement. Nor is this a North-South issue, as the debate over SSM has made clear.
One quick final word on agriculture. The U.S. strongly agrees with the Chair’s point about the absolute need for up to date notifications. Indeed, it is hard to imagine how negotiations can proceed in the absence of meaningful, current information. It is difficult to square the call for progress in negotiations by some of the very Members who are not living up to their existing transparency obligations.
In agriculture and other areas, the United States is convinced that our existing structures of committees and working groups can play an extremely helpful role in fleshing out issues that need attention, and in considering where new negotiations may be warranted. It is gratifying to see that a number of our fellow members share this view and are already beginning to inject new energy into certain committees. We believe these structures have new relevance in the post-Nairobi era and should not be neglected in a rush to reconvene negotiating bodies.
Finally, a word about MC11, a topic that we are already hearing a lot about. The United States agrees with other Members that it is never too soon to begin preparing ourselves, and our ministers, for our next MC. We share the interest in making MC11 meaningful, and that it should ideally build on the successes of our past two conferences. At the same time, it seems important to recognize that some of the bigger questions we are now asking ourselves may not fit neatly within our customary two-year cycle. Where that’s the case, we should be cautious about placing too much pressure on our next MC and we should be open to harvesting outcomes as they present themselves, as we hope to do soon with the EGA.
Thank you, Chair, for the opportunity to share thoughts. We look forward to ongoing conversations.