Kabar WTO Impacts of the Doha on Global Investment Policy and Regulation Mark Ritchie, Institute for Agriculture and Trade Policy November 30, 2001
Background On November 15, 2001, the Fourth Ministerial Meeting of the World Trade Organization concluded with a 10-page Declaration outlining a work agenda for the negotiators. Delegates also approved two other statements clarifying WTO rules on patenting medicines and on problems implementing current WTO rules and regulations. All three documents have impacts on investment policy and regulation. This brief report looks at the most important investment issues in each of the three documents: the Doha Declaration, the Statement on Intellectual Property Rights, and the Statement on Implementation. Doha Declaration The introductory paragraphs of the Declaration include the customary language praising the WTO for bringing prosperity to all and committing the Ministers to the "process of reform and liberalization" to ensure "recovery, growth and development." However, the opening also includes an important admission that the current rules have not resulted in a level playing field or fair sharing of benefits and burden. The introduction concludes with a pledge for greater "market access, balanced rules and well targeted, sustainably financed technical assistance and capacity-building programmes." The document continues with a statement about "the particular vulnerability of the least-developed countries and the special structural difficulties they face in the global economy." However, instead of recognizing the role of the current trade rules in creating these difficulties, the text merely calls for measures to help least developed countries "effectively participate in the multilateral trading system." In paragraph nine, the Declaration notes the joining of the WTO by China and Taiwan, along with seven other countries ranging from Albania to Oman. Given the size of China and the wealth in Taiwan, it can be anticipated that they will take a very active role in all investment related discussions in the future and given the unique structure of ownership and investment rules in China it will make these negotiations much more complicated and difficult. issues at the WTO in Geneva. How this will play out remains to be seen. Paragraph 10 commits the WTO to being more open and transparent both internally and to civil society. Whether this becomes reality is yet to be determined, but the mere presence of the language is encouraging in terms of NGO activity and effectiveness on issues like investment policy. The Doha meeting continued many of the most objectionable WTO practices in terms of closed meetings, "green rooms", etc. so this language has yet to be fully translated into a more open and democratic process. After all of this introductory language, the Declaration gets down to the main point of the document in Paragraph 11,"We hereby agree to undertake the broad and balanced Work Programme set out below. This incorporates both an expanded negotiating agenda and other important decisions and activities necessary to address the challenges facing the multilateral trading system." The Work Plan The first topic addressed is implementation issues raised by developing countries. A separate document, analyzed below, was prepared, but essentially these issues were barely addressed at the Doha Ministerial. Paragraphs 15 in the Declaration starts the section of the work plan that covers what the WTO calls "services" includes financial services ranging from insurance to banking. Paragraph 15 commits the WTO member countries to future negotiations on the rules for cross-border services negotiations. There is strong opposition to these talks from some developing countries that fear that their service sector, including everything from health and education to banking and drinking water, will be taken over by foreign investors. Paragraphs 17, 18, and 19 address some of the key issues associated with the "implementation and interpretation of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement)." This section acknowledges the importance of protecting public health aspects but gives little detail. Most of this issue was addressed in a separate declaration which included fairly strong language on the need to protect public health despite existing WTO rules on the patenting of drugs that have limited the ability of countries to acquire affordable medicines to deal with AIDS/HIV and other public health issues. Investment Section of the Declaration Paragraph 20 begins the major section on the declaration that deals with the relationship between trade and investment. It is addressed along with the other three so-called "Singapore Issues" of competition policy, trade facilitation (i.s. improvement in custom procedures), and government procurement. Here is the actual language from the final Declaration - "Relationship between trade and investment 20. Recognizing the case for a multilateral framework to secure transparent, stable and predictable conditions for long-term cross-border investment, particularly foreign direct investment, that will contribute to the expansion of trade, and the need for enhanced technical assistance and capacity-building in this area as referred to in paragraph 21, we agree that negotiations will take place after the Fifth Session of the Ministerial Conference on the basis of a decision to be taken, by explicit consensus, at that Session on modalities of negotiations. 21. We recognize the needs of developing and least-developed countries for enhanced support for technical assistance and capacity building in this area, including policy analysis and development so that they may better evaluate the implications of closer multilateral cooperation for their development policies and objectives, and human and institutional development. To this end, we shall work in cooperation with other relevant intergovernmental organisations, including UNCTAD, and through appropriate regional and bilateral channels, to provide strengthened and adequately resourced assistance to respond to these needs. 22. In the period until the Fifth Session, further work in the Working Group on the Relationship Between Trade and Investment will focus on the clarification of: scope and definition; transparency; non-discrimination; modalities for pre-establishment commitments based on a GATS-type, positive list approach; development provisions; exceptions and balance-of-payments safeguards; consultation and the settlement of disputes between Members. Any framework should reflect in a balanced manner the interests of home and host countries, and take due account of the development policies and objectives of host governments as well as their right to regulate in the public interest. The special development, trade and financial needs of developing and least-developed countries should be taken into account as an integral part of any framework, which should enable Members to undertake obligations and commitments commensurate with their individual needs and circumstances. Due regard should be paid to other relevant WTO provisions. Account should be taken, as appropriate, of existing bilateral and regional arrangements on investment." While this is very tortured and difficult to understand language, it is complicated further by the interpretation added by the Chair of the meeting at the very end to overcome an objection to this from India. The Chair added this interpretation - "In my view this (language) would give each Member the right to take a position on modalities that would prevent negotiations from proceeding after the Fifth Session of the Ministerial Conference until that Member is prepared to join in an explicit consensus." In other words, the Chair was saying that if India or others wanted to ultimately block negotiations on investments (or other Singapore issues) they could do this. Obviously, this did not make the Europeans happy and they have immediately begun a campaign to get this interpretation discredited. The issue of WTO negotiations on investment was one of the most controversial and hard-fought items on the entire Doha agenda. For the European Union, these were deal breakers - investment had to include in the final text. For India, this was also a deal breakers - they worked hard to keep all three Singapore issues out of the final text. The language that was finally included in the Doha Declaration allowed both to claim partial victory. The issue of is in the text as the EU wanted, but actual negotiations on this (or any of the other Singapore issues) cannot be started without the approval of every single WTO member government, including India, according to the Chair of the meeting. Many developing countries' NGOs saw the whole investment push by the EU as an attempt to revive the recently defeated Multilateral Agreement on Investment (MAI) by sneaking it the WTO and most have strongly opposed Europe's position on this. The US government mostly supported the EU on this but did not get as far out in front. Other Important Provisions Affecting Investment Issues Paragraph 30 promises negotiations to improve the Dispute Settlement mechanics of the WTO. Improvements are clearly needed, but this section of the text does not indicate if the goal is making it more transparent and accountable or less so. A May 2003 deadline for clarification was established. Paragraph 31 starts the section on trade and environment with the promise to enhance the "the mutual supportiveness of trade and environment." The text commits countries to negotiate on a number of important items, including the relationship to multilateral environmental agreements (MEAs) and deregulation of environmental goods and services, which includes such basic public services as drinking water, waste treatment, and disposal. This has been interpreted by some to include the investments made in these services, like corporate buy-outs of municipal water systems. Some fear that this could lead to WTO rules that force governments to privatize drinking water and other public services. On the relationship to MEAs, the Declaration states that the negotiations must maintain the superiority of the WTO agreement over MEA obligations and calls for better "information exchange" between MEA secretariats and the relevant WTO committees. In this section, WTO members also "instruct the Committee on Trade and Environment, in pursuing work on all items on its agenda within its current terms of reference, to give particular attention to: (i) the effect of environmental measures on market access, especially in relation to developing countries, in particular the least-developed among them, and those situations in which the elimination or reduction of trade restrictions and distortions would benefit trade, the environment and development; (ii) the relationship between the multilateral trading system and multilateral environment agreement (MEAs); (iii) the relevant provisions of the Agreement on Trade-Relates Aspects of Intellectual Property Rights; and (iv) labeling requirements for environmental purposes." A number of environmental groups are concerned that the WTO might try to influence or take control of eco-labeling through this action and are strongly opposed to it. Paragraph 34 covers Electronic Commerce with a general statement that requires that "members will maintain their current practices of not imposing customs duties on electronic transmissions." This statement continues the current practice of not taxing electronic commerce at the same rate that local and small businesses are taxed. This section has implications for investment procedures and regulatory policy but is clearly at an early stage in terms of real negotiations. It should, however, be closely watched. Paragraph 44 addresses some Third World government concerns about the negative impact of the current trade rules on their countries and states, "all special and differential treatment provisions shall be reviewed with a view to strengthening them and making them more precise, effective and operational." It is not clear what this will mean in relation to investment negotiations, but it bears watching. The rest of the Declaration covers the way in which the work program will be organized and managed, including statements that "the negotiations to be pursued under the terms of this Declaration shall be concluded not later than 1 January 2005" and "the overall conduct of the negotiations shall be supervised by a Trade Negotiations Committee under the authority of the General Council." This section also declares that this will be treated as a "single undertaking," which is the WTO codeword signaling that they will launch a new "round" of talks. Since the negotiations on investment are not fully agreed they are not part of this single undertaking as such but the EU has already begun to push for continued work on these issues in hopes that this will bring momentum and an inevitability that will overcome developing country objections. -- Sent through GMX FreeMail - http://www.gmx.net RantauNet http://www.rantaunet.com Isikan data keanggotaan anda di http://www.rantaunet.com/register.php3 =============================================== Mendaftar atau berhenti menerima RantauNet Mailing List di http://www.rantaunet.com/subscribe.php3 ATAU Kirimkan email Ke/To: [EMAIL PROTECTED] Isi email/Messages, ketik pada baris/kolom pertama: -mendaftar--> subscribe rantau-net [email_anda] -berhenti----> unsubscribe rantau-net [email_anda] Keterangan: [email_anda] = isikan alamat email anda tanpa tanda kurung ===============================================
