WTO 'Miniministerial': Stalemate in Tokyo

Walden Bello, Executive Director, Focus on the Global South Philippine Daily Inquirer, Asia News Network, Bangkok

While world attention is focused on the impending war in the Middle East, another drama is building up away from the public view: The runup to the World Trade Organization Ministerial in Cancun, Mexico, in September of this year. A WTO "Miniministerial" (Feb.14-16) brought me to Tokyo as an observer.

On the last day of the event, U.S. Trade Representative Robert Zoellick demands on television that Japan open up its agricultural market in the same way that "other countries have opened their markets to Japanese manufactured goods."

The draft negotiating document prepared by WTO farm negotiations chairman Stuart Harbinson zoomed to the top of the agenda when, even before the meeting began, Japanese Minister of Agriculture Tadamori Oshima rejected the paper's proposals for minimum cuts of between 25 and 45 percent and average reductions of 40 to 60 percent on all farm tariffs over five years.

The European Union (EU) said the Harbinson proposal was "unbalanced", for proposing that "trade-distorting" subsidies be cut by 60 percent over five years and that export subsidies be phased out entirely over nine years. Both Japan and the EU denounced the paper as ensuring that the U.S. would be the only victor in the negotiations.

In the fight between the agro-export giants, the concerns of developing countries were lost. An analyst said the Harbinson text does not address their fear that EU and U.S. subsidies will now mostly be shifted to the "Green Box," a listing of exempted subsidies that include the massive direct payments to farming interests that directly or indirectly distort trade.

The Harbinson text also ignores proposals from Argentina and the Philippines (both of which were not invited to the Tokyo meeting) for countervailing mechanisms that would allow developing countries to raise tariffs on crops subsidized by the developed countries by amounts proportionate to the subsidies.

Instead, for developing countries, tariffs greater than 120 percent are to be slashed by 40 percent, while those between 20 and 120 percent will be decreased by 33 percent, with no linkage to the subsidies maintained by the wealthy agro-exporters.

The draft also contains no meaningful recommendations that would apply "special and differential treatment" to the developing countries, owing to their different level and conditions of agricultural development.

The Harbinson draft proposes to change some of the terms of monopolistic competition among the EU, U.S., Australia, and Canada while accelerating the removal of the protective barriers of the developing country markets they are fighting over.

The "miniministerial" has no legal status in the WTO constitution. Who is invited, who does the inviting, why are governments invited -- there are no answers, which is why many developing countries have demanded abolition of the institution.

Concerns about the transparency of the Mini-ministerial and its legitimacy did not seem to ruffle representatives of the 22 participating governments. Perhaps this was because the issue barely made it to the press.

Other burning issues also received perfunctory discussion. Among these was the continuing controversy over the U.S.'s effort to water down the Doha Declaration's provision overriding Trade- Related Intellectual Property Rights Agreement (TRIPs) in the interest of public health.

In Tokyo, Washington refused to back away from its position of strictly limiting the number of diseases for which public health would be prioritized over patents. NGO's like Medicines Sans Frontiers, Africa Japan Forum, and Oxfam International lobbied participating governments to reject the TRIPs Council's recent recommendation (obviously inspired by the U.S.) that compulsory licensing of critical drugs be limited to "national emergencies or other conditions of extreme urgency." They pointed out that the Doha Declaration said nothing about limiting the overriding of TRIPs to "national emergencies."

We also brought up our apprehension about Japan's leading role in pushing negotiations on the "new issues", particularly investment. The developing countries felt threatened by Japan's position, which has not budged from its formulation prior to the Seattle ministerial: "National Treatment" and the most-favored nation treatment are the basic principles of the WTO Agreement, and should be included in future investment rules of the WTO.

Once a foreign country is established in a host country, it should, in principle, be treated in a manner equal to that of domestic companies, as there are in most cases no rationales for discriminatory treatment."

Japan has been so dogged in pursuing its line on investment that prior to the Doha ministerial, according to sources in Geneva, Tokyo warned Jakarta that any attempt by the Indonesians to block its efforts to bring investment into the WTO would affect Japanese investors' willingness to bring their capital to Indonesia.

Compared to the Sydney mini-ministerial, there was clearly a failure to make the meeting in Tokyo controversial in the public view. The pitifully small demonstration by less than 2,000 largely aging farmers organized by Central Union of Agricultural Cooperatives Zenchu on Feb. 15, showed up the weaknesses of its approach to mobilizing public opinion around the WTO.

Instead of universalizing the Japanese farmers' struggle to other, and younger, constituencies, the organizers seemed intent on confining the WTO question to agriculture. No wonder the WTO in Japan is seen largely as an aging farmers' issue!

The theme of the rally was to show Japanese farmers' support of both the Japanese government and the European Union. The rhetoric about protecting small farmers was there, as were impassioned references to agriculture being unlike industry in that it is a way of life and has a beneficial impact on the environment.

But to maintain an intergovernmental alliance, Japanese farmers were not told that Japanese agriculture and EU agriculture are different. Japan is not an agricultural exporting country but one where farmers are simply trying to survive and maintain an organic tie to the rest of the society.

The EU is a massive agro-exporter whose subsidized products are creating havoc among small farmers throughout the developing world. The real interest of Japanese farmers lies in allying themselves with small farmers in the developing world in a common front against dumping, not with large-scale EU agricultural interests and agro-technocrats in Brussels.

Anyway, agriculture could well be the WTO's Achilles Heel. A failure to reach agreement on agriculture before the deadline of March 31 could unravel negotiations in other areas like industrial tariffs, the new issues, services, and TRIPs, leading to WTO Director General Supachai Panitchpakdi's great fear: Lack of any movement toward consensus prior to the Fifth Ministerial in Cancun, Mexico, in mid-September.

A "heavily bracketed text" showing lack of agreement on so many points helped precipitate the Seattle debacle.

The bad news is that the relative absence of protest against its taking place in Tokyo gave back to the illegal meeting some of the legitimacy that was taken away by the huge protests on the occasion of the Sydney mini-ministerial in November 2002.

The spotlight now turns to New Delhi, where the next mini- ministerial is said to be scheduled for mid-March. Indian civil society organizations must realize that our side can no longer afford fiascoes like Tokyo in the run-up to Cancun.

The writer is also a professor of sociology and public administration at the University of the Philippines.