Business Europe & EU

Goodwill, flexibility needed at global trade talks

Goodwill, flexibility needed at global trade talks

By JOHNSON WERU
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On December 9, at the onset of my 17-hour maiden flight from Brussels to Argentina for the 11 World Trade Organisation Ministers Conference (MC11), I had plans for a selfie with Diego Maradona, drive to the famous pampas and savour the Argentinian beef and variety of wheat products.

I hoped to cap it all with a salsa-filled evening and a taste of the local brew.

My dreams and aspirations, unfortunately, were thrown under the bus by a group of rich countries whose thinking and hold on world trade affairs are only comparable with the veto powers of the five permanent members (P5) of the United Nations Security Council.

The tone of the MC11 meeting was set on the first day by a member of the P5 who accused co-members (and some adopted allies) of hypocrisy. This allegation was to set the stage for a four-day duel that involved 164 countries that are members of WTO.

The issue at hand was that some of the top 10 global trading countries were comfortable with a classification that placed them at the same level with developing countries, making them eligible for goodies that the rest of the global community was dishing out with a view to persuading the less fortunate countries to see trade as a tool of overcoming poverty and underdevelopment. I saw a red line and could only wish for the best.

At the WTO, critical issues are isolated beforehand and a formidable member state quietly selected to lead the process. No voting takes place in the WTO, but decisions are arrived at through consensus. Once agreed upon and given a seal of approval by the Council of Ministers, the decisions become legally binding to all member states.

Slow death

Over time, major trading countries have become wary of the implications of WTO decisions on local politics so much so that they focus on areas of commercial advantage to them while condemning other “less important” matters, such as the Doha Development Agenda, to a slow death.

The worrying part is how the media and political competitors quickly weave juicy narratives aimed at catching the eye of local players, especially workers, farmers, fishermen, business moguls, manufacturers among others. These groups often carry political influence in local circles.

This defines the nexus between international trade and politics. For Kenya, for example, farmers would wait for the next elections to register their displeasure should our negotiators at the WTO be party to a decision that would erode their market share.

Over the four days of the ministers meeting, local, domestic, regional and international concerns played out. Two of the 10 or so issues will suffice for illustration.

On public stockholding for food security, the ministers wanted a definite decision on how to legally compel major food producing countries to manage their strategic food reserves in a manner that grants farmers in developing countries benefits from market forces. One can imagine the impact of a major grain producing economy like Russia or Canada releasing large quantities of their stocks into the market.

From the foregoing, farmers in major grain producing counties in Kenya — such as Laikipia, Trans Nzoia and Narok — would be faced with below production prices for their produce. They may never know that the low grain prices are not engineered by political competition but by international actors thousands of kilometres away.

In this case, Kenyan negotiators have been pushing for regulation of public stockholding of food reserves. The intention was to lobby member states to a consensus on substantive reduction of subsidies granted to farmers in rich countries such as the US. It is to the same WTO rules that these countries turn to when challenged to drop the subsidies.

Fight re-emerging

While there was plenty of goodwill and flexibility in MC9 in Bali and MC10 in Nairobi, the same was in short supply in Buenos Aires. By the end of the fourth day we could not agree on anything. The fight will re-emerge in the MC12 in a city to be agreed upon in coming months.

Nonetheless, ministers made decisions on e-commerce work programme, moratorium on Trade in Intellectual Property and Services non-violation and situation complaints; the work programme on small economies; and, the creation of the working party on the accession for South Sudan – setting them on the road to membership.

Kenya will be assisting South Sudan accede to the WTO agreement, a move that will enable this new state to fully enjoy the benefits of the East African Community Common Market Protocol and the EAC Customs Union.

Ministers left much of the work to Geneva-based envoys to continue negotiations related to all remaining relevant issues, including to advance work on the three pillars of agriculture (domestic support, market access and export competition) as well as non-agricultural market access, services, development, TRIPS, rules, and trade and environment.

To our dismay, large and powerful countries managed to have their way with illegal unregulated and unreported (IUU) fishing. Until WTO member states reach an agreement on IUU, these countries will continue to deploy their powerful fishing vessels to our territorial waters, pick all the fish they can harvest, and take the same to their people to eat and enjoy — all for free.

In MC12, we foresee an opportunity for Kenya to Marshall along like-minded countries to push for an agreement on total elimination of fisheries subsidies, which will see the end the depletion of our fish stocks due to overfishing.

I have thus left Buenos Aires reluctantly, having missed out on a selfie with legendary Diego Maradona, a drive to the pampas and a salsa dance.

Johnson Weru is Kenya’s ambassador to the Belgium and the European Union.