Pakistan has reportedly decided not to support any proposal at the Ministerial Conference (MC) of World Trade Organization (WTO) which can limit its existing policy space in Green Box, Blue Box (development programme) and de-minimis limits, well-informed sources told Business Recorder.
The WTO's four-day Ministerial Conference is commencing on December 10, 2017 (today) in Buenos Aires (Argentina). Pakistani delegation headed by Minister for Commerce and Textile Pervaiz Malik and comprising Secretary Commerce Younus Dagha and other senior officials including Pakistan' Permanent Representative to WTO Dr Tauqeer Shah has already reached Argentina.
Pakistan is to host a meeting of friends of E-Commerce and Development, a group which was formed by Pakistan. The group comprises Kenya, Sri Lanka, Mexico, Argentina, Uruguay, Costa Rica, Columbia, Chile, and China, etc. Minister for Commerce and Textile Pervaiz Malik will have many bilateral meetings with Trade Ministers of Qatar, Uruguay, Argentina, Paraguay, Russia and European Union. He will also attend a meeting of OIC trade ministers. The commerce minister will also attend meetings of Cairns Group and G 33. Both groups demand elimination of agriculture subsidies by developed countries.
The sources said, in order to firm up Pakistan's stance on each deliverable, Ministry of Commerce and Textile constituted working groups comprising stakeholders from the federal and provincial governments, which analyzed the issues in detail and made recommendations. Lastly, an inter-ministerial meeting was convened by the Ministry of Commerce under the chairmanship of Minister for Commerce and Textile Pervaiz Malik on November 27, 2017 to finalize recommendations.
Some of the issues submitted by the WTO members and recommendations of inter-ministerial committee on each deliverable agreed are as follows:-
Public Stockholding (PSH) for food security purposes;- Public stockholding programs are used by some developing countries for purchase and sale of food stocks (traditional staple food) at administered prices for food security purpose. In Agreement on Agriculture (AoA), PSH is allowed under Green Box programs, if the purchases of traditional staple food are at current market prices for food security purposes and sales of food stocks are at administered prices for domestic food aid only. While, the public stockholding programs are considered to be trade distorting when they involve purchases at prices fixed by the governments, known as "supported" or "administered" prices. Therefore, the support provided under the public stockholding program at administered prices in counted as trade-distorting domestic support and it's subjected to AMS limits. However, in December 2013, in Bali Ministerial Conference, the ministers agreed that the existing PSH program should be shielded from any legal challenge under the AoA until a permanent solution is agreed upon.
Keeping in view the demand of provinces to maintain future policy space for old and new support programs, if any, it was agreed that Pakistan may reconsider its position on G 33 proposal, provided that following safeguards shall be made part of the permanent solution of PSH: (i) the developing member, prior to the implementation of the public stockholding program, shall notify the committee on agriculture, the value of stocks to be acquired, previous stock position and the value chain for production for the previous three years of the product concerned; (ii) shall fulfill its domestic support notification requirements under the AoA; (iii) shall provide to the committee on agriculture on annual basis, full information related to its PSH program in accordance with the template contained in Bali decision, no later than 90 days after the end of the calendar (marketing, fiscal) year in question; (iv) shall provide to the committee on agriculture full statistical information not later than 90 days after the end of the calendar (marketing, fiscal) year in question, as well as any information updating or correcting any information earlier submitted; (v) if a member does not present a full and complete notification within the established timeframe, its public stockholding programs shall not benefit from agreed solution of PSH and; (vi) the entity executing any function related to implementation of public stockholding programs shall not be engaged in export operations.
However, efforts would also be made to include following safeguards in the permanent solution of PSH during MC-II: (i) any country having a specific (negotiable, eg 5 percent) percentage share of global exports of the particular product it should not be allowed to use the stock holding programs; and (ii) in any given year, if there is substantial increase in exports of the particular product, the support provided should be accounted for the AMS entitlement or de-minimis limit.
Domestic Support, under AoA, detailed policy criteria were agreed for exempt policies ie Green Box subsidies, Blue Box subsidies and subsidies for development, whereas numerical annual limits were fixed for non-exempt (Amber box) domestic agriculture measures ie schedule-based, total AMS or de-minimis (which is 5 per cent and 10 per cent for developing countries respectively). AMS entitlements have more distorting impact on international prices as compared to de-minimis limits. For example, AMS entitlement of US is $19 billion which USA can utilize either for all products or for one product only. If it uses the whole AMS entitlement for one product/crop, it results in highly subsidies production of that particular product and will have much more trade distorting impact on international prices of that product.
The inter-ministerial committee agreed that Pakistan may support those proposals that talk about elimination of AMS entitlement altogether. However, Pakistan may not accept any proposal, which may limit its existing policy space in Green Box, Blue Box and Article 6.2 (development programs and de-minimis limits).
On rules negotiations on fisheries subsidies, the inter-ministerial meeting has finalized the following recommendations; (i) fisheries subsidy discipline will not be applicable to artisanal, small scale, subsistence & livelihood, fish stocks exclusively within EEZ, RFMO quotas for DCs; (ii) members shall not provide subsidies to Illegal, Unreported and Unregulated (IUU) fishing, including: operators and vessels identified by the flag state, subsidizing member; any RFMO; an international organization; and to fishing for stocks managed by an RFMO where the member or flag state is not a party; (ii) members shall not provide subsidies to increase or maintain capacity of fishing in Areas Beyond National Jurisdiction (ABNJ) or where there is no RFMO quota or right is established;(iii) members shall not provide subsidies to fishing in ABNJ where there is no RFMO quota or right ;(iv) members shall not provide subsidies to fishing negatively effecting overfished stocks and ;(v) members may support enhanced notification requirement for fisheries subsidies.
According to Commerce Ministry, within the context of MC-11, there are currently eleven proposals tabled and being evaluated at the WTO. The current situation is that members seem to be divided along three lines. First, those that want rules or negotiations or some element of rule-making whether assessment or preparation or discussion on rules at some stage after discussions, second, those who want more formalised, horizontal and crosscutting discussion without resort to any kind of rules or negotiations. Third, those that want to continue the existing discussions under the mandated work programme and not formalising a new working group as the current one is enough, and do not want any new rules or negotiations or discussions on rule-making. Given the nascent stages of development of the e-Commerce industry in Pakistan, Ministry of Commerce is of the view that Pakistan's approach towards the discussions and proposals at the WTO should be focused from a developmental aspect, which encourages growth, as opposed to restricting it through rule-making.
The inter-ministerial committee has recommended that as a matter of policy, Pakistan may maintain a stance that is focused on the developmental aspect of, and is opposed to rule-making on, c-commerce, whether multilateral or plurilateral. Pakistan may oppose the establishment, nor be part, of any forum, by whatever name called, that has or may have the mandate of entering into negotiations on rule-making on e-Commerce.
It was agreed that Pakistan may, keeping in view the ground realities at the WTO and assessment on merits, support a current or future proposal that is focused on the developmental aspect and improvement of developing countries, is beneficial to Pakistan, and is in line with the policy. It was also decided that Pakistan may, keeping in view the ground realities at the WTO, support the Singaporean proposal (JOB/GC/149) as long as it is beneficial to Pakistan, and is in line with the policy. Pakistan will oppose the Bangladeshi proposal of duty free and quota free access to all goods and services from all LDCs that are delivered via c-Commerce platform directly from LDCs' suppliers, due to, it's probable negative implications on Pakistan's economy, diversion of investments from Pakistan to LDCs, including Bangladesh, negative impact on Pakistan's exports of goods and services and growth of Pakistan's e-Commerce industry;
The inter-ministerial committee also evolved consensus that Pakistan may oppose any proposal on e-Commerce that provides for preferential treatment of LDCs over developing countries, including Pakistan, keeping in view its possible or probable negative implications on Pakistan. Pakistan may, keeping in view the ground realities at the WTO, also be open to being part of any future single platform for cross-cutting discussions on e-commerce providing opportunity for exploratory discussions to address the needs of developing countries, including Pakistan, as long as it is beneficial to Pakistan and is in line with the policy.
Various proposals have been tabled in the Working Party on Domestic Regulation (WPDR) which has been consolidated into a single proposal that has been jointly sponsored by 25 WTO members.
The areas include administration of measures, development of measures, transparency, technical standards, gender equality, necessity test and development in services. These proposals call for advanced disciplines in the area of domestic regulation, such as publication of laws and regulations in advance, the administration of all fees and charges in a transparent manner, the acceptance of electronic applications and copies of required documents in processing authorizations etc. These proposals aim at bringing transparency and predictability to the application of domestic laws in the area of services. The proposal ideally aims to reform countries' regime and lock-in any reforms already conducted. However, its impact on different members varies, inter alia, depending on the level of their development. It is to be noted that due to the varied and opposing standpoints of WTO Members, a decision on WPDR (domestic regulation in services) is not being considered likely during MC.
The sources said that revised consolidated proposal by the Working Party on Domestic Regulation (WPDR) and controversial paragraphs, as they currently stand, should not be accepted, as it has the potential of subjecting the sovereign legislative authority of a Member (Pakistan) to the prior review of its proposed legislation by other WTO members. Instead, they should be amended or a satisfactory clarification may be sought from the co-sponsors so as to address this concern.
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