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Geneva, Switzerland UNOFFICIAL TRANSCRIPT: NOT CLEARED WITH THE DELEGATIONS
Minister Nath: I'm not starting the ball rolling, I just have to get a flight back to New Delhi today so that's why I'll have to leave immediately after having said what I'm going to say. Our determination to move forward is demonstrated in the fact that all of us have traveled in the last couple of weeks from far corners. Mark I think it takes him, I don't know how many hours, one full day to arrive here. This demonstrates all our concerns and efforts to ensure that what we are going to achieve in Hong Kong is not merely stock taking. We do seem to be heading towards at least some conceptual convergence. There are no numbers on it, but once we are at conceptual convergence I think numerical convergence will follow. I wish we could say more on this, but apparently English and French I don't, is not descripting enough at this point of time for me to say what is the convergence. We should try Hindi or Portuguese or something next time. Our discussions have been useful and frank and reflective of the fact that all, each one of us are earnest to finding solutions. We have, as you know, been discussing this from yesterday. And however, we must ensure one thing, that good intentions are there, but what matters is not merely good intentions. The results of these good intentions should be able to deliver. We see from the developing countries certain parameters. Let me first say what Hong Kong should not do. Hong Kong, we have discussed this and I think there is convergence of this, that Hong Kong should not, no package of Hong Kong or Doha should lead in the displacement of millions of farmers and tens of millions of farmers in developing countries. Hong Kong we should ensure does not lead to de-industrialization of infant industries and small and medium industries going out of business in developing countries. These are two essential things. Also we should see that professionals, professionals who are able to deliver services from developing countries are really able to deliver them. This is what we have discussed in various forms. I'm getting into specifics because I don't want to go onto to the broad aspects. Each one of us have looked at how the structural flaws in international trade can be corrected. We've looked at how expanded trade flows are products of interest of developing countries, can also be expanded and we also are trying now to work at the package of services. In sum total, at the end of the day it will also be very important that the LDCs, we spent substantial time. This group is not a group, and Rob will tell you more about it, but I want to say the same particularly. It's not that we or Celso or Minister Nikai or Mark are only talking about their own interests. It's really, we have discussed -- I think the maximum number of time we spent was in discussing issues of LDCs. Discussing issues of preference erosion. But these are facts of life, but these are also challenges, preference erosion is a challenge in itself to correct. Because one thing leads to another thing. We may really be negating what the whole system is all about by doing any over-corrections also. So we would like to see, we all would like to see the package for LDCs is real, meaningful, and measurable. The concerns of the countries whose preferences are being eroded, we have to find innovative, out of the box solutions for them without negating the very basics. The development package is the content of this Round. It is not just one content, it is the content of this Round. That's what the name says. And this development package, this developmental round is not going to be judged mainly on its completion, but by its content. We all are conscious of that. What needs to be done, we'll continue to make our efforts. Even in the days when we are not, officials will be engaging with each other. We have all instructed our officials that between now and the few days left for Hong Kong to move in this direction so we will be able to I think in Hong Kong see something, see beyond not full modalities, but between the framework and modalities. Thank you very much, Rob. But if you'll permit me, I need to get to the airport. Ambassador Portman: Thank you, Kamal. Media: May I? Ambassador Portman: Let's go ahead with the statements of the other members, because otherwise I think we'll be here a long, long time. Minister Nath: Is there anything specific about India? Media: Yes. Ambassador Portman: Okay, one question. Media: Mr. Nath, the NGOs yesterday attacked India for wanting to get 17,000 work permits for its high tech experts in the United States in return for signing or going along with the [GLINT] services which does not help the developing world. What is your reaction? Minister Nath: I don't agree with that at all. It's not an issue which relates to India. I think services has to be looked at in a completely new way. Services are something which developing countries today are not -- 10 years ago, 15 years ago, what was India's situation in services? We weren't aggressive in services. And we moved up the ladder. And really, India is the example of how developing countries can move up in services and ensure that a large part of the GDP is services. That's what's happening, that's the pattern all over the world. And more so in developing countries which is happening now. Ambassador Portman: Thanks, Kamal. Have a good flight. I started off by thanking you all for being here. I also want to thank my colleagues for being here and say that this next ten days will involve continued intensive work on our part. We all acknowledge that. The fact that we're back here in Geneva demonstrates our commitment to having the Hong Kong meeting be a success and our commitment to the Round. At our meeting last night we were able to discuss in some detail the development issues that Minister Nath just talked about. Today we also talked about development. He's correct in that most of our time was spent talking about the LDCs in particular, those least developed countries, and how we can be sure that they can indeed enjoy the benefits of the global trading system. We had today with us all day the Director General of the WTO, Pascal Lamy, as part of our meetings. We congratulated him this morning on the successful General Council meeting last night. Some of us were monitoring that carefully, all of us were in fact. Some of us were there. Not me, but others were. We were very pleased that the draft declaration was approved to be moved on to the Ministers late last night. This is a very positive step for the entire membership to have agreed on the Ministerial Declaration, and again, we applaud Pascal Lamy and the General Council Chair Mohammed on their leadership to move these negotiations forward. The challenge facing the leadership now as we see it, is to build on that baseline. To have Hong Kong be an important stocktaking, solidifying what gains we have made since the July 2004 framework, but also to take some measured steps forward. At our meeting today and the meetings we'll have between now and Hong Kong we'll remain focused on that, building up that baseline in the key areas of negotiation including agriculture, services, and non-agricultural market access. Significantly, we will also be continuing to work on this LDC package, the so-called development package for Hong Kong. All of the Ministers here today, I believe, have gained a better understanding of the possible ways in which we could build on that declaration for Hong Kong as well as an appreciation of the range of concerns represented by the countries at the table in front of you and those countries who we may represent in various groups. We will now return to our respective capitals and consult with our colleagues through our own processes, affected ministries, legislators and other stakeholders, to see what kind of progress we can make. In the mean time our officials here will be hard at work doing the technical work necessary to underpin what progress we can make in Hong Kong across the full spectrum. I think it's very important to note that these ministerial conferences tend to be successful or not based on the attitude of the Ministers going into the conferences. I would like every Minister to speak for him or herself, but my sense is we have a very constructive attitude at this point. Not just with this group, but with the larger group evident by the General Council meeting and the affirmation last night of the declaration, but also a number of other meetings that many of us have had over the past several weeks. My colleagues and I are committed to put our maximum efforts toward making Hong Kong successful, making it a staging ground for completing the negotiations by the end of 2006. We believe our success in doing so is certainly in the best interests of the global economy and specifically the developing world. Before I turn to my colleagues I just want to note briefly that today at a meeting in London the G7 Ministers also issued a bold statement on the need for an ambitious Doha Round. I have the statement here. I wholeheartedly embrace the challenge that they've laid out. We greatly support their efforts to increase aid for trade. They have designated a number of $4 billion annually. We are especially pleased that they are prioritizing it for infrastructure in Africa. So we think this is a significant statement and we welcome it. As Trade Ministers we can work to open markets and reduce trade barriers, but we do need the participation of our partners in the Finance Ministries to provide the assistance necessary to help least developed countries and also other developing countries to take again, full advantage of the opportunities afforded by those market openings. Again, as we've said many times, we believe the successful Doha Round is key not just to our economies and our commercial interests in our respective countries, but also to global economic growth and to delivering relief to those in the poorest countries. While providing aid for trade and other development initiatives are important and helpful, again we remind you that it's the broad market opening opportunities in Doha that will deliver the most benefit, the substantial development gains that can come from this Doha Round coming to a successful conclusion include not only the LDC package we've talked about a lot in the last 24 hours, but also then connecting it to the broader outlines of the market openings, the reductions in trade distorting support and so on that come with the Doha Round. That's where most of the gains will be found, and therefore we are committed to seeing a successful result. With that I would like to go to my left, if that's all right, to Minister Vaile, then we'll go to the right, to our friends from the EU. Minister Nath has had to leave us, but we have Minister Amorim here, Minister Nakagawa I think is here, Minister Nikai is here, Secretary Johanns is here, and of course Commissioner Mandelson and Commissioner Fischer Boel. Minister Vaile? Minister Vaile: Thanks very much, Rob, and I'll just be very brief. Having been one of the Ministers in this group that's participated in this organization, in ministerial meetings since Seattle and through Doha, the launch of the Round, and then the meeting in Cancun, I can say that the preparations for the Hong Kong ministerial meeting have been far more intense than they were for those previous three meetings in terms of the effort that's gone in. The series of meetings that have taken place at a ministerial level and in different groupings to try and progress the agenda and create convergence on the critical issues has been quite significant, as Rob has said. I think it's fair enough to say that the shared objective in terms of going to Hong Kong in a week's time is to be able to progress this whole process forward. We are working in a finite timeframe in terms of the overall Round and the time left to conclude the negotiation. Certainly we're looking for the ability to be on the move forward beyond just being a stock taker in Hong Kong, so there is some progress in different areas in terms of the modalities. Today's discussion has been I felt quite fruitful in terms of developing that, particularly with regard to the development agenda, bearing in mind that it was designated and launched as a development round, as well as a market access round. Generically, market access is a development issue, particularly in the area of agriculture, but certainly there's a range of development issues that are of great importance not just to the least developed countries, but to the other developing countries, and I'm sure that Minister Amorim will say something about that in a moment. In terms of the progress across all fronts, I think that we are starting to develop a bit of a focus on what may be achievable in terms of the three pillars in agriculture. The one thing that we should recognize as far as agriculture is concerned, there are still differences of opinion in some aspects of the pillar, the three pillars, but if you look at the overall circumstance as far as agriculture is concerned at the moment, with what is in prospect, what has been put on the table, we are further advanced than we have been in previous ministerial meetings. That's not to say that there's not a lot of work to do, there is. But we shouldn't underestimate the work that has been done and the position we're in. We just need now after establishing what I call a beachhead in Hong Kong, to push the negotiations into the final stages to successfully conclude the Round. That needs to be still matched by the ambitions in NAMA in terms of agreeing on formula and coefficients in the Non-Ag Market Access areas, and of course in the all-important area of services which is so important to all the members of the organization as the growth area in so many of our economies. That still is lagging a little bit behind and is a requirement for a significant amount of effort and energy as we move forward from here. But if I can just conclude my comments in terms of thanking, the American delegation here and USTR Ambassador Portman for organizing the meeting and the discussion. It's a big effort by all these Ministers that are here to come together for a day and a half to try to continue to ripen, if you like, the process and the agenda and we look forward to the meeting in Hong Kong being successful, again as we build towards the final stages of these negotiations moving into 2006. Thank you. Ambassador Portman: Thank you, Mark. Commissioner Mandelson? Commissioner Mandelson: Rob, thank you very much. Our task this meeting was to try to move together towards a middle ground short of full modalities. We've made some limited progress in that, but on the development package for the least developed countries I think we have the makings of a common platform, and I'm encouraged by that. Of all the individual subjects we spent the greatest time in our discussions on this package. Quite a number of elements are already locked in yesterday's draft declaration, which as a whole I welcome. I think that the revised draft ministerial text reflects accurately and in a fair way the work done since Sunday. In our discussion about the development package, considerable effort was devoted to the question of quota and duty-free access, and I believe that there is some convergence emerging on this as a key centerpiece of the development package at Hong Kong. We had in-depth discussions on aid for trade and the question of preference erosion. I hope that it will be possible to create a solid platform at Hong Kong for concluding full modalities after that meeting. Certainly the key thing is to ensure that no wrong moves are made in Hong Kong that jeopardize the successful completion of the Round. Thank you. Minister Amorim: Thank you very much, Rob. First of all I want also to join others in thanking you for convening this meeting, and I would also echo Mark Vaile's words in the sense that I have been, I'm an old hand -- Not an old hand maybe as Minister, but I've been in and off in several positions and I have hardly seen so much effort being put before a Round either being launched or being concluded or any ministerial meeting for that matter. That in itself is a very positive signal because it shows that our governments in the highest levels are very much committed to a successful conclusion of the Doha Round because they understand its political importance not only for our individual interest but for the systemic needs of the multilateral system and the world economy as a whole with consequences that actually go beyond pure economic matters. So I think it was very important that we meet here and that we work hard together. I'm saying that because sometimes of course some of my colleagues in the media are tempted to say that we are practicing some kind of dramatic or comical drama or theater, and I just want to assure them that's not the case. We are really doing hard, hard work, not necessarily finding the solutions all the time. But I think it's highly important that this meeting take place, and I'll explain in a moment why in particular this meeting. I would like to say that I agree in particular what Peter Mandelson has just said in relation, Rob also mentioned, but Peter Mandelson elaborate on the question of the development issue. Of course development, as said before by Kamal Nath, is something that's all pervasive in the Round so we cannot just isolate some issues, but we were able to concentrate yesterday and this morning on the issues that are of greatest interest for the poorest of the poor, for the LDCs and maybe other countries that maybe are not LDCs but are also affected by similar situations. I'm very glad to say that there was a large convergence of views. Of course maybe some technical aspects or legal aspects still to be defined, but there was a large convergence of views among all of us that we need to have an important, meaningful package that will show to these countries that yes, they are part of the multilateral trading system; yes, there is something for them in this Round and something very substantial. I think that was probably the biggest achievement of this meeting. Not only because that will be beneficial to these countries, but also because all of us, we are all humans and can fall to the temptation of using this or that situation to our own benefit. And the fact that we are acting together in that respect is of extreme importance so I think that's very important. I would also highlight the duty free/quota free with predictability and some sort of permanence, what is the precisely legal status to be discussed, and also of course with flexibility for developing countries that are prepared also to take this kind of obligation. I would only add in relation to that of Brazil certainly, but I would only add to that point that we also have to take care of the situation of countries that are not technically qualified as LDCs but who may suffer in the process. In all regions there are countries that are very near debt threshold, so we have to be sure that what we do for LDCs is done in a way that somehow encounters compensations on other, for these other countries. And I'm not speaking here of countries like Brazil. I'm speaking of countries like Nicaragua, Paraguay, Latin America, and other countries probably in Asia and Africa. So I think this was an extremely important achievement. Many ideas were discussed, some of which not yet in detail, but I just give one or two examples -- the increase of these compensation funds for these countries, for instance which have preference eroded; and also the idea of having maybe flexible rules of origin, relatively more flexible rules of origin to encourage diversification of production, so act on the supply side as well. The second part of our meeting was our attempt also to work on building blocks on the areas that we know that are very difficult. I think we had a frank discussion. It was an open one, and I can say a very sincere one. Sometimes what one says doesn't please perfectly what others would like to hear, but in any case it was a frank and honest discussion. I think that we are, we made some small progress, smaller in these areas, but we still I think can be built on either from here to Hong Kong or more probably from Hong Kong on. We can't delude ourselves. We all know that our mandates as they stand now, or at least as they are interpreted now, are limited so we'll have to make an extra effort among ourselves and with our leaders in order to have the real results that we wish to have. And precisely because these gaps are still wide, they are not small, they are still wide -- we are working to bridge them, they are still wide. That's one of the reasons why President [Lula] phoned yesterday to Prime Minister Tony Blair and suggested to him that maybe our leaders could be more involved in one way or another in trying to, if necessary, even redefine the mandates so that we -- and that includes all of our mandates including our own -- to see if we can come to a positive agreement. Ambassador Portman: Minister Nakagawa? Minister Nakagawa: [Through Interpreter]. Allow me to speak in Japanese. At the outset I would like to express my appreciation to Ambassador Rob Portman and other members of the US government for hosting this meeting. And I would also like to thank Director General Pascal Lamy as well as the fellow members of the G6, and we have been able to have a productive and meaningful meeting over the past two days. I think our task is quite clear. We are here to represent a position of the government of Japan, but at the same time we are here to make positive contributions for the further development of the WTO-led global trade and economic expansion, and also for the development. We have received very strong instructions from Prime Minister Koizumi himself, and this is also our common recognition. Over the course of yesterday and today we have spent the longest time discussing the development issue, particularly the questions concerning LDC, so we have to think about how many population exist in the world who have to live on the income of less than one dollar per day, and also how much of the global population has access to clean and safe water supply. Bearing these points in mind I think we have been able to engage in very concrete discussions on a major LDC package including elements of duty free and quota free access as well as preference erosion matters. We have also been able to have a meaningful discussion on the wider development round including the developing countries other than the LDCs. Besides development we have also been able to delve very deeply into discussions on agriculture, NAMA and services and Japan was able to make a positive contribution, participating in these discussions. Of course over the upcoming days we will be involved in very detailed work with regard to development issues concerning developing countries, and also not only agriculture but NAMA and services, and therefore gain very favorable results at Hong Kong, and by doing so I am quite convinced that we will be able to successfully conclude the Round by the end of 2006. Ambassador Portman: Thank you, Minister Nakagawa. Secretary Johanns? Secretary Johanns: The Ambassador's comments, Ambassador Portman's comments were pretty thorough so if I could just add a couple of points to underscore a couple of things that have been said. First, we should not minimize the progress that has been made. If you think about it, really over the last 90 to 120 days very very specific proposals on very complex topics have been tabled by many parties. We now go to Hong Kong with very specific documents that outline exactly where we stand on some very very difficult issues. That's a positive step in the right direction. The second area that I'd like to underscore is that this was a very valuable meeting if for no other reason than to spend some real time on issues relative to least developed countries. And as folks have indicated, a substantial piece of the time was spent there and some good ideas, I believe, were fleshed out. So I'm optimistic about that as we head to Hong Kong next week. The third and final point I wanted to make, the spirit really is good. I think you can see that from the discussions that are occurring during this press conference. People were very engaged, very forthright in terms of their views on certain issues. So I think that lays the groundwork not only for a successful Hong Kong meeting but also for a successful effort to wrap up the Doha Round in 2006. So from our standpoint we are encouraged. The spirit is good. We're anxious to get to Hong Kong, have a successful Hong Kong meeting, and then work to wrap this Round up in '06. Thank you. Ambassador Portman: Minister Fischer Boel? Commissioner Fischer Boel: Thank you. I'll be fairly short. It is true that we spent quite a lot of time discussing the least developed countries and the possibilities for them to raise their level of income. Aid for trade. And specifically on the erosion of preferences with opening up markets. In this context I should like to mention that ten days ago the European Union, the Agricultural Ministers agreed on a new reform on the sugar regime. It was a very strong reform that actually would cut 36 percent of the prices, and it was quite clear that after this reform the European Union was criticized by the effect that this cut in prices would have for specifically the LDCs. Just to be sure that there should be no misunderstanding, in the agreement on the budget for the European Union for the next financial period, from 2007 to 2013, there are actually 190 million euros a year, so the disbursal of the ACP countries that will be affected by the consequences of this reform. So this is a way to solve the erosion of preferences. Secondly, today we had a discussion as mentioned previously, in all the three pillars within agriculture, and specifically within the export subsidies. It was decided before March 1st next year to have a full-fledged discussion among our technical people. The value of the different pillars within the export subsidies so that we on March 1st know exactly the value of this pillar and can decide from that on. Thank you. Minister Nikai: [Through Interpreter]. Thank you very much. Because my colleague, Minister Nakagawa, has already spoken I'd like to be very brief in making some additional comments. Looking at my calendar I attended APEC Minister meeting in November and then this meeting, and next week I'm going to attend the meeting of East Asian Ministers and then the following week after that we are going to meet again in Hong Kong ministerial meeting. As was pointed out by my colleague ministers already, this meeting was very constructive and we were able to engage very frank and intensive discussions. But I could feel very strongly the enthusiasm by all of the Ministers to make the Hong Kong Ministerial a success. Therefore I'd like to keep my hope and expectation high for Hong Kong. This Round is about development and I think there has been a very strong cry and demand coming from developing countries that the WTO should have human face. And I think this is something that we have to take very seriously and respond to. In that regard Japan is fully prepared and willing to make active contribution to make it happen. In our country we have the program or campaign what we call One Village, One Product. In other words, in a very small village in Japan people try to establish an industry focusing on one or two products which could be very strong in terms of market competition, and we have been very successful with this experience which we have been trying to spread to Asian countries including Malaysia, Laos, and so forth, and these campaigns and programs are found to be successful also in Asia. I think I would like to spread this to Africa so that the countries in Africa can also benefit from this sort of experience. I would like to commit myself to the efforts we would like to go to achieve in the future by making this sort of technology transfer or transfer of experience from Japan to the developing countries and LDCs. In concluding my remarks, lastly but not leastly I'd like to express my deep appreciation and respect to the excellent leadership and chairmanship of Ambassador Portman. Thank you very much in deed. Ambassador Portman: Thank you, Minister Nikai. I want to thank all my colleagues for their comments and the constructive way in which we conducted our meetings over the last 24 hours. Now we shall open it up to your questions. Which will be constructive too, I'm sure. Media: Thank you very much, Ambassador Portman. I am the only person probably from Africa here so I've been very sensible to what you have been saying about these developing countries. I am making a reference to one of your statements you made in recent days. You state that some countries are hiding behind these developing countries not to open up the markets. And you have been talking, all of you here, about these developing countries, development package, and nothing concrete discussions on the [NABAR] which is market exposed subsidies. Is this development package not a face-saving device to save the Hong Kong meeting? Ambassador Portman: I'll start by answering that and then I'd like to hear some other comments. My comment shouldn't be taken out of context. It's with specific reference to a question I received on agriculture, and particularly agricultural market access. I was referring to the comments made by my colleagues from the European Union about the fact that because of preference erosion among least developed countries that it was difficult for them to move on market access. My view is that while preference erosion is a very real issue, as has been discussed today and should be addressed, it should not be a block to the larger benefits that least developed countries and developing countries and the global economy will receive from the market openings in the Doha Round, including in agriculture. And including not just in the developed country markets but also in the other developing country markets. My comments are backed up by all the economic analysis that I have seen which indicates that by lowering those tariffs and by providing more access you will see tremendous benefits to economic development. So the comment was made in that context. It was not made in the context of the LDC development package for Hong Kong. With regard to the package for Hong Kong, as Minister Nath said before he left and as others have said, we spent a lot of time on it, not for the interests of our own country but frankly for the interests of development and specifically for the least developed countries and being sure that indeed there is a way that we can ensure the least developed countries that they will from the Doha Round receive not just these benefits that I talked about, the broad benefits, but receive the capacity to be able to engage in these new market openings and to benefit from the global trading system. So that was a lot of our discussion. I'd like Minister Amorim and others to respond please. Minister Amorim: Thank you. I don't have really much to add. I think it's really, as I said when I was recently in Arusha, the question of preference erosion, although it affects a small number of countries and a small number of products, it's a real problem and it has to be faced head on. We cannot just put it under the carpet. So the real challenge before us is not, precisely as Rob said, not to use that as a pretext not to go on liberalizing trade which after all is the objective of the WTO, but to find measures that can somehow compensate for them -- I'm not using the word compensation in the legal sense here, but compensate for them so that they can first not be eternally dependent on some preferences, on some products, on some markets, but diversify both their production and their markets to have more value added for their production and to open new markets including in the developing world. I quite agree that our countries, developing countries, have also to do their part. Of course the bigger the gains for us also in the agricultural trade as a whole, the easier it will be for us to open and to have duty free and quota free access for the countries that are poorer than we are. And I, as I said, I even made concrete suggestions on how we could look. For instance, one is the question of rules of origin which might help LDCs to find, or LDCs or other countries that are affected by preference erosion, to find products that have more value added and to go also to new markets including our own market. So we're quite prepared to work on that line. But just to finish, that's not a face saving. That is only the awareness that we have a special responsibility vis-à-vis those countries. But the Round as a whole, including the development aspects of the Round, go much beyond these packages that we discussed today. Minister Vaile: If I could just very quickly and succinctly respond to the core of your question which I think was is the development of a development package a face-saving exercise for Hong Kong. The straight answer is no. From the time we launched this Round in Doha, we have been on an ongoing basis focusing on the development issues. We remember the difficult circumstances surrounding some of those development issues in Cancun. We are absolutely committed and focused on ensuring that we deal with the development issues in Hong Kong so we build the required level of confidence amongst the developing countries. And just remember, there's in excess I think of 113 developing countries in the membership of the WTO. There might be more now. That are entitled to and deserve to have their issues met and dealt with as a part of the overall package. So it's not about saving Hong Kong, it's about delivering benefits to developing countries. Media: I was just wondering if one of you or any of you have come up with new proposals in the agricultural, NAMA, services negotiation today or committed yourself to do so at Hong Kong? Thank you very much. Minister Nakagawa: [Through Interpreter]. Yes. Earlier on when I was making my statement on the LDC question I have mentioned the duty free and quota free access as well as measures against preference erosion, but those measures alone will not be sufficient because if the LDCs are not able to benefit from the duty free/quota free access, unless they are able to have products which they can export and they are internationally competitive, my portfolio as Minister is [inaudible], so we are thinking of providing assistance in terms of the development of soil and water resources so that any seeds which are planted would produce good agriculture products which can be exported. Unless that is the case the picture cannot be completed, In terms of the package, we will be providing assistance not only in terms of financial support but also in terms of human resources development as well as technology development, technological development, and unless those elements are in there it will not constitute a genuine development package. The government of Japan is now making preparations to come up with very concrete development package which we hope we'll be able to announce sometime in the near future. Ambassador Rob Portman also suggested that if each country is to come up with its own development package without any coherence with each other's package, it will be quite confusing. So the respective members, particularly the members of this group, will keep in close contact with each other to make sure that the substance of the package that we each come up with will be really producing very positive effect of, the combination of the different packages will have a positive effect. Media: Almost all Ministers mention about the duty free and quota free for LDC, but no one said about binding the issue that the LDCs are asking for. So I was wondering if you see some development for the binding issue in this meeting? Ambassador Portman: Commissioner Mandelson put it well, I think, when he said that we are seeking a common platform with regard to duty free/quota free and other LDC development package issues. With regard to duty free/quota free, as you know these would be undertakings we would make autonomously. In other words, the United States for instance, through our AGOA program and our GSP program, and other duty-free programs we have, we would be implementing this multilateral commitment we would make. So you do have an interesting situation where you have individual countries making an autonomous decision to grant duty free treatment. In our case we already provide quite a bit of duty free/quota free through our existing programs, but we would want to even make a further commitment through this WTO process. The question is, how can you do that in a way that is both a real political commitment that has predictability, that is a commitment to the LDCs that they know will be there, and yet make it a country by country commitment? So we talked a lot about that and we came up with what we think is the broad parameters of a solution to that which would be working this through the enabling clause, making again a real and predictable commitment. As Commissioner Mandelson has said, this would be something where we would hope to have a common platform. We will now work over the next week with our officials here. There have been a number of lawyers involved in this, as you know, in the green room discussions on this, and the United States has made a commitment that we will look carefully at the legal issues, of course, because we want to make sure that this works over time, but that we will not allow some legal technicalities to block our overall objective here, which is to be able to embrace a broader duty free quota, quota free that we currently have under our existing preference programs. I think that was the spirit of the entire membership today. So I think we made a lot of progress on that, and this is one of those issues that we hope to be able to have as part of our success in Hong Kong. Other comments? Minister Amorim: I think first of all it would be very important to note, and I think it's very significant, that developing countries are also prepared to take this commitment, of course with flexibilities that have to take into account that they don't have the same standard of living, and of per capita income as the rich countries have, but they are prepared to take the commitment. That's why the flexibilities are needed. I understand that in the past India made an announcement to that effect, the Mercosur countries which Brazil also made an announcement to the same effect. But the fact that we now all agree to participate in a multilateral commitment that will take into account all these maybe different flexibilities, I think it's a rather important gesture. So the greatest predictability we can give the better. I think of course each of our countries, according to the legal systems, will try to do the best possible way within this common platform. I think it's really, as I said, a display of unit and interest in having these countries really integrated and benefiting from the multilateral trade system. But if I can then come back to the previous question about new proposals, I would like to make a comment. Apart from this area in which we have already discussed, I don't think there was really anything absolutely new, and I come back to my analysis of this and I think I want to be very frank and honest with you. The meetings have been productive, we have advanced, but the gaps still exist. And I think no one came to this meeting today expecting that anyone else would have changed its basic position, or there would have been a change in their mandate. So actually the ideas that we explored, and I think Mariann referred very appropriately to the export subsidy side on which we dwelled quite a long time, were precisely to see if on the margins of the mandates or the positions that are fixed, there is room for progress. And I think I am encouraged that there will be room for progress. Probably some of it will have to materialize only in Hong Kong -- Some may materialize from here to Hong Kong, some may materialize on Hong Kong itself, some even may materialize just after Hong Kong. I don't know. But the important thing is to ensure that the momentum is there, and I think by working as we tried to do, as I say on the margins of the basic differences, that is helpful. But that of course does not elude the main problem that there are gaps to be bridged in the main bargaining areas. Minister Nakagawa: [Through Interpreter]. I would like to respond very accurately to the question which has been addressed. Of course the question is based on the fact that LDC has submitted a proposal on the duty free/quota free access. And of course just as in the [inaudible] United States, Japan as I have announced previously, will be making the effort towards achieving the objective of duty free/quota free access. We consider this to be one of the important pillars in the development package that we are working at. At the same time, as I mentioned earlier, even if we did provide duty free/quota free access, unless these LDCs have products which they can export, this will not do. And of course predictability is important in that vein. Minister Amorim has commented on the developing countries, that is [South/South] trade, and it is also necessary to provide assistance in that sense. For instance, Japan is currently considering providing assistance to LDCs through the channel of developing countries. We have a very lengthy debate on this question anyway and I think Rob Portman has been very skillful in trying to summarize the discussions that we have had, and therefore, we will further work on this subject leading onto the Hong Kong Ministerial and that was one of the conclusions that were drawn from today's meeting. Media: Ambassador, thank you. This is a question to you as well as Mr. Celso Amorim. You mentioned about building blocks, and yesterday Mr. Lamy was talking about having a negotiating meeting at Hong Kong which does indicate that things will be much beyond stock taking. Can you, both of you indicate what exactly are the building blocks that are you are looking from your perspectives at Hong Kong in order to reach modalities sometime by March or April? If Hong Kong is a launching pad or an intermediate stage or a takeoff or whatever you call it, what exactly is it in terms of quantifiable targets in agriculture, NAMA and services? Ambassador Portman: We should have had you in the meeting because you're giving us deadlines here that we couldn't even agree on. So everybody agree to March/April? [Laughter]. As you know, Director General Lamy was in the meeting with us today and he is interested in having Hong Kong be more than a stock taking, so are we. The key is, in my view, to do exactly what Celso Amorim has said which is provide some momentum in the right direction. It's not to have a great breakthrough. I would not expect that if I were you. So if you are writing a story about the great breakthrough in Hong Kong to be unveiled ten days from now I'm afraid you'll be disappointed. I just don't see it because I don't see the stars aligning in a way that we can make the kind of breakthroughs that I would like to see and I think every member of this panel would like to see. Commissioner Amorim talked about that very honestly a moment ago. The pieces have to come together into a puzzle, and we have some pieces missing. So my expectations for Hong Kong are that it will be a stock taking. There will be some negotiation. But it will be as Commissioner Amorim said, more on the margins than some of the big changes that I think we need to see in some positions in order to make the real progress. I do hope shortly after Hong Kong that we will have the ability through more intensive negotiations to make some of those breakthroughs. That's my honest answer. Others may have different views and can respond. Minister Amorim: Since the question was put to me as well, I think I would like to answer. Well of course each one of us will single out a different building block because of course the interests are more concentrated on different subjects. But of course I think there was, as mentioned before, an honest period to look at each different question, be it NAMA, be it services, be it agriculture. I can mention one example which I already did following on Mariann which is export subsidies. As you know, for instance, in this area there has been a discussion that has been entangled because of several factors. One of them is because of the relationship between export subsidies and other forms of export support. The other has to do with an end date that might apply to all these forums but of course then other countries say, and I don't want to go into the merits of that, that this is linked to other pillars of the agriculture or even beyond agriculture. Well fine, I mean we all understand this kind of question. But I think we have, to my opinion, although our conclusion was rather modest, the conclusion that a discussion on parallelism should finish not more than two months after Hong Kong, which anyway it's something. We had an interesting discussion to elucidate what the real problems are. We didn't come to a conclusion, we didn't come to a solution, but this is the kind of building block that we tried to put together now. There are others that we tried also. I think on the basis of discussion today and especially if we're all able to reflect on what was said and what were the responses, and if we go to Hong Kong with an open mind, I think probably we'll be able to have some of these building blocks in place. But I come back to what Rob said and what I said before, these building blocks -- when you say on the margins, it maybe sounds they are marginal. They are not marginal. They are important. But they're not at the center of what we need to achieve in order to conclude the Round. But they are important. Once you have moved in the center you still have to deal with all these other pieces. So it's important to give momentum and it's important also to have the whole architecture ready when the central bargain arrives. I don't think the central bargain has arrived yet. Ambassador Portman: I don't want to be too pessimistic. Let me caveat to my previous statement on Hong Kong. There will be substantial progress in Hong Kong in some areas, and one will be development. And unless I'm wrong about that, I think we've seen a convergence, as I said, today and others have said, of views on a real and meaningful package on development that will then go along with progress in the core areas of Doha including services, NAMA and agriculture. Media: My question is to all the Ministers on the podium. I was wondering if in your two day discussions since you're looking at Hong Kong and beyond, if you played around with ideas on possible swaps between sensitive products in agriculture and sensitive product categories in NAMA, what percentage you think might be reasonable in one and the other, given that these are the huge political tradeoffs. Ambassador Portman: There's a simple answer. We didn't really talk about that. [Laughter]. We did talk a lot about the trade off issue. We talked a lot about the fact that the ultimate bargain here seems to be one where some countries who are concerned about opening their markets on the industrial side or services side and others on the agricultural side need to have an understanding, and that would include of course not just sensitive products but also non-sensitive products. We did talk a lot about special products and also about SSM safeguards for developing countries which are also part of that mix of so-called non-sensitive products. But we did not talk about that specific tradeoff that you reference. You want a follow up don't you? Quick. Media: Yeah. I was wondering with reference to what you've been saying most of this meeting about development issues, we've heard duty free/quota free is not new. It's been around this town for years. The question is, are there any product categories that would be exempt from duty free/quota free deal in Hong Kong? I thinking whether it's leather products, footwear, textiles? Do you have an exemption list from your generous offer? Ambassador Portman: I was distracted for a moment. Let me just say generally speaking there was progress made today on duty free/quota free. I think this is the first time the United States, for instance, has talked about the fact that we are going to be able to embrace the concept. I think Japan has made an important statement here today to you that perhaps was not previously made. I don't know about the other countries, I won't speak for them. But I will just say that there was progress made on not just the technical issues that I talked about earlier, you know how legally do you come up with a predictable and a certain commitment in these areas? But even with regard to the general concept, there are four other areas, as you know, where the LDCs have come forward and asked us to work on particular areas. We also addressed those issues today. We also talked about the issue of preference erosion and made some commitments there as a group to do some further work in that regard. So there was progress made today on the duty free/quota free issue as well as the bigger development package that was not previously the case. Media: My question was very specific. In your quota free/duty free offer, would you include all categories of products including textiles, apparel, footwear and leather goods? Or would it be a custom made package? And the idea has been around this town for years. Ambassador Portman: What idea? The custom made package or the other? Media: For instance, will the US include across the board textiles,
apparel, footwear, leather goods, Fischer Boel, whatever? But in general I think you'll see that as we move into Hong Kong there will be a broader receptivity on the part of the United States and some other countries to this concept than you've seen in the past. Media: Thank you. Actually, two questions. First, Madame Fischer Boel, if you could explain a little bit of how you're going to deal, it looks like that in London today Mr. Gordon Brown and the Minister of Finance of Brazil gave a press conference asking for basically more market access. That's one country of the EU, basically, claiming for market open. How do you think your mandate will be revised or touched when, by these declarations by one of the member countries of the EU? Secondly, for Minister Amorim, how close or how coordinated this meeting was the meeting of the G7 since they only talked about WTO it looks like today in London? Thank you. Commissioner Fischer Boel : First of all, I can say I'm always very interested when you see these vision papers, and of course specifically within agriculture. It's quite clear that the reform that we made in 2003 and 2004 was made on the basic of a commitment made by all the heads of states in Brussels in 2002 on the budget for agriculture in the period up to 2013. So as far as I remember, the present Prime Minister in UK was participating in this meeting and signed this package for financing the agriculture in the next period. So I just of course consider it very interesting to receive these vision papers. I can tell you that this paper will be part of the considerations that we will do when we look at the health check of the cap reform in 2008 or 2009, but at this stage well, I'm not that interested. I think it's not the proper time to put on the table a paper like this. Minister Amorim: Thank you. Well, you may be interested also to know that we talked about IMF and the World Bank. So it is only normal that Ministers also talk about trade. As far as the Brazilian Ministers are concerned, that's the only ones that I can say, the coordination was 100 percent. We talked several times over the phone and if you read Mr. Palsi's declaration he said that Brazil was willing to make advances in NAMA in the lines that I had indicated previously. Ambassador Portman: Okay. Left, and then we're going to take one more question from the back here and then we're going to have to break. Some members will stay, but we're a little bit over time so there are some airplanes to catch. So we'll take two more questions. Media: Two questions, but very quick ones. Minister Amorim mentioned a date for settling the parallelism issue on export subsidies. I wonder if there are any other dates that were mentioned in other specific areas in agricultural negotiations, any target dates. Also when it comes to the LDCs, did you discuss cotton specifically? And particularly did Mr. Portman give any sort of, anything new on how cotton could be handled? Ambassador Portman: On dates, we mentioned a lot of dates. and we worked on dates in a number of different areas including export competition. We were not able to arrive at an end dates for export subsidies. We were able to arrive at a date which I believe is March 1, 2006. Since Mr. Amorim already let the cat out of the bag I can say it now, which is the date at which we hope not just to have the negotiation done on export subsidies, but the parallelism that Commissioner Fischer Boel and others have talked about with the other areas including state trading enterprises, food aid, and export credits. So we have established that, Richard, as a date for forcing the negotiation, frankly. I'm not suggesting this is a huge accomplishment today, but it is something new. With regard to cotton, it came up, it was discussed briefly, I asked for any advice around the room, but I think it's an issue that mostly involves the US. It also involves the EU, as you know. I didn't pressure the EU on it. It also involves Brazil and others. But I'm talking about in terms of being responsive to the C4. I just want to make clear that since July 2004 when the commitment was made that we would deal with this issue in an expeditious, specific and ambitious way, we also at that time, as you know, made a commitment to consider the cotton issue along with the agriculture negotiation. That's in the July 2004 framework. It was agreed to by the C4 countries, so-called C4 which would be the Cotton 4 countries in Africa and West Africa. And that's agreed to, by the way. I've spent a lot of time, as you know, on this issue. I went to Burkina Faso about a month ago, met with three Ministers and representatives from actually the C4 and Senegal, the fifth country which has the most interest, and that's understood that we will deal with the cotton issue in an ambitious, expeditious, and specific way, but that it will be part of the agriculture negotiations. It doesn't go on its own. That's the agreement. Since that time, July 2004, think about what's happened. We have not only sent the step two program which is our premier export competition program in cotton to the Congress with a recommendation for repeal, total elimination. That has now happened as of two weeks ago in the House and the Senate. We're hoping that they will get together with the budget reconciliation legislation and actually repeal it perhaps even during the time we're in Hong Kong. We have also administratively, and Secretary Johanns can speak to this with much more authority than I can, done everything we can administratively to eliminate the export subsidies in cotton. Also since July 2004 we have made a commitment of course, as I said earlier, export credits to eliminate them altogether, and we put on the table on October 10th a US proposal not only to phase out some of our domestic support that's trade distorting, but actually even over time eliminate it, and that includes the marketing loan program which is the premier program used by cotton farmers in the United States. So we've made a lot of progress since July 2004 on the very issue that these countries are most concerned about, and in my discussions with them they're quite understanding of that and appreciative of that. Would they like to see it even sooner? Yes. But they understand we've got to go through a political process and we're doing that. Second, in addition to the subsidies issue, we have made some commitments on the market access side and those we'll see in Hong Kong, but the duty free/quota free will affect the cotton countries. It won't just be the United States, that affects many countries including the biggest markets for cotton, like China and India. But that's something that they're very interested in, as you know, and they're following the market access discussions in agriculture very closely as well as the subsidy discussions. Third is we have made a broader commitment to directly and specifically help cotton in these countries, since July 2004, in a very direct and concerted way. You were, Richard, there as part of, or you've written about the -- You may not have written about it, but you're aware of the Cotton Improvement Initiative that we have now unveiled with the countries of West Africa including Burkina Faso, Benin, Mali, Senegal, Chad. This is focused on improving all the way from, as Minister Nakagawa said, the planting of the seed to the marketing of the product. The $7 million that we announced last month when we were in Burkina Faso is part of the overall effort. It's a small part of the overall effort, but it's an important part to those countries because it directly and specifically addresses their concerns about making their cotton industry more efficient, which is part of the answer. Finally on aid, since July 2004 we have made a huge commitment of US aid to the area. About half of that aid, by the way, is aid for infrastructure development which is directly related to trade capacity building. That's through the primary means that the United States provides aid and we provide more aid than any other country in the world, and that's through the Millennium Challenge Corporation. The MCC monies to these countries, and Burkina Faso was just made eligible last month. We were able to announce that when we were there. These aid packages which are called compacts, are likely to come together within the next two years and are likely to result in roughly, maybe more, but I would say roughly $1 billion of new US direct aid to these four or five West African countries. Chad is not eligible at this point because of its oil resources and for economic reasons they're doing a little better right now, but for the other countries they have since July 2004 all become eligible. This is significant if you look at the budgets of these countries, particularly their agriculture budget, this amount of money, over $200 million in each case, is a significant new development. Again, if you look at the applications, I said 50 percent, it may be a little more in some cases, a little less in some cases, but it is directly related to things like roads and ports and infrastructure development for cotton. I'm sorry for my colleagues, it's probably boring to my colleagues because I didn't go into all this detail with them. But I want to make it clear, the United States is taking this very seriously. Why? Because we agree that these countries ought to have the ability to be integrated into the global trading system, and in their case they have a comparative advantage in cotton and we want to be sure that they have the ability to use that comparative advantage. So we are not ignoring the issue by any means. We are directly addressing the issue. We are in constant communication with the Ministers from the C4 countries and other interested countries, and as you will see in Hong Kong, we will be very attentive to these concerns and very responsive to these concerns. I will worn you, though, despite everything I just told you and some other undertakings that you will see from the United States in this regard that I cannot announce today, will there still be some who will say it's not enough? Of course. And some of those may be members of the governments of those countries, although I think it's probably more likely it will be from some of our civil society friends, some of the NGOs. But the political reality is we are pushing this I think as hard as we can, and also the political reality is it was always meant to be part of the agriculture negotiation. That's in the 2004 framework, and so the benefits to the cotton countries can only be realized if we can bring this Doha Round to a successful conclusion. Again, in my conversations with Ministers, they are very understanding of that. I'm sorry to go on so long, to my colleagues and to the members of the press who aren't that interested in it, but I did want an opportunity to address that. Celso? Minister Amorim: Very briefly I would like to say that we didn't discuss this, Rob mentioned before. But we as Brazil are appreciative of the steps that the United States has been taking in relation to the implementation of panels and rulings of the appellate body. And of course other measures that can be taken to help the supply side in developing LDCs or other African countries are of course of great importance and we agree with that. But we also would sustain that the quickest possible implementation of the appellate body decisions probably will be the best, more rapidly to help all the cotton producers including the African ones. And we appreciate the moves that have been taken but we hope they can go fast. Commissioner Fischer Boel: Can I just add just an information, since we are, the European Union is mentioned in connection with the cotton issue, that the production in the European Union is only two percent of the world production and we have actually reformed our cotton sector just to, not to get any misunderstanding. Ambassador Portman: All the way from Hong Kong, the last question. Media: The way back benches get to ask one question so I will make mine very brief, hoping that my colleague can ask his question as well. What do you expect of the chair of the conference, Mr. John specifically? Never before was a list of issues of questions, whatever you call it, forwarded to the chair before. So do you expect John Tsang to steer the conference in a way at the end you have answers to all those eight questions that Mr. Lamy forwarded to John Tsang, would be written into the final declaration? Thanks. Minister Vaile: What we expect of John is to be able to chair the meeting in an orderly way that carries the organization through all those issues that have been raised, that gives all the member states the opportunity to pursue their interest and prosecute their case in their national interest. We have no doubt that John Tsang will be able to do that very very well. He's been involved in and around the organization for a number of years. He will be given an enormous amount of support in this task by the Ministers that have been here for the last day or so, plus all our other colleagues, and we will also help him coordinate the series of discussions in different forums during the course of the week that will produce the outcome. But it is very very important that we focus on the objectives that have been outlined that we need to achieve out of the meetings during the course of the week and we all have a great deal of respect and regard for John's ability and feel quite confident that he will produce a successful outcome out of the ministerial meeting in Hong Kong. Ambassador Portman: Thank you all very much. (END) |