E-News No.47

E-News No.47

WTO 10th Ministerial Conference in Nairobi – December 15-19, 2015

by Manoj Menda, Co-Chair of the Standing Committee on TRIPS

The World Trade Organization (WTO) held the 10th Ministerial Conference from 15 to 19 December 2015 in Nairobi, Kenya. The Ministerial Conference is the highest decision-making body of the WTO composed of representatives of all WTO members, which usually meets every two years.

The WTO meeting kicked off in Nairobi on 16 December 2015 amidst very heavy security.

This biennial WTO 2015 meeting was important as the future relevance of the WTO was being questioned.

As the Kenyan Cabinet and Trade Minister Ms. Amina Mohamed put it “we will need to figure out how to make the global trade body work as a negotiating forum or otherwise decide whether it still has any purpose.”

The WTO Director-General Roberto Azevêdo stated that the WTO is already going through “fundamental changes as we speak” and noted that it took 18 years for the WTO to agree to the Trade Facilitation Agreement (Bali 2013).

The G-33 countries have decided that they wanted to continue with the Doha Development Agenda and wanted a Special Safeguards Mechanism (SSM) for food prices and stockholding for food security for their countries.

A Special Safeguard Mechanism (SSM) for Developing Countries (WT/MIN(15)/43) recognizes that developing members will have the right to temporarily increase tariffs in face of any import surges by using SSM.

Member countries could not arrive at a consensus on the Doha pending issues. The negotiation and discussions were continued beyond 18 December and were very complex and did not merely revolve around developing vs. developed countries.

The Trade Facilitation Agreement that was cleared in Bali in December 2013 is nearer to implementation. Sixty-three countries have already ratified this agreement. Two-thirds of the WTO members have to ratify the agreement for it to come into force.

There was also an Agriculture Agreement decision that contains disciplines to ensure that other export policies are not used as a disguised form of subsidies. These disciplines include terms to limit the benefits of financing support to agriculture exporters, rules on state enterprises engaging in agriculture trade, and disciplines to ensure that food aid does not negatively affect domestic production of a country. Developing countries have been given longer period to implement these rules.

A Ministerial Decision was also adopted on Public Stockholding for Food Security Purposes (WT/MIN(15)/44). It commits members to engage constructively in finding a permanent solution to this issue. (Under the Bali Ministerial Decision of 2013, developing countries are allowed to continue food stockpile programmes until a permanent solution is found by the 11th Ministerial Conference in 2017.)

A Decision on Cotton (WT/MIN(15)/46) also stresses the vital importance of the cotton sector to LDCs which includes three agriculture elements: market access, domestic support and export competition.

The Ministers also declared that there is a need to ensure that Regional Trade Agreements (RTAs) remain complementary to, not a substitute for, the multilateral trading system.

An agreement on Information Technology was concluded in the Nairobi meeting.

The WTO members representing major exporters of information technology products also agreed in Nairobi on a timetable for implementing a deal to eliminate tariffs on 201 IT products whose trade is valued at over $1.3 trillion per year. The WTO member countries will benefit from this agreement, as they will enjoy duty-free market access to the markets of the members eliminating tariffs on these IT products. This means that by 2019 almost all imports of products that are covered in this agreement will all be duty free, such as new-generation semi-conductors, GPS navigation systems, medical products such as MRI machines, machine tools for manufacturing printed circuits, telecommunications satellites and touch screens.

The issues that are still open to negotiation at the WTO are as follows:

1. the Doha Round;

2. Agriculture Subsidy;

3. Agricultural export competition; and

4. Stockholding of food.

In the final Nairobi Ministerial Declaration, document WT/MIN(15)/DEC dated 19 December 2015, “TRIPS” has been referred to in the following paragraphs:

  • in paragraph 21, the Ministerial Decision on Non-violation and Situation Complaints, document WT/MIN/(15)40. It was decided that the TRIPS Council would continue to examine this issue and make recommendation to the next Ministerial Conference to be held in 2017. In the meantime, no such complaints will be initiated.
  • in paragraph 22, the TRIPS Council adoption of the decision on extension the transition period for LDCs on patenting in regard to pharmaceutical products, and the related General Council Waiver decision concerning LDC members’ obligations under TRIPS Article 70.8 and Article 70.9. The TRIPS Council decision was to extend the extension until 1 January 2033.
  • in paragraph 31, the specific mentioning of TRIPS, among other WTO areas, in the context of expressing “a strong commitment of all Members to advance negotiations on the remaining Doha issues.”

Also in paragraph 12, there is a small mention of “We recall the adoption of the Protocol Amending the TRIPS Agreement”. This refers to the so-called Paragraph 6 system for compulsory licences for export of pharmaceutical products. This system is in force by a waiver. However, the formal amendment of TRIPS, decided in 2005, has as yet not entered into force. The period for acceptance of the TRIPS amendment has been extended to 31 December 2017.

Trade ministers also welcomed the conclusion of negotiations on the accessions of Liberia and Afghanistan at the 10th Ministerial Conference in Nairobi.

Conclusion: The 10th Ministerial Conference in Nairobi concluded by achieving a historic agreement which brought Six Ministerial Decisions on Agriculture, Cotton, Issues related to LDC, Public Stockholding for Food Security, Special Safeguard Mechanism (SSM) and Regional Trade Agreements. There clearly remains a strong commitment of all Member countries even in the back drop of other mutual agreements to advance negotiations on the remaining Doha issues mainly in the areas of:

Agriculture, namely domestic support;

Market access and export competition, as well as non-agriculture market access, services, development; and

TRIPS and its rules.