Cablegate: Meeting of the Wto General Council - October 19, 2005

This record is a partial extract of the original cable. The full text of the original cable is not available.




E.O. 12958: N/A
SUBJECT: Meeting of the WTO General Council - October 19, 2005

1. BEGIN SUMMARY. The General Council meeting on October 19,
2005 was shorter than usual in light of other DDA-related
developments taking place simultaneously. Director-General
Lamy began by recapping his comments at recent meetings of the
Trade Negotiations Committee (TNC) and added that he would
stress to ministers meeting informally in Geneva that they
must act now to build on recent momentum. During the meeting,
a few Members put down markers on issues of importance to
them, including Mali (on cotton), Cuba and Kenya (on
TRIPS/public health), Barbados (on small economies), and
Uganda (on commodities).

2. In terms of Hong Kong preparations, the General Council
chair announced she is consulting with a view to reaching
precise operational text for inclusion in the draft text on
issues not under the remit of the TNC. In addition, the
Council approved requests by Timor-Leste and Tuvalu for
observer status in Hong Kong, but Egypt (for the Arab Group)
blocked the Agency for International Trade Cooperation and
Development (AITIC)'s request for observer status. The chair
noted four requests by international intergovernmental
organizations are pending and Members have until November 5 to
express reservations.

3. Agenda items included a report by the chair of the TRIPS
Council on TRIPS/public health, a report by the chair of the
Work Program on Small Economies, a report by the General
Council chair on consultations involving the non-recognition
of rights claimed by Honduras and Guatemala in connection with
EC enlargement and the modification of the EC banana tariffs.
Under other business, the United States requested a dedicated
session of the General Council to discuss e/commerce issues,
and the chair made a statement on GATT document de-restriction
and archiving, expressing the intention to bring the matter up
for decision by the General Council following the Ministerial
Conference in Hong Kong. The next General Council meeting is
planned for December 1-2. END SUMMARY

Statement by TNC Chair

4. Director-General Lamy recapped his remarks at the TNC
meetings of September 14 and October 13, noting that these
remarks have been circulated (and are posted on the WTO
website). He said there is a need for "urgent action" by all
Members with a view to producing, by mid-November, a draft
ministerial text based on convergence among negotiators.
Referring to the recent U.S. proposal on agriculture, Lamy
said he would stress in his meetings with ministers and
negotiators that the task is to build on the new momentum and
try to advance the negotiations on all fronts. He reiterated
that the Hong Kong Ministerial Conference must be a success
for the round to conclude by the end of 2006.

5. After Lamy's report, Mali's Minister of Industry and Trade,
Choguel Kokala Maiga, made a statement on behalf of the four
cotton countries, reiterating the importance of cotton for
their economies and expressing "serious alarm" that recent
proposals do not solve the cotton issue. He called on the WTO
to speed up work and come up with appropriate solutions,
including through creation of "a solidarity fund" to mitigate
the adverse effects of falling cotton prices and trade-
distorting subsidies of developed countries. In his remarks,
he pointed to daily death and suffering because farmers are no
longer able to earn a minimal livelihood in the current global

Preparations for the Sixth WTO Ministerial Conference

6. The General Council Chair said that she is beginning a
process of consultations with delegations and chairs
concerning the nature and context of the texts to be put
before ministers in areas of the Doha work program not under
the remit of the TNC. The aim, she said, is to reach a high
level of convergence on these areas before Hong Kong, to build
it step-by-step so there are no last-minute surprises and that
all delegations feel ownership of the outcome. She would work
with the Director-General to put these issues into a coherent
package for Hong Kong on the basis of his "bottom-up" approach
to the ministerial text.

7. Affirming the centrality of development, she observed that
many of these issues have considerable political significance
for developing countries - TRIPS issues, notably TRIPS and
Public Health but also the moratorium on non-violation
complaints; small economies; trade, debt and finance; trade
and transfer of technology; technical co-operation and
capacity building; least-developed countries; and electronic
commerce. On TRIPS/public health she noted the importance of
giving space to work in other WTO bodies. Her aim is to
develop concise operational text for the declaration, and she
added that the revised draft Cancun Ministerial Text could be
useful reference point in terms of the length and level of
detail to aim for.

8. With respect to the conduct of formal and informal work in
Hong Kong, the chair said she would brief delegations more
fully at the next General Council meeting on December 1-2,
once the agenda has become clearer. She closed by recalling
that, under the rules of procedure, a provisional agenda for
the formal part of the Conference will be communicated to
Members at least five weeks before its opening (by
7 November). Members may propose items for inclusion in this
provisional agenda up to six weeks before the opening of the
session (by 31 October). Members wishing to do so should
notify the Secretariat.

Attendance by Governments as Observers

9. The General Council approved requests by Timor-Leste and
Tuvalu for observer status in Hong Kong.

Attendance by International Intergovernmental Organizations as

10. Egypt (on behalf of the Arab Group) blocked the Agency for
International Trade Information and Cooperation (AITIC)'s
request for observer status. In principle the Arab Group is
sympathetic to all requests for observer status, he said, but
it is unable to accept this request because of an "outstanding
issue" [a reference to the Arab League's outstanding request]
and the need for a broader examination of the observership
issue where "resolution is long overdue." He expressed a
willingness to take part in any consultations. Switzerland
expressed "deep disappointment at this position." The chair
noted Egypt's willingness to consult on the matter and said
she would keep Members informed.

11. The chair informed Members that four additional requests
for observer status had been received from 1) the Technical
Center for Agricultural and Rural Cooperation ACP-EC (CTA), 2)
the Basel Convention, 3) the Council of Europe Development
Bank, and 4) the African Development Bank. In keeping with
past practice concerning requests by intergovernmental
organizations without observer status in any WTO body, Members
would be given until November 5, 2005 to communicate any
reservations to the Secretariat. She would provide an update
at the next General Council meeting.

Statement by TRIPS Council Chair on TRIPS/Public Health

12. The chair of the TRIPS Council, Ambassador Choi of Korea,
notified Members that he has resumed consultations with key
parties and the number of outstanding issues seems more
limited than in previous discussions. Nevertheless, it is
unlikely that the issue can be resolved by next week's meeting
of the TRIPS Council, so his plan is to suspend the meeting
to allow more time for consultations. With goodwill and
cooperation, he concluded, an agreement on this issue by Hong
Kong should be possible.

13. Cuba then spoke up, characterizing the issue as an
extremely important trade of technology issue for the
developing world and disingenuously calling attention to the
"millions of men, women, and children that are dying in
Africa". Kenya's representative then took the floor, saying
his country is "hoping and praying" for a resolution of this
issue by Hong Kong, an outcome that is becoming even more
important because of the threats caused by bird flu. The
General Council chair closed by urging Members to work hard to
resolve the issue, but she also reminded Members that there
is a waiver and many countries have enacted legislation, so it
isn't as if nothing is in place.

Work Program on Small Economies - Report by the Chair

14. The chair of the Dedicated Session of the Council on Trade
and Development (CTD) informed Members that a productive
meeting took place on October 17 and the two-track approach
involving work in negotiating bodies as well as the Committee
on Trade and Development has a broad base of support among
Members. He said he would intensify work in coming weeks over
what could be submitted to ministers in terms of draft text
for Hong Kong.

15. The ambassador of Barbados argued that the overall
negotiations are nearing a "critical juncture" and warned that
the WTO would be judged harshly in small vulnerable economies
if the ministerial declaration does not contain effective
responses to their concerns. He recalled the contributions
made by small vulnerable economies in substantive areas such
as agriculture, NAMA, and fisheries subsidies and he
underscored the "central role" of the CTD in the work program.
El Salvador, Guatemala, Cuba, Jamaica, and Honduras supported
the statement and echoed its themes.

Non-Recognition of Rights

16. The General Council chair reported on her consultations,
saying that she has been unable to resolve the disagreement
surrounding the claims of substantial interest submitted by
Honduras and Guatemala concerning EC enlargement as well as
the modification of the EC's tariff schedule under Article
XXVIII. The chair noted a sense among Members that the issue
should not be left unresolved because it risks complicating
the agenda for MC6.

17. Guatemala and Honduras made long statements reiterating
the importance of the matter and argued that the EC's stance
involves important systemic implications. Both countries
emphasized that the EC's position is especially damaging to
small economies, with Guatemala warning that "today it is
Guatemala, tomorrow it may be others." Honduras said the EC
should consider how its stance is undermining the credibility
of the organization and prospects for a successful Ministerial
Conference. Eleven Members - Brazil, Colombia, Costa Rica,
Ecuador, El Salvador, Mexico, Nicaragua, Paraguay, the
Philippines, Uruguay, and Venezuela - expressed support for
Guatemala and Honduras and urged the EC to respond to their
concerns. Brazil added that this is a specific example of a
problem facing small vulnerable economies requiring
resolution. Costa Rica observed that the ongoing arbitration
process is separate and independent from these consultations.

18. The EC gave an abbreviated version of its statement at the
last General Council, key themes being that it is committed to
faithfully fulfilling its obligations and that it is open to
reviewing rules and established practices on this matter in
the appropriate forum. He added that the EC is willing to
continue consultations, and that it would meet bilaterally
with any Member to discuss, on a tariff line by tariff line
basis, the acceptance or rejection of its claims.

Committee on Budget, Finance, and Administration

19. The General Council adopted the Committee's report on its
meetings in June and July 2005. The chair of the Budget
Committee, Mr. Postma of the Netherlands, noted the report of
the meeting on September 29, 2005 remained in dispute [the
matter in dispute relates to whether the Junior Professionals'
Program will be implemented in any way before concerns
expressed by India, Bangladesh, and Pakistan over the
participation of applicants from developing and least-
developed countries are resolved].

Other Business

20. Three items were raised. First, the United States made a
short statement requesting a dedicated session of the General
Council to discuss electronic commerce issues in early

21. Uganda's representative made a long statement to the
effect that commodities should feature prominently in the
ministerial declaration particularly in light of worsening
commodity problems facing developing and least-developed
countries including tariff escalation and falling prices on
international markets. He called for clarification of rules
to stabilize commodity prices and for a consultative mechanism
to address the issue.

22. On Lamy's behalf, the General Council chair read a
statement on GATT document de-restriction and digital
archiving, informing Members that after three rounds of
consultations there seems to be broad support for 1)
preserving the French and Spanish language documents, and 2)
de-restricting the documents that were restricted during the
GATT era. She expressed an intention to bring up the matter
following the Ministerial Conference in Hong Kong and hoped
for a positive decision that would help to safeguard the
legacy of the GATT.

Next Meeting

23. The next meeting of the General Council will be December 1-
2, 2005.

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