Rather no WTO trade pact than ‘inequitable’ deal, says SA’s Carim
Seven years of talks and negotiations, millions of miles flown between countries and hopes for uplifting trade agreements broke down as the World Trade Organisation’s (WTO’s) Doha round of Ministerial trade talks “collapsed” in Geneva this week.
Pressure was on to see the process continued before the US elections, so as not to lose the hours of work and the progress that was made.
South Africa’s chief negotiator Xavier Carim said on Thursday that it would have been good to have an agreement, but only if South Africa’s issues were addressed properly.
“It would have been good for everyone, but in terms of what was on the table, it was not a deal that was balanced for [South Africa], it would have been an inequitable deal for us. Because our issue was not addressed. It's better that we didn’t come out with a deal that was going to place such an onerous burden on us,” he said in an interview with Engineering News Online from Geneva.
Carim said that South Africa would like to see the negotiations restarted, but that a fundamental shift and rethink of the non-agricultural market access (Nama) proposal would be required.
He added that there would probably be consultations in September, after the WTO holiday, where, after countries had some time to reflect, they could decide when to get started with discussions again, and what the basis for these discussions would be.
“What we were looking at was nothing more than moderate reforms in agriculture, and at the same time, for South Africa in particular, what was on the table for us was very heavy and disproportionate tariff cuts on industrial products. So for us, we were looking at quite a bad bargain,” stated Carim.
The breakdown in the main talks among ministers centred largely on disagreements among the “group of seven” (consisting of Brazil, China, India, the US, the European Union, Australia and Japan) over the Special Safeguard Mechanism (SSM), and particularly the situation where the SSM raises tariffs above commitments countries made in the 1986 to 1994 Uruguay Round, or the ‘pre-Doha Round bound rates’.
SOUTH AFRICAN DETERMINATION
From a South African perspective, it was felt that there was an overall imbalance in the process, and what was currently being proposed for the country under Nama was “simply a non starter”, said Carim.
“At the one level there were important potential gains and even though we are saying that moderate reforms were proposed in agriculture, it's not to say that those were unimportant. But what we are saying is that the price, at least for South Africa, that we were being asked to pay for it was too high,” he added.
In fact, the depths of the cuts that South Africa was being requested to take in the industrial tariffs, were the deepest cuts of any developed or developing country, in this round.
“If anybody looks at it objectively, it's clear, the numbers speak for themselves - the price was just exorbitant,” commented Carim.
To establish the architecture of an agreement, formulas and coefficients were used, and these did not take into account the specificities of particular countries. “So in trying to get everyone into a kind of ‘one-size-fits-all’ category, some countries end up having to make a much bigger contribution and much bigger payments, and this goes back to the fact that South Africa during the Uruguay round took bigger cuts,” emphasised Carim.
It was felt that if South Africa got a ‘special deal’, or more flexibilities, other countries would request the same. “But I think that argument was flawed, it was not confronting the central issue, which was not that we were getting a special deal, but a deal that would ensure that South Africa did not pay disproportionately more. Some of the others didn’t want to face up to that issue,” stated Carim.
Although this was not the main issue of the negotiations, and a South African-specific issue, it certainly would have become a critical issue in the negotiating process, had the other negotiations been settled.
South Africa had a multi-sector delegation present at the negotiations, with representatives from government, Nedlac, business, labour, and nongovernmental organisations. Thus, the party was interacting with a broader constituency throughout the process, and it gave the delegation a great deal of strength in representivity, and it could remain firm on its positions. “For South Africa that is a source of strength in the way we participate in these complex processes,” concluded Carim.
