Appendix 1

Parliamentary Conference on the WTO
September 21 2011, IPU Headquarters, Geneva
24th Session of the Steering Committee
Summary of Discussions with WTO Deputy Director-General Valentine Sendanyoye Rugwabiza

Mrs. Valentine Sendanyoye Rugwabiza, Deputy Director-General of the WTO, appeared before Members of the Steering Committee to discuss recent developments at the WTO. She made a presentation and answered questions from the members.

Mrs. Rugwabia first gave an overview of the current economic situation. As the world moved from a financial crisis to a growth crisis, global trade has been negatively affected. While global trade grew by 14.5% in 2010, trade growth in 2011 is projected to be rather limited. Although protectionist measures have been contained in 2009 and 2010, there are currently a lot of pressures on governments to take a more protectionist approach.

With respect to the Doha Development Agenda (DDA), Mrs. Rugwabia mentioned that a lot of things have been achieved in the past 10 years but that the current negotiation round is now at an impasse. The world has seen a lot of transformations, new members have joined the WTO, the economic power has shifted, and the world agenda has evolved as global issues have emerged (energy, food security, climate change, exchange rate). All of these changes have had an impact on the Multilateral Trading System (MTS). The WTO membership is somewhat split between those, who would like to move to 21th century issues, and those, who believe we cannot move on those issues if the DDA has not been dealt with. Some members fear to divert attention into new issues whereas movement is not guaranteed on the DDA front. Furthermore, DDA issues such as agricultural subsidies will not disappear. It has not been decided yet if those new issues will be addressed at the next ministerial conference, but some countries have started to act. For example, Brazil asked the WTO’s Working Group on Trade, Debt and Finance, to take a look at the impact of currency exchange rates on international trade.

Members recognize that if the rule-making part (the DDA round of negotiations) of the WTO was to be paralyzed, it would have an impact on the whole system. The WTO is more than the DDA, it is also about rule enforcement, and accountability. Members agree on the need for a way out of the impasse. At the next ministerial conference is December, ministers will have to talk about new approaches and provide guidance on how to move on the negotiation front. The Chair of the General Council is consulting members on the organization; members have put forward a number of issues including DDA. Some members are already looking for a pragmatic approach to adopt what is already mature and pose little problem at the table (such as trade facilitation). They are looking for flexibility in negotiating procedure and may review the principle of the single undertaking. The ministerial conference also has a mandate to review key elements of the organization.

Mrs. Rugwabia recognized that the media coverage about the DDA is rather negative, and that most news outlet would characterised it as “dead.” There is a need to find new ways to improve communication. It was said that members have not been very good at communicating to their population the stake of the negotiations, but it is ultimately their role since people trust their government more than the WTO administration. The WTO outreach activities are targeting parliamentarians and government officials rather than the general population.

Regarding a question on bilateral or plurilateral free trade agreements (FTA), Mrs. Rugwabia indicated that the WTO monitors FTA through a mandate included in WTO agreements, and that countries must notify agreements with a factual presentation. There is a possibility that members would strengthen the monitoring system with an analytical rather than a factual presentation. She mentioned a WTO report on bilateral agreements and its relations to the MTS. FTAs are not driven by tariff reduction but rather by new regulations setting or regulation harmonization. There is currently a “spaghetti ball” of regulations that is impeding trade. One problem with this approach is that it excludes members with least developed regulatory systems.

Mrs. Rugwabia briefly touched upon the negotiations on the accession of Russia to the WTO. Russia remains the largest economy outside the WTO membership. Negotiations have accelerated, and Russia accession could be dealt with at the next ministerial conference.

Responding to a question about the significance of gender in trade issues Mrs. Rugwabia indicated that agreements are negotiated in a gender neutral way. The gender dimension, however, is not reflected in negotiations, but it is reflected in some members’ position and trade policies.