WTO fails on major reforms, extends digital tariff ban in Abu Dhabi meeting

By Emma Farge and Rachna Uppal

ABU DHABI (Reuters) -World Trade Organization (WTO) negotiators failed to break a deadlock on major reforms on Friday despite talks extending deep into overtime in Abu Dhabi, in what some delegates said was a triumph of national interest over collective responsibility.

Talks ended early on Saturday after five days of negotiations which failed to see breakthroughs on agriculture, fisheries and other key topics. However, a moratorium on imposing tariffs on e-commerce data transmissions was extended by two years, in a relief to businesses.

“On the big ticket items that are essential for the mandate that the WTO wants to sort out, the fisheries, the harmful subsidisation, that just did not happen, because there was not the spirit of give and take,” a senior European official said.

On the fifth day of the ministerial meeting, most ministers had already gone home, although India’s trade minister Piyush Goyal and European Trade Commissioner Valdis Dombrovskis remained until the end.

BLAME GAME

Dombrovskis expressed disappointment over the lack of consensus on fisheries, agriculture and broader reforms, and singled out India for blame.

“Agreements were within reach, supported by an overwhelming majority of members, but ultimately blocked by a handful of countries – sometimes just one,” he said in a statement.

Goyal, who was a holdout on these topics, was seen smiling and shaking hands outside a meeting room late on Friday as delegates gathered in small groups next to a coffee stand.

India insisted on a long promised permanent fix on public holdings of agriculture stocks which some developed countries opposed.

“We have not lost out on anything. I go back happy and satisfied,” Goyal told reporters as talks started to wind down.

Delegates had described the talks as intense and contentious at times, but WTO Director General Ngozi Okonjo-Iweala sought to put a positive spin on a difficult week, telling a closing session: “We’ve worked hard this week, we have achieved some important things and we have not managed to complete others.”

India, along with South Africa, had opposed extending a moratorium on digital trade tariffs – a move that has overwhelming support of most governments and from business – but later relented after an appeal from host United Arab Emirates.

WTO ministerial meetings have failed in the past and this year’s negotiations, held in the oil-rich Gulf state the United Arab Emirates, has highlighted fissures between some of the world’s top economies.

BRICS DISAGREEMENT

U.S. President Joe Biden’s trade chief, Katherine Tai, said in an interview with Reuters late on Thursday that if talks failed, fragmentation among the BRICS group would have contributed.

India and China, core members of the BRICS group of nations, have disagreed on key issues including on investment. India’s commerce minister joined the negotiations two days after they started and after his Chinese counterpart had left Abu Dhabi.

Pacific island nations have also complained at the talks about feeling marginalized and overlooked by most major powers, arguing that proposals did not go far enough to protect fish stocks.

But Fiji’s delegate earned a standing ovation at the end of the closing ceremony after urging countries to support future negotiations on fisheries.

U.S. support for global trade and multilateral groups like the WTO has been renewed under Biden. But negotiators were mindful that former President Donald Trump, who disrupted the multilateral system, could win a second term in the U.S. presidential election in November.

John Denton, who heads the International Chamber of Commerce, warned that the weak outcomes from the meeting should “serve as a wake-up call on the need for a more nuanced and constructive debate on the role of trade in society – both locally and globally. No country stands to gain from a weakened multilateral trading system.”

Earlier in the week, even the formal acceptance of completed negotiations on improving investment was blocked at an organization where all 164 members must agree by consensus.

A consensus on major deals would have elevated the UAE’s status as a global interlocutor, as it seeks to place a bigger emphasis on multilateralism and dialogue, a turnaround from the assertive foreign policy it was pursuing a decade ago.

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