WTO approves services trade rules, overcoming objections
Battles on fisheries and agriculture loom during UAE talks
ABU DHABI: The World Trade Organization on Tuesday enshrined new rules facilitating trade in services between more than 70 member states, the European Union’s trade commissioner said, despite initial objections from India and South Africa. The set of rules will streamline authorization requirements and ease procedural hurdles faced by businesses, according to a press release.
It will help reduce the costs of global services trade by more than $119 billion every year, it added. The integration into the WTO implies all 164 members have approved, given the body’s rules requiring full consensus. “Reaching this outcome...and integrating it into the WTO has not been an easy pass,” EU trade commissioner Valdis Dombrovskis said during the WTO’s 13th ministerial conference in Abu Dhabi.
“We faced opposition from two WTO members” but a “spirit of compromise” eventually cleared hurdles, he said without naming any country. WTO chief Ngozi Okonjo-Iweala, meanwhile, thanked “India and South Africa for finding a way forward,” calling services the “future of trade.”
Global services exports are valued at more than $6.5 trillion, representing 23 percent of total world trade, according to the EU. The latest WTO agreement applies to 71 member states who signed the initiative but businesses from other member states can also benefit.
China, the United States and the EU are among the 71 signatories. India and South Africa have not signed. Costa Rica, which led the negotiations on the initiative, called it “a significant milestone” for member states and the WTO. This “is the first WTO result in the field of services in more than 25 years. A real success story for this organization,” said Costa Rica’s foreign trade minister Manuel Tovar.
Many eyes were trained on India—which is often described as an obstructionist element in trade talks—but its Commerce Minister Piyush Goyal has yet to arrive in Abu Dhabi. The closed-door negotiations were taking place on the second day of the World Trade Organization’s 13th ministerial conference which is scheduled to run until Thursday but could go into over-time amid divisions.
With WTO rules requiring full consensus between all member states, there is little hope for major breakthroughs, apart from a new global agreement on fisheries subsidies. After a 2022 deal which banned subsidies contributing to illegal, undeclared and unregulated fishing, the WTO hopes to conclude a second package focusing on subsidies which fuel overcapacity and overfishing.
“We’re close. It’s doable for sure,” said a diplomatic source. “The final push needs a little bit of compromise, a little bit of political will,” the source told AFP on condition of anonymity, calling a potential agreement a “very good outcome”.
The 2022 agreement has yet to take effect as not enough countries have ratified it. But it was seen as a major achievement, marking just the second accord concluded by the WTO’s full membership since the global trade body was created in 1995, and the first focused on environmental protection.
Negotiations in recent months at the WTO headquarters in Geneva have enabled a draft text to be brought forward for a second fisheries deal. It essentially divides member countries into three groups, with the largest subsidy providers subject to greater scrutiny.