WTO passes ‘unprecedented’ trade package after fraught talks

Deal comes after failure to reach consensus on fishing subsidies and IP waiver for COVID treatments.

Ngozi Okonjo-Iweala
WTO Director-General Ngozi Okonjo-Iweala presented countries with a series of draft trade agreements that includes pledges on health, reform, and food security [File: Martial Trezzini/Pool via Reuters]

The World Trade Organization on Friday agreed on an “unprecedented” package of trade deals touching on health, reform and food security, after disagreement between countries on key issues forced the trade body to extend negotiations by two days.

The agreement came after WTO Director-General Ngozi Okonjo-Iweala had earlier urged countries to compromise, after negotiations failed to reach consensus on ending environmentally damaging fishing subsidies and fully waiving patents for COVID-19 treatments.

“The package of agreements you have reached will make a difference to the lives of people around the world,” Okonjo-Iweala said. “The outcomes demonstrate that the WTO is in fact capable of responding to emergencies of our time.”

The negotiations involving more than 100 trade ministers has been seen as a crucial test of the trade body’s ability to strike multilateral trade deals at a time when rising geopolitical tensions are increasing protectionism and economic decoupling.

Under the package, members agreed to loosen intellectual-property protections for COVID-19 vaccines and limit, not eliminate, subsidies for illegal fishing for at least the next four years. The pared down deals on two of the most contentious areas under the WTO’s purview drew mixed a response, with some campaigners arguing the agreements did not go far enough.

“This agreement fails overall to offer an effective and meaningful solution to help increase people’s access to needed medical tools during the pandemic as it does not adequately waive IP on all essential COVID-19 medical tools and it does not apply to all countries,” said Christos Christou, international president of Doctors Without Borders.

On Thursday, WTO members reached a provisional deal on maintaining a moratorium on e-commerce tariffs until the next ministerial meeting, which is expected next year. The prospect of an end to moratorium, which would have paved the way for tariffs on digital goods and services, had been a key concern of businesses.

WTO headquarters
The WTO’s first ministerial conference in nearly five years has stretched into a second day of overtime [File: Stefan Wermuth/Bloomberg]

Deborah Elms, founder and executive director of the Asian Trade Centre, described the extension of the moratorium on e-commerce tariffs as “fantastic news” but said the outcome overall appeared to be a package that “avoids failure but does not represent resounding success either”.

Elms said the WTO’s failure to reach consensus on measures such as phasing out subsidies for illegal fishing showed the need for reform at the trade body.

“After two decades, they can’t stop subsidies on illegal fishing. Think about that: at the most basic, this was meant to stop subsidies from illegal, unreported and unregulated fishing,” Elms told Al Jazeera, while stressing she had not seen the final package.

“By definition, illegal, unreported, and unregulated (IUU) fishing isn’t supposed to happen at all. We were not discussing stopping such IUU fishing. No, it was about providing subsidies to support such activities.  This is an appalling failure to deliver what should have been a simple act to save the future planet.”

In the letter outlining drafts of the trade agreements on Friday, Okonjo-Iweala asked members to consider the “delicate balance” achieved over five days of nearly round-the-clock talks marked at times by displays of anger and frustration.

“The nature of compromise is that no one gets all of what they want,” the letter said. “Let us complete our work tonight so we can honour those out there waiting for the WTO to deliver.”

Under WTO rules, all 164 members must reach consensus on any proposals and an impasse on one topic can derail other discussions. The WTO on Wednesday extended the period of negotiations in the hope of reaching agreement on key issues following resistance from members including India and Indonesia.

Julien Chaisse, an expert in international trade at the City University of Hong Kong, said the agreement represented a “great dawn” for international trade and multilateralism “despite all fears, threats and challenges”.

“There were many doubts surrounding this ministerial conference but the last days have shown a growing consensus on these issues of systemic importance,” Chaisse told Al Jazeera.

“I think the pressure is huge on this because the WTO has been under huge pressure from developing countries and NGOs since 2020 to accept a waiver of intellectual property rights,” Chaisse said. “And, the COVID pandemic is not over.”

Source: Al Jazeera and news agencies