Questions and Answers on WTO 13th Ministerial Conference

Questions and Answers on WTO 13th Ministerial Conference

What were the main outcomes of MC13?

After a week of intense engagement, EU negotiators secured important agreements on new rules to improve global services trade, environmental cooperation, and strengthening the position of developing countries in the global trading system. WTO Members also agreed to renew the “e-commerce moratorium” until MC14, maintaining duty free trade in online services, including apps, games and software, as well as digitally transmitted content such as music, video, and other digital files.

However, over the past months, the EU had worked for ambitious results to revitalise the WTO at a time of rising geopolitical tensions, including a comprehensive agreement on global fisheries subsidies, and meaningful progress on dispute settlement. The EU regrets that, despite willingness by a large majority of WTO members, it was not possible to find compromises on these issues.

What happened with the ecommerce moratorium?

WTO Members agreed to renew the “e-commerce moratorium” until MC14, maintaining duty free trade in online services, including apps, games and software, as well as digitally transmitted content such as music, video, and other digital files.

The e-commerce moratorium gives businesses and consumers around the world access to a wide range of innovative and affordable electronic services, allowing them to reach new markets or new audiences, and to participate in global value chains or global conversations. In this way, it supports the global digital transition, providing opportunity, legal certainty and predictability in the EU and worldwide. It also supports companies in developing countries – small businesses in particular – by facilitating access to the digital inputs and the online markets necessary to grow their business within and outside of their national borders

The e-commerce moratorium has been in place since 1998 and is crucial for businesses and consumers around the world, enabling them to engage in electronic commerce and to access electronic services more cheaply and more easily.

What happened with the new rules to simplify trade in services?

The EU welcomed the entry into force of new rules to facilitate and simplify trade in services. Businesses will now enjoy clear, predictable and effective authorisation procedures in more than 71 markets. The EU was at the forefront of this initiative, which will support economic growth for us and our partners in the largest and fastest growing sector of today's economy.

How did MC13 help least developed and developing countries?

The EU played a leading role in delivering outcomes that will integrate developing countries more firmly into the global trading system.

123 WTO Members finalised a deal to facilitate investment and support development. This new Agreement on Investment Facilitation for Development (IFD) aims to harness the economic potential of foreign direct investment to boost development in poorer countries. The next step will be to incorporate this agreement into the WTO rulebook.

The World Trade Organization got two new members, Comoros and Timor-Leste, showing that the WTO is an attractive and relevant organization for developing countries. Responding to the development challenges of WTO members is at the centre of the WTO reform agenda and of the Ministerial. The Conference helped find and define practical solutions such as best practices to improve implementation of the available flexibilities under the special and differential treatment (SDT) provisions, so that developing countries have time and policy space to adapt to the different rules and regulations of the WTO.

What progress has been made on sustainability issues?

The Coalition of Trade Ministers on Climate convened for the second time on the margins of MC13. The Coalition has called for stronger engagement by WTO Members on trade, climate and sustainable development, and identifying a number of actions Ministers can take collectively and individually to advance the trade and climate agenda.

A first-ever "Ministerial conversation on trade and environment" took place during MC13, where ministers expressed their desire that WTO Members come together and deliver on sustainable development and reflect on how the WTO can contribute to address the triple global crisis of climate change, biodiversity loss and pollution. Taking policy deliberation forward as part of WTO reform could not only strengthen the WTO as the key international forum for global trade governance but also help members when designing their domestic policies in response to these global challenges.

Three plurilateral initiatives - the Dialogue on Plastics Pollution and Environmentally Sustainable Plastics Trade (DPP) with 78 members; the Trade and Environmental Sustainability Structured Discussions (TESSD), with 76 WTO members; and Fossil Fuel Subsidies Reform (FFSR), with 48 WTO members – have presented the progress they have made to set ambitious work programmes to further these initiatives. Members have developed deliverables in the form of best practices and reports, such as an analytical summary of discussions on environmental goods and services and renewable energy, a compilation of best practices in the development of trade-related climate measures, a mapping on trade policy aspects of the circular economy and a compilation of national experiences on subsidies.

What happened with the Fisheries Subsidies Agreement?

The EU deeply regrets that a handful of WTO members blocked a comprehensive agreement on global fisheries subsidies. A deal was on the table to build on the outcome reached at the 12th Ministerial Conference, and fulfil the mandate set by the UN Sustainable Development Goal 14.6 to ban harmful fisheries subsidies worldwide. The EU worked with partners from across the development spectrum to find common ground for a robust deal to expand the rules to prohibit subsidies that contribute to overcapacity and overfishing.

What was the outcome on agriculture ?

Despite all the efforts of the EU to broker compromises and reach an agreement on agriculture, the WTO Members could not agree on agriculture at MC 13, due to wide divergences of views and unrealistic demands.

The EU strongly regrets that no agreement could be reached, notably because of wide divergences of views, in particular on the issue of public stockholding for food security purpose. While public stockholding programs may be essential for food security, it is important that they are implemented in a way which limits negative impacts on other countries. Politically and economically unrealistic demands on market access could not gather consensus. Negotiations, in order to succeed, have to be realistic and inclusive as well as respect a balance of interests and sensitivities for all Members.

The EU remains committed to working towards reaching a balanced and realistic outcome on agricultural reform at WTO MC14.

What are the priorities for the EU in WTO agricultural negotiations?

The EU is committed to an open, fair, inclusive and transparent multilateral trading system, which delivers on the interest of farmers and contributes to global food security.

The EU considers that the top priority should be the reform of trade-distorting support implemented by many other countries, to the detriment of our farmers. Thanks to the reforms of the CAP, most of support given to our farmers does not have negative effects on trade, contrary to the support given some other countries. It is crucial to advance on “repurposing” the

agricultural subsidies towards forms which do not have negative impacts on trade. EU's direct payments decoupled from agricultural production as well as environmental programmes are a good example of such policy. The EU's policy is a positive example of such direction of reforms implemented in line with the reform objective of the WTO Agreement on Agriculture.

The EU is also committed to deliver on specific outcomes for the most vulnerable countries at the WTO, including in relation to export restrictions. The EU also supports work towards outcomes on cotton which could help the livelihoods of the African cotton producers.

The EU is also open to negotiate on all issues of importance to other Members. In this context, we consider a solution to the issue of public stockholding for food security purposes is needed and should be one of the priorities of our work alongside the reform of trade distorting support.

What happened with Dispute Settlement reform?

AT MC13, WTO members recognised the progress made - and reaffirmed their commitment to finding agreement to restore - a fully functioning dispute settlement system by the end of 2024. The EU has consistently called on the WTO membership to make headway on reforming the dispute settlement system, which is critical to the WTO's overall legitimacy and to stopping the erosion of trade rules. It is also vital in providing stability for companies to invest and export. However, a solution still needs to be found on a reformed appeal system.

The multilateral rules-based trading system has brought stability and predictability to global trading conditions and has been an engine of prosperity for many decades. The EU has always been and will continue to play a leading role in the WTO's ongoing reform process. The WTO must now be equipped to deal with evolving 21st century challenges. It is urgent to reform the WTO in its three functions: rule making, negotiations and dispute settlement.

What happened with discussions on industrial policy?

The EU regrets that there was no agreement at MC13 to launch deliberations on key trade challenges (Trade and Industrial Policy, policy space for industrialisation, Trade and environment) despite being supported by the EU and a majority of other delegations. The blockage of this future-oriented agenda by a small number of countries is a setback that weakens the role of the WTO as a key forum to address contemporary challenges.

Further international cooperation will continue to be necessary to address these issues, and the EU will maintain its leadership role in this respect.

What have WTO Members Discussed on Ukraine?

Trade ministers from around the world expressed support for Ukraine at a Solidarity Event, hosted by the EU in the margins of the Ministerial Conference. The event marked the two years since the start of the full-scale war of aggression by Russia against Ukraine. Remembering the victims of the war, WTO Members in attendance reaffirmed their continued support for Ukraine as they called for the end of the war.

Russia's war of aggression against Ukraine continues to have devastating global and regional impacts, including on Ukraine's economy and ability to trade. The destruction of significant parts of Ukraine's transportation, port infrastructure, and grain storage facilities as well as mining of agricultural land is impeding Ukraine's ability to produce, export, and import normally. This violates the principles and values of the WTO.

WTO members have praised Ukraine's achievement of reopening grain exports by its Black Sea corridor to the global markets. Russia weaponized food, and hit the world's most vulnerable with its sea blockade. We welcome the establishment in 2022 of the EU Solidarity Lanes, which allowed the exports of around 67 million tonnes of grain since May 2022 from Ukraine to global markets. This benefits all countries, notably the countries most in need. In this context it is necessary to ensure free, full, and safe navigation in the Black and Azov Seas and ensure that sea routes and ports are not threatened or blocked by threat of or use of force.