HEAVY RESPONSIBILITY ON HOST COUNTRY

6:48 AM Dec 5, 1996

HEAVY RESPONSIBILITY ON HOST COUNTRY
Singapore 5 Dec (Chakravarthi Raghavan) -- Singapore, as the host country and chair of the first Ministerial Conference of the World Trade Organization, is facing a heavy responsibility and burden, as it gets ready for the Ministerial Conference beginning Monday.

No preparatory process for any such meeting can attempt to tie up everything in advance, and some loose ends are always left for the Ministers to tidy up.

But this one is all loose ends.

The year-long preparatory process at Geneva for this first Ministerial Conference has resulted in a situation where there is no working document that could provide a basis for negotiations, at this Conference which runs till 13 December.

The report, made on his own responsibility, by the WTO Director-General, Mr. Renato Ruggiero, in the form of a letter to the Singapore Trade Minister and Chair of the Singapore Ministerial Conference (SMC), Mr. Yeo Chow Tong, has not been presented as a "draft Declaration", but one outlining the "elements of text", with some parts commanding a working consensus and others, where there is no such consensus.

In such international gatherings, it is normal for the preparatory process to come up with a text, with controversial parts -- both the formulations proposed by one or the other side, with alternatives, amendments etc, presented within square brackets.

And Ministers and senior officials, when they assemble, take such a text as a working document and providing a basis for further negotiations, aimed at removing square brackets through compromises of drafting or substance.

The WTO General Council which has the responsibility under the WTO charter, of preparing for the Ministerial meeting, has not formally been able to get a report on the outcome of the informal Heads of Delegations process that Ruggiero chaired and ran for nearly a year, that it could consider and forward to the Ministers.

The meetings of the General Council were ended, in an effort to give Ruggiero a free hand and force through a text favoured by some majors. And Ruggiero at one stage said, he had the authority to make his own recommendations and report to the Conference, but had to reconsider his stand when it became clear that this would be challenged, and the office and the process may face future problems.

As a result, the Conference and the host country as chair has some difficult days ahead.

When he took office in May 1995, Ruggiero sought to bring to the office (through press statements), his own agenda for the WTO. This agenda that Ruggiero announced, even before his election and taking office, had converged with those of the US and the European Union (EU).

But he was quickly reminded of the facts of the trading system and organization, by the then Chair of the WTO General Council (Amb. Kesavapani of Singapore) and the Chair of the Contracting Parties (Amb. Mounir Zahran of Egypt) of GATT 1947 (which co-existed with the WTO for a while).

Ruggiero was advised that neither the GATT practice nor the WTO charter provided any such role for the executive head of its secretariat, and that the only agenda or viewpoint of the WTO head had to be one decided by the Members, and that WTO Member countries, during the Uruguay Round negotiations, had decided against any provision in the charter to give any independent authority or initiative for the head of the institution.

Nevertheless, but after a brief period of reticence, the ever ebullient Ruggiero has been trying to promote a WTO agenda which seemed to be largely reflective of the interests of the US and the EU - making the secretariat appear a partisan.

But the year-long informal HOD process, and the bilateral and plurilateral consultations, to promote this agenda by adopting tactics to "isolate" those opposed -- whether on the investment issue and some narrow views of competition policy favoured by the EU Commission or the so-called bribery and corruption issue promoted by the US, to promote US corporate bidding for government procurements -- has now become counter-productive.

It has hardened the stand of a number of key developing countries which have now joined in denying consensus to one or the other parts of a draft Declaration on which Ruggiero had been working, and even some veiled challenges to his authority to propose to the Ministers, any draft even on his own responsibility.

It is in this situation that Ruggiero has formulated and sent a 10-page letter to the Singapore Trade Minister, outlining various elements of texts that he thinks commands a working consensus, others which do not have such a working consensus, and some others where consensus is blocked until one emerges elsewhere.

Considering his earlier pronouncements, in speeches around the world on the various issues covered, the Ruggiero text is cautious, even when still attempting to push forward, the attempts to initiate a study at the WTO on the trade and investment question.

Canada, Japan and a few others (with the EC, which originally wanted negotiations hiding behind them) have been pushing for a study at the WTO which several developing countries (including Egypt, India, Indonesia, Malaysia, Ghana, Tanzania, Haiti), have opposed and criticised Ruggiero in his several drafting exercises, for ignoring their views and proposing texts based on the desires of Canada, Japan etc. They have also made clear over the last several weeks that they will withhold consensus at Singapore if it is pressed.

But the attempts to isolate these countries having failed on this, and as a result, several divisions emerging on other issues including the labour standards issue, the SMC has no draft text to work on, with or without square brackets.

It has only a report, on his own responsibility, from Ruggiero to the Singapore Trade Minister, who chairs that meeting.

It will now become the responsibility of Mr.Yeo Chow Tong to find a working basis for any negotiations. As a host country, Singapore may find itself in difficulties if it tries to put forward the Ruggiero letter, abstracting the elements of texts without the explanations, and presenting a draft for negotiations or consideration of the Ministers.

Unlike a negotiating process of officials and ambassadors, a Ministerial meeting may generate a different dynamics. Some of the Ministers may lack mastery over technical details, but several elements of the draft in the year-long process where some countries have been sought to be isolated, have resulted in considerable domestic political sensitivities. Any Minister who ignores the stands his officials took (under instructions) and compromises on them at Singapore, may find themselves in great difficulties at home, particularly as when in several of these countries, the heads of governments have pronounced themselves.

Unlike the Marrakesh document, which was presented to countries as a 'single undertaking' document to be accepted in whole, there is no such possibility here.

At Marrakesh, many developing countries were faced with the heavy responsibility that if they rejected one part, they have to reject everything, including a few parts giving them some small advantage.

There is no such problem here.

Even if the Singapore meeting ends without a Declaration, the WTO would not collapse, nor its permanent machinery whose work programme in various areas on the WTO agenda have already been sent by consensus, by the various WTO bodies.

As one experienced Latin American diplomat told some journalists informally at Geneva (during one of the HOD process meetings), the way preparations had gone forward, the advantage lay with those who are ready to say no, to one or the other part.

And as far as developing countries are concerned, none of the other parts, including those commanding some working consensus, or opposed only by one or two (the US or EC), gives them anything substantial - neither in further agricultural reforms, even if one believes it will be of benefit to developing countries, nor the textiles and clothing agreement or any others.

In this complex situation, the Singapore Chairman would at least be forced to listen to one or two meetings, where individual country ministers could express their views on the controversial areas, before attempting to put forward his own text, which would be different enough from the various earlier Ruggiero formulations to prevent any rejection ab initio.

Singapore has some hard diplomatic work ahead in the next few days. It is one of the top trading nations, and a successful one. But its political clout does not match its economics, and in the final analysis, it is politics that counts with ministers and countries.