Follow up to RNM UPDATE 0607 article:

‘Modalities Deadline Highly Improbable, WTO Talks At Crossroads’

The end-of-April deadline for reaching agreement on ‘full modalities’ in troubled WTO talks will be
missed. Confirmation of this came yesterday (April 24) from WTO Director General Pascal Lamy.

The objective preconditions for striking this important interim agreement are not in place, with the
G6 – an influential group at the center of the debate on market openings - having failed to reach
consensus in recent days on central planks of the Doha Round, Non-Agricultural Market Access
(NAMA) and Agriculture issues. Until this Group arrives at an accommodation acceptable to all six
members, prospects for advancing these core issues amongst the WTO’s wider membership are
remote. However, at present, gaps in the positions of this Group are far from being bridged, as
reflected in slow and uneven progress in the negotiating agenda.

In attempting to resolve divergences regarding the ‘triangle’ of domestic support and market
access in Agriculture and market access in NAMA, the problem is how to reach the right level of
ambition to guide the negotiations. The key question according to the WTO chief is how the
numbers would affect cuts in applied rates in these three areas, as well as ‘flexibilities’ - such as
Special Products, ‘Blue Box’, Sensitive Products, Para. 8 flexibilities, and ‘Green Box.’

The question now is, what does this delay in the April deadline and the G6 falling short of arriving
at an acceptable compromise regarding Agriculture and industrial goods mean for bringing the
Round to a conclusion by December 2006? In respect of the former, not having met an interim
deadline, while constituting a serious setback, is not uncommon in multilateral trade negotiations.
Although far from acceptable, this is the reality that presents itself, and if anything it forces the
parties concerned to intensify the pace of the talks to find an acceptable compromise. On the
issue of concessions amongst the G6, continued delay in convergence of entrenched positions is
profoundly damaging not just for the issues at the centre of the dispute - Agriculture and industrial
goods – but for the Round’s agenda at large.

Clearly, failure to arrive at an interim agreement by the end of this month makes meeting the end-
of-year deadline that much more difficult, in a negotiating process already protracted and fraught
with disagreement. In acknowledging yesterday that the April deadline would be missed, Pascal
Lamy dismissed claims that the negotiating process was deadlocked. In a statement to an informal
meeting of heads of delegations in Geneva April 24, he said that “genuine and important progress
has been made, but not fast enough to allow us to reach agreement on modalities by the end of the
month.” He noted further that “from now on, the process to reach modalities will be continuous,
Geneva-based, and focused on texts - and we should aim at finishing this work in matter of weeks
rather than months.”

The Caribbean will monitor these developments in the coming weeks, with a view to ensuring that
its issues particularly in NAMA and Agriculture are taken on board in any ‘full modalities’ deal that
is ultimately clinched.

1
For More Information Contact:

Marsha Drakes
Programme Officer-Trade Information
Caribbean Regional Negotiating Machinery (RNM)
3rd Floor The Mutual Building
Hastings Main Road
Hastings, Christ Church, Barbados
Tel: (246) 430-1678
Fax: (246) 228-9528
marsha.drakes@crnm.org