Delegation of the European Union to Togo

EU Statements at the General Council Meeting, 1-4 March 2021

Geneva, 04/03/2021 - 00:00, UNIQUE ID: 210304_16
Local Statements

<p>Statements delivered by Ambassador J. Aguiar Machado</p>

Item 2 - IMPLEMENTATION OF THE BALI, NAIROBI AND BUENOS AIRES OUTCOMES – STATEMENT BY THE CHAIRMAN

On the Bali Ministerial Decision on Public Stockholding, the European Union (EU) notes that India has invoked the Bali Ministerial Decision for the first time. Examination on this is ongoing in regular Committee on Agriculture and further transparency from India is awaited.

On the Nairobi Decision on export competition, the European Union continues to urge the remaining members that have so far not, submitted the necessary schedule modifications to eliminate export subsidy commitments to do it as soon as possible. 

The 2021 Export Competition Questionnaire will be the first occasion on which developing countries are required to submit replies. The European Union encourages all developing members to do so. This is particularly important for those who are active exporters. 

The European Union also looks forward to the discussion in the regular Committee on Agriculture on the triennial review of the Nairobi Decision. The European Union counts on members’ active participation on how to enhance disciplines and ensure no circumvention of commitments.

Finally, on the Bali Ministerial Decision on Tariff Rate Quota (TRQ) administration, the European Union continues to regret that it has not yet been possible -as you indicated Mr Chairman - to reach agreement on the scope of the TRQ underfill mechanism, in order to ensure that all WTO members take equivalent commitments. This issue will need to be addressed by our ministers at MC12. 

 

Item 4 - TWELFTH SESSION OF THE MINISTERIAL CONFERENCE – DATE AND VENUE

I would like to thank Kazakhstan for its continued commitment and for showing flexibility. Unfortunately circumstances did not allow to hold the Ministerial Conference in Nur-Sultan. The European Union supports the organisation of MC12 in Geneva in December, confident that if we work together over the coming nine months we can deliver in a number of areas.

The European Union has set out what it hopes can be achieved on WTO reform by MC12 and beyond in a recently published strategy paper named ‘Reforming the WTO: towards a sustainable and effective multilateral trading system’.

The paper describes the reasons for the WTO’s current crisis and puts forward a set of ideas for restoring the Organisation’s relevance and credibility. It notably presents ideas for updating the Organization’ s rulebook and practices to better equip it against the challenges that we are collectively facing, such as the recovery from Covid-19 and the digital and green transitions.

Executive Vice President Dombrovskis has written to all WTO Members’ trade ministers with an offer to reinforce dialogue in Geneva and in capitals to ensure a successful outcome of MC 12, which should be an important milestone in the process of WTO reform. We offer our full cooperation to the new Director General in this endeavour.

 

Item 7 - SUPPORTING THE CONCLUSION OF FISHERIES SUBSIDIES NEGOTIATIONS FOR THE SUSTAINABILITY OF THE OCEAN AND FISHING COMMUNITIES - DRAFT MINISTERIAL DECISION - COMMUNICATION FROM BRAZIL (WT/GC/W/815)

The European Union thanks Brazil for its Communication.

The existing mandate from the Sustainable Development Goal 14.6 and the WTO Ministerial Decision in 2017 on the fisheries subsidies negotiations remains valid. 

We are on ‘borrowed time’ already to conclude the negotiations in advance of MC 12. The European Union welcomes initiatives that bring us closer to our goal to reach an ambitious agreement as soon as possible.

We support the emphasis that sustainability is the responsibility of the whole WTO Membership. We welcome the spirit of Brazil’s Communication which is crucial for these negotiations to be successful.

However, if it leads to a long discussion about what is and what is not in the mandate and thus distracts from the task we have at hand, the European Union thinks that our key focus now should be on negotiating the disciplines and delivering a successful outcome.

 

Item 8 - WORK PROGRAMME ON ELECTRONIC COMMERCE AND MORATORIUM ON IMPOSING CUSTOMS DUTIES ON ELECTRONIC TRANSMISSIONS – REQUEST FROM INDIA

 

The European Union welcomes the interest expressed by Members to engage in discussions in the context of the Work Programme on e-commerce, including on the moratorium on customs duties on electronic transmissions.

The Covid-19 pandemic has highlighted the importance of electronic commerce. We are pleased with the useful exchanges on the development dimension of e-commerce, for example in the Council for Trade in services in the course of the year. We remain open to continuing these discussions.

On the moratorium on customs duties, we would like to underline that the moratorium provides the predictability and security that our consumers and businesses – both in developed and developing countries – need when engaging or planning to engage in e-commerce.

We would also like to recall that several recent economic studies have provided scientifically solid new evidence on the positive economic implications of the moratorium.

This is not in our view the case of the recent UNCTAD paper on e-commerce which takes a narrow approach without looking at the broader economic benefits of the work that we carry out in the WTO.

The European Union remains committed to continue engaging in structured discussions on the moratorium in line with the GC decision of December 2019, taking into account the new evidence that has been published over the last couple of years on the multiple benefits of the moratorium for business and citizens.

While Members had decided to extend the moratorium until MC12, the European Union hopes that our Ministers will be a position to consider a longer term – if not permanent – extension at the next Ministerial meeting in December.

 

Item 9 - CALL TO PREVENT EXPORT RESTRICTIONS ON COVID-19 VACCINES – COMMUNICATION FROM COLOMBIA, COSTA RICA, ECUADOR, PANAMA AND PARAGUAY (WT/GC/W/818)

The events of the last couple of months illustrate the difficult dilemmas we are facing as global demand for vaccines greatly exceeds available supply. The global nature of the pandemic and the development of new variants demonstrate that no country is safe until every country is safe.

Like many other countries, the European Union has also struggled with the lack of transparency in the delivery of vaccines, the production of which it has pre-financed. Our inquiries into reasons for delays did not result in satisfactory answers from some vaccine manufacturers. In order to ensure that vaccines and their ingredients are not directed to export destinations in unjustified volumes, the European Union had no choice but to introduce a transparency mechanism on Covid-19 vaccine export transactions.

We are in a situation where some vaccine producers have overpromised and under delivered. They have committed more than what they produce. In this situation, we need to ensure a transparent distribution of vaccines and avoid a situation where the much-awaited vaccine goes to the highest bidder or distribution is left to the arbitrary decision of vaccine producers.

The European Union understands the concerns that WTO Members have expressed. Paradoxically, the scheme and the reactions from other WTO Members clearly demonstrate the need to agree on guiding principles in the WTO for the imposition of trade measures and in particular regarding transparency. The European Union has put in place an export authorisation fully in line not only with our WTO obligations but also with our G20 commitments. And the scheme has been notified immediately to the WTO.

In the spirit of international solidarity, the European Union has also exempted from the scope of this measure 92 vulnerable countries, which do not have sufficient financial resources and sufficient production capacity to supply their population with vaccines in adequate quantities. We have also exempted neighbouring countries who, through their close integration in the European Union’s market and supply networks depend on vaccines supplies from the European Union. And more broadly, we have exempted any COVAX supplies from the scope of the measure to allow this global facility to achieve its goal of equitable distribution of vaccines across the globe. We were happy to see that first supplies were delivered to Ghana and the Ivory Coast just last week.

I can also reassure WTO members that this mechanism does not create unnecessary barriers to trade or any disruption to global supply chains.

Since the entry into force of the scheme on the 1 February, we have received 150 requests for export authorisation. All of them have been accepted. I repeat, all of them.

Therefore, the measure has not slowed down the export of vaccines and the data compiled so far indicate that the European Union is the biggest vaccine exporter worldwide, in a situation where there are very little exports from other OECD or G-20 countries. Indeed, it should be underlined that the European Union is the sole significant exporter of Covid-19 vaccines amongst OECD members. The European Union is not engaged in vaccine nationalism.

It should be recalled that the Covid-19 vaccine production capacity in Europe, that we share with the world, was created through the European Union’s support to vaccine producers in the form of the Advanced Purchased Agreements. The European Union has not restrained the ability of vaccine producers to engage with other partners, but expects them to be fair when delivering on their contractual obligations.

However, the root causes of the problem lie elsewhere: the exploding global demand is well above the global production today. As long as this global industrial challenge is not met, and the world population is not vaccinated quickly enough, we will all face a risk of a continuing health emergency including new Covid-19 variants and a prolonged economic crisis.

The European Union believes there is an important role for public authorities to play and to drive the increase of production, and to facilitate access to the vaccines and other treatments that are in need today. Cooperation must be promoted amongst the different participants along the value chains where necessary to enhance production capacities. A closer, more integrated and more strategic public-private cooperation with the industry is needed. In this spirit, the European Union has set-up a Task Force for Industrial Scale-up of COVID-19 vaccines to detect and help respond to issues in real-time. In order to ramp up production, we will, amongst others, work closely with manufacturers to help monitor supply chains and address identified production bottlenecks. Since European Union’s vaccine production is critical for global supply, the benefits of this initiative will extend beyond the European Union’s borders.

Scaling-up of production on a global level requires further actions. It will not happen without increased global collaboration with the pharmaceutical industry, which should facilitate the transfer of the right know-how and technology for the highly complex vaccine production process. We should facilitate this collaboration, while also recognising that intellectual property provides the necessary platform for it to take place. Waiving intellectual property rights would disrupt this collaboration and the transfer of know-how.

In conclusion, Mr Chairman, we believe it is legitimate to engage the sector in order to ensure that all complementary production facilities across companies and continents are actively contributing to ramp up production. Companies that have tried and failed to develop a vaccine of their own, for example, should actively consider making their facilities available for the production of vaccines of successful companies. Companies with new vaccines should consider whether they have checked all options for licensing agreements to increase production. The objective should be to ensure they enter into licence agreements with companies around the world that have the necessary production capacities and could export the vaccines to any low middle-income countries without production capacities. At the same time, we should be mindful that the manufacturing campaigns for covid-19 vaccines do not crowd out the production of other life-saving vaccines and therapeutics.

The European Union, working together with other WTO Members and under the leadership of the Director-General Dr. Ngozi Okonjo-Iweala is ready to facilitate a dialogue between the vaccine developers and companies with the production facilities that are ready to step in to help out with the production of vaccines and their delivery to the countries in need. We welcome the DG’s proposal to focus on collaboration among companies to enhance licensing in order to use all the adequate manufacturing capacity, including in developing countries. The European Union is ready to facilitate this dialogue and contribute to the efforts on expanding these partnerships.

The European Union remains open to a dialogue with all WTO Members on how to facilitate the collaboration with the pharmaceutical industry on the transfer of know-how and technology. In the same manner, the European Union remains open to a dialogue on how to facilitate the use of the TRIPS flexibilities, should the voluntary solutions fail or not be available. The flexibilities offered by the TRIPs Agreement are absolutely legitimate tools for Members in need, as many are in the midst of this pandemic. This includes fast track compulsory licences for export to countries without manufacturing capacity. Administrative burdens should not stand in the way of manufacturing and delivering vaccines to where they are needed.

We believe that a successful contribution of the WTO to the current pandemic will require all WTO Members to agree on actions that will not only encompass the elements enshrined in the Ottawa Group’s proposal on Trade and Health, such as export restrictions or transparency, but also address the problem of insufficient manufacturing capacity. The European Union stands ready to engage in such a dialogue.

 

Item 10 - INTRODUCTION OF A PAPER ON "LEGAL STATUS OF JOINT STATEMENT INITIATIVES AND THEIR NEGOTIATED OUTCOMES" – REQUEST FROM INDIA AND SOUTH AFRICA (WT/GC/W/819)

Plurilateral agreements have been a driving force under the GATT and beyond and paved the way for many of the multilateral agreements that are today an integral part of the WTO Agreement. They are not antithetical to multilateralism; on the contrary, they pave the way towards it.

Beyond these agreements, the WTO’s negotiating arm has not been able to deliver many of the significant improvements in the multilateral trade rulebook that are needed to respond to important trade issues. It is clear that modernising WTO rules cannot be achieved only through multilateral agreements based on a single undertaking.

It is therefore vital for the WTO’s relevance and credibility to maintain the option of developing rules that correspond to the economic and trade realities of the 21st century through plurilateral agreements.

A very large number of WTO members are involved today in plurilateral negotiations under the Joint Statement Initiatives on services domestic regulation, e-commerce and investment facilitation for development. These initiatives bring many benefits and are essential to make global trade rules responsive to the digital transformation of our economies, the growing importance of services and the need to facilitate investment, which is key for development.

If no effective formula is found to integrate plurilaterals in the WTO, there would be no other option than developing such rules outside the WTO framework. This would increase fragmentation and risk to eventually condemn the WTO to irrelevance.  

Meaningful WTO reform has to recognise this reality. As indicated in the European Union’s recently published Trade Policy Review, the European Union favours an inclusive approach to open, plurilateral agreements that facilitates participation by developing countries and allows them to decide whether they wish to join the agreement, leaving the door open for them to join at a later date.

There are various ways in which plurilaterals can be incorporated in the WTO. Some are included already in the WTO Agreement, such as in the GATS that provides that Members can inscribe additional commitments in their schedules, which is the legal architecture that the participants in the JSI on services domestic regulation have chosen.

Nobody can doubt the benefits from various types of plurilaterals (such as the GPA or the ITA). What matters is not their legal form, but that they bring undeniable benefits. Legal form should be a secondary consideration; the focus should be on how this Organization can remain relevant by developing rules that address pressing issues.

The European Union is in favour of having further discussions on this with members and calls on members to adopt a constructive approach and make positive contributions to this discussion. 

 

Item 12 - REVIEW OF THE EXEMPTION PROVIDED UNDER PARAGRAPH 3 OF THE GATT 1994 (WT/L/1108)

The European Union supports this review process.

I must underline once again our strong concerns with this unjustified exemption. The European Union continues to view the Jones Act as a piece of legislation that restricts fair competition in the shipbuilding and shipping markets, and no longer serves a legitimate purpose in today’s global economy. Even more, new implementing rules show an increasingly protectionist interpretation of the Jones Act, going even further beyond its original intention.

The prevailing situation has negative economic consequences for the European Union’s and other countries shipbuilding, logistics, dredging and energy industries. But the costs are also high for the United States, which is faced with higher costs for off-shore energy production, coastal protection from flooding, adapting to climate change, and haulage services due to the closure of the US market for foreign built, serviced or operated ships. 

We sincerely hope that the 2021 review will be consequential. It should not become simply a recurring point in our agenda but rather the starting point to look into how to remedy a situation, which is neither justified nor satisfactory.

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