Deadlock in FTAA Negotiations
 

CHRIST CHURCH, BARBADOS – The Seventeenth Meeting of the Free Trade Area of the America’s (FTAA) Trade Negotiations Committee (TNC) ended inconclusively, the evening of February 6.  The five-day meeting of Trade Vice-Ministers, from thirty-four nations in the Americas, was held in Puebla, Mexico, February 2 to 6.  

“The meeting was unable to reach consensus on a framework for the proposed FTAA because of differences amongst delegations, in particular on the contentious issues of agricultural export subsidies and domestic support”, said Director-General of the Caribbean Regional Negotiating Machinery (RNM), Ambassador Dr. Richard Bernal, who headed the RNM delegation to the TNC, and served as Caricom lead negotiator/spokesperson.  

Ambassador Bernal underscored that because the TNC meeting failed to reach agreement the FTAA process had essentially stalled.  Until deliberations at the TNC level are concluded negotiations in the various negotiating groups are suspended. 

In spite of calls, as the meeting got under way, for “constructive” and “harmonious” talks an agreement on the way forward eluded negotiators. The Southern Cone Common Market (Mercosur), led by Brazil and Argentina, has consistently pressed for farm subsidies to be included in hemispheric trade talks, with a view to their reduction.  The United States, which has extensive subsidies and domestic supports, refused to agree for these to be negotiated in the FTAA.   The US argues that these issues can only be effectively addressed within the World Trade Organization (WTO), which includes other countries utilizing farm subsidies – namely, the European Union (EU).   

Although there was no agreement on the subject matter of FTAA negotiations, significant progress was made in deliberations regarding the procedures for operating a ‘two-level’ structure for the Americas-wide trade pact.  The two levels envisioned are: a core – a common tier – which would incorporate all countries, and a plurilateral level, for which participation would be voluntary.   

A decision was taken at the Seventeenth Meeting of the TNC to reconvene in early March, to conclude discussions on the common set of rights and obligations, and procedures for plurilateral negotiations. 

Ambassador Bernal noted that Caricom countries were concerned by the fall-out from the impasse, at the meeting.  In the course of the Vice-Ministerial meeting, last week, the dates proposed for a ‘CARICOM Roundtable’ under the Hemispheric Cooperation Programme (HCP), February 26 to 27, were no longer viewed as timely. It was announced that new dates will be proposed in due course. 

The Roundtables are a follow-up process to an initial dialogue between potential donors and countries seeking assistance for trade capacity building, for the implementation of the FTAA HCP.  The “Initial Meeting with Donors for the Implementation of the HCP” took place in Washington, DC, in October 2003.  The purpose of this Initial Meeting was to engage FTAA countries that have identified trade-related capacity needs in dialogue with countries, regional and international institutions with the potential to assist in addressing the needs expressed. 

The Vice-Ministerial talks, in Puebla, followed the Eighth FTAA Ministerial Meeting, held in Miami in November 2003.  At that meeting thirty-four Western Hemisphere country Trade Ministers endorsed a key Ministerial Declaration.  It constituted a ‘compromise’ outline for the Americas-wide trade pact.   The Ministerial Declaration marks a watershed in FTAA talks.  It signifies an acceptance of the need for a ‘pragmatic re-dimensioning’ of the FTAA.  The vision of the FTAA, which forms the core of the Eighth Ministerial Meeting Declaration, reaffirms commitment to a comprehensive and balanced Agreement, and introduces an element of flexibility into negotiations; which seeks to accommodate the needs, sensitiveness and ambitions of all FTAA countries.  Central to the ‘vision’ is the principle of ‘appropriate balance of rights and obligations where countries reap the benefits of their respective commitments’.  The ‘vision’, which represents a compromise between US and Brazilian ambitions, introduces a two-tiered structure into the negotiations.  

Disparate ‘expectations’, and competing ‘visions’/‘goals’, for the treatment of agricultural subsidies in global trade talks have also been a major a sticking point in, and stymied negotiations regarding, the WTO’s Doha Round.