Statement from Ms. Marième Fall Counsellor, Agriculture and Commodities Division World Trade Organization (WTO) 1

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1 Statement from Ms. Marième Fall Counsellor, Agriculture and Commodities Division World Trade Organization (WTO) 1 I would like to begin by thanking the ICAC Secretariat for its support of the Doha Round and for the assistance it gives to the WTO Secretariat in collecting data on the world cotton industry. Cotton is an integral part of the Doha Development Agenda (DDA) and there can be no completion of the DDA without a solution on cotton. WTO Members have agreed that cotton will be treated ambitiously, expeditiously and specifically within the overall negotiations on Agriculture. Everyone here knows that the DDA has not moved forward smoothly. Negotiations have dragged on for nearly a decade in fact, for agriculture and services, more than a decade because they both started in In that time there have been thousands of pages written as proposals, counter proposals, modalities, working papers, reference papers, first approximations, etc. But there has not been a result. That does not mean that nothing has been achieved. On the contrary, since the end of 2008 there has been an almost completed set of modalities on the table (TN/AG/W/4/Rev.4). That is, the document WTO Members need to calculate how much to reduce tariffs and subsidies has existed, nearly completed but in draft form, for nearly two years. Since then progress in completing the modalities has continued on two tracks: (a) the technical development of "Templates" for the presentation of data, both that required for the establishment of Modalities and that required for the eventual scheduling of commitments, based on draft modalities as contained in TN/AG/W/4/Rev.4; and (b) consultations by the Chair of the Negotiating Group on Agriculture on the issues that are bracketed or otherwise annotated in the documentation before the Negotiating Group TN/AG/W/4/Rev.4 together with TN/AG/W/5, TN/AG/W/6 and TN/AG/W/7. The work the Negotiating Group has been undertaking on development of templates has proceeded across each of the three "pillars" (Domestic Support, Market Access and Export Competition) in two "steps" as follows: (i) Step 1 concerns the identification and development of templates (including possible supporting tables) for the presentation of base data; and (ii) Step 2 concerns the identification and development of templates (including possible supporting tables) for the presentation of DDA commitments. While it is recognised by all Members that this work is not a substitute for work which is necessary for the conclusion of Modalities, significant effort has been devoted to work on Step 1 across each of the three pillars and work is well advanced. A considerable number of documents have been produced to contribute to this work with many having been amended or superseded through the course of discussion in the Negotiating Group. Those documents that remain under discussion will need to be finalised and consolidated as part of the conclusion of base data template work. The work on Step 2 on drafts of the actual proposed formats for the scheduling process has been engaged: Members are actively involved; "road-maps" have now been proposed for developing draft templates for domestic support, market access and export support. Finally, the Negotiating Group is also separately undertaking some substantive discussion of data requirements associated with TN/AG/W/4/Rev.4, and there has also been progress on base data and its verification. 1 This paper has been prepared under the Secretariat's own responsibility and is without prejudice to the positions of Members or to their rights or obligations under the WTO.

2 The Chair has also been undertaking consultations on the following ten categories of issues that are bracketed or otherwise annotated in the documentation: Blue Box product-specific limits, Cotton, Sensitive products, Tariff cap, Tariff quota creation, Tariff simplification, Special Products, Special Safeguard Mechanism, Tropical and diversification products and Long standing preferences. The objective of this work is to help Members build consensus towards concluding Modalities in Agriculture. Although Members have not yet been in a position to substantively resolve matters, it is nevertheless considered useful to, where necessary and as far as possible, advance technical understanding and framing of issues in preparation for when decisions could be taken. Concerning more specifically cotton, the Chair has reported that consultations have confirmed that not all Members are in a position to agree to the text as drafted in TN/AG/W/4/Rev.4, but no new contributions, technical or substantive, have been forthcoming in consultations to date. All Members involved, however, have emphasised that they remain committed to finding a solution that addresses the issue of cotton "ambitiously, expeditiously and specifically", consistent with the commitments made at the Hong Kong Ministerial Conference in December It has also been suggested that Ministerial-level contacts that have taken place between particular Members in recent months have been useful in enhancing understanding of respective perspectives. Finally, the Chair has advised Members that he is available to hear from them individually or collectively regarding any technical ambiguity they consider exists, or technical clarification they consider is needed, in the text of TN/AG/W/4/Rev.4. The Chair will again convene open-ended informal meetings of the Negotiating Group on Agriculture starting on 27 September on templates and base data. In addition, he will continue his consultations on the bracketed and otherwise annotated issues in the draft modalities. Agriculture is part of a single undertaking, including areas such as Non Agricultural Market Access (NAMA) and services. Overall balance will need to be found across all areas before modalities can be finalized. Overall, what is clear from the agriculture negotiations and other discussions in the WTO, is a shared desire to move the DDA negotiations to a balanced and ambitious conclusion as soon as possible, consistent with the mandate and based on progress already made.

3 Mariéme Fall Agriculture and Commodities Division World Trade Organization 1 Comprehensive negotiations aimed at: substantial improvements in market access reductions of, with a view to phasing out, all forms of export subsidies substantial reductions in trade-distorting domestic support.. Cotton at the heart of DDA and only commodity with specific treatment in the agriculture negotiations [1] This presentation has been prepared under the Secretariat's own responsibility and is without prejudice to the positions of Members or to their rights or obligations under the WTO. 2 LDC products Tariff escalation SSG Commodities Maximum average cut (DgC) Sensitive Products LDCs Minimum average cut (DdC) Lower tariff reductions (DgC) Preference erosion Tropical products Tariff capping Special Products SSM DDCs and DGCs in a position to do so shall give duty- and quota-free access for cotton exports from LDCs from the commencement of the implementation period DGCs that are not in a position to give duty- and quota-free access for cotton exports from LDCs from the commencement of the implementation period shall undertake to look positively at possibilities for increased import opportunities for cotton from those countries 3 4 Topics included under all forms of export subsidies : Traditional export subsidies Export credits, export credit guarantees or insurance programmes International food aid Practices of exporting state trading enterprises Elimination of export subsidies on day 1 for DC and end of year 1 for DDG Any new or additional obligations from export credits, STEs and food aid shall be implemented: on 1 st day of implementation for DDC by the end of the 1 st year for DGC 5 6 1

4 New constraint: Reduction in Overall Trade-Distorting Domestic Support (OTDS) OTDS Base Reduction in Final bound AMS Reduction in de minimis Product-specific AMS caps Capping of Blue box support Review and clarification of Green Box criteria Final bound Total AMS Permitted de minimis Agreed blue box level Trade-distorting domestic support subsidies to be reduced more ambitiously than under whatever general formula is agreed implemented over a shorter time period time Reductions in support C4 (Benin, Burkina Faso, Chad, Mali) proposal to reduce AMS reflected in draft modalities (TN/AG/W4/ Rev.4) Blue Box cap for cotton - 1/3 of the product-specific cap that would otherwise have resulted implemented over 1/3 of the implementation period S&D DgCs with cotton AMS and Blue Box commitments make a reduction that is 2/3 rds of the reduction for DdCs and implement it over a longer time period HongKongCh MacaoCh Singapore Qatar Albania Austria Belgium Bulgaria US UAE Brunei Kuwait Bahrain Armenia Cape Verde (China) Croatia Ecuador Cyprus CzechR Denmark G 1 G 90 FYR- Macedonia (Georgia) Estonia Finland France Jordan KyrgyzR Moldova Germany Greece Hungary LDCs (Mongolia) Oman (Panama) Ireland Italy Latvia Lithuania Luxembourg Malta Bangladesh Saudi-Arabia (Ch Taipei) Netherlands Poland Portugal Cambodia Viet Nam Tonga Chad ACP Romania Slovakia Maldives Burkina Faso Recent Slovenia Spain Myanmar Burundi Togo new Sweden UK Nepal Central African Rep TROPICAL Solomon Djibouti DR Congo PRODUCTS EU Islands Mali Gambia Guinea (Bolivia) G-27 Guinea Bissau Lesotho (Colombia) Malawi Mauritania Niger (Costa Rica) Mexico Sierra Leone Rwanda Gabon (Ecuador) G-20 Haiti Ghana Fiji El Salvador Benin Namibia Papua New Guinea (Honduras) India Madagascar (Guatemala) China Senegal (Nicaragua) Uganda Botswana Belize Venezuela Tanzania (Panama) Cuba Zambia Cameroon Barbados Antigua/Barbuda (Peru) Indonesia Congo Dominica DominicanRep (Venezuela) Pakistan Côte d Ivoire Kenya Grenada Guyana Philippines St Vincent/Grenadines G-33 Chile Peru Mozambique Trinidad/Tobago Honduras Brazil Jamaica Suriname Mongolia Bolivia Nigeria St Kitts/Nevis Nicaragua Uruguay Australia Zimbabwe St Lucia Panama Thailand Canada Mauritius Sri Lanka Turkey Paraguay Colombia El Salvador Argentina Costa Rica Angola R Korea Guatemala Egypt Swaziland Malaysia N Zealand Tunisia Morocco Cairns Group S Africa African Group G-10 Iceland Israel Japan Liechtenstein Norway Switzerland Ch Taipei 11 Work proceeding on a two-track approach: development of templates for modalities and schedules data discussion of specific outstanding bracketed or otherwise annotated issues Data work is technical and advancing well Chair consultations on outstanding modalities issues are ongoing (status report in TN/AG/25): some areas: unchanged positions need political decision other areas: further dialogue & technical discussions Chair reported significant developments for: tropical products and long standing preferences Chair reported need for progress on: blue box, cotton, sensitive products, tariff cap, tariff quota creation, tariff simplification, special products and the SSM 12 2

5 Key element of the round and litmus test of the DDA Reductions in trade-distorting support: to be more ambitious and implemented more expeditiously than the general provisions on such support C4 proposal (TN/AG/SCC/GEN/6) reflected in current draft modalities Cotton is one of the bracketed issues under consultations No consensus on text in draft modalities Ministerial-level contacts and Quadrilateral meetings: C4, US, EU and Brazil All Members committed to an ambitious, expeditious and specific solution for cotton Key to solution lies with number-based reduction commitments to be made by developed countries Can only happen within a successful conclusion of DDA! 13 3