US embassy cable - 05GENEVA2593

UNCLAS SECTION 01 OF 03 GENEVA 002593 
 
SIPDIS 
 
PASS USTR FOR ALLGEIER AND DWOSKIN 
EB/OT FOR CRAFT 
USDA FOR FAS/ITP/SHEIKH, MTND/YOUNG 
USDOC FOR ITA/JACOBS 
 
E.O. 12958: N/A 
TAGS: ETRD WTRO USTR, WTRO, Trade 
SUBJECT: Meeting of the WTO General Council - October 19, 2005 
 
 
1. BEGIN SUMMARY.  The General Council meeting on October 19, 
2005 was shorter than usual in light of other DDA-related 
developments taking place simultaneously.  Director-General 
Lamy began by recapping his comments at recent meetings of the 
Trade Negotiations Committee (TNC) and added that he would 
stress to ministers meeting informally in Geneva that they 
must act now to build on recent momentum.  During the meeting, 
a few Members put down markers on issues of importance to 
them, including Mali (on cotton), Cuba and Kenya (on 
TRIPS/public health), Barbados (on small economies), and 
Uganda (on commodities). 
 
2. In terms of Hong Kong preparations, the General Council 
chair announced she is consulting with a view to reaching 
precise operational text for inclusion in the draft text on 
issues not under the remit of the TNC.  In addition, the 
Council approved requests by Timor-Leste and Tuvalu for 
observer status in Hong Kong, but Egypt (for the Arab Group) 
blocked the Agency for International Trade Cooperation and 
Development (AITIC)'s request for observer status.  The chair 
noted four requests by international intergovernmental 
organizations are pending and Members have until November 5 to 
express reservations. 
 
3. Agenda items included a report by the chair of the TRIPS 
Council on TRIPS/public health, a report by the chair of the 
Work Program on Small Economies, a report by the General 
Council chair on consultations involving the non-recognition 
of rights claimed by Honduras and Guatemala in connection with 
EC enlargement and the modification of the EC banana tariffs. 
Under other business, the United States requested a dedicated 
session of the General Council to discuss e/commerce issues, 
and the chair made a statement on GATT document de-restriction 
and archiving, expressing the intention to bring the matter up 
for decision by the General Council following the Ministerial 
Conference in Hong Kong.  The next General Council meeting is 
planned for December 1-2.  END SUMMARY 
 
Statement by TNC Chair 
 
4. Director-General Lamy recapped his remarks at the TNC 
meetings of September 14 and October 13, noting that these 
remarks have been circulated (and are posted on the WTO 
website).  He said there is a need for "urgent action" by all 
Members with a view to producing, by mid-November, a draft 
ministerial text based on convergence among negotiators. 
Referring to the recent U.S. proposal on agriculture, Lamy 
said he would stress in his meetings with ministers and 
negotiators that the task is to build on the new momentum and 
try to advance the negotiations on all fronts.  He reiterated 
that the Hong Kong Ministerial Conference must be a success 
for the round to conclude by the end of 2006. 
 
5. After Lamy's report, Mali's Minister of Industry and Trade, 
Choguel Kokala Maiga, made a statement on behalf of the four 
cotton countries, reiterating the importance of cotton for 
their economies and expressing "serious alarm" that recent 
proposals do not solve the cotton issue.  He called on the WTO 
to speed up work and come up with appropriate solutions, 
including through creation of "a solidarity fund" to mitigate 
the adverse effects of falling cotton prices and trade- 
distorting subsidies of developed countries.  In his remarks, 
he pointed to daily death and suffering because farmers are no 
longer able to earn a minimal livelihood in the current global 
marketplace. 
 
Preparations for the Sixth WTO Ministerial Conference 
 
6. The General Council Chair said that she is beginning a 
process of consultations with delegations and chairs 
concerning the nature and context of the texts to be put 
before ministers in areas of the Doha work program not under 
the remit of the TNC.  The aim, she said, is to reach a high 
level of convergence on these areas before Hong Kong, to build 
it step-by-step so there are no last-minute surprises and that 
all delegations feel ownership of the outcome.  She would work 
with the Director-General to put these issues into a coherent 
package for Hong Kong on the basis of his "bottom-up" approach 
to the ministerial text. 
 
7. Affirming the centrality of development, she observed that 
many of these issues have considerable political significance 
for developing countries - TRIPS issues, notably TRIPS and 
Public Health but also the moratorium on non-violation 
complaints; small economies; trade, debt and finance; trade 
and transfer of technology; technical co-operation and 
capacity building; least-developed countries; and electronic 
commerce.  On TRIPS/public health she noted the importance of 
giving space to work in other WTO bodies.  Her aim is to 
develop concise operational text for the declaration, and she 
added that the revised draft Cancun Ministerial Text could be 
useful reference point in terms of the length and level of 
detail to aim for. 
 
8. With respect to the conduct of formal and informal work in 
Hong Kong, the chair said she would brief delegations more 
fully at the next General Council meeting on December 1-2, 
once the agenda has become clearer.  She closed by recalling 
that, under the rules of procedure, a provisional agenda for 
the formal part of the Conference will be communicated to 
Members at least five weeks before its opening (by 
7 November).  Members may propose items for inclusion in this 
provisional agenda up to six weeks before the opening of the 
session (by 31 October).  Members wishing to do so should 
notify the Secretariat. 
 
Attendance by Governments as Observers 
 
9. The General Council approved requests by Timor-Leste and 
Tuvalu for observer status in Hong Kong. 
 
Attendance by International Intergovernmental Organizations as 
Observers 
 
10. Egypt (on behalf of the Arab Group) blocked the Agency for 
International Trade Information and Cooperation (AITIC)'s 
request for observer status.  In principle the Arab Group is 
sympathetic to all requests for observer status, he said, but 
it is unable to accept this request because of an "outstanding 
issue" [a reference to the Arab League's outstanding request] 
and the need for a broader examination of the observership 
issue where "resolution is long overdue."  He expressed a 
willingness to take part in any consultations.  Switzerland 
expressed "deep disappointment at this position."  The chair 
noted Egypt's willingness to consult on the matter and said 
she would keep Members informed. 
 
11. The chair informed Members that four additional requests 
for observer status had been received from 1) the Technical 
Center for Agricultural and Rural Cooperation ACP-EC (CTA), 2) 
the Basel Convention, 3) the Council of Europe Development 
Bank, and 4) the African Development Bank.  In keeping with 
past practice concerning requests by intergovernmental 
organizations without observer status in any WTO body, Members 
would be given until November 5, 2005 to communicate any 
reservations to the Secretariat.  She would provide an update 
at the next General Council meeting. 
 
Statement by TRIPS Council Chair on TRIPS/Public Health 
 
12. The chair of the TRIPS Council, Ambassador Choi of Korea, 
notified Members that he has resumed consultations with key 
parties and the number of outstanding issues seems more 
limited than in previous discussions.  Nevertheless, it is 
unlikely that the issue can be resolved by next week's meeting 
of the TRIPS Council, so his plan is to suspend the meeting 
to allow more time for consultations.  With goodwill and 
cooperation, he concluded, an agreement on this issue by Hong 
Kong should be possible. 
 
13. Cuba then spoke up, characterizing the issue as an 
extremely important trade of technology issue for the 
developing world and disingenuously calling attention to the 
"millions of men, women, and children that are dying in 
Africa".  Kenya's representative then took the floor, saying 
his country is "hoping and praying" for a resolution of this 
issue by Hong Kong, an outcome that is becoming even more 
important because of the threats caused by bird flu.  The 
General Council chair closed by urging Members to work hard to 
resolve the issue, but she also reminded Members that there 
is a waiver and many countries have enacted legislation, so it 
isn't as if nothing is in place. 
 
Work Program on Small Economies - Report by the Chair 
 
14. The chair of the Dedicated Session of the Council on Trade 
and Development (CTD) informed Members that a productive 
meeting took place on October 17 and the two-track approach 
involving work in negotiating bodies as well as the Committee 
on Trade and Development has a broad base of support among 
Members.  He said he would intensify work in coming weeks over 
what could be submitted to ministers in terms of draft text 
for Hong Kong. 
 
15. The ambassador of Barbados argued that the overall 
negotiations are nearing a "critical juncture" and warned that 
the WTO would be judged harshly in small vulnerable economies 
if the ministerial declaration does not contain effective 
responses to their concerns.  He recalled the contributions 
made by small vulnerable economies in substantive areas such 
as agriculture, NAMA, and fisheries subsidies and he 
underscored the "central role" of the CTD in the work program. 
El Salvador, Guatemala, Cuba, Jamaica, and Honduras supported 
the statement and echoed its themes. 
 
Non-Recognition of Rights 
 
16. The General Council chair reported on her consultations, 
saying that she has been unable to resolve the disagreement 
surrounding the claims of substantial interest submitted by 
Honduras and Guatemala concerning EC enlargement as well as 
the modification of the EC's tariff schedule under Article 
XXVIII. The chair noted a sense among Members that the issue 
should not be left unresolved because it risks complicating 
the agenda for MC6. 
 
17. Guatemala and Honduras made long statements reiterating 
the importance of the matter and argued that the EC's stance 
involves important systemic implications.  Both countries 
emphasized that the EC's position is especially damaging to 
small economies, with Guatemala warning that "today it is 
Guatemala, tomorrow it may be others."  Honduras said the EC 
should consider how its stance is undermining the credibility 
of the organization and prospects for a successful Ministerial 
Conference.  Eleven Members - Brazil, Colombia, Costa Rica, 
Ecuador, El Salvador, Mexico, Nicaragua, Paraguay, the 
Philippines, Uruguay, and Venezuela - expressed support for 
Guatemala and Honduras and urged the EC to respond to their 
concerns.  Brazil added that this is a specific example of a 
problem facing small vulnerable economies requiring 
resolution.  Costa Rica observed that the ongoing arbitration 
process is separate and independent from these consultations. 
 
18. The EC gave an abbreviated version of its statement at the 
last General Council, key themes being that it is committed to 
faithfully fulfilling its obligations and that it is open to 
reviewing rules and established practices on this matter in 
the appropriate forum.  He added that the EC is willing to 
continue consultations, and that it would meet bilaterally 
with any Member to discuss, on a tariff line by tariff line 
basis, the acceptance or rejection of its claims. 
 
Committee on Budget, Finance, and Administration 
 
19. The General Council adopted the Committee's report on its 
meetings in June and July 2005.  The chair of the Budget 
Committee, Mr. Postma of the Netherlands, noted the report of 
the meeting on September 29, 2005 remained in dispute [the 
matter in dispute relates to whether the Junior Professionals' 
Program will be implemented in any way before concerns 
expressed by India, Bangladesh, and Pakistan over the 
participation of applicants from developing and least- 
developed countries are resolved]. 
 
Other Business 
 
20. Three items were raised. First, the United States made a 
short statement requesting a dedicated session of the General 
Council to discuss electronic commerce issues in early 
November. 
 
21. Uganda's representative made a long statement to the 
effect that commodities should feature prominently in the 
ministerial declaration particularly in light of worsening 
commodity problems facing developing and least-developed 
countries including tariff escalation and falling prices on 
international markets.  He called for clarification of rules 
to stabilize commodity prices and for a consultative mechanism 
to address the issue. 
 
22. On Lamy's behalf, the General Council chair read a 
statement on GATT document de-restriction and digital 
archiving, informing Members that after three rounds of 
consultations there seems to be broad support for 1) 
preserving the French and Spanish language documents, and 2) 
de-restricting the documents that were restricted during the 
GATT era. She expressed an intention to bring up the matter 
following the Ministerial Conference in Hong Kong and hoped 
for a positive decision that would help to safeguard the 
legacy of the GATT. 
 
Next Meeting 
 
23. The next meeting of the General Council will be December 1- 
2, 2005.