YAOUNDE: World Trade Organization (WTO) talks broke up on Monday (Mar 30) with no agreement on a plan for reform or even on extending a moratorium on e-commerce, piling more pressure on the trade body that finds itself increasingly sidelined by economic nationalism.
The four-day ministerial talks in Cameroon’s capital Yaounde ended in the early hours with Brazil blocking a bid by the United States and others to prolong a moratorium on duties for electronic transmissions such as digital downloads and streaming.
Expectations for progress had been low before the talks, but there had been hopes that the moratorium would be renewed at least.
In the end, even that proved impossible amid resistance from Brazil, and trade ministers could not agree to extend it for more than two years, which was not enough for the US, diplomats said.
US officials and business groups expressed frustration at the impasse, and the failure to reach a joint decision was described as a “major setback for global trade” by Britain’s Business and Trade Secretary Peter Kyle.
Singapore, which led the successful adoption of interim arrangements for the WTO e-commerce agreement, said it deeply regretted that a consensus could not be reached.
A statement by its Ministry of Trade and Industry on Mar 30 said it is disappointing that a decision on the moratorium, in particular, could not be reached with “a handful of WTO members”, and that Singapore urges WTO members to maintain the current practice of not imposing customs duties on electronic transmissions, as digital trade will continue to grow in importance.
Earlier this month, Singapore and 11 other countries jointly backed a push for a permanent moratorium to be signed.
The talks were deemed a test of the WTO’s relevance after a year of huge trade turmoil and more recent major disruptions due to the US-Israeli war on Iran.
Agreeing on an e-commerce moratorium was seen as key to securing support for the WTO from the US, which under President Donald Trump has retreated from global multilateral bodies as he pursues his “America First” agenda.
WTO Director-General Ngozi Okonjo-Iweala said the trade body hoped to be able to restore the moratorium and that Brazil and the US were trying to reach an agreement on it.
The WTO said progress was made on a reform roadmap before time ran out, and discussions on issues such as reworking its rules to render subsidy use more transparent and make decision-making easier are expected to continue in Geneva in May.
Singapore affirmed the “good progress” made on reform, “including on decision-making, development and level playing field, as well as modalities of reform”, its Ministry of Trade and Industry added.
However, the US and the European Union (EU) argue that China, in particular, has taken advantage of the current rules to their detriment.
DEADLOCK DRAWS TERSE US RESPONSE
Diplomats worked throughout Sunday to close the gap between Brazil’s initial two-year proposal and the US, which wanted a permanent extension, by drafting a plan for a four-year extension with a one-year sunset buffer, concluding in 2031.
Brazil later proposed a four-year extension, with a review clause halfway through, but that failed to win support.