I welcome the Minister of State at the Department of Foreign Affairs, Deputy Tom Kitt, and the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, and their officials to the sub-committee. They will make presentations on trade and development issues post-Cancún and the way forward. The sub-committee is aware of the regrettable failure to reach agreement on a framework for the continuation of negotiations under the Doha development agenda at the WTO ministerial conference at Cancún last September. Both Ministers of State have agreed to meet the sub-committee to discuss Ireland's trade and development policies and how Ireland can progress the Doha development agenda after the disappointing outcome at the Cancún conference.
Trade and Development: Ministerial Presentations.
I thank the Chairman for this opportunity to expand upon and develop the important aspect of Irish policy, multilateral trade policy. Trade policy is a EU competence and as such falls to be considered and co-ordinated within the 15 - soon to be 25 - member states of the European Union.
In November 2001, the WTO declaration was agreed at the fourth trade ministerial meeting in Doha which provides for a new round of multilateral trade liberalisation negotiations across a broad spectrum of trade related issues. Based on the Doha schedule, the negotiations are to conclude by 1 January 2005. The launch of a comprehensive trade round, which operates under the title of the Doha development agenda, is regarded as the best way to address the challenges resulting from significant and far-reaching economic and technological changes. It is also intended to promote equitable growth and development and to respond in a balanced manner to the interests of all WTO members, in particular the developing countries.
Issues of importance to Ireland under the current round are the conclusion of a successful round of negotiations in the areas of agriculture, services, non-agricultural goods market access and strengthening the influence and outcomes for developing and least developed countries in the multilateral trading environment. As a country with a small domestic economy, Ireland relies greatly for its economic development on a liberal global trading environment. Opening up trade with other countries stimulates Irish economic growth and higher living standards. As a result of the impact on productivity of more efficient specialisation, economies of scale, increased competition, and the spread of technologies and investment, customers benefit from a wider choice of goods and services and the lower prices that go with competition. Businesses benefit through the development of new markets and new sources of supply. This has been Ireland's experience in the context of EU membership and previous rounds of trade liberalisation negotiations.
Ireland supports the maintenance of a strong rules based multilateral trading system. It is very much in our interest that the WTO, which reflects the interests of both developed and developing countries, remains the primary arbiter and rule-making body in international trade issues. Without the WTO regulating the system with enforceable rules, the interests of large countries would dominate those of smaller countries. Countries seeking better overseas market access would pursue regional or bilateral trading arrangements and the whole system would become increasingly complex and lacking in predictability. Ireland's overall priority in these WTO negotiations as a member of the EU has been and continues to be to see these negotiations continue in a fair and balanced way with a commitment to respond positively in the negotiations to the concerns and ambitions of developing and, in particular, least developed countries.
At the WTO ministerial meeting in Cancún last year, stress was placed on the need to ensure the success of the Doha mandate and work programme. Cancún was seen as a mid-term review of progress of the Doha development agenda negotiations. There was a strong emphasis from the EU's perspective to deliver on the commitments made in Doha. The WTO, and the EU in particular, were conscious of the importance of the negotiations in respect of several crucial areas, including agriculture and non-agricultural market access, services and the development aspects of the round.
From the EU perspective, two important developments going into Cancún were in the areas of agriculture and access to medicines. On agriculture, the substantial reform of the Common Agricultural Policy under the mid-term review in June 2003 considerably strengthened the hand of the EU in the negotiations. The EU Council of Ministers stressed that the reform represented an important European contribution while establishing the limit of the EU's negotiating position in the round. The increased flexibility offered by the reform injected new momentum into the negotiations, from the EU's perspective, and improved the prospect for agreement.
On access to affordable medicines, crucially on the eve of the Cancún conference, agreement was reached on the intellectual property problems faced by some poor countries in their fight against pandemic public health diseases such as AIDS. Members will recall that at Doha, Ministers made a separate declaration on access to medicines and public health. That declaration required the WTO to find a solution to the problems developing countries face in using compulsory licensing to access medicines, if they have no pharmaceutical manufacturing capacity. The agreement reached on the eve of the Cancún conference on this matter, when US difficulties regarding agreement on the medicines to be included in the agreement were overcome, was a major step forward. The EU played a big role in bringing about agreement on this matter.
Regarding the "Singapore issues" i.e. trade facilitation, investment, competition, and government procurement, the Cancún ministerial meeting was to decide whether to begin full-scale liberalisation negotiations. The EU had proposed that trade rules covering these issues be developed, given their importance for international trade. Other WTO members, in particular the United States and some major developing countries, including India, remained to be convinced. In recognition of these concerns, the EU proposed very modest targets, fully taking into account the requirement that economic development policies of developing countries be respected.
On development, the EU has provided over many years for preferential access to EU markets from developing countries through the ACP association agreement, the generalised system of preferences and other preferential trade agreements. More recently, the EU has offered duty-free and quota-free access to all imports except arms from least developed countries. Under the current round, the EU is building on that special and differential treatment, including the implementation of WTO trade rules as they impact on developing countries. The EU is also a substantial contributor in support of technical assistance to countries for capacity building to help in their better integration into the WTO multilateral trading system.
Prior to the departure of the Irish delegation to Cancún and in the preparation and development of Ireland's trade policy approach to the negotiations, there was substantial and regular consultation with key stakeholders, including the business and farming communities and the non-governmental development groups. I spoke on Ireland's strategic trade interests in a Dáil debate of 27 June, accompanied by Ministers with responsibility for agricultural and development policies. In addition, non-governmental organisations under the umbrella of the trade matters group presented their views at the same time to the Joint Committee on Enterprise and Small Business.
Following this preparation, the failure of Cancún was a big disappointment. There were many reasons for the failure. Some might say the absence of the political willingness of the key players to fully engage in the delivery of the Doha vision was the key factor. It is probably futile at this stage to continue to debate the matter, and more productive to focus on the way forward.
Following Cancún, the EU undertook a period of intensive internal reflection with key stakeholders including the EU Commission, EU Council, EU member states, the European Parliament and European interests including business, trade unions and civil society. The result of this internal reflection was the Commission communication of 26 November 2003. This communication set out a strategy aimed at contributing to the re-launch of the DDA negotiations and delivery of the Doha mandate. The inputs received by the EU Commission from all these key stakeholders led to the conclusion that the fundamental objectives of the EU in the DDA negotiations remain valid; that there is a strong and clear preference in favour of the continued pursuit of the multilateral approach to trade negotiations, with a strong rules-making component and a strong WTO; and that there is a continuing need to ensure that negotiations deliver a development round.
The General Affairs Council on 8 December endorsed the Commission's conclusions. Since then, the efforts of the EU have been towards persuading other participants to return to the negotiating table. These efforts have been reasonably successful. The whole process is in much better shape now than just after Cancún. New chairpersons have been appointed to the various negotiating groups in Geneva and they have been encouraged to restart their work.
On behalf of the EU, Commissioner Lamy has been engaged in a series of consultations worldwide aimed at restating the EU approach to the other WTO members and seeking to better understand their concerns. The United States trade representative has also been engaged in a similar exercise, as have representatives of the major developing countries. The response has been encouraging, and there now exists a positive atmosphere which many believe can be translated into real progress in the negotiations. The main difficult issues nevertheless remain. It seems relatively certain that the original target date for ending the negotiations will not be met, but there is a possibility that sufficient advances can be made during the current year to conclude the round in the foreseeable future.
The Irish Presidency of the EU has been facilitating the process within the EU. I chaired a meeting of EU trade ministers in Brussels in January, where we were able to have a full discussion of all the substantive issues involved and advise Commissioner Lamy on the way forward. My officials have also been progressing the development of EU positions within the Article 133 committee.
The major issues of substance remain pretty much as they were in Cancún, but a degree of flexibility on all sides can lead to progress. Agriculture continues to be the difficult subject, but the EU will continue to adopt a constructive approach. The mid-term CAP review package is, as I have said, a major step forward, and the EU offer to eliminate export subsidies on a list of key products for developing countries remains on the table, as does our commitment to seriously address trade distortive measures on cotton.
On the Singapore issues, the EU approach is flexible. Trade facilitation is the priority, while the other issues can be dealt with in a way that is acceptable to all participants. There are many other issues of considerable importance to be negotiated in the context of the DDA, issues of importance to the regulation of world trade and, in particular, the treatment of developing countries. I am working closely with the Minister of State, Deputy Kitt, to ensure that we play an effective role in these ongoing discussions, both in the term of the Irish Presidency and as a member state of the EU.
Thank you.
I am happy to appear in front of the committee. I know the members were anxious that I and my colleague, the Minister of State, Deputy Michael Ahern, should appear here together. I am very happy that such collaboration is taking place. It is important, and I know that the committee supports it.
The committee recently adopted a resolution on trade and development issues which was addressed to me, and I have sent it to the Minister of State, Deputy Michael Ahern, given his Department's overall co-ordinating role on Ireland's international trade policy. I will address the points raised in the resolution in the course of these remarks.
I begin my comments by referring to the current situation in the WTO negotiations. The failure to reach agreement at Cancún was a major setback for developing and developed countries alike. It was a lost opportunity to fulfil the promises regarding the integration of developing countries into the world economy made at the ministerial meeting in Doha over two years ago. It is vital that we learn from that failure.
While the EU has been proactive in trying to address the problematic aspects of the WTO negotiations, there is a need for more to be done. I would like to outline some of the measures that Ireland, as holder of the EU Presidency, has been taking to advance the trade and development agenda in the European Union. The General Affairs and External Relations Council, or GAERC, traditionally holds an orientation debate at the beginning of the year on the effectiveness of EU external action. The purpose of that orientation debate is to survey the effectiveness of the various strands of EU external policy such as trade, development co-operation and foreign policy, and how they can be made to work in greater harmony. At last month's orientation debate, the GAERC, on the basis of an Irish Presidency paper, reached several important conclusions on trade and development. In particular, I would like to mention three of those conclusions.
First, the Council concluded that, following the breakdown in Cancún, the EU should take the lead in getting the process back on track, and to that end, the Union should give priority to the achievement of real benefits in the short term for the poorest countries through rapid progress on issues of importance to them. Secondly, the Council also concluded that the EU will over the coming months take several steps to give substance to its commitment to effective multilateralism, including genuine dialogue with partners in the developing and developed world, and through a strong leadership role at the UNCTAD XI conference in Brazil in June 2004. Thirdly, the GAERC concluded that, if coherence in EU external policies is to be achieved, aid deployment will have to form part of a mutually reinforcing mix of policies supporting the external objectives of the Union. The Council agreed on the need for consistency and balance across a range of external policies and that the EU's commitment to the achievement of the MDGs should be reflected across EU policies and in its decisions on financial allocations.
That conclusion of the GAERC reflected a contention made in the paper submitted to the Council by the Irish Presidency that appropriate EU trade policies could have a far greater effect than aid programmes in encouraging development in certain countries. Those conclusions of the GAERC represent a significant achievement and will lead to a more determined effort by the EU to address the concerns of developing countries in the WTO process.
I would like now to move to other trade and development issues which the Presidency is pursuing. As members are well aware, many of the poorest developing countries, and particularly those in sub-Saharan Africa, are heavily dependent on commodities such as cotton, coffee and rice as their main source of income. The EU has in the past provided African countries with substantial funding to defend their interests in cotton in particular. The Union has now resolved to go further on commodity issues generally. The Commission is bringing forward, with the active support and participation of the Presidency, several initiatives to help developing countries enhance their export performance and reduce their vulnerability with regard to commodity price fluctuation. The intention is to prepare a comprehensive plan of action to address developing countries' needs with regard to agricultural commodity chains, dependence and poverty.
That proposed EU action plan has identified several areas of intervention to assist commodity-dependent developing countries, the first being putting the commodity problem more squarely on the agenda of international commodity bodies and making them more receptive to developing countries' concerns. The second is responding to commodity price decline by allocating resources to trade-related assistance within the economic partnership agreements between the EU and the Africa, Caribbean and Pacific regions, or ACP. I shall return to these economic partnership agreements in a moment.
The third is improving developing countries' commodity risk management and facilitating access to financial help to cope with shocks, for example through simplifying the EU's instrument for compensating short-term losses of export earnings in African, Caribbean and Pacific countries, the so called "Flex" mechanism to ensure that it reaches developing countries most in need. The Irish Presidency understands the importance of that initiative and intends to see that it is fully and thoroughly examined and discussed among member states to ensure that it directly addresses the problems facing commodity-dependent developing countries, including the cotton producers in west Africa.
Let me now return to the subject of the EU-ACP economic partnership agreements. The EU-ACP Cotonou agreement, which was signed in 2000 and came into effect last year, extends traditional trade preferences to EU markets for African, Caribbean and Pacific countries for eight years. During that time, the EU and the ACP will conclude new trade arrangements compatible with WTO rules which will replace the existing non-reciprocal preferential arrangements. That means that, for first time, ACP countries will negotiate trade agreements with the EU. Those agreements, to be called economic partnership agreements, or EPAs, are currently being negotiated with regional groupings of African countries in the west, south and east of that continent.
The introduction of the new economic partnership agreements underlines the Union's commitment to increasing coherence between trade and development. They will foster the smooth and gradual integration of ACP countries in the world economy, taking into account their own political choices and development priorities. They are designed to make best use of all EU instruments in reducing poverty, not just its financial assistance. They will help build up regional ACP markets and guide the trade relationship between those regions and the EU market.
I would also like to avail of our discussion this morning to refer to the Singapore issues in the WTO talks. Those were also part of the sub-committee's resolution to me, to which I referred at the outset. As I have said before, it is very important that the Singapore issues do not become an obstacle to achieving agreement in the Doha round. In that regard, I welcome and support the Commission's openness to finding an effective way of avoiding that.
The EU must also show itself to be generous in its response to developing countries' needs for special and differential treatment in the WTO process. Such generosity would be fully in keeping with the Council conclusion to which I referred earlier, which committed the EU to giving priority to the achievement of real benefits in the short term for the poorest countries through rapid progress on issues of importance to them.
Finally, I would like to inform the sub-committee about the preparations for the UNCTAD ministerial conference in São Paulo in June 2004. I will have the honour of leading the Presidency delegation to that conference, and I understand that members of this committee will be joining us on that occasion. UNCTAD is the United Nations Conference on Trade and Development and is dedicated to achieving the development-friendly integration of developing countries into the world economy. At this week's GAERC Council, Ministers adopted a joint Presidency-Commission strategy paper on the EU's approach to the trade and development issues that will be discussed in São Paulo.
I would like to highlight very briefly the main objectives and priorities of the EU's approach to the conference as conveyed in the paper. The general objectives that the EU will pursue at UNCTAD XI include the following. UNCTAD XI should contribute to strengthening confidence in the multilateral trading system and give further momentum to the successful conclusion of the Doha development round. It should have a balanced outcome with particular regard to the macro-economic analysis of the effects of globalisation and to the role of market forces and governments. It should identify key areas where it can concentrate its efforts to respond more effectively to the needs of developing countries. It should deliver more effective research and technical assistance to developing countries, particularly least-developed countries, or LDCs, by maximising its strengths in analysis and intergovernmental consensus-building. It should focus on the effective implementation of the Bangkok plan of action through the identification of priority areas of work. This week's Council concluded that the European Union should pursue action in the following three areas as priorities for UNCTAD over the coming four years: integrate trade and development into national development policies and poverty reduction strategies; regional integration in South-South trade; commodity dependence and poverty.
Last week I addressed as a representative of the EU Council Presidency the EU-ACP Joint Parliamentary Assembly in Addis Ababa last week. The assembly is one of the main institutions of the EU-ACP partnership, along with the EU-ACP Council of Ministers. In the trade matters part of my speech I discussed the current state of negotiations between the ACP countries and the EU Commission on the economic partnership agreements as well as the WTO negotiations. On the latter I expressed the view that the EU should be as accommodating as possible in its response to developing country concerns and needs as regards special and differential treatment and the Singapore Issues. On UNCTAD XI I said that the EU's role can help send a positive message for the success of the negotiations.
I hope members will find this survey of Irish Presidency action in the area of trade and development of some value. I trust that the joint appearance of the Minister of State, Deputy Michael Ahern, and myself and our complementary approaches to the issues will assure the committee of the Government's commitment to coherence between our trade and development policies. Both the Minister of State and I are determined that this commitment should be carried forward by means of close and frequent co-ordination between senior officials in our respective Departments. This process is currently ongoing as regards co-ordination of the EU position both at the WTO negotiations and in the preparatory process leading to UNCTAD XI in June next, and we are determined this will continue.
On another aspect of the sub-committee's resolution address to me concerning input from Development Co-operation Ireland to the national trade possibility statement, our views on this are now being finalised. I expect we will be sending these shortly to the Department of Enterprise, Trade and Employment.
Tá áthas orm go bhfuil seans agam cúpla rudaí a rá faoin ábhar seo agus fáilte a chur roimh an bheirt Airí Stát.
I welcome both Ministers of State and have a number of questions to put. It is valuable that they are appearing together. I am sure all members of the committee will welcome the commitment to coherence, so perhaps that is a good place to begin. I would first like to put a question to both Ministers of State. When we discussed these issues comprehensively a resolution was passed with three components. The third component stated:
..... recommends to the relevant Minister that Ireland supports the removal of the Singapore Issues from the table in order to reinvigorate talks and return them to the agreed priorities of the Doha Development Round such as agriculture implementation, special and different treatment, trade related intellectual property rights and other such priorities.
Is the Irish approach consistent with that request from this committee? Can the committee be assured that we have not sought to recommence the talks on the basis of the Singapore Issues?
Another reference is relevant as regards what was agreed on the eve of Doha as regards medicine. With respect, I suggest it was the multinational corporations that focused on the intellectual property rights; the developing countries concentrated on the diseases. On that one in particular, is it not a fact that the agreement is not being implemented and that there has been considerable difficulty even up to today as regards different medicines being considered? That is an important issue. I find a contradiction between the two papers. I find it difficult to reconcile them.
The Minister of State, Deputy Michael Ahern, stated, "As a country with a small domestic economy, Ireland relies greatly for its economic development on a liberal global trading environment." I suggest that what was discussed and recommended in this committee was an open but a fair trading environment. What the Minister of State responsible for development is continually quoting is a "fair trading environment". A liberal global trading environment as described here on the basis of the Singapore Issues is not reconcilable with a fair trading environment. At least I want to be recorded as saying that I do not believe in or accept that. It is an absurdity.
The following reference was made intriguingly, too, towards the end of Deputy Ahern's paper: "My officials have also been progressing the development of EU positions within the Art. 133 Committee." Article 133 Committee exclusively removed any accountability to the European Parliament or domestic parliaments. Working Groups III and VIII of the Convention both recommended non-accountability to the European Parliament. This was described in a letter to me by the Minister for Foreign Affairs as matters that were internal discussions and so forth, not accountable - recommended by the recent Convention as "should be accountable" - and exclusively removed from the European treaties in terms of accountability. This is not democratic and it is not satisfactory and it does not facilitate accountability on the trade side, not to mention coherence or reconcilability with others. I found Commissioner Lamy's speech, which I received yesterday, more progressive than the Irish position. I want to be fair. I compliment the Minister of State, Deputy Kitt. What has been achieved on the development side has been significant. I hope it is sustained and I certainly support it.
What has been happening on the Singapore Issues on the trade side is regressive. It is not reconcilable with the position of the Minister of State, Deputy Kitt, as regards medicines and so forth. Reference was made as well to what might be called "the great agenda", as the Ministers went to Doha, including issues of agriculture, services and so forth. The issue of services is not treated here. Surely one of the issues that arises between both Ministers of State involves the impact on services. Do both Ministers of State, for example, disagree with the purchase of land by non-nationals in developing countries where no agricultural reform has taken place? Should a landless peasant have to go into competition with Coca-Cola for a piece of land?
I find these issues simple to resolve - the way to make progress and resume the talks would have been to take the Singapore Issues off the map for a start, take the statement for the need for a development round and regard that as a starting point. There is nothing heavily ideological in what I am saying. I have listened to the UNCTAD case as well. My view is that I cannot say, after 25 years as an academic, how people can advance the idea that a single neoliberal paradigm of economic development has established itself with authenticity, relevance and evidence. It has not.
When the Ministers of State reply, let them start with things the public can understand. Who lost at the Uruguay Round? What was the net loss of the developing countries and who was the principal beneficiary? I know the answer to that. If one wants to change the outcome one has to change the approach and the assumptions. I detect and welcome significant gains on the development side. On the trade side I see people holding on to a strong trading environment and so forth. I question that, and they know it. The argument is strong but it is poorly based.
If, as has been said, they went to Cancún with a significant set of changes about agriculture might I suggest that it be teased out? If one opts for direct payments to farmers within the EU, which might be a very good idea, giving certainty to agriculture and agricultural incomes, and one reduces the price of commodities, what happens then to the arrangements with countries that enjoy special tariff arrangements? There is an in-built contradiction here.
On the issue of protected food security and local economies, there are some references to food security, but what of the right of a local economy? Can the Minister say it is right that the WTO should have the right to prevent chicken farming developing in a region in Uganda? This is not consistent. It would have been a magnificent morning for us if the Minister of State at the Department of Enterprise, Trade and Employment had said that the Government had decided to go down the road of fair trade, could see the extremism of the neo-liberal model in trade, that it had taken a lot of the development agenda on board, and had seen how it is beginning to make progress, and that even Commissioner Lamy is moving in that direction. That would have been development.
The speech of Deputy Kitt, the Minister of State at the Department of Foreign Affairs, spells out once again the tragedy of sub-Saharan Africa and we have the inevitable references to cotton, coffee and rice with which we are familiar. Sub-Saharan Africa contains 7% of the world's oil reserves. When one runs that resource figure alongside the income figures, is it not relevant to ask what the relationship is between resource revenues and expenditure? These are very real issues. They also would be relevant in Russia, and in Nigeria, which has fallen down three places in the UNDP index, while at the same time increasing its oil production. These are the questions to ask. Some way or another, I hope to go to the UNCTAD meeting. Under a civilised Government, we would be asked to go. We will make our own arrangements.
The reality is that one cannot keep operating with two sides of one's mind. I welcome, in both speeches, the word "coherence". We have not had it and it is time we began to see it emerge.
I welcome both Ministers of State and thank them for their contributions. I can see their difficulties at present because they are wearing their EU hats in the course of the Presidency. That is reflected in the speeches. The contributions are very detached and are almost like observers commenting on EU policy, rather than Ministers advocating a national policy position. It is understandable, especially in the case of Deputy Kitt, who will lead the EU Presidency delegation to São Paolo. Obviously, it blunts of the edge of national policy when one is accommodating the policy positions of so many EU members.
That said, I welcome both Ministers of State and their contributions and I welcome the occasion, because it is important that the two Ministers of State are here together. Small country as we are, there is still some incoherence between policy positions put forward by the Department of Foreign Affairs and those put forward by the Department of Enterprise, Trade and Employment on issues such as this. It is very good to have both Ministers of State here together, so that they are both conscious of the importance of coherence and that the coherence concept is embedded in both speeches.
On the practicalities, I would like more information on the re-establishment of the negotiating committees in Geneva. I address this to the Minister of State, Deputy Michael Ahern, as he drafted this. Has any further progress been made? Can he give us any insight into what direction they may take or have they advanced in any way towards a tentative timetable for negotiations?
I ask the Minister of State, Deputy Kitt, about the objectives in the action plan, the three areas of action which are identified in his statement. These could mean a lot or they could mean absolutely nothing. For example, "putting the commodity problem more squarely on the agenda", could mean something or it could be just a platitude. The second and third points could mean a lot if they were adequately supported financially. Could the Minister of State give us an indication, particularly in respect of the flex mechanism, as to whether these are just further EU platitudes in the present circumstances or will they back it up with hard finance? If they are to back it up with hard finance, can the Minister give us an indication of the budgets, or how soon interventions will commence? Can he give us an indication of the ground rules for the flex interventions? Tentative budgets might be in place and then it gets tied up in red tape and no money is actually delivered to the commodity producers where the real difficulty arises in terms of human rights, standard of living, the poverty of children, and the inadequacy of incomes into small families involved in the production of commodities in various parts of the world.
I have a number of questions but I will keep them brief. Everybody welcomes the commitment to coherence but I would like to hear about the structures in place to ensure that coherence is more than an occasional informal meeting between the Ministers of State. We need a structure which ensures real coherence and that the coherent policy is development orientated, rather than dominated by what my colleague, Deputy Michael Higgins, described as a rather one-dimensional neo-liberal view of trade.
I am also interested in procedures. I suggest to both Ministers of State that, as Irish parliamentarians going abroad to any conference that involves parliamentarians from developing countries, it is now becoming an embarrassment. This is because one will have all the fine rhetoric one wants, but they will ask about agriculture and point out that both Ireland and France represent the biggest defenders of the status quo in agriculture in trade negotiations on behalf of the EU.
There is a vote in the Dáil.
I was asking about structures for coherence. I invite the Minster of State, Deputy Michael Ahern, to tell us that, if a trade policy statement is made, he will come back to the committee and discuss it with us. It is important that the committee follow up coherence between trade policy and development policy.
I have already mentioned agriculture and there is not much else to say about it. I was recently in Rome with the Chairman and we took part in an interesting dialogue between parliamentarians from Europe and Africa. The Africans made the stark point that 350 million Africans live on $1 or less a day while the EU provides a subsidy of $2 per cow per day and the Japanese provide a subsidy of $7 per cow per day. In the developed world, we give more to our cows as a subsidy than many people in Africa have to live on. I do not want to make that a huge issue, but we need to remember it.
I would like to hear from either Minister of State, Deputy Kitt or Deputy Michael Ahern, about the Singapore Issues. Nobody has any objection to trade facilitation, but if 1.2 billion people on the planet are living on less than $1 a day, we have not reached critical mass in ability to participate in a market economy in which trade is central. Trade policy is important because we must consider facilitating some sort of short-term or medium-term protection mechanisms that allow developing economies to reach a basic level of critical mass in production in which they can feed themselves. To suggest that some good will come from totally open trade to the 1.2 billion who are living on less than $1 a day is to fly in the face of reality. I have no problem with free trade - in the longer term, it is good for everybody - but the process by which countries move from protection to free trade can be extremely destructive, and our trade policy must reflect that.
I am always disappointed when I hear discussions about trade and development in which arms are not mentioned. I heard the Minister of State, Deputy Kitt, mention everything but arms. I would like to hear the view of the Department of Enterprise, Trade and Employment on our participation in the arms industry. Does it have an ethical question about it and about the idea of developing countries spending considerable resources on arms?
One of the NGOs which sent me some information said that when Cambodia joined the WTO it was asked to provide higher concessions than would normally be asked of a least developed country. Do we know anything about why we would support something like that? I have only the suggestion that it happened. If we have a strange policy whereby the World Trade Organisation is making life more difficult for the accession of less developed countries, the whole idea of free trade is a mockery. What we are doing is grinding people down.
I congratulate both Ministers on their efforts to bring fair play to the least developed countries. I am not sure if we have any programme of exchange of personnel within the EU; if not, we should have such a programme.
While travelling to a match with a young Wexford hurler, a highly qualified young man, I asked if he would be interested in serving in the Third World, and he said he would love to. I do not know if there is any governmental or European programme to facilitate such ambitions. Do we have any programme for the exchange of information? I heard at this meeting - it may have been mentioned by Deputy Higgins - that a good deal of EU money is unclaimed by the least developed countries.
I said "unallocated".
Unallocated, obviously because it has not been claimed. It comes down to education and information - people do not know how to go about that.
I am old enough to remember when farmers attended night classes in my village to learn how to handle agriculture. Is anything like that being done? One cannot get economic development without educational development. I overheard Deputy Higgins speak about a teacher in Cambodia being given $10 per month. Education is of vital importance.
The Minister of State, Deputy Michael Ahern, said that more recently the EU has offered duty-free and quota-free access to all imports except arms. I am pleased that arms are mentioned. Is it making any appreciable difference to the least-developed countries that we are allowing that to happen? Do we have any programme to help sub-Saharan Africa develop its oil resources without their being robbed by multinationals?
In relation to the negotiating programme for Cancún, Commissioner Lamy talked about trying to get half way in the programme. He said, "We failed, quite simply, because the gap between the parties in negotiating positions remained too wide to be bridged. We were supposed to get half way, we barely covered a third of the ground." What have we covered, but more important, where do we go from here?
I will be brief because I have to leave at 11.15 a.m. I am accompanied by Tony Joyce and Frank Doheny who are willing to go into detail on questions afterwards, if necessary.
The first question relates to the Singapore Issues. At Cancún, the EU was flexible in its approach to dealing with the Singapore Issues. If we continue in that vein, the Singapore Issues are not cast in stone. We are willing to progress those negotiations and hope to do so. The Singapore Issues are not viewed by us as a block on the negotiations.
On the issue of access to medicines, this was a solution that was promoted and agreed in the context of the intellectual property dimensions of the problems faced by the developing world. The agreement reached was important in the context of affordable medicines to counter the pandemic diseases. The solution represents only one element of the overall approach to beat the scourge of AIDS and other public health diseases. Of itself, it will not solve the problem but it is a positive development in fighting the problem of the disease.
The Article 133 committee was set up under the Rome treaty to advise the EU Commissioner. Contrary to media reports in recent weeks especially, it is not a secret committee. It comprises officials, one of whom is present. Other Departments' officials meet also to advise the Commissioner on the policy of the community. We agreed to put up the agenda of the 133 committee. No organisation will state its position before the negotiations. That will not be done in public.
Either here or in Europe.
They are the officials.
No, they report to no parliament.
They represent the view on Government policy and convey it to other member states. They are responsible to the Department and to the Government.
They do not report to any parliament. In the Treaty of Rome, it is specifically mentioned that trade matters are excluded. The committee in the European Parliament is one that looks only at the operation of policy. It is a fact that the Convention addressed this issue of opening a mechanism of parliamentary accountability for what is called the "common commercial position".
I understand that the Commissioner advises the European Parliament on the policy.
Deputy Noonan raised the question of the negotiating committee and asked what has happened since Cancún. New chairs have been appointed to the negotiating bodies and they are looking at the way forward. We have no detail on how they will progress it. Senator Ryan and Deputy Noonan referred to coherence and asked how it is achieved. The officials of the Departments of Finance, Agriculture and Food and Enterprise, Trade and Employment meet on a weekly basis and any other Department involved when necessary.
Are there any notes on the outcome of those meetings to which we might have access?
The officials discuss whatever arises on a weekly basis. On foot of what is discussed policy is framed and it then become public.
Senator Ryan highlighted a development oriented trade policy in his initial address. My role is to ensure that a coherent and balanced trade policy is pursued by this country. There is a wide range of constituents including the NGOs, the farming community and the business community and it is important that I reflect all those interests in the most effective way possible.
The trade policy is the main area that must be pursued in the Department of Enterprise, Trade and Employment but that does not mean we are ignoring the development side. That is the reason we have had more meetings, from a ministerial point of view, than previously and the officials meet on a weekly basis. We have to achieve a proper balance between trade and development.
Unfortunately I will have to leave in a few minutes because I have another engagement.
I will try to cover some of the points raised by Deputy Higgins, Senator Ryan, Deputy Dempsey and Deputy Noonan. I come back to what my colleague, the Minister of State, Deputy Ahern, said. We have worked very hard to achieve coherence, and I think the members have acknowledged that. I would be the first to accept that in any Government, and Deputy Higgins has had ministerial experience, there are priorities in different Departments. We have to accept that. I was honoured to serve as a Minister of State in the Department of Enterprise, Trade and Employment and it is understandable that that Department will have a close eye on our domestic interests. It is also understandable that the Department of Agriculture and Food will do the same. That is the way every Government works.
We have worked very hard, especially in the run up to the meeting in Cancún. I am aware that representatives of NGOs who were with us in Cancún are in the public gallery and they would be the first to accept that even in Cancún we managed to get greater dialogue going between our NGOs and the three Departments. An aspect that interested me and of which I was very supportive was dialogue between NGOs representing the developing world and the farming organisations. We have come some distance in that regard.
The Singapore Issues have been dealt with by my colleague.
On medicines, Deputy Higgins raised an important issue, having spent some days at the HIV-AIDS conference in Dublin where we agreed the Dublin Declaration on the epidemic in Europe and central Asia, especially towards the east. The issue of access to medicines came up over the weekend. We made excellent progress on the issue at Cancún but it is now time to implement.
The up-to-date position is that Canada has issued licences and introduced legislation with regard to the production and availability of anti-retroviral drugs. I understand the Clinton Foundation has secured the necessary licences for the drugs being produced in India. At EU level we have to ensure we move forward this agenda.
Can I interrupt the Minister of State with what I hope will be a helpful comment? If we look at the position in regard to, say, Ireland or one of the Scandinavian countries which are in competition for multinational investment in the pharmaceutical industry, could this committee be assured that will not be an inhibition in driving the European Union? Will we be taking an initiative at the European Union in regard to legislation or licensing? What is the Minister of State's opinion? Does he believe our reliance on foreign direct investment and our competition for it with other countries is an obstacle?
My own position, as Minister of State, is that we should not let the issues the Deputy referred to get in the way, no more than the Singapore Issues, of moving quickly on the availability of drugs. From a legislation point of view, we will have to work closely with my ministerial colleagues in the Department of Enterprise, Trade and Employment.
One of the decisions we have to make is whether we can deal with this issue through national legislation or by way of an EU directive. I can give an assurance to the committee that we will be working hard to ensure we do not let the possible development the committee has outlined get in the way of making generic drugs available where they are urgently required. During the course of our own conference at the weekend we heard about the 3 by 5 initiative being undertaken by the World Health Organisation, and we have set specific objectives in the Dublin Declaration.
To answer the Deputy's question as best I can, there is an ongoing discussion at EU level. We will monitor the situation carefully and ensure that there are no barriers in our own systems. There is movement, as the Deputy is aware, in countries like India and Canada, and the TRIPs agreement allowed for the production of generic drugs. The challenge now is to make sure they are made available. We are working closely with the Clinton Foundation, especially in Mozambique.
Moving to the Parliament, I suggest to Deputy Higgins that if he had been in Addis Ababa recently, where I addressed the EU ACP Parliamentary Assembly, he would disagree that there is not a strong engagement from parliamentarians. I have never been in the Presidency position previously but I found my presence at the European Parliament an interesting and energising experience. As the Deputy is aware, the European Parliament brings a whole new dimension to our work. For example, many European Parliament parliamentarians criticised their own Governments on various issues, which is interesting. We moved from that to the EU ACP Parliamentary Assembly where we got a very good input from parliamentarians. I want to share with members the importance of that and, as the Presidency, we appreciated that.
Regarding the impact of services at the WTO, the reality is that land reform issues are a matter for the particular national policy positions. They are country specific and we do not have a huge role to play in that area.
Deputy Noonan opened his contribution by saying we are somewhat constrained in that we are to some extent merely observers because of the Presidency. That is not the case. We are not in the business of being observers during our Presidency. I stated earlier that from the very start of the orientation debate we laid down specific objectives. We want a poverty reduction focus. We want to push the millennium goals up the agenda and deal with the issue of commodities. That is why UNCTAD is so important. There was a reference to neo-liberal but as the Deputy is aware, UNCTAD is not a neo-liberal organisation.
The opposite is the case. That is why it is neglected.
The opposite is the case. I hope the Deputy will be at the meeting. We have signalled that this meeting of UNCTAD is an important one and we want to use the opportunity to ensure the position of developing countries is put further up the priority list. We will do that through our involvement in UNCTAD.
Deputy Noonan asked specific questions on the flexibility issue. This is a mechanism for compensating producer countries for falls in commodity prices. It has replaced the STABEX initiative. It does not involve new money but this is one of the issues under discussion in the preparation for the Council conclusions on the action plan.
Senator Ryan raised a number of issues. The structures on coherence have been dealt with by my colleague. Senator Ryan said that wherever he goes as a parliamentarian, the question of agriculture is raised. Going back to my earlier point about coherence, we have tried our best to bring about coherence. I suggest that when we decoupled subsidies from production in the mid-term review in advance of Cancún, it was a step forward but I accept that in revising the talks we now have to make further progress.
With regard to free trade, I referred to special and differential treatment. It is an important issue and there are moneys available. Along with the Singapore Issues, we are anxious to pursue the agenda on differential treatment for developing countries.
Deputy Dempsey mentioned the concept of everything but arms. He asked if there is any exchange of personnel. Since returning to office as Minister of State I have been convinced of the need to do far more on the trade side. We have put a great deal of money into capacity building and into the legal advice centre in Geneva to help countries to facilitate their trade capacity. With regard to personnel, I set up an ICT task force which has already reported back to me.
The next move, which I am now pursuing, is a private sector forum. One of the objectives I have for the private sector forum is greater mentoring and partnership between our private sector and our bilateral countries. Part of that would involve a movement of personnel. If companies in Ireland, such as IT, food or pharmaceutical companies, could allow some of their staff to spend some time in similar companies in our bilateral countries, it would be an important initiative. There will be some progress on that in forthcoming months. The private sector forum is one way to do it.
The private sector is a much maligned constituency in general. I am convinced, however, that we have not challenged that sector on the issue of development. I want to involve it, obviously for the right reasons.
Has it responded?
Yes. I am convinced it has a role to play. With regard to everything but arms, it is not just about opening markets for these least developed countries but also about building capacity. We have put much money into building capacity for these countries.
The Deputy is correct that there are problems with moneys not being spent. We have vigorously pursued this during our Presidency, particularly the EDF funding. This was raised again at the meeting in Dublin Castle in the last few days. Why is so much money left unspent? We raised this issue at the orientation debate and it is on the agenda for the April General Affairs Council meeting, which has to deal with a cluster of issues. We have been proactive on this issue; we are not just observers. The amount of money not being spent has decreased so the reforms are working somewhat. However, the Deputy is correct to identify this as a problem area.
There is no doubt about our national commitment to this issue. Deputy Higgins has acknowledged it. Progress on the development side is visible but the situation with trade is more difficult. Cancún was a big disappointment. There has to be a change of heart. There can be meetings and discussions and new chairmen can be appointed to replace the others, but this must be dealt with by governments at national level. More worryingly, vested interests within states are setting the agenda. Unless the developed world experiences the pain now being experienced by the developing world, this will not change. We have influence during the Presidency and we can make progress.
I acknowledge the contribution of both Ministers at this meeting but a huge challenge faces us. We can only do so much and unless there is a change of heart at national level in developed countries, there will be many more Cancúns. People must change. I acknowledge the progress that is being made and I compliment the Ministers and their officials in that regard.
I wish to clarify the point about the 133 committee. It is most important and there should not be confusion about it. I do not have my notes with me on the 133 committee but I believe it was working groups 3 and 8 in the Convention on the Future of Europe which dealt with the issue. They made a specific suggestion. This is not an academic point. The thinking of the Convention, as I understand it, was to give accountability for the common commercial policy and to give compensation for extended qualified majority voting. The working groups at the Convention in discussing this looked at different models. Should accountability be given in the qualified majority voting area, should it be given in general or should there be a prior consultation?
It is startling that the founding treaty states there will not be a role for the European Parliament with regard to trade. The European Parliament has an advisory committee. It is limited. It can offer an opinion on the consequences but it is not an informing opinion. That raises an issue which we can discuss on another day in the context of the future of Europe because it begs the question of how an unaccountability in trade can dislodge the future of Europe.
The evidence is that multinational corporations, including some pharmaceutical ones, have had access to the 133 committee during different Presidencies. Where the tangible evidence has leaked out, it has done so specifically with regard to GM products and foods. That can be seen in black and white. People, for example, who would fall with the politically accountable process could seek to access this committee, which does not give accountability. I am not saying we can resolve this today but reform of the accountability structures of the committee dealing with the common commercial policy cannot, with credibility, be left as it is.
I have never understood why there is such mystery about arms. The answers one receives on the distinction between actual production and licensing and the shift in licensing and implemented licensing would do credit to a Jesuit. It is fascinating. It is like smoke sometimes. What is the moral inhibition with stating the origin of armaments and their end destination? I have campaigned against war all my life. One will never end the trade in either small or large arms unless one is able to trace from the point of production to the end user. The trade policy appears to be aimed at avoiding knowing where the product goes or being unable to give definite figures.
If everything goes right in the new atmosphere, what is being asked for the least developed countries? What is the invitation to them to become part of the process? With regard to land reform, I never suggested that the Minister is taking over the land reform of Africa, Latin America or Asia. However, I was suggesting that the right of foreigners to purchase land in places where there is no land reform is an issue for the countries involved.
While we attract multinationals to create employment and offer them a low regime of capital gains tax, we do not seek to have a totally unconditional protection for foreign investment. This is part of one of the four Singapore projects and it is morally required that it be dropped. What in the name of God is the advantage, other than in terms of diplomatic tactics, of keeping the Singapore Issues alive until the reopening of the discussions is at an advanced stage? Is it that the Minister of State is not allowed to do otherwise, not by the Government but by the forces of multinational capital and investment? This is such a wonderful opportunity to have questions answered.
The Article 133 issues are very much for the officials from the Department of Enterprise, Trade and Employment. I will be delighted to answer the questions that pertain to my Department and then I must leave.
I stated my position on the Singapore Issues in my contribution. When I, the Minister of State, Deputy Michael Ahern, and other Ministers met the various Commissioners in Dublin Castle at the beginning of our Presidency, I specifically asked Commissioner Lamy - Commissioner Nielson was also present - to show the greatest flexibility on the Singapore Issues. Most development Ministers, including me, would be quite happy to park them. As one can see from the developments and from what the Minister of State, Deputy Michael Ahern, has outlined, Commissioner Lamy is taking that approach, which I very much welcome.
In the short term, we are certainly considering the special and differential treatment, which is very much linked to this matter. As one knows, there are many issues in this area, including TRIPs administration and customs, which are very difficult for the least developed countries to deal with. There is funding in place to help countries in this position.
What do we want for the LDCs in general? When I had responsibility for trade, I pushed very hard for everything but arms and I stated earlier that this is not just about market access but also about trade capacity building. Furthermore, we are very keen to use UNCTAD which, as the Deputy rightly stated, is not a neo-liberal organisation but very much a supporter of the position of developing countries. We want to use the opportunity to put the needs of developing countries on centre stage. UNCTAD has done much analytical work in this area and we support it.
As the Deputy knows well, there are other issues to be considered, including debt, the HIPCI initiative, the threat of HIV-AIDS and other social pressures. When I go to Zambia I hear of teachers dying of AIDS and I know the pressures the LDCs are under. We are, in many ways, in centre stage because of the Presidency and we also have had a strong involvement with the LDCs, especially in sub-Saharan Africa. Given our orientation debate, our April meeting, our involvement in UNCTAD and our close collaboration and co-operation with my colleagues in trade and agriculture, we can really make a difference. I hope I am correct.
I am thankful for the opportunity to address this committee. It is a good initiative bringing two Ministers of State together.
I asked if the Minister of State will return when we have finalised a statement on trade policy so we can discuss the matter again.
I would be very anxious to discuss it and would be happy to do so. The Minister of State with responsibility for trade obviously puts it together and it is therefore appropriate that he be present, but I assure the committee that I will have an input, as I was invited to do. Our NGOs have been in touch with me about this. I will certainly put this to my colleague. I will convey the Senator's request to him.
Mr. Tony Joyce will be replying to some of the questions. I am sorry to say he is not covered by parliamentary privilege. He may not question or express an opinion on the merits of Government policy or policy objectives.
Mr. Tony Joyce
On the question of the national trade policy statement, we are at a very advanced stage. There has been wide consultation with many Departments and outside interests, as the Minister of State, Deputy Kitt, has said. We hope to publish the statement in the near future. I am sure there will be no difficulty with the Minster discussing it before the committee.
The function of the Article 133 committee is to advise the Commission on how to negotiate on behalf of the European Union regarding international agreements, be they bilateral, regional and multilateral. The Commission comes to the committee with information on the progress of negotiations and the way in which it feels we should address particular issues. I refer to Commission policies developed within the Commission fora, obviously involving consultations carried out between the Commission services and the Commission representatives on the trade side. The negotiators whose job it is to negotiate with third countries come to the Article 133 committee and present their points of view, after which the committee has the opportunity to advise them on member states' views thereon.
As was rightly said, the trade policy is a common commercial policy. The Commission has the competence to negotiate but it is obliged to advise member states and seek, in the final analysis, the approval of the Council of any agreements it hopes to make. The Council looks at the mandate for negotiations, the Article 133 committee is advised of what is happening and what points of view should be put forward and, at the end of the negotiations, the Council takes a view on whether to conclude the negotiations in the way in the Commission has proposed.
On the question of parliamentary involvement in overseeing the work of the committee, both Commissioner Lamy and his predecessor, Commissioner Brittan, had been very assiduous in reporting to the Parliament regularly on the progress in trade negotiations. There is no obligation and this issue has been considered in recent conventions, but no conclusion has been reached. The voting arrangements within the trade policy area have also been the subject of consideration. Changes were made regarding the Nice treaty, and further changes were being considered in the most recent Convention.
The Article 133 committee has a number of different manifestations dealing with general and specific matters pertaining to trade policy. It meets on a weekly basis and sometimes more frequently. It is representative of all the member states.
Deputy Michael Higgins raised some questions on the arms policy and the licensing arrangements. I am very disappointed to hear the answers we provided to the various questions did not give him all the information he required. We obviously tried to do so. Our arms licensing arrangements are fully in accordance with our EU commitments and the Wassenaar agreement, which also deals with the licensing of arms and dual-use products. We are currently reviewing the operation of the licensing system, particularly the end user element. We require all applications for licences to provide fully certified end user certificates in support of applications. These are examined carefully and form part of the examination of the application for a licence. We are looking at this in the review, which is almost complete. We hope to be able to make new proposals on it in the near future.
The Minister of State, Deputy Kitt, referred to the Singapore Issues and I make the point made by the Minister of State, Deputy Michael Ahern, that these are not issues we feel will be a block to the further development of the negotiations. In Cancún, the European Union was prepared to be flexible and to drop all the Singapore Issues in the context of the single undertaking. The position now is that we have emphasised the flexibility we have in these issues. There is a strong feeling within the European Union that many of the issues are important in terms of international trade and that there are benefits in concluding international agreements on trade facilitation and on investment, competition and Government procurement.
We recognise the difficulties others have in taking on board these negotiations within the whole area of multilateral talks and the European Union is flexible in how we proceed on those. Trade facilitation, as the Minister of State, Deputy Michael Ahern, stated at the beginning, is the important issue as far as we are concerned and we hope it can be included in the overall Doha package. It could be of great benefit to the developed and the developing world.
I thank the Ministers of State and their officials for appearing before us. It has been an interesting and useful exchange of views.