I am aware the Chairman of the joint committee suffered a bereavement and I would like to offer him my sympathies.
I will begin by presenting a short history of this round of the negotiations in terms of the developments to date and the main political messages being sent. I will then describe what can be realistically achieved at the Hong Kong meeting. As it is clear there will be not be a final agreement in Hong Kong, I will also make recommendations on subsequent goals.
We all remember the disruption caused at the opening of the current round in Seattle in October 1999. The next major event was the Doha meeting in November 2001, two months after the events of 11 September in the United States. It was clearly felt at that meeting that the round should be regarded as a development round, that is, negotiations should be conducted in the interests of developing countries.
The next milestone was the meeting in Cancún, Mexico, in September 2003, at which the negotiations broke down over a number of sensitive issues arising from the range and scale of the agenda and conditions in the field of agriculture. However, it is important to remember that the meeting did not break down solely because of disagreements on agriculture. Some progress in resolving these disagreements was achieved through the framework agreed in Geneva in 2004 which attempted to pull together many of the issues involved. In a sense, that agreement represents the foundation for subsequent negotiations. In the past two months significant offers have been put on the table by the European Union, the United States and the G20 group, particularly with regard to agriculture. Other discussions have also been held with a view to broadening the debate because, while agriculture is important, it is clearly not the only issue involved. The aforementioned events bring us to within two or three weeks of the Hong Kong meeting.
On the messages being sent from the negotiations, I will confine my remarks to the major political level because I am limited in the extent to which I can describe the details. The issues involved are complex and many of the discussions have not matured to the point where a possible outcome may be seen. It was stated at the Doha meeting and repeated at senior political levels that this round must serve the interests of developing countries. It is important to understand the reason such a statement was necessary. The six or seven trade negotiation rounds since the end of the Second World War did not take the interests of developing countries into account. The Uruguay Round was the first in which there was, at least, an apparent concern for their interests. However, after its conclusion and implementation of the agreement reached in 1995, disappointment was expressed because, despite the rhetoric, results were poor. It is clear, therefore, that the current round of negotitions has to deliver.
Since completion of the Uruguay Round, new players have altered the balance of power, including, for example, South Africa, which did not play a significant role in the conclusion of the last round. Current major players include Brazil, India, China and other emerging developing countries. African countries are also asserting themselves to a greater degree than before. However, countries with weak civil service structures continue to face monumental challenges because of the complex nature of the negotiations.
As developing countries have different interests, they cannot be put in the same category for the purposes of this development round. The middle income group of developing countries have certain interests, are already engaged in the world economy and trying to negotiate better deals for themselves. Weaker countries, including those in Africa with which Concern is involved, are outside or marginalised in the world economy. Most of the matters under discussion in this round will not be relevant to the latter countries in the short to medium term and will only become relevant if their capacity to engage in the world economy is improved. Developed countries such as the member states of the European Union, the United States and Japan and middle income developing countries such as China face the challenge of being generous towards least developed countries. United Nations figures reveal that 32 of the 50 poorest countries are WTO members.
What are the realistic prospects, politically, for the meeting in Hong Kong? The negotiations have made insufficient progress in the past few months to reach an agreement. Progress in Hong Kong will be critical and political direction will have to be given if an agreement is to be reached by the end of 2006. The best possible outcome will involve an overall agreement that will be phased in over a number of years beginning in 2008. All the major players share responsibility for progressing an agreement in Hong Kong that will cover all the important issues in the areas of agriculture, non-agriculture and services. In making such progress our leaders will, at best, have achieved enough to make the Hong Kong meeting a limited success. Even if it transpires that the shape of the final outcome of the talks in Hong Kong is somewhat hazy, it is of great political importance that the talks focus more specifically on what we might call a development package for developing countries. Achieving this objective in the final outcome will provide an indicator of intent, political goodwill and commitment.
I suggest the development package for the meeting in Hong Kong should contain three key elements. It should include a commitment to tariff and duty free entry for the goods of the least developed countries into markets in developed countries. In effect, the European Union, through its Everything but Arms initiative, has already established such an arrangement, particularly for Africa and some other EU partners. Other developed countries should match this initiative.
The principle must be accepted that least developed countries should have greater flexibility than richer countries in meeting whatever final commitments are entered into on tariff reductions and phasing in new measures. Critically, what is needed for the meeting in Hong Kong is an aid for trade package, in other words, assistance to poorer developing countries to increase their capacity to engage with the international trading system. I know from my visits to many countries in Africa that they are so structurally weak that the prospect of their engaging in international trade is a long way off. They need support to develop their own domestic and regional trading arrangements and will be in a position to engage in the international trading agreements when they reach that point. It is here that a combination of aid and trade policies comes into play for poorer countries. It is important we achieve an arrangement along these lines in Hong Kong to send out a clear signal of intent and possible decisions.
What should the targets be post the meeting in Hong Kong? As I stated, the target must be that these negotiations are properly concluded by the end of 2006. There is a common interest in agreeing a fairer system, in which Ireland, as one of the most globalised economies in the world, has a strong stake. Achieving this goal will require imagination and generosity.
I do not wish to shy away from the fact that agriculture will be one of the most contentious issues in the talks. The agriculture negotiations in the World Trade Organisation, contrary to what may be the impression, have made a reasonable degree of progress in a number of areas, although an overall agreement is not likely or possible in the short term. The three key aspects of the negotiations are domestic support arrangements, in other words, the subsidies given by countries to their farmers, export refunds or supports and market access. Progress has been made at the level of domestic support and export refunds but difficult issues remain to be dealt with in the area of market access. I will address each of these areas in turn.
On domestic support, it is important to note that the European Union, through its reform package of 2003, has made significant changes in its agriculture policy. For example, it introduced the principle of decoupling support to farmers from production. Ireland has taken a significant step forward in opting for complete decoupling.
