WTO News

Canada seeks WTO review of EU ban on seal products

(Reuters) – Canada asked the World Trade Organization Friday to set up a panel to resolve its dispute with the European Union over the EU’s ban on trade in seal products, Fisheries Minister Gail Shea said.

The European Union closed its borders to seal products last year, when an EU court allowed the ban to proceed even though a Canadian legal challenge was still in progress.

“By moving ahead with this World Trade Organization challenge, we stand behind the thousands of Canadians in coastal and northern communities who depend on the seal harvest to provide a livelihood for their families,” Shea said.

Shea said the challenge would not have a bearing on ongoing negotiations on a Canada-EU free trade agreement, which is expected to affect billions of dollars worth of trade.

Canada’s seal trade with Europe was worth only several millions of dollars a year.

“Both sides have agreed that this issue will be resolved outside the free-trade agreement process, and will be resolved at the WTO,” Shea told reporters outside the House of Commons.

“What Gail Shea is not taking into account is the fact that the European Parliament has to ratify any free-trade agreement,” reacted Rebecca Aldworth, activist at Human Society International Canada.

Aldworth said the European Parliament passed the ban in the first place and takes it very seriously.

EU trade spokesman John Clancy said the European Commission would vigorously defend the law.

“This particular legislation has been carefully crafted to ensure respect for all of our international obligations, while at the same time responding to the concerns expressed by EU citizens in respect of seal products from certain hunts,” he said in Brussels.

Dispute panels normally take 12 to 18 months to deliberate. The request for a panel comes after the failure of two sets of formal consultations to resolve the issue.

Shea said the panel would help take the emotion out of a ban that she said had “no basis in fact or in science.” Animals rights activists said the harvest, which involves shooting or clubbing the animals to death, is inhumane.

“Europeans have made it clear they don’t want seal products. Even if Canada wins, it’s not like Europeans are going to go on a stampede to buy seal pelts,” said Adrian Hiel, spokesman in Brussels for the International Fund for Animal Welfare.

But the issue is a live one in Canadian domestic politics in the Atlantic regions where sealing takes place, and Shea said regardless of the cost of the challenge it was a matter of principle.

Her announcement came as Conservative Prime Minister Stephen Harper was touring Newfoundland and Labrador, where many sealers live. The Conservatives won no seats in that province in the last election in 2009 and are hoping to break through next time.

Govt to move WTO if Visa talks with US fail next month

NEW DELHI: With the recent visit of US commerce secretary Gary Locke failing to address India’s concern on professional visa fee increase and imposition of additional duties on government imports, the country will try for one last time to settle the issue bilaterally next month.

Commerce secretary Rahul Khullar will meet US undersecretary of commerce Francisco Sanchez in March to settle the issue, failing which India would approach the World Trade Organsation, or WTO, a senior official has said.

“We have already successfully demonstrated to the EU that we don’t hesitate going to the WTO if we are wronged. It will not be any different with the US,” a commerce department official told ET.

India had complained to the WTO about its generic medicines being seized at various EU ports enroute to third countries illegally, following which the EU agreed to change its customs laws.

The commerce department has already started consultation with legal experts on the articles under which the US could be challenged at the WTO. “We are going to go prepared with all documents and if talks fail we would soon give them a notice for WTO consultations,” the official said.

The US has increased professional visa fees (H-1B and L-1 visa) by at least $ 2,000 for all US-based companies that have more than half of its employees on such visas. The hike that will stay till 2015 is expected to cost Indian IT companies like Infosys and Wipro $200 million annually.

The country has also imposed additional import duty of 2% on all government imports from countries like India that are not part of the government procurement agreement ( GPA )) of the WTO.

Commerce and industry minister Anand Sharma took up the issue with the US trade representative Ron Kirk and US commerce secretary Gary Locke at various forums without any concrete assurance so far.

“I can only tell you that we know how sensitive this is. But this was not targetted at Indian companies,” US commerce secretary told ET during his visit earlier this month, without explaining how it could be sorted out.

Both provisions are part of the James Zadroga 9/ 11 Health and Compensation Act of 2010 which aims to set up a $ 4.3 billion fund for a period of five years 2010- 15) to provide free medical treatment to those affected by the 9/ 11 terror attack in New York.
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WTO: Chinese commodity export restrictions are unfair

The WTO is to issue a preliminary report on Friday that concludes China has no right to impose export restrictions on nine raw materials, the Wall Street Journal reported. Many of the industrial ingredients concerned are vital in the production of steel. The restrictions, in the form of quotas, license requirements and other measures, have caused increasing friction in China’s trade relations. The case is not directly related to the sensitive rare earths’ export issue, but a victory in this raw-materials filing could lead to a new US complaint on rare earths, trade analysts said. This is because the ruling will indicate whether the WTO agrees with China’s general assertion that export restrictions are necessary to protect the environment. The final report will be released in April, at which point China can appeal. Should that the appeal fail, the country must remove the restrictions or potentially face sanctions

US:Doha trade talks finally dealing with substance

Feb 17 – An intensive week of talks among key trading powers was constructive and the long-running Doha negotiations have finally started to deal with matters of substance, the U.S. ambassador to the World Trade Organization said on Thursday.

“My sense is that we’re finally starting to do the things we need to do, which is grapple with the really hard issues,” U.S. envoy Michael Punke told Reuters after a week of meetings among 11 major WTO members including the United States.

“We’re in a mode right now where we’re talking about substance.”
Original article on Reuters
(Reporting by Jonathan Lynn; Editing by Stephanie Nebehay)

Environment lobbyists hopeful of WTO fish deal

(Reuters) – Environmental activists are hopeful that negotiations at the World Trade Organization to curb fisheries subsidies, especially those on fuel, can produce a deal that will help end overfishing.

Agreement would not only help reverse the alarming depletion of global fish stocks and contribute to a broader trade deal in the WTO’s long-running Doha round, but would provide a template for tackling global problems such as climate change that have a trade dimension.

Despite big differences over the scope of a deal and which countries should be exempted from which provisions, the outlines of an agreement are already emerging,” Peter Allgeier, former long-serving U.S. ambassador to the WTO, told Reuters after two weeks of talks on fishing as part of a renewed push on Doha.

“You’ve got a structure there,” Allgeier, who now heads the trade consultancy arm of law firm Crowell and Moring, and is advising Oceana, an advocacy group fighting for ocean conservation, said on Thursday.

WTO members are all agreed that they have a mandate to impose trade disciplines on fishing subsidies, which will involve prohibitions of some support, he said.

They accept that the way to do this is to agree prohibitions and then work out exceptions and flexibilities for suitable cases, and that fuel subsidies will be a central part of a deal.

OVERFISHING

In its latest two-yearly survey of fishing last month, the United Nations Food and Agriculture Organization said that 85 percent of fish stocks are now fully exploited, over-exploited, depleted or recovering from depletion, a figure that has deteriorated steadily in recent years.

“If current trends continue the world’s fisheries could be beyond recovery within decades, within our lifetime,” Oceana’s senior campaign director, Courtney Sakai, told Reuters.

One of the main reasons for this over-fishing is that many countries subsidize uneconomic activities, such as long-distance deep-sea fishing, where fuel amounts to two thirds or more of the operating costs of a fishing fleet.

Every country accepts the need to curb or prohibit these subsidies — but each one also argues its own arrangements are special and should be exempt. But Trinidad’s WTO ambassador, Dennis Francis, who chairs the talks on fishery subsidies and other trade rules, has challenged WTO members to subject each other’s programs to scrutiny.

“Everybody has got to figure out how they are going to discipline their fuel subsidies,” said Allgeier. “You just can’t have a situation where some are allowed to do it and some aren’t… Everybody’s got to give.”

Another faultline in the talks is whether the emphasis should be on fair trade or the environment.

Japan says that bringing trade considerations into the talks, even though they are at the WTO, is a distraction and they should focus on resource management and conservation.

But Allgeier said there is a clear trade dimension.

Subsidies in industry hurt a competitor by depriving them of market share or profits but do not stop them from manufacturing. Fisheries subsidies are different.

“If I’m subsidizing my fishing fleet I’m actually taking away from you your resource base,” he said.

Developing countries insist that their small-scale and subsistence fishermen should be exempt from any restrictions on subsidies, and Sakai said it was reasonable for poor countries to help under-developed coastal communities with infrastructure and other support to build viable, self-sustaining industries.

Japan has also proposed that small-scale fishing in developed countries should enjoy similar waivers from restrictions, but other countries such as the United States, New Zealand and Mexico say this would open too many loopholes.

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WTO to Fault China on Raw-Material Exports

WTO to Fault China on Raw-Material Exports- China has no legal right to impose export restrictions on nine raw materials, say trade diplomats and lawyers familiar with the case. "This [case] is a punch against China's trade policy," says Simon Evenett, an economist at the University of St. Gallen in Switzerland. "It means you can't use protectionism as a policy tool on natural resources."

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U.S. files two new trade cases against China with WTO

The Obama administration said Friday that it had launched two new appeals against China to the World Trade Organization as new data showed the trade gap between the two countries rose to a record level last year.

The new appeals to the WTO are part of an evolving administration strategy to press China for better market access while playing down the high-profile dispute over how Chinese authorities manage the value of the country’s currency.

The latest cases attack import duties imposed on certain types of U.S. steel and challenge the virtual monopoly over electronic payment processing granted to a state-owned Chinese company. They come on top of other trade actions filed by the administration, including the tariffs on imported Chinese tires and a high-profile challenge of the subsidies and other support that the country provides to its alternative-energy industries.

“In each of these cases, [the United States] will be pressing to ensure that we obtain the trade benefits provided by the WTO agreement,” U.S. Trade Representative Ron Kirk said in a statement.

Wang Baodong, spokesman for China’s embassy in the United States, said China conducts business “strictly in accordance with its WTO and bilateral commitments.”

“We stand for settling trade disputes with other countries through consultations on an equal footing,” Wang added.

In talks last year, China appealed to the Obama administration to hold off on imposing duties and appealing to the WTO, urging negotiations on trade tensions between the countries.

The WTO and other trade actions come as the Obama administration has become less concerned about China’s management of the value of its currency, the renminbi.

Many economists say the value of the currency is being held at an artificially low level as a way for China to help its exporters, whose goods are comparatively less expensive because of the exchange rate.

The issue has been politically volatile in the United States, and this week members of Congress reintroduced legislation, approved by the House last year, that would impose duties to offset the effects of an undervalued currency.

But Chinese officials have been allowing the renminbi to rise in value, and many longtime critics of China’s currency management say recent signs are encouraging. Including the effect of inflation and a recent drop in the value of the dollar, the Chinese currency is appreciating at a rate of about 10 percent a year.

“We may be on the road” to a renminbi that trades at close to its market value, at least in relation to the dollar, said C. Fred Bergsten, head of the Peterson Institute for International Economics, who has denounced China’s currency management.

There is a similar feeling among U.S. officials that recent changes in how the renminbi can be bought and sold outside China, if sustained and expanded, will lessen central government control over the exchange rate.

China’s central bank controls the exchange rate by actively buying or selling renminbi in exchange for dollars, increasing supply or demand as needed. The more the currency is bought and sold around the world, independent of those transactions, the more difficult it will be for the central bank to manage the rate.

The U.S. trade deficit with China hit a record $273 billion in 2010 as $91 billion worth of U.S. exports to the country were exceeded by Chinese imports.

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WTO urges Japan to reform, free trade

WTO says Japan structural reforms slowing-Trade reform would boost competitiveness
GENEVA, Feb 15 (Reuters) – Japan must liberalise its foreign trade as part of wide-ranging structural reforms to restore competitiveness and boost growth, the World Trade Organization said on Tuesday.

Looser macro-economic policies, albeit offset by the appreciation of the yen that reinforces deflationary pressures and saps export competitiveness, have helped Japan’s economy recover from the global financial crisis, the WTO said.

But these policies do not address long-standing structural problems, including a rapidly aging population, reflected in sluggish growth for a decade in real gross domestic product and productivity, it said in a report prepared for a regular review of Japan’s trade policies.

“These problems can be addressed more effectively by far-reaching structural reforms, of which trade liberalisation (and the resulting stimulus to competition) is an integral part,” the WTO said. “However, structural reforms have, if anything, slowed since 2009.”

The report was prepared in early January and so does not reflect some recent reform initiatives by Prime Minister Naoto Kan.

The report notes that the government has been moving towards income support in agriculture — where productivity is lower than in the rest of the economy — from price support.

But agriculture continues to benefit from substantial government support including higher tariffs than on other sectors, quotas, income support and in some sectors production controls, it said.

In its own report for the review, the Japanese government noted that Japan was the world’s biggest net importer of food and was particularly keen to strengthen international trade rules on export prohibitions and restrictions.

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Australian Govt will adhere to WTO apple ruling

Australian Prime Minister Julia Gillard has given what appears to be an unequivocable assurance that her Government will not try to get around the World Trade Organisation decision on apple imports.

A WTO disputes panel ruling last year upheld New Zealand’s complaint about the stringent quarantine restrictions that Australia was proposing, after lifting its 90-year ban on apples from this country.

The New Zealand case also survived an appeal from Australia.

Julia Gillard said in Wellington on Wednesday that Australia accepts the decision.

She says in a rules-based trading system it would be expected that appeal rights would be used but the “umpire has now spoken” and Australia will abide by the ruling.

Pipfruit New Zealand chief executive Peter Beaven says it is heartening to get that sort of public assurance from Ms Gillard.

The New Zealand apple industry is hoping it can start exporting fruit to Australia from next year.

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Sharp reversal, U.S. agrees to rebuke Israel in Security Council

The U.S. informed Arab governments Tuesday that it will support a U.N. Security Council statement reaffirming that the 15-nation body “does not accept the legitimacy of continued Israeli settlement activity,” a move aimed at avoiding the prospect of having to veto a stronger Palestinian resolution calling the settlements illegal.

But the Palestinian’s rejected the American offer following a meeting late Wednesdy of Arab representativs and said it is planning to press for a vote on its resolution Friday, according officials familar with the issue. The decision to reject the American offer raised the prospects that the Obama adminstration may cast its first ever veto in the U.N. Security Council.

Still, the U.S. offer signaled a renewed willingness to seek a way out of the current impasse, even if it requires breaking with its key ally and joining others in the council in sending a strong message to Israel to stop its construction of new settlements. The Palestinian delegation, along with the council’s Arab member Lebanon, have asked the council’s president this evening to schedule a meeting on Friday. But it remained unclear whether the Palestinian move today is simply a negotiating tactic aimed at extracting a better deal from the United States.

Susan E. Rice, the U.S. ambassador to the United Nations, outlined the new U.S. offer in a closed door meeting on Tuesday with the Arab Group, a bloc of Arab countries from North Africa and the Middle East. In exchange for scuttling the Palestinian resolution, the United States would support the council statement, consider supporting a U.N. Security Council visit to the Middle East, the first since 1979, and commit to supporting strong language criticizing Israel’s settlement policies in a future statement by the Middle East Quartet.

The U.S.-backed draft statement — which was first reported by Al Hurra — was obtained by Turtle Bay. In it, the Security Council “expresses its strong opposition to any unilateral actions by any party, which cannot prejudge the outcome of negotiations and will not be recognized by the international community, and reaffirms, that it does not accept the legitimacy of continued Israeli settlement activity, which is a serious obstacle to the peace process.” The statement also condemns “all forms of violence, including rocket fire from Gaza, and stresses the need for calm and security for both peoples.”

U.S. officials were not available for comment, but two Security Council diplomats confirmed the proposal. The Arab Group was scheduled to meet this afternoon to formulate a formal response to the American offer. Council diplomats said that the discussions were fluid and that there was still the possibility that the U.S. draft would be subject to further negotiations. They said it was also not yet certain that the U.S. offer would satisfy the Arab Group, and that the U.S. may be forced to veto the Palestinian resolution.

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