We heart the WTO
Oil prices have fallen a bit in SL, and happily enough Fowzie has attributed this to world prices falling. I wouldn’t have been surprised if he had instead said that according/due to the Chinthanaya oil prices are falling. Also CBSL has increased short term lending rates a bit, eating, ever so slightly, into the negative rates that we have right now. It’s a good start to the day. It’s been a bit difficult to keep pace these days bc the weeks have been moving so fast. Last week went like a rocket bc I spent 5 days at a WTO training session for trade negotiators. I’ve been reading about WTO technical assistance for a long time but this is the first time I’ve seen tangible evidence. The course really was excellent. The WTO trainer himself was the epitome of globalisation, born in Ghana, lives in Australia, works in Geneva, and flies all over the developing world to train and impart wisdom. The first day and a half was spent running through the agreements themselves, trying to get past the superficial and dig a bit deeper into the nitty gritty. The afternoon was spent going through negotiation skills, which are applicable not just to trade but to any form of negotiations, and also some trade speicific skills. The trainees were an interesting bunch, a cross section of economists and lawyers, mainly from Commerce and the AG’s boys and girls. There were also a few ppl who were a bit lost bc they really had no WTO or trade background and struggled quite a bit to keep up. That was actually the only drawback in the whole process, the trainees selection needed to be better, a trade background should have been mandatory.
We were then split into 6 groups of five, and each assigned a hypothetical country, armed with complete details of trade, political and negotiating interests of all 6 countries, and then had to run through mock negotiations over the next 4 days. The first three days would be bilateral negotiations followed by multilateral negotiations on the final day.We basically had to conclude the Doha round on our own! Each team had a Minister of trade, and chief advisors on services, agriculture, NAMA and rules. I was doing services, and had to spend the rest of the day preparing my country’s position in terms of offensive and defensive intersts by going through hypothetical service schedules that were provided (though i suspect they weren’t entirely hypothetical, some of the schedules given were suspiciously similar to those of the country in real life that the hypothetical country was modelled upon).
The negotiations themselves were excellent and very very professional. We took great efforts to maintain a degree of realism, referring to one another as sir, your excellency etc. and each country having their own “territory” and playing host to their trading partner during the bilateral sessions. The country we represented was modelled on India, we also had China, the EU, the States, possibly Japan and one other developing country. We negotiated 3 successful bilateral deals, I was very generous in my services offers in mode 3 and got exactly what I wanted in terms of horizontal liberalisation in mode 4, which would never have happened in real life. The problem was that as negotiators we faced no domestic political pressure in this simulation, and therefore we were able readily liberalise as long as we stuck to our mandate. For instance, my mandate instructed looking after our interests in Financial, telecom, IT, retail and outsourcing sectors, which I did, but I had no pressure to protect any other sectors, so I happily gave up to 75% equity participation in mode 3 in return for Mode 4 commitments. That said, negotiations in NAMA and agriculture were more protracted, specially agriculture. Nonetheless all 3 of our bilateral negotiations went well and we had a deal in each. The boys and girls playing for China weren’t as lucky and only had one deal, they couldn’t agree with their 2 other developed partners, particularly in terms of tariff cuts in NAMA. The negotiations were hard work, it’s not for fun that the word negotiation is dervided from the Latin neg (not) otium (leisure). It requires hours of planning your own position (in real life weeks and months), and strategizing give and take options, the strengths and weaknesses of trading partners, and at the same time thinking about domestic interests and negotiating with them.
On the final day, the results of the bilateral positions were multilateralised under the MFN clause. This is where you see the value of the multilateral system. Even though the country simulating China failed to strike a deal with the US on a bilateral basis, they enjoyed the benefits of the commitments given by the US to other negotiating partners. This could also be viewed as free riding, but at the end of the day, only China loses out by protecting. So back to the training session, the final morning saw simulation of coalition building as we got into groups of developing and developed nations to prepare multilateral positions. Once again agriculture and NAMA proved to be stumbling blocks, the 6 services experts got together for a parallel session as a last ditch attempt to salvage some kind of deal, but just when we got close to a possible compromise we ran out of time. And so the multilateral session collapsed with no deal possible, much like in real life.
The session overall was a great success. I learnt a hell of a lot not just about negotiations skills but also some of the nitty gritty of the agreements, GATS in particular. It also heightened my sadness about the state of multilateral trade liberalisation in the world today. It becomes so clear how much room there is for mutual benefit, and yet it is difficult to strike a balance in intersts due to the unwillingness to compromise. Sure there have been some bad deals in the past, like the TRIPS agreement, but these are greatly exaccerbated in bilateral agreements between developed and developing nations. That said, I am confident that the WTO will get back on track once the environment for negotiations improve. Let’s just hope that is sooner rather than later.
The session ended on friday afternoon, I went up to the trainer to say toodley doo and spank him very much, so I offered my hand, he took it and pulled me to him and gave me a big hug! It was such a nice gesture from a very nice guy. Throughout the sessions he had that typical African friendliness and enthusiasm, laughing out loud all the time and gesticulating wildly. He hugged everyone else and things ended on a very pleasant note. I skipped lunch and skipped home as soon as possible for I was off, off to Kandy to watch the Bradby. But that’s another story.
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