US: could a USD 100 million anti-dumping settlement become a fisheries subsidy?

Recently US media reported that the Southern Shrimp Alliance (SSA) had sought to end anti-dumping tariffs on Thai shrimp in exchange for a cash payment estimated at $100 million or more to be distributed among U.S shrimp producers.

Actually it seems that the initiative for such settlement came from Thailand, eventhough it is not clear whether the initiative came from the Thai authorities, from the Thai exporters or from both.

The SSA maintains that said that eliminating the anti-dumping duties in exchange for the settlement is the best option for the industry as the punitive import duties will be subject in to the so-called “sunset review”, i.e. a re-examination of the anti-dumping duties before they come to an end.

Should the outcome of the review be that there is no need for further anti-dumping duties then US shrimp harvesters will be fully exposed (again) to foreign competition.

But perhaps more interest is the fact that, even if anti-dumping duties would be extended after the sunset review, U.S. shrimpers would not be able to get the proceedings of moneys collected through such duties.

A document posted in the SSA’s website explains at length how the subsidy previously received by US shrimp harvesters will be terminated soon because the Continued Dumping and Subsidy Offset Act or CDSOA program (remember the so-called “Byrd-amendment”) will be phased out and the proceeding of antidumping duties remain with the US Treasury.

As an illustration of the subsidy paid the SSA document mentions the figure of USD 106 million made available to the US shrimp industry in the year 2006.

Here is a link to the web site of the Southern Shrimp Alliance where the aforementioned document (“Domestic Industry and Thai Frozen Foods Association Submit Joint Request for Revocation of Antidumping Order on Shrimp from Thailand - Questions & Answers – 27 December 2009) can be found.

http://www.shrimpalliance.com/

And here a link to an article from “The Daily Comet” (Lafourche Parish, Louisiana) on this issue:

http://www.dailycomet.com/article/20100128/ARTICLES/100129256/1026?p=all&tc=pgall#

WTO: the BRICs and Mexico make proposals on "small-scale fisheries" and on... fisheries agreements

This week the so called BRICs (Brazil, China, India) and Mexico have made a joint written proposal modifying the Chair’s draft text agreement of November 2007.

The main thrust of the proposal is to present the other Members of the WTO with a definition of the so called « small scale fisheries ». According to this group of countries « small scale fisheries » have to be defined according to « socio-economic criteria ». Here are two paragraphs of the introductory part of the submission setting out the rationale for such proposal.

Here are extracts of the introductory part:

On the issue of small-scale, artisanal fisheries, the proponents decided to bring forward a definition based on socio-economic criteria, inspired by the current Article 6.2 of the Agreement on Agriculture. We believe that this is the best way for striking a satisfactory balance, in the absence of internationally-agreed definitions on those fisheries activities by other Organizations more directly involved in fisheries issues. Each Member should be able to work on its own definition, insofar as the criteria set forth in the future WTO disciplines are observed.

On the larger scale fisheries, criteria such as the boat size and the area of capture were replaced with provisions structured on the rights Members have under the international law. For those activities the controls in Articles IV and V would fully apply, in order to implement the Hong Kong mandate consistently with its main goal: to bar harmful fisheries subsidies that create over-fishing and produce overcapacity, as well as distort trade or production. Artificial distinctions such as the Exclusive Economic Zone limitation and the 10 meters threshold were thus deleted.

Another important feature of the proposal is that it introduces new language, under Article III, that would prohibit to developed countries those « subsidies arising from the further transfer, by a payer Member government, of access rights that it has acquired from another Member government to fisheries within the jurisdiction of such other Member.» if concluding such agreement with a developing country.

As an example all payments made in the context of the fisheries agreements concluded by the EU with developing countries could come under such prohibition.

Here is the aformentioned language:

III.4 III.3 Subsidies referred to in Article I.1(g) shall not be prohibited where the access rights are acquired by a developing country Member and the fishery in question is within the EEZ of a developing country Member,

 The fact that the words "the access rights are acquired by a developing country Member and" have been added imply that, to benefit from the exemption to the prohibition under Article I.1(g), the fisheries agreement must be concluded exclusively between developing countries. At least this is my interpretation.

Strangely enough the introductory part is silent about such substantial change to the Chair’s draft.

The full text of the submission, with WTO reference TN/RL/GEN/163 can be found at the WTO’s website.

WTO: Fish, a "pressing issue" for Pascal Lamy

Fish is definitely one of the favourite subjects of the WTO Director General, at least when it comes to talking about the WTO’s Doha Development Agenda.

In an article recently published in The Guardian’s section « Comment is free » and titled « Lamy's lament on trade liberalisation » the author, Larry Elliott, enumerates the pressing issues that were discussed at the Davos meeting. Fish is cited as a pressing issue (after Financial markets. Greenhouse gases and Currencies).

Here is the link to the article.

http://www.guardian.co.uk/commentisfree/2010/jan/28/davos-wto

WTO: and now the IISD on fisheries subsidies as environmental issue at the Doha negotiations (and candidate for a separate agreement?)

The International Institute for Sustainable Development has recently published a document titled “A Sustainable Development Roadmap for the WTO” by Aaron Cosbey.

In this document the author discusses how the WTO can effectively contribute to one of its “constitutional objectives” (as recently put by Pascal Lamy at the 2010 World Economic Forum) namely sustainable development.

Among one of the “areas of need” (of action?), as put by the author, one finds the ongoing negotiations on Fisheries Subsidies (page 16)

Further the author refers to fisheries subsidies as one of the subjects holding the “…greatest potential in the Doha work program for environmental good if an ambitious agreement can be reached”. Here is the full paragraph (page 30) on fisheries subsidies as part of the Doha negotiations:

The Doha talks on fisheries subsidies too are potentially valuable. Subsidies in the fisheries sector lower the cost of fishing and lead to overexploitation of the resource—too many fishermen and too many boats chasing too few fish. Government subsidies have been estimated at some 20 per cent of the value of the worldwide fish catch, and have contributed to declining fish stocks and marine environmental damage, particularly in the developing countries where the surplus capacity is often exported. These talks hold perhaps the greatest potential in the Doha work program for environmental good if an ambitious agreement can be reached. Some have also opined that if these talks succeed they may help pave the way for consideration of the next big item on the perverse subsidies agenda: fossil fuel subsidies.

And finally fisheries subsidies are identified as one area where “it will be easiest to push for” as being a priority and being achievable. Here is the paragraph, in page 47, where fisheries subsidies are mentioned.

Those items that are already on the WTO agenda are arguably easiest to push for: liberalization of environmental goods and services, fisheries subsidies, MEA observership, TRIPS and CBD, trade-related technical assistance, trade facilitation, capacity building, and collaboration in a revitalized EIF. Of course, it is not enough to simply be on the agenda— what is needed is an ambitious outcome in each of these areas. 

So, should the “single undertaking” in the Doha Round (“nothing is agreed until everything has been agreed”) fall victim to piece meal agreements on specific subjects? Are fisheries subsidies to be used as a battering ram  against the "single undertaking"?

I would very much welcome comments from readers on this latter issue.

Here is the link to download the document:

http://www.iisd.org/pdf/2009/sd_roadmap_wto.pdf

WTO: fisheries subsidies at the World Economic Forum (WFE) 2010

One of the sessions of the WFE had the title: "Rethinking the Global Commons: Fisheries". Pascal Lamy, WTO's Director General, was among the panel members.

A summary of the discussions and the list of panelists (all this is copyrighted material) can be found in this webpage at the WFE:

http://www.weforum.org/en/knowledge/Events/2010/AnnualMeeting/KN_SESS_SUMM_29932?url=/en/knowledge/Events/2010/AnnualMeeting/KN_SESS_SUMM_29932

WTO - NZ: a former Chair of the WTO Negotiating Group on Rules on the workings of international negotiations

Mr Tim Groser, New Zealand's current Minister in charge of Trade was the very first Chair of the Negotiating Group that is dealing with new WTO for Fisheries Subsidies.

Mr Groser does not like to beat about the bush. He is someone who likes to speak things out, in all clarity. At least that is the impression I have got when reading one of the speeches he has recently delivered. I found in this post titled "Tim Groser on Border Tax Adjustments: "anti-dumping or CVD investigation on steroids" of the International Economic Law and Policy" Blog, which appears in "My blog list".

In this speech, given in London on 8/12/2009, i.e. just before the start of the Copenhagen Conference on Climate Change, Mr Groser shares with the audience his personal views on how the above mentioned meeting could develop and the results it could yield.

In this post I will go through Mr Groser's talk by way of quoting some of the passages which I think could be related, in some way, to the ongoing WTO negotiations on fisheries subsidies. After all the title of the speech is "Trade and Climate Change: A Negotiator's Perspective", so Mr Groser is discussing how he, as a negotiator for New Zealand, approaches the issue of Climate Change and the negotiations at the Copenhagen meeting.

Copenhagen: the Outlook

There will be literally thousands of international civil servants; hundreds of harassed security guards; a phalanx of the world's media interviewing delegates initially and finally interviewing each other. There will be businesses, lobbyists, a diverse range of NGOs with a vast universe of demands and agendas, some of which will be only loosely related to climate change.

There will be film stars, vegans, people running around in polar bear suits. This is, ladies and gentlemen, international diplomacy in action. Is it likely to lead to anything useful?

Comment: fisheries subsidies negotiations have not attracted as much attention as Climate Change talks, nevertheless there are a number of NGOs gravitating around the negotiations (e.g. WWF, OCEANA) and film stars (remember my post on the presence of Ted Danson in Geneva) have been "running around" to lobby negotiators. In this regard I always wonder why civil society organisations representing are not lobbying, at least in a visible manner, WTO negotiators in Geneva. Until now I have only seen reports of fishermen from the Philippines protesting against "fisheries liberalisation" (see my post of 20/12/2009).

I have spent thirty years negotiating international economic agreements. Most of them, contrary to popular opinion, and after massive political frustration and delays, do end up getting done - never perfectly of course, but usually in the right direction.

Comment: Mr Groser appears to be right in the sense that delays are part and parcel of international trade negotiations. Needless to say that the Doha Round is a good illustration of how delays do plague such undertakings. On the outcome of negotiations I can agree with Mr Groser with the fact that there can be "massive political frustration". This was the case for the EU in Copenhagen. Will it be the case (for the EU) on fisheries subsidies? I ask this question because the assertion on agreements (usually) ending up "in the right direction" is made by a negotiator representing New Zealand. I assume thus that for Mr Groser, should the Doha Round be concluded and an agreement reached on new rules for fisheries subsidies, it will end up in the right direction, at least for New Zealand.

But this is never achieved in one step and seldom in conformity with agreed 'road maps', or time-lines to which solemn Brownie oaths have been earlier pledged. A successful negotiation is always done incrementally by building up convergence and consensus first at the general, then increasingly specific, levels of detail.

Comment: Mr Groser appears to have participated in negotiations where results were reached by using a different approach than the one put forward by his successor in the Chair of the Negotating Group, Ambassador Valle, who did draw a Roadmap for the to move forward the negotiations on fisheries subsidies. Here what Tim Groser tells us about such “different approach”

Highly experienced and astute Secretariat officials, working closely with experienced negotiators from a number of countries, will be developing a text covering the key issues contained in the unmanageable draft legal text and on which firm political decisions are required - mitigation targets, financing in both the short and long term, capacity building and other key elements of the earlier Bali Action Plan.

He also gives us hints on the dangers that the “different approach” can entail and of the opportunities it can bring with it.

Extremism, or gross tactical misjudgements by certain Delegations, can still torpedo what could be a highly constructive step towards a full and ratifiable agreement at a subsequent point. This is not a time for people to start throwing their toys out of the cot. And if finally wisdom prevails, and we do get a solid set of politically binding decisions on key issues, our professional negotiators will then be able to re-engage in 2010 to complete the second, and one hopes, final step towards a far more solid agreement than Kyoto ever was.

This was Tim Groser, the first Chair of the WTO Rules Negotiating Group on Rules of the Doha Development Agenda, on how international negotiations are (or can be?) conducted.

The full speech can be found in these web pages:

http://www.voxy.co.nz/politics/speech-groser-trade-and-climate-change-negotiator039s-perspective/5/32614

http://www.beehive.govt.nz/speech/trade+and+climate+change+negotiator039s