What the 10th Ministerial WTO Forum Spells for Kenya and Africa

By Phyllis Wakiaga

Other than the fact that the 10th World Trade Organisation (WTO) ministerial meeting is a meeting of ‘firsts’; the first to be held in Africa and Kenya, led by the first female minister since the meetings begun and is estimated to bring in 7000 delegates, it is also special in that it comes after the adoption of the Strategic Development Goals (SDGs) meaning that the negotiations will be structured within the context of economic growth through trade that eradicates poverty.

The ministerial conference is in reality a negotiation table for member states on all matters trade and as the MC10 comes home to the continent, the question arises; how much can Africa score on home ground? On the table will be; Liberia’s ascension to the WTO, ratification of the Trade Facilitation Agreement, increased market access for agricultural products from developing countries, Trade Related Aspects of Intellectual Property Rights (TRIPS), tariffs and nontariff barriers and other issues that hark back to the Doha Ministerial meeting of 2001.

Least Developed Countries (LDCs) come to the table faced with the challenges of a fast evolving environment in global trade and they will definitely need a more aggressive approach in order to secure significant gains. Since the Doha round began, the trade environment has changed considerably, if one considers the slowing pace of economic growth globally since the beginning of this decade. The small size of national, and even sub-regional markets, make African countries particularly dependent on international trade for economic growth.

Meanwhile, an impasse on various important issues has persisted over the Doha round raising doubts about the potential outcome and success of the Nairobi meeting. The positive aspect is that the WTO is committed to actioning the barrier agreement on trade facilitation whose foreseen outcome is the reduction of costs due to transparency in the customs department and certainty in documentation requirements for exporters. The agreement will help developing countries address ‘behind the border’ issues that should be monitored and agreed upon like; red tape and a lack of information, paperwork and automation.

But the WTO has to help Africa integrate production rather than continue exporting raw materials to the developed world which are then processed and brought back to the continent for sale. A case in point is the Mombasa auction. We sell bulky tea instead of blending it for better prices. Value addition is still not taking place in Africa and member states need to deliberate on how more investments can come to Africa by aiding the continent strengthen its supply-side capacity. While Africa’s firms can be internationally competitive, Africa’s economic systems often are not, making it harder to export reliably, efficiently, and competitively into global markets.

Market access issues discussed at the Ministerial Declaration of the Doha round need to be relooked at through the review of Special and differential (SDT) treatment that offers developing countries greater leeway in this area. However, the SDT provision is still under contention. Not all WTO member countries, particularly the developed ones, have been able to agree on this point and implementation of this particular concern has been highly politicised even though a number of concessions are accorded to developing countries through the Everything But Arms (EBA) and African Growth Opportunity Act (AGOA). It will be important to agree on this issue during the Nairobi Round.

A new strategy is therefore needed to tackle the new and the old problems. Various tactics could be used during the negotiations such as concluding the Doha Round meaningfully once and for all to deliver market access for developing nations and thereafter establishing a new round with a new set of requirements. This would allow developing countries to incorporate changes that reflect the new realities they are faced with. Another strategy would be for developing countries to garner the support of LDCs in the push for more market access for their agricultural products in the developed world. In turn, they would offer LDCs better access into their own markets as a trade-off for the support.

From a country perspective, Kenya has been consolidating its trade ties through multilateral and bilateral agreements. Think of the recent signing of the Tripartite Free Trade Agreement (TFTA), the successful conclusion of the negotiation for the Economic Partnership Agreement (EPAs) last year, or the ratification by the Ethiopian Parliament of the Special Status Agreement (SSA). These agreements form a suitable foundation and impetus for the conversation this week and should encourage Kenya to work at passing of the Trade Remedies Law which will allow Kenya to take advantage of the safeguards offered under WTO for the growth of Industry.

Perhaps, the best outcome for the ministerial meeting would be to help developed countries realise that they too will benefit if they help developing and LDC countries achieve their trade objectives. This would certainly make the talks easier all round and result in quicker outcomes. In the meantime, I welcome all the delegates who will be pouring into the city this week and I wish them all a successful ministerial meeting.

Karibu Nairobi.

(The writer is the CEO of the Kenya Association of Manufacturers and can be reached on ceo@kam.co.ke)

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