N

egotiations in Geneva have reached a very critical moment, especially since there is a sense of uncertainty regarding whether all members of the World Trade Organization (WTO) will be able to regain confidence in the WTO and the multilateral trading system it oversees. The Ninth Ministerial Conference, or MC9, is scheduled for Dec. 3-6, 2013 in Bali, and it was agreed earlier by all that the negotiations should be concluded in Geneva, Switzerland, rather than Bali.

The faith of what can be delivered in Bali is now in the hands of negotiators in Geneva, but all capitals should also play a role in providing guidance '€” if not instruction '€” on how to make the MC9 a success. Since its establishment in January 1995, the WTO has served as a preeminent forum for multilateral trade negotiations and disciplines.

However, it took only a few years for developing countries and the least-developed countries or LDCs to realize that they either have limited capacity to comply with the WTO Agreements, or discover that not all agreements are responsive to the new challenges and aspirations.

Ministers gathered at the MC4 in Doha, Qatar in 2001 agreed to launch a new round of negotiations to revamp the WTO system by focusing on the developmental issues; hence, the Doha Development Agenda or DDA.

There are at least 19 issues to be negotiated under the DDA, and after 11 years of negotiations it is not clear to everyone what the landing zone for the DDA will be.

Such impasse in the DDA negotiations has contributed to recent assertions that the WTO does not really function apart from being an avenue to settle trade disputes among its members.

It was agreed at the MC8 in December 2011 in Geneva that members should find a break-through to the DDA negotiations by focusing on some '€œlow-hanging fruits'€. Members further agreed that the MC9 should aim at agreeing to a package of deliverables that centers on trade facilitation, some elements from agriculture, and development issues including those of particular
interest to LDCs.

Since 2012 negotiations have started toward a package for Bali, but it was only in the second quarter of this year that the pace of negotiations accelerated as members were focusing first on the selection of a new director general between December 2012 and May 2013.

Negotiations toward a Bali package have proved difficult. Negotiations on trade facilitation, for example, require long and tough discussions as members seek the right balance between commitments to take the necessary measures to make exports and imports easier, faster and cheaper, while also trying to follow through with obligations to provide adequate assistance for developing countries and LDCs to execute their commitments.

Meanwhile, negotiations on the public stockholding for food security as proposed by the G-33 and some measures to improve export competition and the Tariff-Rate Quota (TRQ) administration as proposed by the G-20 (agriculture), may be considered the toughest ones. These are sensitive issues between developed countries and developing countries.

In contrast, negotiations on development issues look easier to complete as they are less sensitive to developed countries. Nonetheless, there are areas where the LDCs themselves need to consolidate first.

What we can observe in Geneva now is that issue configurations could split in a matter of hours. What has been agreed earlier may be subject to renegotiation later on if certain members feel that negotiations on other issues have caused the balance to shift to another side. Putting it simply, the situation remains fragile until everything is agreed and locked.

Coming up with a small yet credible Bali package is certainly everybody'€™s wish. It will help restore confidence in the negotiating function of the WTO to complete the DDA sooner than later. Success in Bali will also convey a strong signal to businesses around the globe that the multilateral trading system is still working and if it can be strengthened a little bit more all forms of business will be able to operate in a more conducive global environment.

What if there is no Bali Package? The MC9 will nevertheless come up with some decisions. Accessions of new members, settlement of house-keeping issues, and some political statements on the status of the DDA negotiations are some possible outcomes of the MC9.

But without the Bali package, the MC9 will undoubtedly send out three political messages.

First, the voices of the developing world cannot be taken for granted. After decades of developed country-led growth, it is time for developing countries to move forward and together with developed countries to reshape global trade.

Second, every member of the WTO counts. The view cannot be maintained that decisions can be made by a few key members as the rest simply follow the bigger guys. This is certainly not the case in the context of negotiating the Bali Package in Geneva, let alone if we wish to complete all the issues under the DDA. The WTO needs to be more inclusive than ever.

Last, should the Bali package not fly, it may be the right time for us to think whether we will continue negotiating the DDA.

No one is prepared to see the collapse of the DDA and the multilateral trading system. All members repeatedly called for all parties to be flexible in negotiating the Bali Package. However, what is needed at this critical juncture is direct engagement by all capitals of the WTO members to instruct their missions in Geneva to save the Bali package.

The writer is the Indonesian Trade Minister.