Explained: The key takeaways from the 12th Ministerial Conference of the World Trade Organization

What is the WTO and the Ministerial Conference

The World Trade Organization is the only international organization that deals with the rules of trade between countries. Founded in 1995, the WTO is run by its 164 members, and according to its rules, all decisions are taken through consensus and any member can exercise a veto.

Its aim is to promote free trade, which is done through trade agreements that are discussed and signed by the member states. The WTO also provides a forum for countries to negotiate trade rules and settle economic disputes between them.

The Ministerial Conference is the WTO’s top decision-making body and usually meets every two years. All members of the WTO are involved in the MC and they can take decisions on all matters covered under any multilateral trade agreements.

The WTO’s 12th Ministerial Conference was held in Geneva from 12-17 June. It was supposed to end on 15 June, but with intensifying negotiations, the conference was extended by two days.

A look at some of the key takeaways from the meeting.

Curtailing harmful fishing subsidies

The WTO passed a multilateral agreement that would curb ‘harmful’ subsidies on illegal, unreported and unregulated fishing for the next four years, to better protect global fish stocks. Since 2001, member states have been negotiating the banning of subsidies that promote overfishing.

Newsletter | Click to get the day’s best explainers in your inbox

The current agreement, which establishes new trading rules, is the second multilateral agreement in WTO’s history.

“WTO members have for the first time, concluded an agreement with environmental sustainability at its heart,” Okonjo-Iweala said. “This is also about the livelihoods of the 260 million people who depend directly or indirectly on marine fisheries.”

India and other developing countries were able to win some concessions in this agreement. They successfully lobbied to remove a section of the proposal that would threaten some subsidies which would assist small-scale artisanal fishing, as reported by The Associated Press. Artisanal and traditional farmers would not face any restrictions under this agreement, said Piyush Goyal during a media briefing on Friday.

Critics argued that this agreement would only restrict and not eradicate subsidies on illegal fishing. “After 20 years of delay, the W.T.O. failed again to eliminate subsidized overfishing and in turn is allowing countries to pillage the world’s oceans.” Andrew Sharpless, the chief executive of Oceana, a non profit ocean conservation organization told The New York Times.

Global Food Security

Members agreed to a binding decision to exempt food purchased by the UN’s World Food Programme (WFP) for humanitarian purposes, from any export restrictions.

In light of the global food shortages and rising prices caused by the war between Ukraine and Russia, the group’s members issued a declaration on the importance of trade in global food security and that they would avoid bans on food exports.

However, countries would be allowed to restrict food supplies to ensure domestic food security needs.

India’s key demand to allow it to export food from its public stockholdings to other countries will reportedly be discussed in the next Ministerial Conference in 2023.

E-commerce transactions

During the MC12 session on Wednesday, India has asked the WTO to review the extension of the moratorium on custom duties on e-commerce transactions, which include digitally-traded goods and services

Piyush Goyal, the commerce and industry minister who led the Indian delegation, argued that developing countries faced the brunt of the financial consequences of such a moratorium.

From 2017-2020, developing countries lost a potential tariff revenue of around $50 billion on imports from only 49 digital products, he said.

WTO members had first agreed to not impose custom duties on electronic transmissions in 1998, when the internet was still relatively new. The moratorium has been periodically extended since then.

By Friday however, all members agreed to continue the long standing moratorium on custom duties on e-commerce transmissions until the subsequent Ministerial Conference or until March 31, 2024, depending on whichever comes first.

Covid-19 vaccine production

WTO members agreed to temporarily waive intellectual property patents on Covid-19 vaccines without the consent of the patent holder for 5 years, so that they can more easily manufacture them domestically.

(This) “will contribute to ongoing efforts to concentrate and diversify vaccine manufacturing capacity so that a crisis in one region does not leave others cut off.”, said WTO Director-General Ngozi Okonjo-Iweala

The current agreement is a watered down version of the original proposal made by India and South Africa in 2020. They had wanted broader intellectual property waivers on vaccines, treatments and tests.

Rich pharmaceutical companies had strongly opposed this, arguing that IP’s do not restrict access to Covid vaccines and that the removal of patent protections gives researchers that quickly produced life saving vaccines, a negative message.

The waiver agreed by the WTO was criticized by advocacy groups for being narrow in scope, as it did not cover all medical tools like diagnostics and treatments. “This agreement fails overall to offer an effective and meaningful solution to help increase people’s access to needed medical tools during the pandemic as it does not adequately waive IP on all essential COVID-19 medical tools and it does not apply to all countries,” said Christos Christou, international president of Doctors Without Borders

The agreements passed by the WTO come after an intense week of negotiations.

“India is 100% satisfied with the outcome.” Piyush Goyal told reporters on Friday, “I am not returning to India with any worries.”