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1 1 (April 21, 2020)

handle is hein.crs/goveayt0001 and id is 1 raw text is: C re$Sic~n8I ~ese~srd~ $~rv~e 9 April 21, 2020 WTO: Ministerial Delay, COVID-19, and Ongoing Issues Overview Due to the coronavirus pandemic (COVID-19), the World Trade Organization (WTO) canceled its 12th Ministerial Conference (MC12) planned for June 2020. The biennial meeting, which usually involves active U.S. participation, was widely anticipated as an action-forcing event for the WTO, amid serious challenges facing the multilateral trading system. Some members hoped key results for ongoing negotiations could help preserve the WTO's relevance. In addition, a dispute settlement (DS) crisis continues, with the Appellate Body ceasing to operate in December 2019 and no consensus on solutions. Broader reforms of the institution also remain under active discussion, including some U.S. proposals. While MC12 and other meetings were suspended, members are attempting to continue some WTO operations virtually. The WTO can play a unique role in coordinating global trade responses, which could be criticalin mitigating the grim global economic and trade outlookin the wake of COVID-19. The WTO has committed to work with other international org anizations to minimize disruptions tocoss- border trade and global supply chains-in particular those central to comb atting the virus-while s afeguarding public health concerns. It has sought to informmembers of the impacts on trade and encouraged themto notify WTO of any trade-related meas ures taken in response to COVID-19. The number of countries implementing trade res trictions, including curbs on exports, has increased exponentially since the beginning of 2020, raising debate among analysts about the economic and policy rationales and imp acts, plus questions about consistency with WTO rules. At thesame time, other countries have committed to trade openness. Members of Congress haveexpres sed support for ongoing W TO reform efforts (see H.Res.746), sought clarification on the Administration's positions, and proposedtrade- related legislationin response to COVID-19. MCI 2 Delay and Implications After the declaration ofCOVID-19 as a pandemic, Kazakhstan, the host forthe WTO's MC12, cancelled the planned June meetings. Following mixed results coming out of the last ministerial in 2017, the United States and other W TO members had hoped MC12 would mark a turning point to conclude some negotiations. They also hoped to announce significant progress on multiple initiatives, demonstrating the value of the WTO. MC12 was to serve as a critical forum for taking stockofvarious WTOreform proposals (seebelow). A new date for MC12has not been set, but will likely occur in 2021. Some negotiations and other W TO activities continue in writing and virtually. Members are currently evaluating how those negotiations should proceed and whether these formats can be used to yield binding decisions. https://crsrepc Select Ongoing Negotiations of U.S. Interest Fisheries. Members had committed to finish negotiations on fisheries subsidies at MC12, an achievement many view as criticalto upholding the WTO's legitimacy. Primarily seeking to limit subsidies that contribute to overcapacity and overfishing, negotiations continue in written exchanges, and the negotiations chair is working to bridge differences. The U.S. has supported equal obligations across members, with minimal flexibilities for developing countries. F-commerce. Members had extended the moratoriumon customs duties on electronic transmissions until MC12, but it is unclear if the extension willbe sustained, given the opposition of some developing countries. Separately, the United States and over 75 members are actively negotiating a plurilateralinitiative on e-commerce. The United States seeks an ambitious, high standard digital trade agreement. The parties hadhoped to publish a consolidated text at MC12 to gain momentumand attract new participants. Agriculture. Some observers warned thatMC12 would be deemed a failure without some agreementon agricultural is sues. Talks have s talled in recent years, but members continue to exchangeviews in writing on issues, including public stockholding and special safeguard mechanisms for developing countries. Given renewed attention to lack of compliance with WTO notificationrequirements (e.g., on domestic support and export subsidies), some experts saw a transparency agreement as a feasible outcome for MC12. COVID- 9andWTOReactions In the wake of COVID-19, the WTO Director-General emphasized, Maintaining open trade and investment flows will be critical to protectjobs, prevent supply chain breakdown, andensure that vitalproducts do not become unaffordable for consumers. In early April, the WTO is sued its trade forecast, es timating a plunge in global trade in 2020, ranging from 13% to 32%. A recovery is expected in 2021, but the extent depends on the duration of the pandemic and countries' policy choices. For the latter, the WTO has emphasized the importance of transparency. WTO Agreements and Trade in Medical Products Several WTO agreements are relevant to health-related policies, such as technical barriers to trade, sanitary and phytosanitary meas ures, s ervices, and intellectual property rights. Others guide implementation of policies, including throughthe WTO's fundamental principle of nondiscrimination, as well as rules on subsidies. Specific commitments have contributed to liberalization of trade in medical products: (1) tariff negotiations during the Uruguay Round; (2) a plurilateral Agreement on Pharmaceutical Products, updated in 2011; and (3) the expanded plurilateral Information Technology Agreementin 2015. W TO negotiations and agreements have improved market access for medical products, but barriers remain. An April 2020 report by the WTO estimates $597 billion in annual .conigress.gov

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