Trade talks stall amid US-India split over e-commerce
Diplomats say trade ministers are close to agreeing on a reform plan for the World Trade Organization as wrangling continues over extending the moratorium on tariffs on electronic transmissions such as digital downloads.
Discussions at the WTO meeting in Cameroon also include efforts to resolve differences between the United States and India over the extension of the e-commerce moratorium, which will expire in March.
The extension of the moratorium (first agreed to in 1998 as part of a declaration encouraging early growth in digital trade) is seen as a test of the WTO’s validity after a year of trade turmoil triggered by tariffs and major disruptions from the Iran war.
After initial resistance from some WTO members, the new draft of the reform roadmap provides a timeline for progress and lays out key issues that need to be addressed, according to a copy of the draft seen by Reuters.
These issues include improving decision-making in a consensus-based system, long blocked by a few countries, and trade benefits to developing countries.
The reform debate comes amid efforts to reform WTO rules to make subsidy use more transparent and facilitate decision-making.
The US and the EU argue that China, in particular, is taking advantage of existing rules to their own detriment.
Bringing the agreement reached by a subset of members aimed at increasing investment in developing countries into WTO rules also continued to be blocked by India; India said multilateral agreements risked eroding the organisation’s founding principles.
Alongside reform discussions, a senior diplomatic source, speaking on condition of anonymity, said there was a possibility that the e-commerce moratorium could be extended for four years.
Diplomats said India had indicated it would agree to a two-year extension on Friday, while another diplomat said there were suggestions that the US might agree to a 10-year extension.
U.S. Trade Representative Jamieson Greer said this week that Washington wants a permanent extension.
A new draft document on e-commerce seen by Reuters proposes a review clause as well as providing support to developing country members worried about losing tax revenue.
Business leaders say the extension is vital to ensure predictability, fearing taxes could be imposed otherwise.
It is also seen as key to securing US support for the global trade body.
“If the moratorium is not extended, the US will use it as an excuse to circumvent the WTO,” a senior diplomat said.
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