The World Trade Organization (WTO) ministerial meeting in Yaoundé, the capital of Cameroon, ended this Sunday (29) without an agreement on key issues (reform, e-commerce, and agriculture), amid tensions between India, Brazil, and the United States (U.S.).
According to a report by Lusa, the moratorium on customs duties in digital trade, which had been in effect for 28 years, has come to an end, representing a painful setback for developed countries—led by the U.S.—that had been calling for its extension.
The moratorium in question affects goods or services produced, distributed, or marketed through digital means, such as e-books, music, videos, films, video games, as well as financial services, data services, advertising, courses, and many others.
“Although we tried very hard, we ran out of time,” declared WTO Director-General Ngozi Okonjo-Iweala early this morning, hours after the scheduled end of the 14th WTO Ministerial Conference, which was supposed to have concluded its work by midday on Sunday.
On Sunday, however, tensions arose, particularly when Brazil linked the negotiations on e-commerce to those on agriculture, in protest against the lack of an agreement in that area. But Brazil was not alone. According to several diplomatic sources, a number of countries were refusing to move forward with agricultural reforms without progress in the area of e-commerce.
WTO Faces Crisis Exacerbated by Global Protectionism
The 166 WTO members have been trying for years to establish a work program on agricultural negotiations.
The goal in the Cameroonian capital was to adopt a declaration laying the groundwork for continuing agricultural discussions at WTO headquarters in Geneva, Switzerland, but deep differences persist, with the U.S. seeking to relaunch agricultural negotiations based on new premises—an approach rejected by many developing countries, including India.
The ministerial meeting should, first and foremost, adopt an action plan to revitalize the institution, which has been weakened by geopolitical tensions, deadlocked negotiations, and rising protectionism, at a time when the war in the Middle East is disrupting global trade.
In particular, the organization has difficulty reaching agreements due to the consensus rule and needs to reform in several areas to emerge from a deep crisis that calls into question its central role in regulating international trade.
As at all ministerial conferences, countries negotiated the extension of a moratorium prohibiting tariffs on these transactions.
Concluded in 1998, it has been renewed approximately every two years at each WTO ministerial conference, but this time the organization’s 166 members failed to reach an agreement.
U.S. and India Take Opposing Stances on Digital Tariffs
The United States sought a permanent extension, a proposal that many developing countries—led by India—did not accept, as they feared a loss of tax revenue.
Okonjo-Iweala indicated that the matter will be revisited in Geneva, the organization’s headquarters, expressing confidence that the countries’ delegations will be able to reach an agreement given more time.
Washington had scaled back its expectations this week, and an agreement seemed to be taking shape on Sunday around a five-year moratorium, a proposal that Brasília rejected because it did not want to go beyond two years, as the Brazilian Ministry of Foreign Affairs explained on the social media platform X.
The WTO Director-General acknowledged that, in theory, new customs tariffs could be imposed on e-commerce within two days, but clarified that, in practice, countries need time to implement such a change and expressed confidence that, in the meantime, countries will reach an understanding.
