By Kristin Dawkins <

Institute for Agriculture and Trade Policy Minneapolis, Minnesota

January 2000

U.S. Secretary of Agriculture Dan Glickman, back in 1997, called disputes over biotechnology and the patenting of life "the Battle Royale of 21st century agriculture." In Seattle during the closing month of the 20th century, the United States and its cohort of fellow exporters of genetically modified organisms (GMOs) fired their first shots in this battle and found that they fizzled. Not only did the World Trade Organization fail to launch a new round of trade talks, but proposals that the WTO even consider biotechnology issues never got out of brackets. (In international negotiations, any proposals still in brackets have not been agreed.) This could give a boost to efforts to negotiate a legally-binding Biosafety Protocol under the United Nations-based Convention on Biological Diversity.

The U.S. leads the world in producing GMOs and is desperate to protect its dominant position in the world grain market. Consumers in Europe, Japan and elsewhere object to GMOs in the food supply. Environmentalists fear the spread of genetically altered DNA throughout ecosystems could trigger potentially catastrophic problems. The market's reaction to these consumer and environmental concerns is causing many farmers in the U.S. to reconsider their plans to sow GMO seed next year, to the dismay of the agri-chemical-pharmaceutical industry that supplies them. In fact, the American Corn Growers Association is predicting a 20-25% reduction in the acreage planted in genetically-engineered crops this spring while agribusiness analyst Dan Basse of Chicago's AgResource Co. anticipates a drop in GMO-soybean plantings by more than half. In Seattle, the U.S. had joined Canada and Japan in proposing a WTO "Working Party on Biotechnology" whose mandate was unclear. The U.S. wanted it "to examine approval processes" for GMOs - taking dead-on aim at the European Union's array of national and regional restrictions on the import, planting and consumption of genetically engineered seeds and foods. Japan's proposal was to have a WTO Working Party look at the benefits of GMOs as well as health and environmental concerns, whether the WTO's existing agreements apply to GMOs, and how the WTO might appropriately deal with other international fora where GMOs are discussed (such as the Biosafety Protocol negotiations). Canada's proposal was for the WTO to assess the adequacy of existing rules and the capacity of WTO members to implement them. In response to these proposals, a large number of developing countries had objected to any WTO working party on biotechnology whatsoever. And indeed, the developing countries never gave in: the final version of the draft Ministerial Declaration to surface prior to the sudden announcement on December 3rd that the talks were suspended contained what was essentially the Canadian proposal for a Working Party on Biotechnology - but it was still in brackets.

The Europeans' role in negotiating the biotech issue in Seattle generated a storm of protest with implications for the future of European Union politics. On December 1st, it was learned that the lead negotiator for the EU, Commissioner Pascal Lamy, had voiced EU support for a Working Party without checking with the Heads of Delegations of the member states. Within hours, five Ministers of the Environment from EU members - Denmark, the United Kingdom, Belgium, France and Italy - issued a press advisory objecting to Lamy's position. Later that night, fifteen Ministers of Trade objected. Indeed, the EU's position until then had been that biotechnology should be dealt with by the United Nations through the Biosafety Protocol, not by the WTO. For Europeans, this issue has special significance given their ban on imports of beef laced with growth hormones has been attacked by the U.S. as a "barrier to trade" that is not "scientifically justifiable." The WTO dispute panel and appellate body agreed with the U.S. and, in the run-up to Seattle, EU attempts to include "the precautionary principle" as a justifiable consideration in WTO policies were rebuffed. In the Biosafety Protocol talks, the EU has considered the precautionary principle a non-negotiable clause in the draft text.

Despite the environmental and trade ministers objections, Lamy defended his support for the WTO Working Party on Biotechnology. In a briefing with non-governmental organizations on December 2nd, he said, "My job as a negotiator is how to get the maximum� I have to spend money to get money. I don't find it a problem if I can get what I need� At the end of the day, the Council [of Ministers] will make their decision." For the WTO, the issue is moot, for the time being, as officials struggle to define the legal status of the Seattle negotiations overall, but in Brussels there is surely a fierce debate raging over the democratic rights and responsibilities of the European Commission - and particularly, how it clears its mandate with member states in future negotiations.

Meanwhile, there is a strong consensus that the failure to launch a new

round of WTO trade talks is due to a deficit of democracy in WTO procedures. Those most frustrated by the Seattle debacle, probably U.S. Trade Representative Charlene Barshefsky who chaired this Third Ministerial Meeting and WTO Director-General Michael Moore, have been severely criticized for their handling of the meeting. Most analysts point the finger at their use of the infamous "Green Room" technique, by which the Director-General invites selected governments into a closed-door session designed to brow-beat them into a series of trade-offs to get results on the most contentious issues. While a tried and true technique in past trade negotiations, it backfired in Seattle. As a group of Caribbean countries put it, "as long as due respect to the procedures and conditions of transparency, openness and participation that allow for adequately balanced results in respect of the interests of all members do not exist, we will not join the consensus to meet the objectives of this Ministerial Conference." This sentiment was expressed by the governments of African and Latin American countries as well, foreshadowing by one full day the eventual announcement of December 3rd that the Seattle talks were ended. Calls for "transparency" have beleaguered the WTO for years. Ironically, the U.S. has most emphatically called for more transparent measures for non-governmental organizations (NGOs), such as earlier de-restricting of documents and their posting on the web, or permitting NGOs to submit amicus curiae briefs in proceedings of the WTO's dispute settlement body. Developing countries, suspicious of the U.S. proposals for transparency, insist that their own access to WTO processes be fulfilled before that of the NGOs. Beyond problems with the Green Room, developing countries suffer a disadvantage in WTO negotiations based on their relative capacity to send a full compliment of personnel. The U.S. sent some seventy or more official delegates to Seattle, while Chad and Cameroon fielded just three. When several meetings are convened at the same time, and negotiations go on around the clock, the short-handed delegations are in trouble. In yet another example, the head of the Kenyan delegation found out that a new text had been issued after a member of the press asked him about it! Upon requesting his own copy at the press center's copy room, this head of delegation was told he would have to ask the WTO Secretariat for a copy, since these facilities were reserved for the media! Despite these glaring flaws, the democratic deficit in Seattle and in the WTO generally is not the whole story. Significant substantive issues also enflamed the developing country delegations, such as the one-sided implementation of numerous agreements reached in 1994. Developing countries have published a litany of complaints regarding the rigid and destabilizing enforcement of Uruguay Round agreements benefiting the industrialized

sector and a systematic failure to implement agreements benefiting them. In the months preceding Seattle, acting as a united "Like-Minded Group," these developing countries staked out negotiating positions to remedy these matters. In Seattle, however, the U.S. and EU gave short shrift to these proposals, committing themselves merely to "examine with particular care" or "take note of concerns" or "prepare a recommendation" in response, or to make "more operational" or "more transparent" those matters already agreed. Other key proposals of developing countries were severely watered down during the Seattle negotiations. For example, led by the African Group, developing countries had drafted text amending the Uruguay Round Agreement on Trade-Related Aspects of Intellectual Property (TRIPs) so that all living organisms and their parts would not be patentable, and so the list of exceptions to patentability would include the list of essential drugs identified by the World Health Organization. In addition, their proposal referenced "the Convention on Biological Diversity and the International Undertaking on Plant Genetic Resources" and the duty to "ensure the protection of innovations of indigenous and local farming communities; the continuation of traditional farming processes including the right to use, exchange and save seeds, and promote food security." In the last draft to emerge in Seattle, however, WTO members were merely to "examine, in cooperation with other relevant intergovernmental organizations, the scope for protection�relating to traditional knowledge and folklore�and other legal means and practices, both national and international." Bienniel reviews of TRIPs, however, is part of the "built-in" agenda, so developing countries will be able to pursue these reforms in the future. At least President Clinton, no doubt due to the effective organizing of ACT-UP and other health-based NGOs, announced to the Seattle media that the U.S. will in the future respect other countries' implementation of WTO-legal alternatives to exclusive patents on essential drugs. Earlier in 1999, these groups had very publicly challenged Democratic presidential contender Al Gore for his attack on South Africa's national laws protecting lower prices for AIDS drugs by implementing compulsory licensing and parallel imports, two WTO-legal mechanisms to ensure competition in sectors vital to public health.

There is considerable doubt about what happens next. If the Seattle meeting was "suspended" rather than adjourned, what is the authority of the WTO's General Council, charged with deciding all matters in between the bienniel ministerials? And although Barshefsky and Moore declared, in calling for a "time-out" in the negotiations, their intention to "freeze" the results of the meeting up to the moment, others argue that WTO deals are constructed as a single package so nothing is agreed unless everything is agreed. That would mean that none of the agreements of Seattle - that is, not even the text issued throughout the week showing that some brackets had been successfully removed - would be brought forward. Then again, some critics of the Seattle fiasco have argued that Barshefsky was never even formally elected to chair the meeting in the first place, nor did she ever gavel the meeting formally to order! In such a case, the "built-in agenda" agreed at the end of the Uruguay Round of 1994 and restated at the First Ministerial Meeting of Singapore would seem to limit the scope of future negotiations, although the General Council has the right to negotiate anything at any time, subject to a consensus.

While the WTO and its various authorities dicker over how to proceed,the next meeting of the Biosafety Protocol negotiations takes place January 20-28, 2000 in Montreal. These talks were stalemated last February in Cartagena, Colombia, when the U.S. and five other GMOgrain-exporters refused to allow the Protocol to include genetically-engineered grains in its scope. However, the "after-Seattle" political context may be markedly different. There are at least five reasons why the negotiating dynamic in Montreal offers more promise now than it did before:

1) GLOBAL: As a result of the Seattle failure, it is now clear that the WTO has no mandate to negotiate beyond the "built-in agenda," which does not address biotechnology. This reinforces the mandate of the Conference of the Parties to the Convention on Biological Diversity (CBD) to conclude a Biosafety Protocol establishing binding international rules governing the transfer, handling and use of all GMOs.

2) NATIONAL: Efforts to negotiate the Biosafety Protocol heretofore have been stymied by the intransigence of the United States, Canada, Australia, Argentina, Chile and Uruguay. However, in Seattle, the initiative of the U.S., Canada, and Japan to create a WTO "Working Party on Biotechnology" were defeated. Even in the last draft of the Ministerial Declaration, this proposal remained in brackets indicating that most national governments rejected the WTO's taking on this agenda. Again, this strengthens the mandate as well as the political will of the rest of the world - more than 160 nations - to achieve a Protocol under the CBD.

3) IN EUROPE: In an astonishing display of public discord, European

Commission (EC) negotiator Pascal Lamy's support for the WTO biotech working party elicited opposing statements from five environment ministers and fifteen trade ministers of EU member countries. In the Biosafety Protocol negotiations, Europe's position has been that the Protocol should clearly indicate its superiority to the WTO in cases of conflict. Europe's internal debate over the respective roles of the EC and EU member states will likely strengthen the political will of the EU negotiators in Montreal.

4) IN THE U.S.: There is dramatic and rapidly growing opposition in the U.S. to genetically-engineered foods, and the media are picking up on it. Farmers are reacting to the uncertainty in the markets: The president of the American Corn Growers, for example, is actively campaigning to warn farmers of the risk they entail if they sow GMO-seed this spring. Environmentalists' concerns have been buttressed by university studies showing that corn engineered to genetically express the Bt toxin kills the larvae of monarch butterflies. The U.S. Food and Drug Administration has been sued for an alleged failure to protect public health from GMOs, and three public hearings - in Chicago, Washington DC, and Oakland, California - were flooded with protesters and testimony expressing concern about the FDA's inadequate safety testing. Furthermore, a number of the FDA's own staff scientists have expressed similar concerns. Meanwhile, legislation has been introduced in the U.S. Congress demanding labels on GMO foods, while Monsanto has been hit by a class-action suit by farmers. All of this may lead to changes in U.S. policy in the near term.

5. IN THE PRIVATE SECTOR: Last July, the highly-respected Deutsche Banc published a report entitled "Ag Biotech: Thanks But No Thanks!" warning investors that "European concerns are very real and not merely a trade

barrier." An appendix entitled "GMOs Are Dead" downgraded Pioneer Hi Bred stock to "sell" and predicted falling growth rates and valuations for the industry as a whole. In October, the European Commission proposed making permanent a moratorium in effect since 1990 against the use of genetically altered bovine growth hormone. Meanwhile, Japan, Korea, Australia, and New Zealand have joined the EU in demanding labels on GMOs. It may be that, rather than trying to accommodate varied national regulations, the biotech industry itself is ready for a coordinated international system.

All told, biotech is "the biggest issue in agriculture today" - as a

spokesperson for the U.S. delegation said in a briefing with non-governmental organizations in Seattle - and there is little doubt that agriculture has been the most troublesome issue facing the WTO negotiators since the beginning of the Uruguay Round in 1986. A legally binding Biosafety Protocol - embracing the precautionary principle for all genetically modified organisms, ensuring clear procedures to track their movements and to cover potential damages with strict liability - could resolve this thorniest of agricultural problems. Otherwise, the

GMO-protagonists must bear the responsibility for any number of trade wars on the brink, as they unconscionably choose to continue waging the especially costly and risky Battle Royale of the 21st Century.

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