Qatar Seeks Private WTO Talks to Resolve Gulf Country Blockade

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By Bryce Baschuk

Qatar attempted to sidestep a volatile World Trade Organization showdown this week by asking WTO’s chief negotiator to help resolve the ongoing economic blockade of the Qatari peninsula.

Qatar sent a letter Sept. 13 to WTO Director-General Roberto Azevedo asking him to facilitate a mediation process known as “good offices” aimed at settling Qatar’s dispute with Bahrain, Saudi Arabia, and the United Arab Emirates, according to sources familiar with the matter.

Article 5 of the WTO’s dispute settlement understanding permits the director-general to serve as a neutral arbitrator in any dispute and use his “good offices” to reconcile members’ positions.

The move temporarily avoids an unprecedented WTO dispute over a country’s ability to defend its trade behaviors as a national security matter, although it remains unclear what the outcome of the talks will be.

Spokesmen for the WTO, Bahrain, Qatar, Saudi Arabia, and UAE did not respond to Bloomberg BNA’s requests for comment.

National Security Dispute

The development comes six weeks after Qatar filed requests for consultations with the Persian Gulf countries that alleged their closure of all land, sea, and airport links to the Qatari peninsula violated international trade rules.

Bahrain, Saudi Arabia, and the UAE in response refused to engage in consultations, claimed that Qatar sponsored terrorism, and argued their trade restrictions were necessary to protect national security interests as permitted under WTO rules.

Certain provisions of the WTO’s core trade agreements — Article 21 of the General Agreement on Tariffs and Trade and Article 14 of the General Agreement on Trade in Services — provide members with broad flexibilities to enact trade measures that protect their national security.

Countries generally have eschewed the use of the WTO’s national security exemptions in defending their foreign trade restrictions for risk of sparking tit-for-tat trade retaliation.

Confidential Discussions

Qatar’s request for a confidential mediation is a politically palatable route for the WTO’s top brass, which have privately fretted about a growing preoccupation with trade-related national security measures.

Earlier this year President Donald Trump threatened to impose tariffs on foreign steel imports in the name of protecting U.S. security interests.

In addition, China cited security concerns to defend its new cybersecurity law, and a dispute between Russia and Ukraine has the potential to evolve into a national security dispute.

Good-offices consultations have been used by previous WTO directors-general to help resolve longstanding feuds like the EU-Latin American dispute over import tariffs on bananas.

These consultations are confidential and involve high-level discussions to help resolve the dispute without forcing the WTO’s dispute settlement mechanism to evaluate the legal merits of a case.

Any party to the good offices talks may terminate them at any time after which a complainant is permitted to seek a WTO panel to investigate the dispute.

To contact the reporter on this story: Bryce Baschuk in Geneva at correspondents@bna.com

To contact the editor responsible for this story: Jerome Ashton at jashton@bna.com

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