Development Issues in the WTO in the Post-July Package Period: Myth or Reality?
Item
- Title
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Development Issues in the WTO in the
Post-July Package Period:
Myth or Reality? - extracted text
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Trade & Development Series
Development Issues in the WTO in the
Post-July Package Period:
Myth or Reality?
Bonapas Onguglo
Third World Network
27
Development Issues in the WTO in the
Post-July Package Period: Myth or Reality
Bonapas Onguglo
twn
Third World Network
Development Issues in the WTO in the Post-July Package Period:
Myth or Reality?
is published by
Third World Network
121-S, Jalan Utama
10450 Penang, Malaysia.
© Third World Network. 2005
2
Printed by Jutaprint
Solok Sungei Pinang 3. Sg. Pinang
11600 Penang, Malaysia.
ISBN: 983-2729-49-1
CONTENTS
Note
Acknowledgement
1
Introduction
/
2
GATT 1947 to WTO 1995
2.1 GATT 1947
2.2 WTO 1995
3
3
From Singapore to Doha and Cancun
7
4
The July Package and Issues at Stake
4.1 The Decision and Changing Perceptions
4.2 Development Issues at Stake in the Lead Up to Hong Kong
and Beyond
a) Special and Differential Treatment
b) Technical Assistance
c) Implementation
d) Other Development Issues
e) Least-Developed Countries
12
12
Conclusion
58
5
3
5
19
22
44
47
50
56
NOTE:
Bonapas Onguglo is an Economic Affairs Officer in the Division on Interna
tional Trade in Goods and Services and Commodities, UNCTAD Secretariat.
The views expressed in this paper are the author’s and do not necessarily reflect
the views of the UNCTAD Secretariat. He can be contacted at
bonapas.onguglo@unctad.org
ACKNOWLEDGEMENT
I am indebted to my colleagues in UNCTAD, particularly Lakshmi Puri and
Mina Mashayekhi who have inspired me in preparing this report by their tire
less commitment in advancing trade and development issues from the perspec
tive of developing countries.
1 am also grateful to Taisuke Ito from UNCTAD and Rabson Wanjala in the
Permanent Mission of Kenya to the United Nations and WTO in Geneva for
their comments on the initial draft of the paper.
Martin Khor from Third World Network continuously kindles the flames of
development issues in trade negotiations and this has helped me to sharpen my
focus on issues regarding the trade agenda of the South.
1 Introduction
Addressing development issues in the WTO in the post-July Package period so
as to mainstream development into the multilateral trading system (MTS) is a
key challenge facing WTO Members and the international community at large.
Missed deadlines in the Doha Work Programme (DWP) on most “development
issues”, juxtaposed against the emphasis placed on the needs and interests of
developing countries have raised the stakes for substantive, commercially mean
ingful and development-oriented results.
Linkages with the Millennium Declaration and internationally agreed goals re
garding the contribution of trade to development and poverty reduction have
further heightened the political move internationally for the attention given to
development to be carried out in practice.
This paper examines whether mainstreaming development into the WTO and
the MTS is a myth, a fiction, or is it a reality, a fact that can be realised to meet
the expectations of developing countries. Can the spirit of Doha, which launched
a new round of negotiations and work with an explicit pledge to deliver devel
opment-friendly results, be redeemed?
This is a major challenge and opportunity as positive results would rectify some
of the development shortfalls of the Uruguay Round, mainstream development
into the WTO as a central principle, and provide development-enhancing rights
and obligations that would enable the entire membership to use multilateral
trade liberalisation and rules as a facilitating engine of trade as well as of devel
opment and poverty reduction.
The July 2004 Package adopted by WTO members provides some hope in this
direction, but it needs to be translated into concrete steps in the period leading
to the 6th WTO Ministerial Conference and beyond. This is especially pertinent
in view of the lack of substantive progress in meeting the interim deadlines set
in the July Package to draft the July 2005 first approximations and clear recom
mendations on development issues.
2
2 GATT 1947 to WTO 1995
2.1
GATT 1947
In the pre-WTO period of GATT 1947, “development issues” were somewhat
synonymous with special and differential treatment (SDT) that was instituted at
the genesis of the GATT. In the late 1940s, it was recognised that some flexibil
ity was needed for the contracting parties of GATT at early stages of industrial
isation, mostly developing countries.
Thus GATT Article XVIII on “Governmental Assistance to Economic Devel
opment” was fashioned to (a) permit developing countries to grant tariff protec
tion required for the establishment of a particular industry (akin to infant indus
try argument), and (b) to apply quantitative restrictions for balance of payment
purposes.
GATT Article XXV (waiver provisions) also provided some scope for coun
tries to engage in staged (rather than full scale) tariff liberalisation. Likewise,
GATT Article XXIV permitted countries to engage in regional trade agree
ments and customs unions and offered to one another better than MFN treat
ment as long as such treatment was not prejudicial to the trading interests of
third parties.
On 8 February 1965, Part IV of the GATT on Trade and Development was
added (and entered into force on 27 June 1966), introducing the element of
“non-reciprocity” for developing countries in multilateral trade negotiations. It
was introduced after a period of discussion and work by the contracting parties
on ways of improving the weak performance of developing countries in inter
national trade, based on the "Haberler Report”.'
Such work on special measures for developing countries also benefited from
the intergovernmental deliberations that resulting in the creation of UNCTAD
in 1964. Then from the Tokyo Round emerged the most classical development
provision of the GATT/WTO, namely the Enabling Clause or the Decision of
28 November 1979 on ’‘Differential and More Favourable Treatment, Reci
procity and Fuller Participation of Developing Countries.
The Enabling Clause further consolidated the SDT acquis of GATT 1947 and
provided developing countries with “differential and more favourable treatment”
in respect of trade preferences (without reciprocating) legalising the provision
of GSP (Generalised System of Preferences), their mutual regional trade agree
ments, and special treatment for LDCs. Significantly, it provided that in re
forming existing rights and obligations or elaborating new disciplines, these
should be “designed and, if necessary, modified to respond positively to the
development, financial and trade needs of developing countries.”
SDT provisions of GATT 1947 provided important flexibility to developing
countries in undertaking and implementing multilateral obligations so as to use
trade policy as an instrument of development. It was recognised that there can
not be full reciprocity between trading partners that are unequal in terms of
economic size, industrial capacity and services development, entrepreneurial
capacity, technological advancement, market power and various vulnerabili
ties. In such situations of unequal competition, having uniform one-size fits all
rules and disciplines would operate to the benefit of the stronger, competitive
partner and to the detriment of the weaker, less competitive partner creating a
vicious cycle of dependency and poverty in these countries and undermining
their effective participation in and support for the MTS.
1 The Haberler Report was prepared by a panel of experts comprising Gottfried Haberler as chairman, and Jan
Tinbergen as a member, submitted the report on “Trends in international trade”, particularly ol developing coun
tries. at the request of the contracting parties of GATT at their twelfth session held in November 1957.
4
Hence policy flexibility was provided to protect infant industries, and to apply
quantitative restrictions when faced with balance of payment difficulties. Flex
ibility in undertaking tariff liberalisation commitments was also provided by
way of not reciprocating in trade negotiations, benefiting from unilateral pref
erences offered under the GSP, engaging in regional trade agreements, and LDCs
could benefit from special treatment additional to those available to developing
countries. Moreover, developing countries were not obliged to participate in
any of the agreements or codes of the GATT.
2.2 WTO 1995
The Uruguay Round and the resultant WTO Agreements brought in many
changes and innovations. With respect to SDT, the Uruguay Round results eroded
the principle of SDT as established under GATT. SDT was redefined mostly as
a transitional device, and specific to each agreement, so as to ensure implemen
tation of the agreement under the single undertaking principle which in itself
removed the option of d la carte participation. These included transitional peri
ods (most of which have expired), certain flexibility arising from exemptions
and different thresholds in certain cases and primarily for LDCs, special treat
ment of LDCs and best endeavour undertakings including for technical assis
tance.
National policy space was also curtailed by the TRIPS Agreement, TRJMs
Agreement, prohibition of industrial subsidies, tightening of the waiver provi
sions, and measures to rein in regional trade agreements, among others. These
innovations capped, and in some cases weakened, the flexibility that was pro
vided under the various GATT Articles, Part IV and the Enabling Clause even
though these instruments were integrated into the WTO Agreements. Again, as
under the GATT 1947, SDT was equated with the “development” orientation of
the new MTS and the WTO.
It appeared that SDT was not integral to the architecture of the new MTS - it
became a casualty of the movement towards emphasising reciprocity and less
of the favourable and more differential treatment for developing countries, so
5
as to bolster the MTS and its cardinal principles of MFN and national treat
ment. There was one notable exception of the GATS which provides develop
ing countries with the flexibility to take into account their development inter
ests and to make commitments accordingly.
6
3
From Singapore to Doha and
Cancun
The lacuna in the WTO and the MTS in addressing “development issues” be
came immediately apparent in the post-WTO period. Starting at the first WTO
Ministerial Conference (MC) in Singapore in 1996, an attempt was made by
mostly developed countries to launch a new, comprehensive round of negotia
tions based on the built-in agenda negotiations under the agriculture and ser
vices agreements, and the introduction of the four so-called Singapore issues.
This became very evident during the preparatory process for the Seattle MC in
1999. Developing countries in contrast heavily resisted the attempts to launch a
new round even as some proposals were made to call it the Millennium Round
or the Development Round.
These developing countries, particularly African countries, began to realise when
implementing their obligations and commitments under the WTO that the re
sults of the Uruguay Round were heavily imbalanced particularly in terms of:
(a)
(b)
(c)
onerous obligations for developing countries with limited implementing
capacity and financial support;
erosion of policy space leading to insufficient flexibility for developing
countries to implement policy options necessary for achieving their devel
opment goals, contrasted with weakened SDT; and
lack of coherence and consistency between some of the multilateral rules
and disciplines that were adopted during the Uruguay Round, and trade
and other economic policies that were pursued by individual developing
countries at the national level.
As a result of these imbalances, developing countries were faced with many
implementation problems and concerns arising from WTO Agreements, and in
turn, denying them some expected benefits with some countries, particularly
those from Africa, experiencing stagnation in economic growth. Conversely, it
was felt that developed countries continued to reap a disproportionate share of
the benefits arising from the Uruguay Round of multilateral trade negotiations,
and were even proposing a new round to further consolidate such gains. Thus
between Singapore and Seattle, developing countries emphasised the need to
address implementation-related issues and concerns, encompassing also SDT,
while developed countries tended to emphasise the launching of a new round to
address new issues and deepen the liberalisation process under the WTO
During the Seattle MC preparatory process, developing countries put forward
some 100 specific implementation problems and concerns that needed to be
addressed for them to be better able to implement their obligations and, more
importantly, benefit from the inherent rights in the WTO Agreements. They felt
that the Seattle MC provided the opportunity to redress the past imbalances and
not to launch a new round of trade negotiations. Further, it was emphasised that
multilateral trade rules and disciplines were not an end in itself, but should
serve as a means of facilitating the participation of particularly developing coun
tries in international trade and their eventual beneficial integration into the world
economy. Multilateral rules should contribute to the development of develop
ing countries, in addition to expanding their trade. It was the insistence of de
veloping countries that their implementation problems and concerns should be
resolved as a matter of priority which also contributed to the failure of talks at
the Seattle MC.
After the setback of the Seattle MC. there was an attempt to address implemen
tation problems and concerns of developing countries as a way of building the
confidence of the developing countries in the MTS. However progress was very
slow and the achievements were minimal until the 4th WTO MC at Doha when
developing countries accepted the launch of a new comprehensive round based
on the promise that their implementation problems and concerns, combined
with strengthening of SDT, would be addressed on a fast track basis within the
8
overall framework of the Doha Work Programme (DWP). Further, at that time
the world economy was experiencing a recession aggravated by the 11th Sep
tember, 2001 terrorist attacks in the United States. WTO members, therefore,
felt that there was need to launch a development round that would redress the
past imbalances and also inject new momentum in the world economy. Mo
mentum for a new round was also facilitated by evolving consensus on a deci
sion on TRIPS and public health to address the pandemics prevalent in many
developing countries.
The Doha Ministerial Declaration (DMD) adopted by the Doha MC was mo
mentous in the history of GATT/WTO in terms of providing specific directives
on the integration of “development issues” into the WTO and the MTS. The
WTO membership agreed to place the needs and interests of developing coun
tries at the heart of the work programme that was launched.2 A declaration was
adopted on the TRIPS Agreement and public health, a decision on implementa
tion-related issues and concerns, and a decision on the waiver for the EC-ACP
Partnership Agreement, all key development issues linked to trade for develop
ing countries.
That “development” was given central attention in the new round led to the
Doha work programme being coined the “Doha Development Agenda” or
“DDA”. However, only when the round has been completed with development
enhancing results can the round be deserving of its appellation as the “Doha
Development Agenda,” i.e., the DDA, with the middle “D” being justified. The
final destination has not yet been reached and the journey so far has been full of
broken promises and missed deadlines, including most recently, the July 2005
approximation deadlines.
Following the adoption of the DWP and the start of its implementation, issues
of particular interest to developing countries encountered resistance from other
members. Indeed the deadlines set out in the Doha Declaration and subsequent
ones on SDT, TRIPS and Public Health, and outstanding implementation issues
2
Sec paragraph 3.
9
were missed due to lack of commitment particularly on the part of the devel
oped countries. Instead issues of interest to developed countries such as the
Singapore issues and industrial tariff negotiations were given undue promi
nence in the negotiations. Implementation-related issues and concerns which
were prioritised by the DWP after the Seattle setback were neglected and no
substantive progress was made on them.
This state of affairs disturbed the balance achieved originally in the DWP that
development issues represented by implementation issues and SDT will be re
solved first and only then will developing countries engage in and make con
cessions in market access and rules negotiations. Developing countries became
even more disillusioned and strongly resisted attempts to attain explicit con
sensus on negotiations on the Singapore issue.
In an attempt to rescue the Cancun MC, Members acting through the WTO
General Council agreed on the eve of the MC on 30 August 2003 to a Decision
on the “Implementation of paragraph 6 of the Doha Declaration on the TRIPS
Agreement and public health”.3 The Decision provides legal changes that will
make it easier for developing countries to import cheaper generic drugs made
under compulsory licensing if they are unable to manufacture the medicines
themselves. Despite this last minute positive step, it was not sufficient to pro
mote agreement among Members on the wider package being developed and
this contributed to the collapse of talks at the Cancun MC.
After Cancun, the lack of consensus on many critical issues persisted despite
the numerous consultations that were held among the Members. Wide diver
gences on many issues under negotiations raised serious concern as to whether
WTO Members were committed to the effective implementation of the DWP
and its development agenda. Political guidance particularly on agriculture, cot
3 The effect of the Decision, as significant as it was, is somewhat limited as it was adopted in the light of a
statement read by the Chairman of the General Council (see WTO document JOB(03)/177). This statement
reflects several key understandings by Members on the Decision, its interpretation and implementation aimed at
assuring those who feared that the Decision might be abused and undermine patent protection.
10
ton, non-agricultural products and development issues were found necessary in
order to move the process of negotiations forward.
A number of informal Mini-Ministerial meetings were held and the outcomes
fed into the Geneva process. Also the UNCTAD XI preparatory process and the
Conference itself provided important stimulus to the Geneva negotiating pro
cess by promoting general understanding and consensus between the Group of
77 and other countries on the contribution of international trade and trade nego
tiations to assuring development gains for all countries. Various initiatives were
discussed by trading partners to reach agreement on the way forward. For ex
ample, the EU offered in the Lamy/Fischler letter a concept of “round for free”
under agriculture and NAMA negotiations for “weak or vulnerable developing
countries” essentially the G-90 (LDCs, Africa, ACP States). Finally on 1 st August
2004 a Decision was taken by the WTO General Council which provided a
positive basis for the next phase of the negotiations.
11
4
The July Package and Issues at
Stake
4.1 The Decision and Changing Perceptions
The 1 August 2004 Decision4 (hereinafter Decision) contains the July Package
re-launching the negotiations and work under the Doha round after the Cancun
setback. In doing so. it re-establishes its viability, and enhances its chances of
being concluded, not in early 2005 as originally envisaged, but much later. In
this regard, the Decision seems to imply that the round could be completed by
the 6th WTO Ministerial Conference (MC), scheduled for 13-18 December
2005;5 however caution has been expressed by the WTO Director General and
some major trading partners that the 6th MC should not be viewed as the end
date for the round. Rather every effort should be made to achieve substantial
progress by the 6th MC and conclude the round some time in 2006, and prior to
the 7th MC. This provides the expected timeframe within which negotiations,
including on development issues, can be expected to be completed. Indeed,
there is an evolving international consensus that the Doha negotiations should
be concluded by 2006, as recommended for example by the Sachs Report, Blair
Commission report and the UN Secretary General.
Apart from the fact that much remains to be accomplished in terms of the spe
cifics on the frameworks and recommendations in the Decision and other as
pects of the DWP, other factors can cause a delay in the negotiations in reaching
4 WT/L/579 (2 August 2004).
5 Paragraph 3 of the Decision gives this impression by stating that “The [WTO General] Council agrees to
continue the negotiations launched at Doha beyond the timeframe set out in paragraph 45 of the Doha Declara
tion, leading to the Sixth Session of the Ministerial Conference.”
the new deadlines set in the July Package. One such factor is the relentless
move towards regional trade agreements by all countries, mostly as an insur
ance policy against limited market access openings at the multilateral level.
Some apprehension also surfaced regarding the focus of attention (away from
negotiations) on the election of the new WTO Director General, and the instal
lation of the new US administration and new EC administration and the setting
of their priorities on international trade. In retrospect such fears were ground
less as the negotiations post-July Package progressed and there had been re
newed expressions of commitment to the round.
Several mini-Ministerial meetings were held in 2005 to enhance common un
derstanding and create a critical mass of consensus among some members on
various market access modalities and recommendations. However it can be
recalled that the Seattle MC took place just after a change of guard at the head
of the WTO. Mr. Mike Moore had just been selected as Director General of the
WTO and took office on 1 September 1999, leaving him with barely two months
to assist Members in finalising the MC preparations. A similar situation is aris
ing with regard to the 6th MC. Mr. Pascal Lamy, the 5th Director General of
WTO, started work on 1 September 2005 and has just over three months to
guide WTO members in meeting the commitments in the July package at the
6th MC which would set the basis for an expeditious conclusion to Doha nego
tiations, after missing the original one.
It can be recalled that in the history of the GATT 1947, the longest and most
ambitious round was the Uruguay Round which took over eight years to com
plete. The Doha round is the first multilateral trade negotiations round to be
conducted under the WTO, and has over lasted three years (up to September
2005). Re-launching the Doha round is important for developing countries since
they have much to lose from a failure - a failure, would mean a lost opportunity'
in mainstreaming “development” into the heart of the MTS. The Decision “re
dedicates and recommits Members to fulfilling the development dimension" of
the DWP. It is also important in that it reaffirms the value of multilateralism and
can help contribute to arresting the growing protectionist tendencies,
13
unilateralism and security measures having considerable negative impact on
trade flows from developing countries.6
The Decision thus serves as a good launching pad for further negotiations under
the Doha round. Such general endorsement of the Decision emanated from the
comprehensive intergovernmental review of the Decision and the July Package
undertaken by the 51st session of UNCTAD's Trade and Development Board
on 8 October 2004.7 The background document provided by UNCTAD for this
meeting provides an insightful analysis of the July Package and the develop
ment implications for developing countries.8
In the period leading to the Hong Kong MC. WTO Members have to come up
with specific, elaborate and detailed elements of the frameworks and recom
mendations. For this process to be beneficial to developing countries in ensur
ing fair, equitable and development-oriented outcomes, several broad condi
tions are important. These include:
(a)
(b)
(c)
the need to prioritise and make concrete progress in addressing the devel
opment needs and interests of developing countries, including in core mar
ket access issues and rules so that the results are commercially meaningful
and development enhancing;
achieve a participatory approach to the negotiations and decision making
process that is transparent and inclusive; and
ensure that the MTS enhances, and not hinders, the ability of developing
countries to adopt trade policies and measures that will enable them to
achieve development and reduce poverty. This “policy space” has to be
reflected, if not in letter, then in spirit in the negotiations and the resulting
obligations and rights.
6 A comprehensive review of the Decision and July Package has been conducted by UNCTAD. See secretariat
note on “Review of development and issues in the Post-Doha work programme of particular concerns to develop
ing countries: A post-UNCTAD XI perspective” (TD/B/51/4, 31 August 2004).
7 See the President of the Trade and Development Board’s summary' of the deliberations by UNCTAD Member
States on the July Package (secTD/B/51/L.8).
8 UNCTAD secretariat. TD/B/51/4.
14
The focus on development in the MTS is important for positive movement to
wards the commitment that the world Heads of State and Government adopted
in the Millennium Declaration on an open, equitable, rule-based, predictable
and non-discriminatory multilateral trading system that contributes to develop
ment and poverty eradication.9 The need to incorporate development in trade is
gaining momentum worldwide. For example, in his address to the 59th session
of the UN General Assembly in December 2004, Mr. Gordon Brown, Chancel
lor of the Exchequer (United Kingdom) advocated a new approach to trade that
is development enhancing and eradicates poverty. The new approach proposed
comprises a triple track as follows:
"First, it is time for the richest countries to show we believe in fair trade, agree
to open our markets, remove trade-distorting subsidies and in particular, do more
to urgently tackle the scandal and waste of the European Common Agricultural
Policy.
Second, it is time to move beyond the old Washington consensus ofthe 1980s and
recognise that while bringing down unjust tariffs and barriers can make a differ
ence. developing countries must also be able to carefully design and sequence
trade reform into their own poverty reduction strategies.
And third, because it is not enough to say to the poorest countries “you 're on
your own, simply compete " we have to say "we will help you build the capacity
you need to trade " — not just opening the door but helping you gain the strength
to cross the threshold. .... I know that developing country governments them
selves recognise that it is important to create the right domestic conditions for
trade and commerce - a stable economic environment, improved infrastructure,
and sound legal processes that strengthen property rights and deter corruption.
But we also have to recognise at the same time that the poorest countries will
need additional resources both to build the economic and infrastructure capacity
to take advantage of trading opportunities and to prevent their most vulnerable
people from falling further into poverty’. ”
9 General Assembly resolution A/RES/55/2, paragraph 13.
15
The emphasis on trade, development and poverty eradication by Mr. Brown
follows similar exhortations by other eminent personalities. Mr. Kofi Annan,
the UN Secretary General, has persistently called for practical trade policy
measures and initiatives that can contribute substantively to development in the
poorest countries. For example, his statement to the 5th WTO Ministerial Con
ference at Cancun emphasised, inter alia, the need for additional resources for
trade - i.e., additional to resources for development - so that one is not done at
the expense of the other.10 Some aspect of this recommendation is evident in the
third pillar of Mr. Brown's new trade deal. In his report in March 2005 on
follow-up to the Millennium Summit entitled “In larger freedom: Towards de
velopment, security and human rights for all”,11 Mr. Annan advocated that the
Doha negotiations should fulfill its development promise and be expeditiously
concluded no later than 2006. He underscored that the first step in this direction
of development is for all countries to provide duty-free, quota-free treatment
for all exports of LDCs.
In June 2004. Mr. Joseph Stiglitz and Mr. Andrew Charlton produced for the
Commonwealth Secretariat a publication on “An Agenda for the Development
Round of Trade Negotiations in the Aftermath of Cancun". They argued that
“development”, not trade, should be the motivating force of the Doha round
and to that end measures that would enable developing countries to effectively
promote development through trade should result from the Doha negotiations.
Notably in the preparatory process for, and at the eleventh UNCTAD Confer
ence (June 2004), member States discussed and adopted commitments relating
to the Doha negotiations which underscored the importance of a “qualitative”
integration of developing countries into the MTS. in addition to purely “quanti
tative” integration. This is encapsulated in the appellation of the sub-theme on
10 Message of the UN Secretary-General. Mr. Kofi Annan. Delivered by Mr. Rubens Ricupero. Secretary-Gen
eral, UNCTAD (WT/MIN(03)/12, 10 September 2003). Specifically, Mr. Annan expressed that "There is a need
for synergy and proper sequencing between the capacities of the developing countries, the level of obligations
they arc to take on. the cost of implementation, and the adequacy of financial and technical resources available to
them. Developing countries need aid for trade, and such aid must not come at the expense of aid for develop
ment."
" A/59/2005 (21 March 2005)
16
“assuring development gains from the international trading system and trade
negotiations” - trade leading to gains that are financial and that are welfare
enhancing.12
Equally important, the WTO membership appears to be paying heed to adher
ing to the development promise of Doha enshrined in the Doha Ministerial
Declaration of placing the needs and interests of developing countries at the
heart of the DWP. The July Package is replete with recommendations on “de
velopment issues”. It provides a definition of what “development issues” are.
Significantly for the negotiations and rule-making within WTO generally, the
modalities adopted for trade facilitation provide that developing countries will
not be required to implement commitments beyond their implementation ca
pacities for undertaking investments in infrastructure projects and every effort
will be made by developed countries to ensure the necessary support and assis
tance, including provision of investment, to developing countries in implement
ing the trade facilitation commitments.
In early 2005, three prominent reports were released almost simultaneously
(after several years of comprehensive work by and in-depth reflection) with
different messages on development issues in the MTS. These are the United
Nations Millennium Project (UNMP) Report entitled, “Investing in Develop
ment: A Practical Plan to Achieve the Millennium Development Goals, di
rected by Professor Jeffrey Sachs, released in January; the Report of the Con
sultative Board of the WTO Director General (Dr. Supachai Panitchpakdi) on
“The Future of the WTO: Addressing Institutional Challenges in the New Mil
lennium,” chaired by Mr. Peter Sutherland (former Director General of GATT),
released also in January; and the Commission for Africa (Blair Commission)
Report entitled “Our Common Interest”, released in March.
The Sachs Report on follow up to the Millennium Declaration underscores the
development dimension of the MTS. It calls for SDT measures to be more ef
12 See Report of the United Nations Conference on Trade and Development on its Eleventh Session (TD 412, 20
August 2004)
17
fective and operational which is in line with the ambition of the Doha Declara
tion. At the same time, it cautions that SDT should be focused (not extensive)
and not applied across-the-board to developing countries but to those that need
them. The Report proposes a cost/benefit analysis to determine what SDT to
grant and to whom on the basis of four factors, namely: (i) market access-re
lated (ii) consistent with development priorities (iii) implementation costs and
(iv) relative costs to others of non-implementation. The Report also suggests
that concrete technical and financial assistance should be assured, including via
mandatory (i.e.. binding) commitments integrated into WTO rules ex ante. This
is further strengthened by the suggestion for an “aid for trade” fund to deal with
adjustment costs of liberalisation. But fundamentally, the report suggests im
plicitly that SDT is a transitional measure that should expire as the world moves
towards complete free trade by 2025 with universal enforcement of reciprocity
and non-discrimination.
The Sutherland Report on the reform of the WTO describes SDT as a threat
to non-discrimination and the non-reciprocity principle. It also states that SDT
is no longer relevant as its underlying assumptions are no longer valid in the
light of the emergence of so-called “advanced” developing countries (thus ob
viating the need for blanket non-reciprocity coverage), and that discriminatory
(non-reciprocal) market access tools like the GSP and other preferences basi
cally have been ineffective but have undermined non-discrimination (leading
to a situation in which the norm seems to be “least”, rather than the “most”
favoured nation treatment). Thus, the report suggests that SDT should be avoided,
even for LDCs as they must undertake a minimum of commitments. It however
recognises that liberalisation will make adjustments necessary, and these ad
justment costs must be borne by the liberalising system, including being spe
cifically included in new agreements as binding commitments. So there should
be no special treatment in trade liberalisation rules, but some adjustment sup
port can be provided to help developing countries meet their obligations.
The Blair Commission Report makes a fervent call for development-related
provisions and features of the WTO to be made to work better so that the ex
pected development impact can be realised, especially in African countries. In
18
this regard, the report emphasises the principles of fairer trade including in the
WTO. Such goals should include building African capacity to trade; providing
assistance with adjustment for trade liberalisation reforms; trade liberalisation
reforms should be consistent with poverty reduction and development objec
tives of countries, rather than on purely mercantilist precepts; making trade
preferences actually work, including by providing immediately duty-free and
quota-free market access to all exports from low-income sub-Saharan African
countries;13 and making SDT actually work.
4.2 Development Issues at Stake in the Lead up to Hong Kong and
Beyond
The journey from Singapore (1996), to Seattle (1999), to Doha (2001), to Cancun
(2003) to Sao Paulo (June 2004) at the UNCTAD XI Conference and to Geneva
(July/August 2004 and July 2005) has revealed that while it is important for
“development” to be recognised and accepted that it is the leitmotif for the
Doha work programme, this recognition must be transformed into reality, into
tangible results. The August 2004 Decision provides some reassurance that ef
forts may be expanded to address the “development issues”. It affirms “devel
opment” as central to the Doha negotiations. In paragraph 1(d) of the Decision
on “Development”, the following “principles” were articulated:
•
•
•
That development concerns form an integral part of the Doha Ministerial
Declaration.
That Members are rededicated and recommitted to fulfilling the develop
ment dimension of the DWP.
That enhanced market access, balanced rules and well targeted, sustainably
financed technical assistance and capacity building programmes can play
an important role in the economic development of developing countries
and LDCs.
” For an insightful discussion on potential gains from duty-free, quota-free treatment of LDCs and possible
mechanism to make such preferences work including suggestions on WTO instruments to making the provision
of preferences binding and thus secure and predictable, see Lakshmi Pun. “Towards a new trade “Marshall Plan’
for Least Developed Countries: How to deliver on the Doha development promise and help realise the UN
Millennium Development Goals” (UNCTAD/D1TC/TAB/POV/2005/1).
19
The Decision then identifies the following five sets of development issues (thus
giving them certain priority): (a) SDT (b) Technical Assistance (c) Implemen
tation (d) Other Development Issues, and (e) LDCs. This demarcation of devel
opment issues in the Decision provides the most specific categorisation so far
in the WTO of such issues. This is significant also because it clarifies the ambi
guity that surrounded development issues in the past, when such issues were
basically equated with SDT issues. It establishes that development issues in the
WTO and the MTS include SDT. implementation and other issues.
The “other development issues” in the Decision bring new progress in the defi
nition of development issues by asserting that "special attention shall be given
to the specific trade and development related needs and concerns of developing
countries, including capacity constraints” in the ongoing market access nego
tiations. These include food security, rural development, livelihood, preferences,
commodities and net food imports, as well as prior unilateral liberalisation,
which should be taken into consideration, as appropriate, in the course of the
Agriculture and NAMA negotiations. Under this rubric, specific mention is
also made of the need for the fuller integration of small, vulnerable economies
into the multilateral trading system, without creating a sub-category of coun
tries.14
The notion of “other development issues” codifies the new concept into the
development jargon in WTO. namely that development issues should respond
to the specific and unique concerns of different developing countries. Members
also reached agreement to deal specifically with cotton, within the context of
agriculture negotiations, which was an important result.
Broadly, the Decision provides specific deadlines for progress in SDT. It paves
the way to addressing effectively and expeditiously (by July 2005) the core
development issues of SDT in legally enforceable manner. The Decision also
provided for a July 2005 deadline with respect to implementation issues and
14 This repeats the mandate in paragraph 35 of the Doha Ministerial Declaration, but in doing so it identifies it
as a priority development issue to be tackled.
20
concerns of developing countries in the negotiations. This a crucial test for the
development dimension of the MTS. These issues, it must be recalled, where
supposed to have been addressed first in the Doha round before going into mar
ket access negotiations. They never were and were continually down-graded.
As regards technical assistance, LDCs, trade-related issues for small, vulner
able economies, the Decision makes general exhortations (best endeavour type
promises) that basically renew the determination of Members to fulfill the com
mitments made in the DWP.
The focus on “development” is an encouraging step especially as it can be re
called that in the immediate post-Cancun period, consultations among WTO
Members on revitalising the Doha round concentrated on four issues, namely
agriculture, NAM A (non-agricultural market access), Singapore issues and cot
ton. Development issues were not part of these priorities. The fact that develop
ment finds expression in the Decision and the July Package and is given signifi
cance, provides optimism that addressing those issues many be realistically
possible in the period ahead under the DWP.
Such optimism however was yet again undermined by a lack of substantive
progress in attaining a harvest of development related issues, particularly SDT
provisions in respect of LDCs which many Members felt would be the easiest
to address by the time of the July 2005 approximations.1516
This unfortunately
recurring state of affairs with development issues is indicative of deep diver
gences among the proponents and opponents to the issues notwithstanding the
mandate in the Doha Ministerial Declaration and the August 2004 Decision.
The Report by the Chairman of the WTO Trade Negotiations Committee to the
WTO General Council Meeting in July 2005,"’ highlighted the lack of move
ment on these issues and urged members to transform their commitments on
SDT and implementation issues into tangible, concrete and meaningful results
in the remaining months to Hong Kong.
15 For a discussion of the developments in the Doha negotiations between the July 2004 package and the July
2005 approximation, see UNCTAD secretariat note on “Review of developments and issues in the post-Doha
work programme of particular concern to developing countries” (TD/B/52/8. 26 August 2005)
16 WTO, Report by the Chairman of the Trade Negotiations Committee to the General Council (TN/C/5, 28 July
2005).
21
4.2(a) Special and Differential Treatment
The August 2004 Decision reaffirms that SDT provisions are an integral part of
WTO Agreements. It then refers to the SDT work in the WTO mandated by
paragraph 44 of the Doha Ministerial Declaration (DMD) to review all SDT
with a view to “strengthening them and making them more precise, effective
and operational." Specific work in this connection was delineated under cross
cutting issues in paragraph 12.1 of the Decision on Implementation-Related
Issues and Concents read in conjunction with paragraph 12 of the DMD. Such
work should:
(a)
(b)
(c)
make clear recommendations on converting SDT into mandatory provi
sions (so they could have legal enforceability);
make clear recommendations on how developing countries, especially
LDCs, could be assisted in making best use of SDT provisions; and
consider how SDT may be incorporated into the architecture of WTO rules.
In this respect the DMD17 takes note of the proposal by a group of devel
oping countries for a Framework Agreement on Special and Differential
Treatment (see Box 3).1819
The DWP thus launched a dual track strategy to rescue SDT. The first track is to
operationalise SDT provisions, so that they can be utilised and implemented,
by “strengthening them and making them more precise, effective and opera
tional” and by identifying non-binding SDT provisions and converting them
into mandatory provisions. The second track is to incorporate SDT into every
aspect of the WTO. Such work on SDT is further underscored by the specific
commitment in the DMD to reflect fully the principle of SDT for developing
countries and LDCs.”
17 Paragraph 44.
’* WT/GC/442. 19 September 2001. Proposal by Cuba. Dominican Republic, Honduras, India, Indonesia, Kenya,
Malaysia. Pakistan, Sri Lanka. Tanzania, Uganda and Zimbabwe.
19 “The negotiations and other aspects of the Work Programme shall take fully into account the principle of
special and differential treatment for developing countries and least-developed countries embodied in: Part IV of
the GATT 1994; the Decision of 28 November 1979 on Differential and More Favourable Treatment, Reciprocity
and Fuller Participation of Developing Countries; the Uruguay Round Decision on Measures in Favour of LeastDeveloped Countries, and all other relevant WTO provisions’’ (paragraph 50 of the DMD).
22
Negotiations in the last 3 years and more has witnessed slow and unsatisfactory
progress, and if the opportunity provided by the Decision is not seized by all to
break the deadlock and achieve some results, the whole issue could be
marginalised and imperiled. A lack of progress in meeting expected recom
mendations and decisions by the time of the July 2005 approximations has height
ened such concents.
Developing countries took up the challenge and submitted some 88 agreement
specific proposals on SDT20 (see Box 1) and a number of systemic and institu
tional cross-cutting issues. The proposals tend to:
(a)
(b)
(c)
propose amendments in the language used in SDT provisions to make
them mandatory mainly by replacing in such provisions the terms “should"
or “may” with the tenn “shall” and only where necessary to consider other
amendments;
propose authoritative interpretations of SDT provisions with a view to
clarifying them and rendering them more enforceable; or
propose a number of cross-cutting issues to mainstream SDT into the ar
chitecture of the WTO.
The consideration of the operationalisation of agreement-specific SDT provi
sions was facilitated by the following six-fold typology elaborated by the WTO
secretariat:21
(a)
(b)
(c)
(d)
provisions aimed at increasing the trade opportunities of developing country
Members;
provisions under which WTO Members should safeguard the interests of
developing country Members;
flexibility of commitments, of action, and use of policy instruments;
transitional time periods;
20 The 88 proposals were made by developing countries, particularly the African Group, aimed at adding eco
nomic and development value to SDT provisions.
21 Sec Implementation of special and differential treatment provisions in WTO agreements and decisions (WT/
COMTD/W/77/Rcv. I, 21 September 2001).
23
Box 1:
WTO Agreements Affected by SDT
Agreement-Specific Proposals
Number
of
proposals
GATT 1994 Article XV1I:C (2): XVIII; XVIIIrA; XV11I:B: XXXVi:
XXXV11; XXXVIII
8
Enabling Clause (4); paragraph 3(b)
5
Understanding on the Interpretation of Article II.1 (B) of the GATT 1994
Understanding on the Interpretation of Article XVII of the GATT 1994
1
Understanding on balance-of-payments provisions of GATT 1994, Paragraph 8.
Understanding on the Interpretation of Article XXIV of the GATT 1994
Understanding in Respect of Waiver Obligations under the GATT 1994
1
2
1
Understanding on the Interpretation of Article XXVIII of the GATT 1994, Paragraph 1
2
1
Agreement on Agriculture. Article 6.2; Article 14: Article 15.1 ; Article 15.2 (2)
5
Agreement on SPS Measures Article 9.2 (2); 10.1; 10.1 and 10.4; 10.2; 10.3 (2); 10.4
Decision on Measures Concerning the Possible Negative Effects of the Reform
Programme on Least-Developed and Net Food-Importing Developing Countries
8
Agreement on Textiles and Clothing. Articles 1.2 and 2.18; Articles 2.18 and 6.6.
Agreement on TBT, Articles 11 and 12: 12.3
Agreement on TRIMs; Article 3; Article 4; Article 5.3
2
4
Agreement on implementation of Article VI (Anti-Dumping), Article 15
1
Agreement on implementation of Article VII (Customs valuation). Article 20.1-2;
Article 20.3
2
Agreement on Pre-shipment Inspection Article 3.3
1
1
2
Agreement on Rules of Origin
1
Agreement on Import Licensing Procedures Article 1.2; Article 3.5;
Article 3.5(a)(iv); Article 3.5(j)
4
Agreement on Subsidies and Countervailing Measures 3.1(b) and 27.3;
Article 27.1 (2); Article 27.4; Article 27.8; Article 27.9; Article 27.13; Article 27.15
8
Agreement on Safeguards Article 9.1-2
1
GATS IV (2); IV.3 (2); V.3; XXV; Annex on Telecommunications paragraph 6
7
TRIPS Agreement; Article 7, 8 and 66.2; 67; 65, 66.1, 70.8 and 70.9.
4
Dispute Settlement Understanding Article 4.10 (2); 8.10; 12.10 (2); 12.11; 21.2;
21.2, 21.7 and 21.8; 24.1; 27.2
10
Decision on Measures in Favour of Least-Developed Countries; Paragraph 1;
Paragraph 2; Paragraph 2(ii); Paragraph 2(v)
5
Rules relating to notification procedures
1
Total
88
24
(e)
(f)
technical assistance; and
provisions relating to least-developed country Members.
In September 2005, at the request of its members, the WTO secretariat elabo
rated a note summarising the developmental aspects of the Doha negotiations
as raised in the various negotiating bodies and working groups.22 The summary
broadly shows that the issues and needs raised on the basis of national, regional
and wider development contexts and which would have to be addressed by the
negotiations pertain to “the need for longer transition periods, the need for greater
flexibilities in national policy making, the need formore technical assistance to
address human resources or institutional or administrative constraints, differ
entiated treatment in complying with certain agreements and exemptions from
some WTO obligations.”
The negotiations on agreement-specific proposals and cross-cutting issues be
came bogged down for a number of reasons, resulting in the initial deadline of
July 2002 being missed, as well as the second one of December 2002 and lack
of any results at the 5th WTO MC. This created disappointment among devel
oping countries that the focus on development was a fiction.
The negotiations on agreement-specific proposals and cross-cutting issues be
came bogged down fora number of reasons. This resulted in the initial deadline
of July 2002 being missed. The second deadline of December 2002 was also
not met. This, coupled with the lack of results at the 5th WTO MC disappointed
the developing countries who felt that the focus given to development was mere
fiction.
One source of conflict arose from disagreement among Members as to how to
achieve the Doha mandate on rendering SDT provisions more operational. This
involved the question of whether the SDT review would entail negotiations that
changed the existing balance of rights and obligations - developing countries
22 WTO secretariat, “Developmental aspects of the Doha Round of negotiations" (WT/COMTDAV/143. 13
September 2005).
25
generally expressed that it should, while developed countries were opposed.
Then questions were raised about the Doha mandate on SDT, such as whether
or not it is appropriate to review all SDT provisions within the Committee on
Trade and Development (CTD) Special Session (SS) charged with this task,
while there were parallel negotiations on agriculture, services and rules for in
stance.
Developed countries tended to favour that the agreement-specific proposals on
SDT be dealt with under the framework of specific negotiating groups whereas
developing countries favoured centralisation of negotiations in the CTD-SS.
Developing countries expressed concern that dispersing SDT proposals into
various negotiating groups would significantly weaken these proposals, and
with their limited negotiating capacities they would not be able to participate
fully in all the multiplying negotiating groups.
There was also disagreement as to the priority to be placed between agreement
specific proposals and cross-cutting issues. The latter included the principles
and objectives of SDT, a single or multi-tiered structure of rights and obliga
tions, coherence, benchmarking, technical assistance and capacity building, tran
sition periods, trade preferences including the Enabling Clause, utilisation of
preferences, and universal or differentiated treatment including graduation and
related issue of definition of developing countries, as well as a monitoring mecha
nism.
Developed countries tended to argue that it was important to agree on a coher
ent vision on especially the principles and objectives of SDT before engaging
in negotiations on agreement-specific issues. They argued that the delibera
tions should proceed first with clarifying the purpose of SDT and other cross
cutting systemic and institutional issues before discussing agreement-specific
proposals. This raised the very difficult differentiation debate i.e., tailoring SDT
to those developing countries that need them the most and to move away from
generalised SDT, and graduate those developing countries that would not need
them owing to their competitive trading situation.
26
Developing countries, in contrast, tended to favour the resolution of agreement
specific considerations first rather than engaging in a debate on principles which
in any case are already well established in Part IV of the GATT and the En
abling Clause. Developing countries were also resistant to the notion of differ
entiation and graduation in relation to beneficiaries of SDT provisions, and
definition of developing countries.
Another concern relates to the monitoring mechanism on SDT proposed by
developing countries, especially African countries.23 The proposal was the es
tablishment of an SDT Monitoring Body under the Committee on Trade and
Development, possibly as a sub-committee, to monitor the implementation of
and compliance with SDT provisions, facilitate cooperation among Members
on SDT, and advise the CTD. The proposal was accepted by WTO Members
and in July 2002 the General Council agreed to its establishment. However,
disagreement arose on the functions and structure of the monitoring mecha
nism, and on the institutional structure and the timing of its entry into force.
Difficult issues included the membership of the Mechanism (opened-ended or
selective); and whether the monitoring should be carried out in the regular ses
sions of the CTD, or by the CTD in sessions dedicated exclusively to the issue,
or should a Sub-Committee of the CTD be established for this purpose. As
regards the entry into force of the Mechanism, some (mostly developed) mem
bers considered that the Mechanism should come into force immediately. Other
(mostly developing) members expressed that the first task is to strengthen SDT
provision prior to defining the modalities of operation of the Mechanism and
deciding when it should come into force. In light of such difficulties and the
apparent transformation of the sense of the original proposal, the initiative ap
peared no longer a priority of the African countries that had initially proposed
it.
23 See African Group proposal on Monitoring mechanism for Special and Differential (S&D) Treatment Provi
sions in WTO document TN/CTD/W/23, 11 December 2002.
27
In order to de-block the SDT logjam in the lead up to the Cancun MC, the WTO
General Council Chairman-’4 was mandated to undertake consultations to carry
ing forward the negotiations. On 7 April 2003. the Chairman came up with a
proposal on “an approach for S&DT" in relation to agreement-specific propos
als built on two premises.24
25 First, all 88 agreement-specific proposals will be
addressed, but without prejudice to the outcome of the consultations. Second,
for the purposes of his consultation, the Chairman circulated a classification of
the 88 proposals in three categories. While the categorisation was informal for
the purposes of consultations with a view to de-blocking the negotiations, the
three categories (see Box 2 for a list of these proposals) have become accepted
as the basis on which to conduct further negotiations and are referred to in the
Decision:
•
•
•
Category 1 includes 38 proposals which were basically agreeable to Mem
bers in principle or for which agreement was reachable in the Chairman’s
opinion. These included 12 contained in Annex III of WTO document TN/
CTD/7 (10 February 2003) on which agreement had been reached in prin
ciple by Members, and a further two agreed upon by Members in May
2003. The remaining 24 proposals were also those which Members could
possibly reach agreement on. These issues were to be fast tracked for adop
tion at the Cancun MC.
Category 11 includes 38 proposals which (a) fall within and thus overlap
with an existing negotiation mandate (such as on agriculture, services and
rules including dispute settlement), or (b) fall within the ongoing work of
existing bodies (SPS, TRIMs, safeguard, TRIPS). The issues were referred
back to the WTO body with the instruction to report on progress attained
at the MC, including indications of areas in which an “early harvest” could
be attained.
Category 111 includes 12 proposals which, in the Chairman’s assessment,
existed a wide divergence of views among Members and thus progress
might not be possible without a re-drafting of the proposals.
24 Ambassador Perez del Castillo.
25 WTO document JOB(03)/68.
28
At Cancun, Annex C on Special and Differential Treatment of the Derbez Text26
identified 28 proposals from among the SDT proposals for endorsement by the
MC (although the developing countries proponents of SDT have consistently
argued for treating all 88 proposals as a package). These included all the 14
proposals in Category I on which agreement has been reached in principle by
Members (text as transmitted by General Council Chairman) and 14 others
from among the remaining 24 proposals in Category I, on which some re-draft
ing of the text from the original had been done at Cancun. The Derbez Text
proposals covered 28 proposals under Category I proposals27 and one proposal
from Category IL28 The remaining 10 agreement-specific proposals in Category
I not included in the Derbez Text relate to proposals 13-14, 22-25,28-20 and 38
(see Box 2).
The August 2004 Decision instincts an expeditious treatment of SDT by the
concerned WTO organs. It firstly instructs the WTO Committee on Trade and
Development (CTD) in Special Session (SS) to undertake the following:
(a)
Expeditiously complete the review of ail outstanding agreement-specific
proposals and to report back to the WTO General Council with clear rec
ommendations for a decision by July 2005 - since there was no agreement
to harvest the 28 agreement-specific proposals in Category 1 that had been
agreed upon in principle as contained in the Derbez Text, and there was no
reference to them in the Decision. Likewise, Category III issues are not
mentioned in the Decision but they would have to be taken up as well.
(b)
Within the parameters of the Doha mandate, to address all other outstanding work, including on the cross-cutting issues, the monitoring mecha
nism and the incorporation of SDT into the architecture of WTO rules and
report, as appropriate, to the General Council.
26 JOB(03)/150/Rcv.2, 13 September 2003, Second Revision.
27 With one proposal, i.e., GATT 1994 Article XVII.C, responding to 2 proposals on this agreement under
Category I. i.e., proposals 16 and 17.
28 TRIPS Agreement - Article 70.9 (which reflects proposal No.75 under Category II).
29
The Decision, secondly, instructs WTO bodies to which proposals in Category
II have been referred, to expeditiously complete the consideration of these pro
posals and report to the General Council with clear recommendations for a
decision, “as soon as possible and no later than July 2005’’.
In all three areas of the Decision identified for action, it was apparent by July
2005 that no concrete progress had been achieved despite some serious work
that was undertaken. The set deadlines were once again missed.
In fact, following the Decision, the Chairman of the WTO CTD-SS consulted
members and in December 2004. submitted informal suggestions for an ap
proach to future work on SDT taking up remaining agreement-specific propos
als on the one hand, and remaining cross-cutting issues on the other. Vis-a-vis
the agreements specific proposals, suggestions were for them to be redrafted or
merged with other similar proposals based on a concept of SDT with thee legs
namely (a) effective market access (b) enhanced (or additional) flexibilities in
WTO rules, consistent with the multilateral rules-based trading system, made
available to members in need of them with no a priori exclusion of any develop
ing countries (hence the term “situational flexibility’’) and (c) enhanced capac
ity building programmes to implement WTO rules and develop supply capaci
ties.
While the first and third legs are standard concerns that all members agree must
be addressed, the second leg is somewhat controversial as it falls into the realm
of cross-cutting issues especially regarding the principles and purposes of SDT
and who should benefit. The concept is one of making available additional
flexibilities in WTO rules to developing countries on a basis, to be determined,
linked to their specific development situation, i.e., situational basis. Any re
maining cross-cutting issues not already addressed was proposed to be taken up
under four themes relating to enhanced flexibility in WTO rules, the Monitor
ing Mechanism, enhanced capacity building, and coherence of policy making
and implementation.
30
Box 2. List of 88 Agreement-Specific Proposals by Categories
(Derbez Text proposals are shaded)
Category I (38)
Category II (38)
Category III (12)
12 proposals contained in
Annex III of document
TN/CTD/7 (10 February
2003) on which agreement
has been reached
2.1. Proposals made in areas
on which mandated
negotiations are ongoing (27)
77. Understanding on the
Interpretation of Article
H.(B)ofthe GATT 1994
(Proposal by the African
Group -TN/CTDAV/3/Rev.2)
1. GATS Article I V.3
39. Understanding on the
Interpretation of Article XXIV
of the GATT 1994
(Proposal by the African
Group -TN/CTDAV/3/Rev.2).
78. Understanding on the
Interpretation of
Article XXVIII of the
GATT 1994 - Paragraph 1
(Proposal by the African
Group - TN/CTD/W/3/Rev.2 )
2. GATS Article XXV
40. Understanding on the
Interpretation of Article XXIV
of the GATT 1994
(Proposal by the LDCs TN/CTD/W/4/Add.l)
79. Agreement on the
Application of SPS Article 10.2
(Proposal by India TN/CTDAV/6)
3. TRIPS Article 67
41. Agreement on Agriculture
Article 6.2
(Proposal by the African
Group - TN/CTDAV/3/Rev.2)
80. Agreement on Textiles
and Clothing - Articles 1.2
and 2.18
(Proposal by the LDCs TN/CTDAV/4/Add.l):
Note: The proposal has
become irrelevant in the
light of the termination of
the ATC in December 2004.
4. Enabling Clause
42. Agreement on Agriculture
Article 14
(Proposal by the African Group
- TN/CTD/W/3/Rev.2)
81. Agreement on Textiles
and Clothing - Articles
2.18 and 6.6
(Proposal by the
African Group -TN/CTD/
W/3/Rev.2): Note: The
proposal has become
irrelevant in the light of
the termination of the
ATC in December 2004.
5. GATS Article IV
43. Agreement on Agriculture
Article 15.1
(Proposal bv the African Group
- TN/CTD/W/3/Rev,2)
82. Agreement on TBT Articles 11 and 12
(Proposal by the African
Group -TN/CTD/W/3/Rev.2)
6. GATS Annex on
Telecommunications,
paragraph 6
44. Agreement on Agriculture
Article 15.2
(Proposal by the African Group
- TN/CTDAV/3/Rev.2)
83. Agreement on TBT Article 12.3
(Proposal by Cuba, Dominican
Republic, Egypt. Honduras,
India, Indonesia.
Kenya, Mauritius. Pakistan,
Sri Lanka. Tanzania and
Zimbabwe -TN/CTD/W/2)
7. Rules relating to
notification procedures
45. Agreement on
Implementation of
Article VI of the GATT
1994 - Article 15
(Proposal by the African
Group - TN/CTDAVZ
3/Rev.2)
84. Agreement on TRIMs
- Whole Agreement
(Proposal by the
LDCs - TN/CTDAV4)
8. Understanding on rules
and procedures governing
the settlement of disputes,
Article 8.10
46. Agreement on Subsidies
and Countervailing
Measures Articles 3.1(b)
and 27.3
(Proposal by the LDCs
-TN/CTD/W/4)
85. Agreement on TRIMs
- Article 3
(Proposal by the African
Group -TN/CTDAV/3/Rev.2)
9. Agreement on rules of
origin
47. Agreement on Subsidies
and Countervailing
Measures Article 27.1
(Proposal bv the African
Group - TN/CTDAV/3/
Rev.2)
86. Agreement on the
Implementation of
Article VII of GATT
1994-Article 20.1-2
(Proposal by the African
Group -TN/CTD/W/3/Rev.2)
10. Decision on Measures in
Favour of Least-Developed
Countries. Paragraph 2(v)
48. Agreement on Subsidies
and Countervailing Measures
Article 27.1
(Proposal by Cuba, Dominican
Republic, Honduras, India.
Indonesia, Kenya. Pakistan.
Sri Lanka, Tanzania and
Zimbabwe -TN/CTDAV/1)
87. Agreement on the
implementation of
Article VII of GATT
1994 - Article 20.3
(Proposal by the
African Group - TN/
CTDAV/3/Rev.2)
32
11. Agreement on
Agriculture. Article 15.2
49. ASCM Article 27.4
(Proposal by the African
Group - TN/CTDAV/3/Rcv.2)
12. Understanding on balanceof payments provisions of
GATT 1994, Paragraph 8
50. ASCM Article 27.8
(Proposal by the African Group
- TN/CTD/W/3/Rev.2)
2 agreed upon in principle
by Members in May 2003
51. ASCM Article 27.9
(Proposal by the African
Group - TN/CTD/W/3/Rev,2 )
19. GATT 1994 Article
XXXVII
(African Group)
52. ASCM Article 27.13
(Proposal by the African
Group - TN/CTDAV/3/Rev.2 )
20. GATT 1994, Article
XXXVIII
(African Group)
53. ASCM Article 27.15
(Proposal by the African
Group - TN/CTDAV/3/Rev.2
88. Decision on Measures in
Favour of Least-Developed
Countries - Paragraph 1
(Proposal by the African
Group -TN/CTD/W/3/Rev,2).
54. GATS Article IV
Remaining 24 proposals on
which agreement is reachable (Proposal by the African Group
- TN/CTD/W/3/Rev.2)
13. GATT 1994 Article XVIII
(African Group TN/CTD/W/3/Rev.2)
55. GATS Article IV.3
(Proposal by the LDCs TN/CTD/W/4/Add.l)
14. GATT 1994 Article XVIII:
A (African Group TN/CTD/W/3/Rev.2)
56. GATS Article V.3
(Proposal by the African Group
- TN/CTDAV/3/Rev.2)
15. GATT 1994 Article XVIII:
B (African Group TN/CTD/W/3/Rcv.2)
57. Understanding on Rules
and Procedures Governing
the Settlement of Disputes
Article 4.10
(Proposal by India
- TN/CTD/W/6)
16. GATT 1994 Article XVII:
C (Saint Lucia
-TN/CTD/W/8)
58. DSU Article 4.10
(Proposal by the African Group
- TN/CTD/W/3/Rev.2)
33
17. GATT 1994 Article XV1I:C 59. DSU Article 12.10
(LDCs - TN/CTD/W/4/Add. 1) (Proposal by Cuba. Dominican
Republic, Egypt, Honduras, India,
Indonesia, Kenya, Mauritius.
Pakistan, Sri Lanka. Tanzania
and Zimbabwe -TN/CTD/W/2)
18. GATT 1994 Article
XXXVI (African Group
- TN/CTD/W/3/Rev,2)
60. DSU Article 12.10
(Proposal by the African
Group -TN/CTD/W/3/Rev.2)
21. Understanding on the
Interpretation of Article
XVII of the GATT 1994
(African Group TN/CTD/W/3/Rev.2)
61. DSU Article 12.11
(Proposal by the African Group
- TN/CTD/W/3/Rev,2)
22. Understanding in Respect
of Waiver Obligations
under the GATT 1994
(African Group TN/CTD/W/3/Rev.2)
62. DSU Article 21.2
(Proposal by India TN/CTD/W/6)
23. Understanding in Respect
of Waiver Obligations
under the GATT 1994
(LDCs -TN/CTD/W/4/Add. 1)
63. DSU Articles 21.2, 21.7
and 21.8
(Proposal by the African
Group - TN/CTD/W/3/Rev.2)
24. Agreement on the
Application of SPS
Measures. Article 10.3
(Cuba, Dominican Republic,
Egypt, Honduras, India,
Indonesia, Kenya, Mauritius,
Pakistan, Sri Lanka, Tanzania,
Zimbabwe-TN/CTD/W/2)
64. DSU Article 24.1
(Proposal by the African Group
- TN/CTD/W/3/Rev.2 )
25. Agreement on the
Application of SPS
Measures, Article 10.3
(African Group TN/CTD/W/3/Rev.2)
65. DSU Article 27.2
(Proposal bv the African
Group - TN/CTD/W/3/Rev.2)
34
26. Agreement on Pre-shipment 2.2. Proposals made in
Inspection, Article 3.3
areas which are being
(African Group considered by other WTO
TN/CTD/W/3/Rev.2)
bodies as a part of their
ongoing work programme (11)
27. Agreement on ImportLicensing Procedures,
Article 1.2 (African Group
-TN/CTD/W/3/Rcv.2)
66. Agreement on the
Application ofSPS Measures
Article 9.2 (Proposal by Cuba,
Dominican Republic, Egypt,
Honduras, India, Indonesia,
Kenya, Mauritius, Pakistan,
Sri Lanka, Tanzania and
Zimbabwe -TN/CTD/W/2)
28. Agreement on ImportLicensing Procedures,
Article 3.5 (African Group
- TN/CTD/W/3/Rev.2)
67. Agreement on the Application
ofSPS Measures, Article 9.2
(Proposal by the African Group TN/CTD/W/3/Rev.2)
29. Agreement on ImportLicensing Procedures,
Article 3.5(a)(iv)
(Thailand -TN/CTD/W/7)
68. Agreement on the Application
ofSPS Measures, Article 10.1
(Proposal by Cuba, Dominican
Republic, Egypt, Honduras. India,
Indonesia, Kenya, Mauritius,
Pakistan, Sn Lanka, Tanzania and
Zimbabwe -TN/CTD/W/2)
30. Agreement on ImportLicensing Procedures,
Article 3.5(j)
(India -TN/CTD/W/6)
69. Agreement on the Application
ofSPS Measures, Article 10.1
and 10.4
(Proposal by the African
Group - TN/CTD/W/3/Rev.2)
31. Agreement on TRIPS,
Articles 7, 8 and 66.2
(African Group TN/CTD/W/3/Rev.2)
70. Agreement on the Application
ofSPS Measures, Article 10.4
(Proposal by India
- TN/CTD/W/6)
32. Decision on Measures in
Favour of Least-Developed
Countries, Paragraph 2
(African Group TN/CTD/W/3/Rev.2)
71. Agreement on TRIMs,
Article 4
(Proposal by the African Group
-TN/CTD/W/3/Rcv.2)
35
33. Decision on Measures in
Favour of Least-Developed
Countries. Paragraph 2(ii)
(LDCs - TN/CTD/W/4)
72. Agreement on TRIMs. Article
5.3
(Proposal bv the African Group
-TN/CTD/W/3/Rev.2)
34. Decision on Measures in
Favour of Least-Developed
Countries - Market
Opportunities (LDCs - 30
January 2003 non-paper)
73. Agreement of Safeguards
Article 9.1-2
(Proposal by the African Group
-TN/CTD/W/3/Rev.2)
74. Agreement on TRIPS
35. Enabling Clause.
(Proposal by the LDCs Paragraphs 1 and 2(d)
(LDCs -TN/CTD/W/4/Add.l) TN/CTD/W/4/Add.l)
75. Agreement on TRIPS.
36. Enabling Clause.
Articles 65. 66.1, 70.8 and 70.9
paragraph 3(b)
(LDCs - TN/CTD/W/4/Add.l) (Proposal bv the African
Group -TN/CTDAV/3/Rev.2)
37. Enabling Clause (African
Group - TN/CTD/W/3/Rev.2)
38. Enabling Clause
(LDCs - TN/CTD/W/4/Add. 1)
36
76. Decision on Measures
Concerning the Possible Negative
Effects of the Reform Programme
on Least-Developed and Net
Food-Importing Developing
Countries
(Proposal by the African Group
- TN/CTD/W/3/Rev.2)
The elements of the proposed conceptual approach were discussed but not agreed
upon by members. Instead, members agreed to take up the agreement-specific
proposals with priority placed on the outstanding proposals of LDCs. Members
have since been discussing, negotiating and possibly re-drafting five proposals
on LDCs namely proposals 23 (WTO waiver), 36 (Enabling Clause on erosion
of preferences), 38 (Enabling Clause (flexibility for LDCs), 84 (TRIMs Agree
ment on exemption of LDCs from its disciplines), and 88 (Decision on Mea
sures in Favour of LDCs that exempts them from any commitments that are
prejudicial to their interests). A key consideration for LDCs in these negotia
tions is the extent of re-drafting of the original proposals that would be accept
able without deviating from its original intent and the Doha mandate.
What can be the way forward in implementing this commitment? The point of
reference that should continue to guide work on SDT is paragraph 44 of the
DMD and paragraph 12 of the Doha Decision on Implementation-Related Is
sues and Concerns which also gives the CTD the mandate of accomplishing all
work on SDT. The August Decision underlines these mandates. On the out
standing agreement-specific proposals, it is important that the Chairman of the
CTD-SS engages in informal consultations with a view to bridging the differ
ences among members, working towards tangible proposals that are commer
cially and developmentally meaningful to LDCs and developing countries. These
are the proposals which are still pending in Category I and those in Category
III. It should be recalled that when proposals were divided into three broad
categories in April 2003, it was on the understanding that this approach did not
in anyway imply that certain proposals were being prioritised since all the pro
posals would be addressed by the membership. Key strategies on the way for
ward include the following:
(a)
Examine carefully the 88 agreement-specific proposals including in each
of the three categories to ascertain which are of greater value (commer
cially meaningful and development supportive) i.e., some prioritisation
may be necessary. In actual fact, the total number of agreement-specific
proposals is now 86 as two of them (in Category III) relating to the Agree
ment on Textiles and Clothing have become irrelevant with the termina37
tion of this agreement in December 2004. This will entail work leading to
recommendations on Category I and III proposals in the CTD-SS and on
Category II issues in various WTO bodies. The CTD-SS has agreed to
priority consideration of outstanding proposals by LDCs. An harvest of
these proposals by July 2005 was anticipated but did not take place. It is
now a prerequisite for any movement in the SDT debate that the LDCs’
related proposals be harvested by the 6th WTO MC as a minimum step
forward, and harvested with their original purpose maintained.
(b)
Given that the CTD-SS is where the negotiations on SDT are focused,
progress on resolving differences among Members could be more expedi
ently addressed in this body. Category I proposals should be resolved on a
fast track basis. Many of them are procedural proposals providing further
clarity or reiterating the legal applicability of the SDT provisions con
cerned. To begin with, the 28 proposals in the Derbez Text that have been
agreed upon by Members in principle could be simply recommended by
the CTD-SS, without further discussion, to the General Council for adop
tion. Thus, the CTD-SS would prioritise consideration of the remaining
10 Category I proposals to resolve remaining difficulties. The CTD-SS, as
stated, is already working on the proposals made by LDCs. With progress
in resolving Category 1, some momentum may be created for the CTD-SS
to take up the now 10 Category III proposals on which there are major
differences among Members to be resolved.
(c)
At the same time, Members in the different WTO bodies to which the 38
Category II proposals have been referred should prioritise the consider
ation of these proposals in keeping with the instruction to propose clear
recommendations as soon as possible and no later than July 2005. Since
the latter deadline was missed, such proposals should now be a minimum
requirement of the outcome of the 6th MC. This Category has two types of
proposals, namely 27 proposals made in areas on which mandated nego
tiations are ongoing specifically over five agreements namely the Under
standing on GATT Article XXIV, Understanding on Dispute Settlement,
Agreement on Agriculture, Agreement on Subsidies and Countervailing
38
Measures, and GATS Article IV and V; and 11 proposals made in areas
which are being considered by WTO bodies as part of their ongoing work
programme, specifically covering five agreements namely the Agreement
on SPS Measures, Agreement on TRIMs, Agreement on Safeguards, Agree
ment on TRIPS and the Decision on Measures Concerning the Possible
Negative Effects of the Reform Programme on Least-Developed and Net
Food-Importing Developing Countries (see Box 2). The concerned nego
tiating groups and WTO bodies should fast track the consideration of these
proposals. Regarding these proposals, many developing countries have
stated that the CTD-SS maintains a supervisory role since it is the body
mandated to deal with SDT. The Chairperson of CTD-SS and the Chair
persons of the relevant bodies need to coordinate closely to ensure:
i.
ii.
iii.
The meetings of these bodies do not overlap so as to enable full and
effective participation of developing countries in these discussions.
This is a concent that has been raised in the past and it is also ad
dressed in the July Package in the paragraph concerning SDT.
The CTD-SS is kept informed of the progress being made in the re
spective WTO Bodies so that all agreement-specific proposals could
be treated as a single package. Where progress is slow in the WTO
body concerned, the CTD-SS could take up the proposals for expedi
tious resolution.
Or alternatively, for the other bodies to relinquish the consideration
of the proposals to the CTD-SS to centrally discuss, negotiate and
reach agreement on all outstanding agreement-specific proposals.
As regards all other outstanding work, which mainly pertains to cross-cutting
issues, the CTD-SS is instructed to address them and report, as appropriate, to
the General Council. No deadline is set here, but as an indicative measure,
concrete progress is needed by the 6th WTO MC. It may be strategically wise to
focus negotiating energy on resolving the agreement-specific proposals and then
proceed to consider in-depth the cross-cutting issues in the period immediately
thereafter. The possible results attained in the agreement-specific proposals may
provide stimulus to and facilitate consensus on cross-cutting issues. The con
39
sideration of cross-cutting issues in the CTD-SS could be structured so as to
make recommendations in advance of the 6th MC, and for the MC to set up
timelines to resolve these issues in 2006. Otherwise, the somewhat weak in
junction to report, as appropriate, to the General Council would leave it an open
matter and subject it to further delays (as there is no reporting deadline).
A number of developing countries had proposed during the preparatory process
for the Doha MC a "Framework Agreement on Special and Differential Treat
ment”. This also relates to a proposal by LDCs for a framework for strengthen
ing and improving SDT.29 The proposed framework agreement provides a suc
cinct and comprehensive case for an umbrella agreement on SDT to provide a
level playing field for unequal partners in the MTS (see Box 3). This proposal
can be taken up as the basis for the elaboration of an approach to incorporating
SDT into the architecture of the WTO and providing the overarching instru
ment for addressing cross-cutting issues.
The preambular portion of a framework agreement on SDT would establish the
“principles and objectives of SDT”, drawing also upon the principles identified
in the August Decision, the acquis from Part IV of GATT and the Enabling
Clause, and other SDT provisions within specific agreements concerning agri
culture, NAMA and services; and addressing other systemic issues such as a
“single or multi-tiered structure of rights and obligations”, “coherence”,
“benchmarking”, and “universal or differentiated treatment including gradua
tion and related issue of definition of developing countries”.
Broadly, there is need to re-think and re-posit the case for SDT within the con
text of the work on integration of SDT into the architecture of the WTO and
MTS. The crux is to change the perception, especially among developed coun
tries’ trade negotiators, of viewing SDT from the short term perspective of static
gain and losses, as transitional measures, towards a long term vision of attain
ing global prosperity for all in which SDT is an essential component of national
and international trade policy. Also as part of this reflection for developing
” See WTO document TN/CTD/W/4. 24 May 2002.
40
countries, it is important to secure more, better and implementable SDT i.e.,
SDT that works and can be made to work effectively. It is equally important for
them to internalise these provisions into their national trade and development
strategies. Only then could they make effective use of the SDT provisions otherwise these measures will remain an empty safety net. For example, the
liberalisation process can be calibrated to be commensurate with the SDT
provisions in agriculture, NAMA and services.
The Chairman of the CTD-SS articulated his views in an article in Bridges30 on
an approach to addressing SDT issues that is anchored on the premise of de
blocking the intellectual quagmire regarding the role of SDT, and at the same
time addressing the agreement-specific proposals. He has done so by highlight
ing the essential elements of development as incorporating SDT and other is
sues that can work to provide fair trade, capacity building that addresses sup
ply-side matters, balanced rules, and global governance in the WTO that per
mits transparency and includes all parties. Such a process of debate and discus
sion on the raison d’etre of SDT and development issues is important and needs
to continue as agreement-specific proposals are prioritised and dealt with.
The operative portion of a framework agreement on SDT could cater for spe
cific issues like “technical assistance and capacity building”, “transition peri
ods,” trade preferences and the monitoring mechanism. For example:
(a)
Technical assistance should go beyond what the WTO is currently provid
ing on implementing WTO rules, to developing capacities in developing
countries and LDCs to negotiate trade agreements, to implementing and
complying with the resultant agreements, and to overcoming supply-side
constraints and developing competitiveness to take advantage of new trad
ing opportunities created;
50 Faizcl Ismail, “Evaluating the July Package from a Development Package” in Bridges Year 8 No. 9 October
2004.
41
Box 3. Proposal for a Framework Agreement on
Special and Differential Treatment
The concept of special and differential treatment is a fundamental building
block of the multilateral trading system. Special and differential treatment
provisions are to be looked at not as exceptions to the general rules but more
importantly as an integral and inherent objective of the multilateral trading
system. It is imperative to undertake a thorough review of the concept of
S&D as its basic objective is to create a level playing field for unequal play
ers in the Multilateral Trading System. This should be seen in the establish
ment of a concrete and binding S&D regime which is responsive to the de
velopment needs of developing countries. There is an urgent need for such
S&D regime, which mainly focuses on enhancing market access opportuni
ties (for developing countries) and provides policy options aimed at unlock
ing their growth and development potential. The system and the rules should
ensure equal participation by, and equal benefits to all. In the immediate/
short term, all the existing S&D provisions in various WTO agreements should
be fully operationalised/implemented. The implementation should go be
yond technicalities and include operationalisation of provisions that pres
ently lack operational modalities. In the medium term, the agreements should
be suitably amended in the light of the experience by the developing coun
tries that these provisions fall short of providing necessary flexibility to pur
sue appropriate policies and facilitate economic development in the devel
oping countries. The WTO must demonstrate sensitivity to developmental
objectives of majority of its Membership to sustain credibility.
Some of the elements which can form part of the Agreement on S&D could
be as follows:
•
Special and differential treatment shall be mandatory and legally bind
ing through the dispute settlement system of the WTO (including noti
fication requirements and inclusion of these commitments in country
schedules).
42
•
•
•
•
•
In any future agreement that the Members may agree on, there shall be
an evaluation of the development dimension. This evaluation should
include the fact as to how these agreements facilitate attainment of
developmental targets (e.g. as set out in the Millennium Declaration).
The Members shall undertake an evaluation of the implications of any
future agreement, with respect to implementation costs in terms of fi
nancial, capacity building and technical assistance, etc.
The transition periods shall be linked to objective economic (debt level,
level of industrial development, human development index, etc.) and
social (literacy and life expectancy) criteria.
Without an evaluation of the fact whether an Industrial Policy has a
demonstrable adverse impact on trade, there shall be no prohibition of
policies which promote growth and development in developing coun
tries.
The application of the concept of Single Undertaking for developing
countries should not be automatic.
Source: WT/GC/W/442, 19 September 2001.
(b)
Transition periods should be based on objective criteria (and not be arbi
trarily set) and for an adequate period, with the option of extending such
period upon notification to WTO Members.
(c)
Trade preferences can be enhanced and their utilisation by beneficiaries
improved by addressing issues like improving rules of origin, strengthen
ing their predictability, and development assistance provided to assist pref
erence-beneficiaries in carrying out medium to long-term reforms to en
hance competitiveness of products and market diversification.
(d)
Develop terms of reference for the monitoring mechanism to monitor the
implementation of and compliance with SDT provisions, and also draw
ing upon reports that all other WTO bodies would be required to provide
on the operation of SDT provisions, and make recommendations thereon
43
as appropriate for consideration by the CTD, the General Council and
Ministerial Conferences with a view to ensuring effective utilisation by
beneficiaries.
Beyond these issues specific on SDT negotiations, there is the SDT to be incor
porated in the substantive negotiations on agriculture, NAMA, services, trade
facilitation, and rules including on regional trade agreements. As regards ser
vices for example, some developing countries had submitted proposals on “in
creasing participation of developing countries in international trade in services:
Effective implementation of Article IV of GATS”.31 It would require address
ing both the positive and defensive interests of developing countries. On the
positive side, there is need to substantially progress in market access and entry
conditions for exports from developing countries. On the defensive side, this
requires incorporating SDT and preserving appropriate space for development
policies.
In preparation for the 6th WTO MC, a number of developing country groups
have met and adopted their common positions on the issues on the Doha nego
tiations. Box 4 below presents those positions taken as regards SDT, which
basically underscore the importance of the issues to developing countries and
for the Doha ambition on SDT and other development issues to be concretely
and expeditiously implemented.
4.2(b) Technical Assistance
The August 2004 Decision provides that developing countries, particularly LDCs
(and low-income countries in transition), should be provided with enhanced
trade-related technical assistance (TRTA) and capacity building. In this con
text, improved coordination by WTO with other agencies is encouraged, in
cluding under the Integrated Framework (IF) for LDCs32 and Joint ITC/
!l S/CSS/W/131. 6 December 2001.11 argues that GATS Article IV is an integral and important aspect of SDT
and its effective implementation needs to be realised including through actions prior to and during market access
negotiations and other actions.
32 For details, see http://www.integratcdframeworic.oig/
44
Box 4. Developing Country Recent Ministerial statements on SDT
Africa Union Trade
Ministers,
Cairo, Egypt,
5-9 June 2005
Second South Summit,
Doha Plan of Action,
Doha Qatar,
12-16 June 2005
Fourth LDC’s Trade
Ministers, Livingstone,
Zambia,
25-26 June 2005
“As a cross-cutting issue,
development has to be ex
plicitly incorporated in all
areas of the negotiations. In
this regard: (a) urgent atten
tion must be given to com
pleting the review of all out
standing S&D Agreement
specific proposals before
adoption, implementation
related issues and concerns
and the amendment of the
TRIPS Agreement to incor
porate the 30th August
2003 Decision on the
Implementation of Para
graph 6 of the declaration
on TRIPS and Public
Health.”
“...to achieve the fullest
realisation of the develop
ment mandate of the Doha
Ministerial Declaration and
the WTO General Council
decision of August 1, 2004
in all areas of the Doha Work
Programme particularly in
agriculture, non-agricultural
market access, services, trade
related intellectual property
system (TRIPS), rules as
well as operational and
meaningful special and dif
ferential treatment for devel
oping countries and to adopt
practical and concrete solu
tions to the outstanding
implementation related is
sues and concerns raised by
developing countries...”
“The full implementation of
the provisions of Special
and differential treatment.
and to make them more pre
cise, effective and opera
tional; and adoption of new
special and differential
measures to take into ac
count problems encoun
tered by LDCs and address
meaningfully the special
and differential proposals
of LDCs...”
UNCTAD/WTO Integrated Technical Assistant Programme (J1TAP) for Selected
Least Developed and Other African Countries.33
Key strategies on the way forward include the provision of enhanced TRTA
which means on the one hand, increased funding of the WTO DDA Global
Trust Fund in the WTO to fund increased TRTA. However, WTO TRTA is
focused on explaining the WTO Agreements for facilitating their implementa
tion by Members, and for servicing issues under negotiations. These relate to
the “softer” end of TRTA, basically trade rules and their implementation. For
n For details, see http://www.jitap.org/
45
developing countries, this type of assistance must be coupled with the “deeper”
end of TRTA aimed at addressing development issues, building sustainable
negotiating capacities, and improving supply and competitiveness including
infrastructure building. This type of assistance can only be provided by devel
opment agencies, like UNCTAD, ITC, UNIDO, FAO, and World Bank, as well
as non-governmental agencies like the South Centre and Third World Network.
Thus, the other side of this commitment in the Decision is for donor countries
and agencies to increase funding of TRTA of these development agencies to
assist developing countries integrate beneficially into the MTS.
Improved funding of IF and JITAP is important so as to deepen the assistance
provided, develop sustainable endogenous capacities and to expand the number
of beneficiaries. Indeed as the IF is focused on LDCs and JITAP on African
countries, there is the need to not only to increase the beneficiaries of these two
programmes within the selected group of countries but also to widen them to
other developing countries that are increasingly requesting deeper capacity build
ing assistance.
The JITAP in particular has made important contributions to developing hu
man, institutional and trade policy-making capacities of the 16 beneficiary Af
rica countries. It has evolved innovative TRTA concepts and applied them in
the field with success such as inter-institutional committees on the WTO as the
national bodies entrusted with the task of assessing trade agreements, develop
ing negotiating positions, engaging stakeholder consultations on trade matters,
informing the general public about the agreements, and developing a cadre of
expertise on multilateral trade. However it is under-funded vis-a-vis the needs
and demands of the current and future beneficiaries and deserves to be substan
tially strengthened. The UNDP Human Development Report 2005 notes in re
spect of TRTA projects that some of the more effective ones, like JITAP, are
chronically under-funded.34
” UNDP, Human Development Report 2005, ‘'International cooperation at a crossroads: Aid, trade and security
in an unequal world” (Box 4.10).
46
4.2(c) Implementation
Regarding Implementation-related concerns, it can be recalled that unsatisfac
tory treatment of such issues (some 100 issues) in the run-up to the Seattle MC
(1999) was a key factor in the failure of that conference. They affect 11 clusters
namely GATT 1994, Agreement on Agriculture, Agreement on the Application
of Sanitary and Phytosanitary Measures, Agreement on Technical Barriers to
Trade, Agreement on Trade-Related Investment Measures, Agreement on Imple
mentation of Article VI of the GATT 1994, Agreement on Implementation of
Article VII of GATT 1994, Agreement on Rules of Origin, Agreement on Sub
sidies and Countervailing Measures, Agreement on Trade-Related Aspects of
Intellectual Property Rights, and Cross-cutting issues (SDT, trade preferences).
The issues and concents broadly relate to:
(a)
difficulties encountered by developing countries in implementing (coping
with) their obligations under WTO Agreements, including in meeting the
costs of implementation ranging from notification related issues to setting
up institutional and administrative arrangements including judicial ones
(b)
such as for the TRIPS Agreement;35
implementation, or lack thereof, of commitments by other (mainly devel
(c)
oped) countries, of provisions in favour of developing countries; and
the issue of the effective operationalisation of SDT, as discussed previ
ously.
Thus, at the MC in Doha (2001), implementation issues and concerns were
given top priority in the DWP. Implementation issues were listed as the first
element of work in the DWP36 that was adopted. Further, a Ministerial Decision
35 Meeting implementation requirements of WTO Agreements is one aspect of the necessary adjustments that
countries have to make. Another aspect of adjustment relate to the real side of the economy, e.g., changes in trade,
output and employment. This will derive from the changes in MFN tariffs, domestic support and export subsidies,
as well as areas such as in trade facilitation, and new rules m services, where it is harder to make estimates. Such
experiences suggest, and as borne out in the modalities adopted for Trade Facilitation, that the costs of implemen
tation of any new WTO agreements needs to be factored into that agreement based on an assessment of what has
to be done, how long it will take, who will do it, how it will be done, and who will pay while bearing in mind that
these costs will vary as between agreements and between WTO Members.
36 Paragraph 12, DMD.
47
on Implementation-Related Issues and Concerns was adopted to address some
of the specific issues. Such prioritisation was thus part of the overall balance
achieved at Doha in terms of addressing developing countries' primary con
cerns while a new and comprehensive round of negotiations was launched. The
Ministerial Decision on Implementation-Related Issues and Concents addressed
some 42 implementation issues from among the 100 issues, including on
operationalisation of SDT, mostly with immediate effect and others with a set
deadline that generally was the end of 2002.
As regards the issues to be resolved within the set timeframe such as SDT,
many of them were not met and thus become outstanding and remain to be
addressed. Also, with the gradual implementation of the WTO Agreements,
some of the issues such as those related to the Agreement on Textiles and Clothing
have lost relevance and therefore obsolete as the Agreement expired at the end
of2004.
Regarding the outstanding implementation issues37 (some 58 of them), i.e., those
not addressed by the Ministerial Decision, the DMD established that: (a) those
implementation issues for which a specific mandate is provided in the Declara
tion shall be addressed under that mandate; and (b) other outstanding imple
mentation issues shall be addressed as a matter of priority by the relevant WTO
bodies which shall report to the Trade Negotiations Committee by the end of
2002 for appropriate action. Thus, there was agreement that high priority is
placed on addressing in particular outstanding implementation issues in a time
bound manner.
In the last three years and more during the course of the negotiations, the atten
tion placed on the issues has weakened despite vigorous efforts by developing
countries to raise their profile so as to address them, and the effort of the WTO
Director General leading the search for solutions on these issues. The issues
remain to be adequately and meaningfully addressed. This is a major concern
” Sec WTO document on "Compilation ofOutslanding Implementation Issues Raised by Members” (JOB(Ol)/
152/Rcv. 1. 27 October 2001).
48
because implementation issues constituted outstanding issues from the Uru
guay Round. There is urgency to finding concrete solutions on a priority and
time-bound basis prior to developing countries assuming new commitments
(and new implementation obligations).
The August 2004 Decision firstly reaffirms Members determination to find ap
propriate solutions to outstanding implementation issues. The Trade Negotiat
ing Committee, negotiating bodies and others were instructed to redouble their
efforts to find such appropriate solutions as a priority. The Director General
was requested to continue his consultations on all outstanding implementation
issues under paragraph 12(b) of the DMD including on the extension of protec
tion of geographical indications to products other than wines and spirits under
Article 23 of TRIPS. A two stage time-bound schedule was established with the
Director General reporting to the Trade Negotiating Committee and the Gen
eral Council “no later than May 2005”, to be followed by a progress review by
the General Council and taking of “any appropriate action no later than July
2005”. By July 2005 there was not progress and the Direct General in his posi
tion as the Chairman of the Trade Negotiations Committee expressed his frus
tration in his report to the WTO General Council as follows: “1 have tried re
peatedly to find ways to advance towards the appropriate action that Ministers
in Doha instructed the TNC to take, but solutions in that sense have just not
been within reach because of the entrenched opposing positions of delegations.
in particular on the issue of GI extension.”38
What can be the way forward in implementing this commitment? First, there is
need to ascertain what progress has been made in resolving the implementation
issues identified in the Doha Decision on Implementation-related Issues and
Concerns for which a deadline was established. If no progress has been made,
then these issues should be taken up expeditiously for resolution as they were
supposed to have been resolved by now. These issues concern, in the Decision.
paragraphs 1.2 (GATT 1994); 7.2, 7.3 and 7.4 (anti-dumping); 8.2 (customs
valuation); 9.1 (rules of origin); 10.1 (subsidies and countervailing measures);
’» TN/C/5.
49
11.1 and 11.2 (TRIPS) and 12.1 (SDT). As previously discussed, SDT, for ex
ample. is still yet to be fully resolved.
Regarding the outstanding implementation issues, some prioritisation of their
consideration can be developed based on the frequency with which these pro
posals were made. Box 5 indicates such frequency showing that the largest
number of concerns have been raised regarding the Agreement on Subsidies
and Countervailing Measures, anti-dumping measures, TRIPS and then cus
toms valuation and TRIMs in that order. These concerns could be taken up by
the concerned WTO body for expeditious examination and decision as their
resolution may take some time. The other issues would also be examined by
relevant WTO bodies and as these concerns only one or two proposals, such
consideration could be made rather swiftly.
It should be noted that the setting up of a single negotiating body on implemen
tation issues has been suggested by some developing countries to provide over
all supervision of negotiations and monitoring. This can be a functional mecha
nism to fast-track consideration of implementation issues.
4.2(d) Other Development Issues
The nomenclature “other development issues” in reality refers to the specific
trade and development related needs and concerns of developing countries. The
August 2004 Decision states that - “special attention shall be given to the
specific trade and development related needs and concerns of developing coun
tries, including capacity constraints.” These specific issues are to be addressed,
“as appropriate”, in the ongoing market access negotiations in agriculture and
NAMA. In addition, the trade-related issues for small, vulnerable economies
should also be addressed consistent with paragraph 35 of the DMD (non-nego
tiating mandate).
A reason why various specific SDT-related needs and concerns of a variety of
developing countries have been increasingly raised in the negotiations is asso
ciated with the recognition that SDT should cater to the specific and special
50
Box 5. Outstanding Implementation-Related Issues and Concerns:
Agreement Affected and Frequency of Proposals
General Agreement on Tariffs and Trade 1994
2
Agreement on Agriculture
1
Agreement on the Application of Sanitary and Phytosanitary Measures
1
Agreement on Technical Barriers to Trade
2
Agreement on Trade-Related Investment Measures
4
Agreement on Implementation of Article VI of the GATT 1994 (anti-dumping)
13
Agreement on Implementation of Article VII of GATT 1994 (customs valuation)
5
Agreement on Subsidies and Countervailing Measures
20
Agreement on Safeguards
I
Agreement on Trade-Related Aspects of Intellectual Property Rights
Cross-cutting issues (waivers to Article I of GATT 1994, and negotiating rights
in favour of small and medium-sized exporting Members in trade negotiations).
8
2
problems faced by developing countries in the multilateral trade negotiations
and the MTS. Thus general SDT (and LDC-specific SDT) needs to be supple
mented and complemented by addressing such specific issues. These specific
issues in the market access negotiations on agriculture and NAMA, as identi
fied in the August Decision, include food security, rural development, liveli
hood, preferences, commodities and net food imports, as well as prior unilat
eral liberalisation.39 At the same time, there is need to be careful about argu
ments for additional SDT beyond the generalised ones to all developing coun
tries as these give currency to arguments on differentiation and graduation among
developing countries in accessing SDT.
This provision in the Decision is an additional directive to Members to apply
SDT in substantive areas of market access negotiations in the DWP in the July
Package context, namely in agriculture and NAMA. It is additional in that in
the agriculture and NAMA negotiations, it is already an accepted principle that
SDT will be integrated specifically, meaningfully and operationally. This is
39 It should be noted that the August Decision does not refer to addressing such specific SDT issues in the
services negotiations and other areas of the DWP. such as on rules negotiations (e.g., on RTAs). However, m the
normal course of DWP, the mainstreaming of SDT into the negotiations is a standing aspect.
reiterated in the July Package modalities for agriculture and for NAMA. The
importance of raising the profile of the issues lies in focusing in the negotia
tions on measures to resolve the specific issues identified.
What can he the wayforward in implementing this commitment? One key strat
egy is to ensure in the agriculture and NAMA negotiations that operationally
effective and meaningful provisions for SDT would specifically address the
issues of food security, rural development, livelihood, preferences, commodi
ties and net food imports, as well as prior unilateral liberalisation. Another is
that measures to address trade preferences and commodities will involve both
market access issues and development-related issues, bearing in mind that some
of the latter type of issues are beyond the scope of the WTO and may have to be
addressed by other development bodies like UNCTAD and specifically so in
the case of commodities. Market access issues on preferences raised in the ag
riculture modalities recognise the importance of long-standing preferences and
call upon Members to address the issue of erosion of preferences.’0
In the modalities on NAMA, preferences are highlighted. Preferences consti
tute one of the elements of the negotiations on which additional negotiations
are required to reach agreement on specific details.'” Further, the negotiating
group on market access is instructed to take into consideration the challenges
that may be faced by non-reciprocal preference beneficiary members, and those
that are highly dependent on tariff revenue, as a result of NAM A negotiations.'12
Adjustment concerns of developing countries affected by preference erosion
remains to be adequately addressed. Improving preferences and enhancing their
utilisation would constitute one track of supporting measures. This can be done
in the context of negotiations for agriculture and market access for non-agricultural products, inter alia, by improving preference regimes and enhancing their
utilisation. Another track is to provide preference-receiving countries with ad
justment support for competitiveness, and product and market diversification.
40
41
42
52
Paragraph 44 of Annex A of the Decision.
Paragraph I of Annex B of the Decision.
Paragraph 16 of Annex B of the Decision.
IMF for instance proposed in early 2004 a Trade Integration Mechanism (TIM)
to address balance-of-payment problems resulting from preference erosion, but
also from post-ATC adjustment and increased farm bills for NFIDCs as a result
of agricultural policy reform. However, such support should provide genuine
aid for trade, in a manner not affecting the debt situation and other development
priorities. An “aid for trade” funding mechanism has been suggested by the
Sach Report and the Blair Commission Report which has received some sup
port and efforts are underway among some OECD countries to concretise the
initiative.
The specific trade and development concerns of commodity-dependent coun
tries arise from the fact that they continue to remain marginalised in interna
tional trade on account of their dependence on commodities, and thus are still
vulnerable to external shocks. This is of concern to a large number of African
countries, particularly LDCs. The commodity sector continues to be the main
stay of their economies in terms of the generation of income, savings and for
eign exchange, as well as employment and livelihood, particularly for the poor.
The issue is to address seriously the difficulties faced by commodity dependent
developing countries, owing to continuing long term volatility and secular de
cline of world commodities prices, with a view to assisting such countries to
restructure, diversify and strengthen the competitiveness of their commodity
sectors. Within WTO, some market access aspects, tariff peaks and tariff esca
lation, and subsidies can be addressed. Many other important aspects go be
yond the mandate of WTO and require the involvement of other international
organisations, specifically UNCTAD, and support from international financial
institutions and donor community.
Regarding small, vulnerable economics, the Decision calls on Members to ad
dress the trade-related issues identified for the fuller integration of these coun
tries into the MTS (without creating a sub-category of Members).43 The DMD
stated that the objective of the work programme on Small Economies is “to
frame responses to the trade-related issues identified for the fuller integration
43 As stated in paragraph 35 of the DMD.
53
of small, vulnerable economies into the multilateral trading system", and man
dated the General Council to make recommendations for actions to the 5th MC.
The work of the dedicated session of the Committee on Trade and Develop
ment has centered on the proposal by Barbados, Belize, Bolivia, Dominican
Republic. Guatemala. Honduras. Mauritius and Sri Lanka.14 Their proposals
pertain to the following areas:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
preferences (liberalisation processes should preserve the existing margin
of preferences for products exported by small economies and extended to
other small economies)
regional trade agreements (GATT Article XXIV should provide that small
economies shall not be required to give reciprocal treatment in return for
the preferential treatment from developed countries, and the small econo
mies should be given necessary policy space on the basis of asymmetry
subsidies (small economies should not be subject to the prohibition of
export subsidies under the Agreement on Subsidies and Countervail Mea
sures);
anti-dumping and countervailing duties;
safeguards
SPS/TBT;
Dispute Settlement Understanding; and
accession.
Issues arising from negotiations in agriculture, services and TRIPS are being
raised by small economies within the context of these negotiation groups.
Small economies, including Small Island Developing States, remain highly
vulnerable to external shocks, including natural disasters. Thus, the work
programme must find solutions for integration into the MTS of small, vulner
able economies into the multilateral trading system in a manner commensurate
with their special circumstances and in support of their efforts towards sustain-*
44
54
WTO document COMTD/SEW/3.
able development. As a start, WTO members can endorse the trade-related is
sues identified since commencement of the work programme and examine ways
and means of putting into effect these measures. Since these are non-negotiat
ing issues, there should be no major problem in agreeing on the measures to
address some of the trade-related issues of small, vulnerable economies.
This aspect can also be read in conjunction with the provisions under paragraph
1(h) of the Decision on “other elements of the Work Programme”. The para
graph reaffirms the high priority Members place on those aspects of the DWP
which do not involve negotiations, and emphasises the importance of fulfilling
the mandates therein. It specifically instructs the General Council and other
relevant bodies to report, in line with the Doha mandates, to the 6th MC. These
non-negotiating issues, in addition to small, vulnerable economies which is
mentioned in the Decision, relate also to trade, debt and finance,45 and trade and
transfer of technology46 which are not specifically mentioned in the Decision.
Regarding trade and transfer of technology, the DMD mandated “an examina
tion... of the relationship between trade and transfer of technology, and of any
possible recommendation on steps that might be taken ... The General Council
shall report to the Fifth Session”. Issues brought up in the Working Group in
clude: (a) definition of transfer of technology (b) transfer of technology and the
enabling environment (c) transfer of technology and the role of home and host
countries (d) transfer of technology and IPRs (e) transfer of technology and FD1
(f) transfer of technology and WTO agreements (g) transfer of technology and
technical assistance.
Regarding trade, debt and finance, the DMD mandates “an examination ... of
the relationship between trade, debt and finance and of any possible recom
mendations on steps that might be taken ... to enhance the capacity of the mul
tilateral trading system to contribute to a durable solution to the problem of
external indebtedness of developing and least developed countries ... and to
45 See paragraph 36 of the DMD.
46 See paragraph 37 of the DMD.
55
strengthen coherence of international trade and financial policies. The General
Council shall report to the Fifth Session". The working group focused on the
following issues: trade liberalisation as source of growth; WTO rules and fi
nancial stability: the importance of market access and the reduction of other
trade barriers in the Doha negotiations; trade and financial markets; trade-fi
nancing; better coherence in the design and implementation of trade-related
reforms and monitoring; the inter-linkage between external liberalisation and
internal reform; external financing, commodity markets and export diversifica
tion.
Work on each of the issues should be completed and recommendations agreed
upon, and the recommendations should be presented, as mandated, to the 6th
MC for adoption and follow-up in the ensuing period. In terms of the relation
ship between trade, debt and finance, work should lead to finalising recommen
dations on (a) WTO's contribution to a durable solution the problem of external
indebtedness of developing countries and LDCs. and (b) strengthening coher
ence between international trade and financial policies so as to shield the MTS
from financial and monetary instability. In terms of the relationship between
trade and transfer of technology, recommendations should be finalised on steps
within WTO’s competence, to increase flows of technology to developing coun
tries.
4.2(e) Least-developed Countries
Regarding LDCs, Members reaffirmed their determination to fulfilling com
mitments made at Doha concerning LDCs. Various commitments have been
made in respect of LDCs under the DMD. Indeed, the MTS must be sensitive to
the special needs of LDCs.
A key issue in this regard is the provision of duty-free and quota free market
access for products originating in LDCs as called for in various international
accords (Doha, LDC III, and Millennium Declaration). A recent report by
UNCTAD on “A Trade Marshall Plan for LDCs” notes that significant com
mercial gains would accrue to LDCs from the provision of bound duty free,
56
quota treatment to all exports of LDCs by developed countries. Such treatment
“is likely to bring welfare gains of as much as USS8 billion and will add up to
USS6.4 billion (10 per cent) per year increase in LDC exports, which currently
represent just 0.68 per cent of world trade.’’47
LDCs have called for duty-free and quota free access for ALL their products
and for such treatment to be BOUND under the WTO. For example, the Fourth
LDC Trade Ministers’ Meeting in Livingstone (June 2005) called on the 6th
WTO MC to agree on “Binding commitment on duty-free and quota-free mar
ket access for all products from LDCs to be granted and implemented immedi
ately, on a secure, long-term, and predictable basis, with no restrictive mea
sures introduced.” Both issues remain outstanding in that not all WTO mem
bers provide LDCs with fully free trade treatment, apart from EBA and AGOA
and some GSP schemes, and all such treatment provided so far are not bound in
the WTO. Such treatment is sanctioned by Part IV of GATT and the Enabling
Clause. In terms of similar treatment that could be provided by developing
countries in a position to do so, some progress is taking place, mostly within the
context of South-South regional trade agreements. In terms of legal coverage
for South-South preferences, a waiver has been provided.48
A related issue is for LDCs to be granted exemptions from tariff and subsidy
reduction commitments. Another key issue isTRTA, and programmes like JITAP
(as noted previously) are making a difference and deserve full and additional
support to deepen the assistance provided and to increase the number of benefi
ciary countries. Addressing the deeper end of TRTA is also a key concern of
LDCs in view of diversifying their production and improving competitiveness
in traditional areas as well as emerging areas of comparative and competitive
advantage; developing human, institutional, regulatory and R&D capacities and
infrastructures; and achieving greater technology-intensity, value-added, value
retention and diversification of products and competitiveness
47 Lakshmi Pun, “Towards a new trade ‘Marshall Plan’ for Least Developed Countries: How to deliver on the
Doha development promise and help realise the UN Millennium Development Goals" (UNCTAD/D1TGTAB/
PO V/2005/1)
4* “Preferential TarifTTrcatmcnt for Least-Developed Countries: Decision on Waiver" adopted on 15 June 1999
(WT/L/304).
57
5 Conclusion
“Development issues’’ lie at the heart of the negotiations and any outcomes of
the DWP. This arises from the commitment to place the needs and interests of
developing countries at the heart of the work programme. A development-ori
ented outcome will give credibility to the appellation - Doha “Development”
Agenda - without which, the appellation will be a name without any real mean
ing.
Without mainstreaming development, the DWP will lack justification as not
responding to the concents of effective integration of developing countries into
the MTS. It would strengthen the hands of those who argue that WTO is anti
development. It would enhance the perception by many that the erosion of de
velopment that took place in the Uruguay Round, through limited attention to
SDT, is perpetuated.
A round without development can sow the seeds for the eventual damaging of
the MTS as it will erode the confidence and commitment of the large majority
of the membership of the WTO in such a system. It will make it difficult for
developing countries to accept to negotiate another new round, once the Doha
negotiations are completed.
Yet development issues have been the most difficult of issues to address in the
three years and over since the launching of the DWP. The missed deadlines in
addressing them has disturbed the balance of interests attained at the Doha MC
in which developing countries basically agreed to the launching of a new round
of negotiations as long as their development issues were addressed on a priority
basis before entering into new market access commitments and rules negotia
tions.
While developing countries have individually and jointly made proposals on a
series of development issues, resulting in the proposed 88 SDT agreement
specific issues and over 100 implementation issues, and various attempts at
discussing and addressing these issues, very limited progress forward in terms
of concrete, substantive outcomes have been achieved. In the meanwhile, as the
negotiations proceed, the concerns of developing countries with respect to de
velopment have fortified with newer, specific trade and development concerns
raised in the market access negotiations.
The July Package attempted to provide new momentum to the treatment of
development issues. It enjoined Members to achieve the mandated work on
these issues by prioritising them in the post-July period. It provided new dead
lines (July 2005) in respect of SDT and implementation issues. It encouraged
Members to be more forthcoming in respect of technical cooperation, to com
plete the work programme on small, vulnerable economies by the 6th MC, to
mainstream the specific trade and development concerns of developing coun
tries into the agriculture and NAMA negotiations, which in any event should
address SDT as a key principle. Such recommendations, by July 2005, were not
provided.
Meeting the July 2004 Package provisions on development issues was and re
mains a major challenge in view of the past hesitancy with which such issues
have been addressed. The July 2005 approximations passed without any tan
gible progress on the deadlines on SDT and other development issues raised in
the July Package.
Thus, the 6th WTO MC and beyond would be seized with concretely, specifi
cally, adequately and expeditiously addressing the development issues. This
will be a challenge for developing countries in:
59
re-examining the SDT and implementation proposals to ascertain their
relevance.
•
prioritising them in terms of their commercial and development values,
and preserving and enhancing them;
•
expediting examination and proposals of measures to address specific needs
of small, vulnerable economies and also with the work with other non
negotiating working groups (trade and transfer of technology, and trade
and debt and finance);
•
mainstreaming into the agriculture and NAMA negotiations the specific
trade and development needs of developing countries and in this context,
seek both trade and development related solutions to the problems of trade
preferences and commodities;
•
monitoring implementation of commitments on technical assistance, and
•
meeting the specific needs of LDCs including through mobilising increased
support for the IF and especially for JITAP.
For their part, developed countries must accept not only in principle and spirit
that development matters, but that this principle must find concrete expression
in the Doha negotiations and its outcomes. Concrete progress must be achieved
on development issues generally and especially in respect of SDT and imple
mentation issues, as well as specifically in the market access negotiations (ag
riculture, NAMA, services).
Finalisation of the work on small economies and other non-negotiating work is
also important to developing countries in terms of addressing their wider devel
opment concerns and thus creating an enabling trading environment in which
these countries can trade in and develop.
60
Ultimately, the functioning of the MTS under the auspices of the WTO in an
equitable manner that addresses the development needs and concerns of devel
oping countries is in the interest not only of these countries, but also of other
countries and the MTS itself. Self-interest and preservation of economies sug
gest that enlightened development solidarity between all WTO Members is
needed in giving a boost to and resolving thoroughly, effectively and adequately
the development issues.
Prominent people and reports have taken up this clarion call for the MTS to
move beyond a purely trade liberalising approach to one which enables devel
opment, job creation, poverty reduction, and wider and affordable access to
essential goods and services, in this regard, the development promise of Doha
is timely and crucial and it must be fully redeemed.
61
Titles in the TWN Trade & Development Series
No. 1
From Marrakesh to Singapore: The WTO and Developing Countries
by Magda Shahin (48 pages)
No. 2
The WTO and the Proposed Multilateral Investment Agreement: Implications for
Developing Countries and Proposed Positions by Martin Khor (40 pages)
No. 3
Some Key Issues Relating to the WTO by Bhagirath Lal Das (40 pages)
No. 4
The New Issues and Developing Countries by Chakravarthi Raghavan (48 pages)
No. 5
Trade and Environment in the WTO: A Review of its Initial Work and Future
Prospects by Magda Shahin (68 pages)
No. 6
Globalisation: The Past in our Present by Deepak Nayyar (40 pages)
No. 7
The Implementation of the WTO Multilateral Trade Agreements, the ‘Built-In’
Agenda, New Issues, and the Developing Countries byXiaobing Tang (68 pages)
No. 8
Strengthening Developing Countries in the WTO by Bhagirath Lal Das (48 pages)
No. 9
The World Trade Organization and its Dispute Settlement System: Tilting the
Balance Against the South by Chakravarthi Raghavan (48 pages)
No. 10 Negotiations on Agriculture and Services in the WTO: Suggestions for
Modalities/Guidelines by Bhagirath Lal Das (24 pages)
No. 11
No. 12
The Implications of the New Issues in the WTO by Bhagirath Lal Das (20 pages)
Developing Countries, the WTO and a New Round: A Perspective
by Ransford Smith (40 pages)
No. 13
Review of the TRIPS Agreement: Fostering the Transfer of Technology to
Developing Countries by Carlos Correa (48 pages)
No. 14 The Proposed New Issues in the WTO and the Interests of Developing
Countries by Martin Khor (32 pages)
No. 15
WTO: Challenges for Developing Countries in the Near Future
by Bhagirath Lal Das (24 pages)
No. 16 Dangers of Negotiating Investment and Competition Rules in the WTO
by Bhagirath Lal Das (32 pages)
62
No. 17 WTO Agreement on Agriculture: Deficiencies and Proposals for Change
by Bhagirath Lal Das (28 pages)
No. 18
Some Suggestions for Modalities in Agriculture Negotiations
by Bhagirath Lal Das (24 page)
No. 19 The WTO Agriculture Agreement: Features, Effects, Negotiations, and
Suggested Changes by Martin Khor (48 pages)
No. 20
Market Access for Non-Agricultural Products: A Development View of the
Principles and Modalities by Martin Khor & Goh Chien Yen (32 pages)
No. 21
Financial Effects of Foreign Direct Investment in the Context of a Possible
WTO Agreement on Investment by David Woodward (28 pages)
No. 22
Implementation Issues Again Off WTO Radar Screens?
by Chakravarthi Raghavan (28 pages)
No. 23
Effects of Agricultural Liberalisation: Experiences of Rural Producers in
Developing Countries by Meenakshi Raman (40 pages)
No. 24 The WTO Negotiations on Industrial Tariffs: What is at Stake for Developing
Countries by Yihnaz Akyiiz (68 pages)
No. 25 The Commodities Crisis and the Global Trade in Agriculture: Problems and
Proposals by Martin Khor (44 pages)
No. 26
Implications of Some WTO Rules on the Realisation of the MDGs
by Martin Khor (48 pages)
No. 27
Development Issues in the WTO in the Post-July Package Period: Myth or Reality?
by Bonapas Onguglo (72 pages)
63
DEVELOPMENT ISSUES IN THE WTO IN THE POST-JULY
PACKAGE PERIOD: MYTH OR REALITY?
The 4th World Trade Organisation (WTO) Ministerial Conference at Doha was
momentous in the history of GATT/WTO in terms of providing specific directives
on the integration of "development issues” into the WTO and the multilateral trad
ing system (MTS).
However, the journey so far in redeeming the development promise of Doha has
been full of broken promises and missed deadlines, including the recent July 2005
approximation deadline. This setback follows on the heels of the important break
through in the negotiations attained in the July 2004 package with regard to devel
opment issues.
The lack of substantive movement is evident in almost all areas of development
matters, including that concerning special and differential treatment, implementa
tion. specific trade-related needs and concerns of developing countries, and, to a
lesser extent, technical assistance.
Will mainstreaming development into the WTO and the MTS be a myth or a fact
that can be realised to meet the expectations of developing countries? Can the de
velopment promise of Doha, which is timely and crucial and deserves to be fully
redeemed, be translated into concrete steps in the period leading to the coming 6th
WTO Ministerial Conference and beyond? This paper attempts to answer some of
these important and pressing questions.
BONAPAS ONGUGLO has been an Economic Affairs Officer with the United
Nations Conference on Trade and Development in Geneva since 1986. He has over
18 years’ experience in multilateral trade negotiations; regional trade and eco
nomic integration among developing countries; trade policyformulation; and traderelated technical assistance and institutional and human capacity building. He
advises in particular African, Caribbean and Pacific countries on WTO issues,
including the current Doha round of negotiations and the ACP-EU Partnership
Agreement.
TWN TRADE & DEVELOPMENT SERIES
is a series of papers published by Third World Network on trade and de
velopment issues that are of public concern, particularly in the South. The
series is aimed at generating discussion and contributing to the advance
ment of appropriate development policies oriented towards fulfilling human
needs, social equity and environmental sustainability.
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