The Impact of the Doha Development The Impact of the Doha Development Agenda Negotiations on Developing Agenda Negotiations on Developing

CountriesCountries

DELHI, May 2006Vilaysoun Loungnarath

2

The Benefits of Trade to Developing The Benefits of Trade to Developing CountriesCountries

The link between trade and growth & development is hotly debated by economists

General acceptance that trade is an engine of economic growth and development

Developing countries accept this fact and are determined to participate effectively in the Doha Development Agenda (DDA) negotiations and play a greater role in the multilateral trading system

The potential benefits from the liberalization of trade…

3

Developing countries’ broad interests Developing countries’ broad interests in the DDA Negotiationsin the DDA Negotiations

Developing countries are targeting the subsidies provided by developed countries to their farming sectors

They are also targeting tariff peaks and tariff escalation as well as non-tariff barriers which prevent them from adding value to their commodities and other products

In addition, they are pressing for policy space – special and differential treatment – to implement development-friendly policies

4

Challenges Facing Developing countries Challenges Facing Developing countries in the Multilateral Trading Systemin the Multilateral Trading System

Developing countries will be required to give reciprocal concessions in the negotiations – reduction of tariffs on both industrial and agricultural products and opening up certain service sectors to allow foreign participation

There could be short-terms costs, including the possible loss of jobs in certain key sectors of developing countries’ economies, including the textiles and clothing industry

Imperative that their firms become competitive and find a niche for certain product categories in their major export markets

5

Challenges in the Multilateral Trading Challenges in the Multilateral Trading SystemSystem

Supportive Government policies to assist firms to become competitive

Supportive policies by major trading partners – removal of subsidies, improvement of preferential schemes by simplifying rules of origin

Improved technical assistance and capacity-building with the aim of addressing supply-side constraints which have prevented developing countries from participating effectively in the Multilateral Trading System

6

Challenges in the Multilateral Trading Challenges in the Multilateral Trading SystemSystem

Challenges are immense but so also are the opportunities for developing countries

They have an opportunity to request their major trading partners to eliminate or reduce significantly barriers to their exports

Increased exports are likely to generate employment and raise living standards

They could attract investments into certain key sectors of the economy, particularly in the services sectors, which could generate positive welfare effects for them

7

Challenges in the Multilateral Trading Challenges in the Multilateral Trading SystemSystem

Developing countries can take advantage of the DDA negotiations to implement difficult but necessary reforms to improve the efficiency of their economies

A strengthened multilateral trading system as a result of the DDA negotiations will be to the advantage of small developing countries

It will safeguard their interests and ensure that their exports are not subjected to arbitrary measures – discriminatory tariffs, unjustified technical standards and sanitary and phytosanitary measures

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Main Elements of the DDA Main Elements of the DDA NegotiationsNegotiations

Negotiations were launched at Doha, Qatar in Nov 2001 in the following areas: agriculture, services, non-agricultural market access, rules, dispute settlement, environment, TRIPS

Implementation issues – para. 12 of the Declaration Issue of GI Extension - paras 12 and 18– Opinions divided

on whether it is a negotiating issue* *Singapore Issues to be negotiated only on the basis of an

explicit consensus i.e. agreement among all present Members

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Main Elements of the DDA Main Elements of the DDA NegotiationsNegotiations

Special and differential treatment for developing countries Work to be pursued under the auspices of the General Council

– Constituent elements of the Doha Work Programme but not part of the Single Undertaking:– Electronic Commerce – para. 34

– Small Economies – para. 35

– Trade, Debt and Finance – para. 36

– Trade and Transfer of Technology – para. 37

– relationship between the TRIPS Agreement and the Convention on Biological Diversity, the protection of traditional knowledge and folklore (para19)

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Main Elements of the DDA Main Elements of the DDA NegotiationsNegotiations

Negotiations were supposed to have been concluded by 1 January 2005

Principle of the Single Undertaking (nothing agreed until everything is agreed) except for the negotiations on dispute settlement

Various Negotiating Groups were established by the Trade Negotiations Committee (TNC) to conduct the negotiations

Membership of these bodies were open to any WTO member and acceding countries with accession Working Parties established

Cancún Ministerial Conference was supposed to review progress made in the negotiations (10-14 September 2003) and take any appropriate decisions

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Elements of the July 2004 Elements of the July 2004 Decision: AgricultureDecision: Agriculture

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AGRICULTURE AGRICULTURE Reaffirmation of the mandate in paragraph 13 of the

Doha Ministerial Declaration Long-term objective of establishing a fair and market-

oriented trading system through a programme of fundamental reform

Final balance to be found only at the conclusion of negotiations and within the single undertaking

Modalities to be developed will need to incorporate operationally effective and meaningful provisions for S&D.

Reform of 3 pillars (market access, domestic support, export competition) form an interconnected whole and need to be approached in a balanced and equitable manner

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AGRICULTURE – COTTON -1bAGRICULTURE – COTTON -1b It is Recognized that cotton plays a vital role in the

economies of several developing countries, particularly LDCs The issue is to be addressed ambitiously, expeditiously, and

specifically within the Agriculture negotiations A special Session of the Committee on Agriculture will

ensure appropriate prioritization of the cotton issue independently from other sectoral initiatives

A sub-committee on cotton will be established and will meet periodically and report to the Special Session to review progress

Work should encompass all trade distorting policies affecting the sector in all three pillars of market access, domestic support and export competition, as specified in the Doha text and also in the Framework

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Domestic SupportDomestic Support Overall support (amber + de minimis + blue) to be reduced by a

tiered formula. 20% cut in the first year of implementation Amber Box (supports having a direct impact on prices and

quantities): tiered formula, so that higher levels are reduced more; caps on support provided to individual products; reductions to be made on some

Green Box (currently unlimited, e.g. environmental protection, rural development) : Review and monitor

Blue Box (distorting supports but less so because of production limits or other criteria): to be capped at 5% of value of production, some flexibility envisaged

De minimis (minimal amounts of amber-type supports): To be reduced; percentage to be negotiated. S&D for developing countries – exemption of support to subsistence and resource-poor farmers

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Export Subsidies Parallel elimination of all forms of export subsidies. Disciplines on all measures

of equivalent effect – subsidised credit, credit guarantees, insurance, state trading enterprises, food aid etc

– Max 180-day repayment on credit, food aid, state trading enterprises etc

– Other subsidised credit, food aid, state trading enterprise (monopolies) – disciplines to be negotiated

End date for the phase out of all form of export subsidies to be negotiated S&D for developing countries – right to have recourse to Art.9.4 (subsidies to

reduce costs of marketing exports of ag products/subsidized internal transport and freight charges) of the Agreement of Agriculture to be maintained until removal of all forms of exports subsidies and implementation of all disciplines

Due account to be taken of the interests of LDCs and NFIDCs in the formulation of disciplines on export credits, export credit guarantees etc.

Special consideration to be given to STEs which enjoy special privileges in order to preserve domestic consumer price stability and food security; Possibility of ad-hoc financial arrangements in exceptional circumstances

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Market AccessMarket Access Substantial improvements in market access for all products Reductions to be made using a tiered (banded) formula Progressive: tariffs in higher tiers to be subject to deeper cuts To be negotiated: how many tiers, which formula(e),

sensitive/special products, quotas Sensitive products – flexibility for Members, but substantial

market access improvement for every product S&D for developing countries – more time, gentler cuts,

Special Safeguard Mechanism SSM, Special Products SP, improved access for tropical products, narcotic replacement crops

LDCs not required to undertake reduction commitments; duty-free and quota-free access for LDC products, importance of cotton to LDCs

Preference erosion to be addressed

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AGRICULTURE – July 2005: AGRICULTURE – July 2005: Job(05)/163 &126: MAJob(05)/163 &126: MA

Both the DG and the Chairman Groser noted that negotiations stuck over another gateway issue – the structure of the tiered formula for tariff cuts

Key issue is whether progressivity should be achieved solely through the number of tiers or through the number of tiers and also on the nature of the formula(e) within the tiers

Another key issue is how to deal with sensitivities – should the criteria be based solely on food security, livelihood security and rural development needs, or should the formula itself contain some flexibilities

Growing acceptance that the G-20 formula offers a possible way forward

Solving this issue is important if progress is also to be made on SSM, tariff peaks and escalation, preference erosion, tropical products etc

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AGRICULTURE – July 2005: AGRICULTURE – July 2005: Job(05)/163 &126: DSJob(05)/163 &126: DS

With respect to domestic support, a key issue is the structure of the reduction commitments, particularly with respect to the tiered formula for reductions of the Final Bound Total Aggregate Measurement of Support AMS (domestic subsidization policies having a direct effect on production and trade)

Where should the 3 largest users (EC -$60 billion; Japan - $36 billion and the U.S. $19 billion of the amber box be placed)? Should there be 3 or 4 tiers? – A further question is whether they should be placed in the higher category

What flexibilities should be provided to developing countries How to handle product-specific AMS caps? Tied to the structure of

the formula and depth of cuts What about de minimis; Is it simply a matter of the size of the cut

or should they be eliminated?

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AGRICULTURE – July 2005: AGRICULTURE – July 2005: Job(05)/163 &126: DSJob(05)/163 &126: DS

With respect to Blue box, the challenge is to ensure that they are less trade-distorting than AMS measures – is capping at 5% satisfactory?

Complex linkages – would depend on the size of the cut of the AMS and de minimis

With regard to Green Box measures, how do you ensure that they satisfy the overarching criterion of “no or at most minimal trade-distorting effects or effects on production”

What flexibilities should be provided to developing countries?

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AGRICULTURE – July 2005: AGRICULTURE – July 2005: Job(05)/163 &126: ESJob(05)/163 &126: ES

Need to flesh out parallel commitments in export credits, State Trading Enterprises (STEs) and Food Aid

Defining the “credible end date” Need to develop additional disciplines on export credits of

180 days or less Should STEs continue to have monopoly powers, what

constraints should be placed on them What disciplines should be enacted with respect to

subsidies, government financing and underwriting of losses Which flexibilities should be granted to developing countries

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AGRICULTURE – July 2005: AGRICULTURE – July 2005: Job(05)/163 &126: ESJob(05)/163 &126: ES

With regard to food aid, how do you achieve a balance between preventing commercial displacements and giving genuine assistance to people in vulnerable countries who need food aid

With respect to cotton , how can the mandate be met? Should discussions be fast-tracked and should obligations be front-loaded

Action on the development aspects of the cotton mandate

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AGRICULTURE – HK MIN DECAGRICULTURE – HK MIN DEC

Establish modalities no later than 30 April 2006. (Paragraph 10)

Complete disciplines on export credits, export credit guarantees or insurance programmes, exporting state trading enterprises and food aid by 30 April 2006 as part of modalities. (Paragraph 6)

Date (2013) for elimination of all forms of export subsidies, together with agreed progressivity and parallelism, to be confirmed only upon completion of modalities. (Paragraph 6)

Submit comprehensive draft Schedules based on modalities no later than 31 July 2006. (Paragraph 10)

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AGRICULTURE – HK MIN DEC:AGRICULTURE – HK MIN DEC:CottonCotton

All forms of export subsidies for cotton to be eliminated by developed countries in 2006. (Paragraph 11)

Director-General to furnish updates on development assistance aspects, at appropriate intervals, to General Council. (Paragraph 12)modalities no later than 30 April 2006. (Paragraph 10)

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NAMA – Job(05)/147 and Add.1NAMA – Job(05)/147 and Add.1 Progress has not been very rapid – probably because of the

lack of substantive progress in agriculture Need to agree on the structure of the formula – some Members

do not want to discuss numbers without first having a defined structure, while others have problems discussing the structure without first having the numbers

Key issue is how to strike a balance between the level of ambition and the flexibilities to be allowed developing countries. Structure of the formula is less contentious

The roadblock can only be removed if Members start discussing numbers and engage in real discussions about trade-offs

Broad support for the use of the Swiss Formula as the central tariff cutting mechanism

26

Girard /Derbez FormulaGirard /Derbez Formula

T1= ( B x Ta x T0 ) = 1 x 5 x 5 = 25 = 2.5( B x Ta + T0 ) (1 x 5) + 5 10

Where, T1 is the final tariff rate, to be bound in ad valorem

terms T0 is the base tariff rate Ta is the average of the base tariff rates B is a coefficient with a unique value to be

determined by the participants

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NAMA – Job(05)/147 and Add.1NAMA – Job(05)/147 and Add.1 Issue is whether there should be a limited number of co-

efficients or whether there should a largely pre-determined coefficient for each member using its tariff average as a starting point

Growing support for the first option but there remains some hurdles which have to be cleared

Only way out is to plug in the actual numbers. A numbers-based negotiation should address both the actual levels of co-efficients and the final numbers to be used in paragraph 8

Growing acceptance of the principle of applying formal cuts to unbound tariffs and using a non-linear mark-up approach as opposed to a linear mark up.

Some difficulties for Members having low unbound tariffs

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NAMA – Job(05)/147 and Add.1NAMA – Job(05)/147 and Add.1 With respect to countries falling under paragraph 6, whether

they should be obliged to bind all their tariffs or whether should be encouraged to bind their tariffs (i.e. not obligatory)

With regard to paragraph 8, the key questions are: whether the flexibilities foreseen in this paragraph should remain intact and separate from the formula; whether they should be modified through a mechanism which creates a trade-offs between the formula and these flexibilities, and whether the flexibilities should be eliminated in exchange for a higher co-efficient for developing-country Members

With respect to paragraph 9, recognised that LDCs do not have to make tariff reductions, should they be expected to increase substantially the level of their tariff bindings

What about improved market access for them?

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NAMA – Job(05)/147 and Add.1NAMA – Job(05)/147 and Add.1 With respect to paragraph 7 – sectoral tariff component – the

key issues are product coverage, participation and S&D. Work taking place in informal Member-driven processes based

on the critical mass approach. Work focussing on the ff: electronics/electrical equipment, bicycles and sporting goods, chemicals, fish, footwear, forest products, gems and jewellery, pharmaceuticals and medical devices, and raw materials

Transparency has been raised; results shall be binding and applied on MFN basis

How to take account of the interests of Recently Acceded Members

With regard to para. 12, which supplementary modalities should be envisaged?

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NAMA – Job(05)/147 and Add.1NAMA – Job(05)/147 and Add.1 With respect to paragraph 13, how to handle the issue of the

elimination of low duties With regard to NTBs, the phase of identifying and categorizing

notified NTBs is complete. The second phase is the examination and negotiation of such NTBs. Modalities being used bilateral, vertical and horizontal

Need for more written proposals from Members. Transparency should be assured as process is increasingly being Member-driven.

With regard to para. 15, how to ensure that appropriate studies are carried out and build the capacity of developing countries to participate effectively in the negotiations – simulations

With regard to para. 16, how to handle the issue of non-reciprocal preferences and tariff revenue dependency

With respect to para. 17 on non-agricultural environmental goods, list being complied in Com.T.Envir. Special Session.

31

NAMA: HK MIN DECNAMA: HK MIN DEC

Establish modalities no later than 30 April 2006. (Paragraph 23)

Submit comprehensive draft Schedules based on modalities no later than 31 July 2006. (Paragraph 23)

May: seminar on preference erosion related problems (agriculture + NAMA).

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SERVICESSERVICES Modest progress in the negotiations. Currently, 70 offers have

been tabled by Members, counting the EC-25 as one. Thus 95 offers received thus far (14.02.2006)

Excluding 32 LDCs who are not required to table any offers, 12 Members are yet to submit their initial offers. Counting LDCs, the figure is 44.

31 revised offers have been submitted by Members (14.02.2006) The May 2005 deadline has been a catalyst in getting Members to

respond While the number of offers and revised offers have improved, the

quality of the offers is far from encouraging. Few, if any, provide new business opportunities to service suppliers. If current offers were to enter into force, the average number of sub-sectors committed by Members would increase only from 51 to 57

33

SERVICESSERVICES Overall, feeling among delegations that negotiations are not

progressing as they should. Members outlined their objectives and aspirations

Need for the quality of offers to improve if a deal is to be struck. Need for real policy and regulatory reforms leading to market opening

Recognition that request-offer method alone is not producing the desired results. Resource-intensive and time-consuming. Some Members urged other approaches to hasten the negotiations

With respect to the rules aspect of the negotiations, some limited progress in the elaboration of disciplines on domestic regulation

Not much progress on GATS rules – emergency safeguards measures and government procurement

34

SERVICESSERVICES Importance of the modalities for the special treatment of

LDCs and their increased participation in the negotiations stressed. Role of technical assistance alluded to. Paper by LDCs discussed (Job(05)/114)

LDC expectations include: realising export opportunities on mode 4 (movement of natural persons in services trade), appropriate mechanisms for effective access for LDC services exports, and measures aimed at increasing LDC participation in trade in services

With respect to assessment of trade in services, a substantive discussion took place on the basis of a submission by Cuba. Presentation made by UNCTAD

Much work remains to be done.

35

SERVICES: HK MIN DECSERVICES: HK MIN DEC Any outstanding initial offers shall be submitted as soon as

possible. (Annex C, paragraph 11(a)) Submission of plurilateral requests by Groups of Members

by 28 February 2006 or as soon as possible thereafter. (Annex C, paragraph 11(b))

Members to strive to complete requirements in 9(a) (develop appropriate mechanisms for according special priority including to sectors and modes of supply of interest to LDCs) before (31 July 2006). (Annex C, paragraph 11(e))

Second round of revised offers to be submitted by 31 July 2006. (Annex C, paragraph 11(c))

Final draft schedules of commitments shall be submitted by 31 October 2006. (Annex C, paragraph 11 (d))

36

TRIPSTRIPS It appears that delegations’ positions have not

evolved very much on the fundamental issue in the negotiations.

On the one hand, some Members are advocating a database system to which Members would have regard when deciding which GI’s to protect nationally.

Others are advocating a registration system which, once a name has been registered at the multilateral level, would create a presumption of protectability at the national level in a Member, unless the notified name has been opposed by that Member

37

TRIPS TRIPS In his last report to the TNC, the Chairman stated

that there has been an increase in the level of activity in the Special Session. New proposals have been submitted

Although negotiations were useful in elucidating the positions of Members, they did not succeed in narrowing the positions of Members

Differences still persist on the merits of the different proposals and their consistency with the mandate of the Special Session as contained in para 18 of the DMD

38

TRIPS TRIPS The two key points of difference that continue to impede

progress are: (i) the extent to which legal effects at the national level should be consequent on the registration of a GI in the multilateral system, and (ii) the extent to which such effects should apply in all WTO Members or only those opting to participate in the system

There are other issues which would also need to be further considered: costs and administrative burdens

If progress is to be made, need for flexibility on all sides In HK MIN DEC: Intensify negotiations in order to complete

them within the overall time-frame for the conclusion of the negotiations (in 2006). (Paragraph 29)

July: working document to be tabled.

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RULESRULES A substantial result in the rules negotiations is one of the pillars

of a successful DDA ( all three areas of dumping, subsidies, including fisheries subsidies and Regional Trade Agreements) should make their contribution to overall balance

The Neg. Group has substantially intensified its work. With respect to dumping and subsidies, the NG’s plenary and informal processes have been supplemented with bilateral and plurilateral consultations directed by the Chairman, which work on the basis of “third generation” submissions proposing specific changes to the Agreement text

The objective is to identify areas of particular and salient interest to participants and to encourage a concrete and precise discussion involving real engagement with a view to identifying solutions

40

RULESRULES The expectation that it would give the NG the most realistic

sense of areas in which some progress may be possible, and the types of changes that might be acceptable to all members

Political input will be necessary to move forward the negotiations

Process should be sharpened by limiting work to precise textual proposals to improve the Agreements on Anti-Dumping and Subsidies and Countervailing Measures

On Regional Trade Agreements, good progress has been made. A draft “decision text” for a new process to improve RTA transparency has been developed on the basis of intense informal debate within the Group

Work is done on the application of new process to agreements notified under the Enabling Clause

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RULES: HK MIN DECRULES: HK MIN DEC Participants promptly to undertake further detailed work on

disciplines on subsidies in fisheries sector. (Annex D, section I, paragraph 9)– March: proposals in the form of detailed legal drafting.

Group to complete process of analysing proposals by participants as soon as possible. (Annex D, section I, paragraph 10, AD/SCM)– April: tabling of remaining proposals on AD/SCM including fisheries

subsidies.– June: analysis of all proposals to be completed.

Chairman to prepare, early enough to assure timely outcome within context of 2006 end date for DDA, consolidated texts of AD and SCM Agreements that shall be the basis for final stage of negotiations. (Annex D, section I, paragraph 11)– July: target date for the submission of consolidated texts by the

Chairman.

42

RULES (Regional Trade RULES (Regional Trade Agreements: HK MIN DECAgreements: HK MIN DEC

Negotiating Group to intensify efforts to resolve outstanding issues, with a view to provisional decision on RTA transparency by 30 April 2006. (Annex D, section II, paragraph 2)

January: Chairman's working document (circulated). Negotiating Group to intensify negotiations, based on

text proposals as soon as possible, so as to arrive at appropriate outcomes by end 2006. (Annex D, section II, paragraph 3)

January: Chairman's working document (circulated).

43

DISPUTE SETTLEMENTDISPUTE SETTLEMENT

Work progressing at a satisfactory pace The Special Session is examining proposals tabled by

Argentina, Brazil, Canada, India, Mexico, New Zealand and Norway, Japan, the EC and the U.S.

Proposals cover remand authority for the Appellate Body (send issues back to the panel to make further findings of facts), sequencing between Articles 21 and 22 of the DSU (compliance panel versus retaliation), post-retaliation (reduction of the level of suspension or withdrawal of the retaliatory measures), transparency and panel composition

44

DISPUTE SETTLEMENTDISPUTE SETTLEMENTProcess to be intensified Objective is to make a substantial progressChair encouraged delegations to consult

among themselves, so as to clarify positions and build consensus around proposals. Negotiations to move to a text-based negotiation

Combination of formal and informal meetings

45

DISPUTE SETTLEMENTDISPUTE SETTLEMENT

Special Session to continue to work towards rapid conclusion of negotiations. (Paragraph 34)– March/April: revised contributions on

specific issue.

– July: presentation of Chairman's draft working document.

46

ENVIRONMENTENVIRONMENT With respect to paragraph 31(i) relating to the relationship

between WTO rules and multilateral environment agreements, the negotiations had entered into a phase of substantive discussions.

Some delegations have requested that national experiences should be shared with the Committee on Trade and environment Special Session (CTESS) and coordinated between trade officials and environment officials

Coordination at the national level key to preventing conflicts between Multilateral Environment Agreements (MEAs) and WTO obligations at the international level

In parallel to the national experience sharing, some members have begun to discuss potential outcomes – examining the principles that underlie the MEAs-WTO relationship

47

ENVIRONMENTENVIRONMENT With respect to paragraph 31(ii) relating to exchange of

information between MEAs Secretariats and relevant WTO Committees, a number of delegations called for improved coordination at the international level

Some delegations highlighted the linkages between paragraphs 31(i) and (ii). The Chair encourages delegations to explore potential synergies between the first and second parts of the mandate

On paragraph 31(iii), the Chair stated that he was encouraged by the level of engagement that has taken place . Numerous submissions have been made, including the submission of lists of environmental goods (e.g. products to manage pollution or natural resources, goods environmentally friendly in their production)

48

ENVIRONMENTENVIRONMENT As far as negotiations on para. 31(iii) are concerned, there

is a need to agree as early as possible on the overall approach to be adopted – Should the focus be on a list-based approach or a project approach or a combination of the two?

The pace of negotiations tied to progress in other areas, particularly the NAMA negotiations

There is need to make progress on what constitutes an “environmental good”

There is also need to identify environmental goods which are of export interest to developing countries

The overall objective should be to deliver both environmental and trade gains

49

ENVIRONMENT:HK MIN DECENVIRONMENT:HK MIN DECMembers to intensify the negotiations,

without prejudging their outcome, on all parts of paragraph 31 to fulfil the mandate. (Paragraph 30)– September: with regard to sub-paragraphs 31

(i) and (ii) begin negotiations based on drafts.Members to complete work expeditiously

under paragraph 31 (iii). (Paragraph 32)– April: clarification of parameters to fulfil the

mandate in this area.

50

S & DS & D Members attempted to find a new approach that would take

forward the work on S&D, e.g. longer time periods for implementing agreements and commitments, measures to increase trading opportunities, support to build trade policy infrastructure, etc.

The Chair had suggested that it would be more productive if the underlying reasons of the 88 Agreement-specific proposals were identified. Proposals could be redrafted and where necessary discussed in cross-cutting thematic clusters

Chair’s proposal would have meant discussing Agreement-specific proposals in parallel with cross-cutting thematic issues

Chair conceded that some Members, particularly developing countries had strong reservations against the proposed strategy of the Chairman. View that the Special Session should stick closely to its mandate in paragraph 44 of the Doha Declaration

51

S & D S & D The Chairman addressed the remaining Category I and

Category III agreement-specific proposals in the two thematic clusters suggested in his conceptual approach – enhanced flexibility for developing countries in WTO rules and enhanced technical assistance and capacity building for developing countries

The intention was to address the proposals in each of the clusters along with the underlying cross-cutting issues related to that thematic cluster

Assurances from Chairs of WTO bodies to which category II issues have been referred that they are looking at ways to re-invigorate the discussions on them in their respective bodies

52

S & D S & D

The Chairman carried out informal consultations on the way forward. He appealed to developed countries to put the ghost of differentiation to rest and urged developing countries to show flexibility and consider issues on their merits

During consultations, it was agreed that work on the agreement-specific proposals should resume. Further agreed that priority should be given to LDC issues covering waivers, the Enabling Clause, TRIMS and the Decision on Measures in Favour of LDCs.

53

S & D S & D Progress made on the LDC issues, but there has been

no agreement to harvest them. Some doubts were expressed about the economic value of the proposed decisions in terms of facilitating the integration of LDCs into the MTS

A lot of work remains to be done. If an agreement was to be reached on the LDC issues, it would be necessary to address the remaining agreement-specific proposals which are of vital interest to developing countries

Other outstanding issues are the inclusion of the cross-cutting issues, the monitoring mechanism and the incorporation of S&D treatment into the architecture of WTO rules

54

DEVELOPMENT ISSUES: HK MIN DECDEVELOPMENT ISSUES: HK MIN DEC Special and Differential Treatment Members to notify implementation of schemes adopted

under decision every year to Committee on Trade and Development. (Annex F – 36, Decision on Measures in Favour of Least-Developed Countries)– by September: developed-country Members to notify the means by

which they will implement the decision.– by December: developing-country Members declaring themselves in

a position to do so to notify the means by which they will implement the decision.

CTD to conduct a review on an annual basis of all steps taken by Members to provide duty-free and quota free market access for all products originating from LDCs. (Annex F – 36, Decision on Measures in Favour of Least-Developed Countries)– November: CTD to conduct first review.

55

DEVELOPMENT ISSUES: HK MIN DECDEVELOPMENT ISSUES: HK MIN DEC S&D Committee on Trade and Development in Special Session to

expeditiously complete review of all outstanding Agreement-specific proposals and report to General Council, with clear recommendations for decision, by December 2006. (Paragraph 36)– May, July, October: General Council meetings.

WTO bodies and negotiating groups to which Category II proposals referred to expeditiously complete consideration of proposals and report periodically to General Council, with objective of ensuring that clear recommendations for decision are made no later than December 2006. (Paragraph 37)– May, July, October: General Council meetings.

Special Session to report on all other outstanding issues on regular basis to General Council. (Paragraph 38)– May, July, October: General Council meetings.

56

DEVELOPMENT ISSUES: HK MIN DECDEVELOPMENT ISSUES: HK MIN DEC Implementation Director-General to report to each regular meeting of

TNC and General Council; Council to review progress and take any appropriate action no later than 31 July 2006. (Paragraph 39)– February-June: DG to report to TNC and General Council (notably

on GIs and TRIPS/CBD). Integrated Framework Task Force to provide recommendations to IFSC by

April 2006. (Paragraph 49) Enhanced IF to enter into force no later than

31 December 2006. (Paragraph 49)– July: report by Director General to the General Council.

57

DEVELOPMENT ISSUES: HK MIN DECDEVELOPMENT ISSUES: HK MIN DEC Aid for Trade Director-General to create Task Force; Task Force to

provide recommendations to General Council by July 2006. (Paragraph 57)

February: setting up of Task Force. DG to hold consultations and report to General Council

on appropriate mechanisms to increase financial resources for Aid for Trade. (Paragraph 57)

March, May: Director General to consult with Members and Agencies.

July: General Council – discuss Task Force recommendations. September/October: Annual Meetings of the IMF/World Bank

(Washington) – Trade-Finance-Development Ministers discussion of Aid-for-Trade package for DDA.

December: Aid-for-Trade programme and enhanced IF become operational.

58

DEVELOPMENT ISSUES: HK MIN DECDEVELOPMENT ISSUES: HK MIN DEC Small Economies Committee on Trade and Development to continue

work in Dedicated Session and to monitor progress of small economies’ proposals in negotiating and other bodies, with aim of providing responses to trade-related issues of small economies as soon as possible but no later than 31 December 2006. (Paragraph 41)

July: deadline for addressing proposals. April-December: monitoring progress on topics of

interest to small economies in other areas of negotiations, in particular Agriculture and NAMA, with aim of providing responses to trade-related issues of small economies.

59

TRADE FACILITATIONTRADE FACILITATION Since its establishment on 12 October 2004, the Group has

met on a number of occasions and agreed to a work plan and schedule of meetings. Good progress is being made in the negotiations

Work has proceeded on the basis of contributions from Members and inputs from other relevant international organizations. Developing countries have been very active and have submitted a number of proposals.

Presentations have been made by the WTO Secretariat on the main legal framework under discussion and the technical assistance provided by the WTO

Presentations have also been made by the World Bank, World Customs Organization and UNCTAD on the work they are doing on trade facilitation. This creates synergies and avoids duplication of functions

60

TRADE FACILITATIONTRADE FACILITATION Mandate of the Group is to clarify and improve relevant aspects

of Articles V, VIII and X of the GATT 1994 Proposals have focused on these articles, particularly Articles

VIII and X, as well as other on other elements of the mandate, including cost implications, technical assistance and capacity building

Examination of proposals underway – would help increase Members understanding of the proposals and lay the ground work for consensus to be built around them

Overall good progress is being made. The main challenge is how to strike the right political balance

between the level of ambition and the degree of political commitment to policy reform that will be acceptable in an eventual agreement

The importance of S&D is stressed in that regard. Developing countries would need time, technical and financial support to implement reforms domestically

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TRADE FACILITATION:HK MIN DECTRADE FACILITATION:HK MIN DECMembers to be mindful of overall deadline for

finishing negotiations and resulting need to move into focussed drafting mode early enough after Sixth Ministerial Conference so as to allow for timely conclusion of text-based negotiations on all aspects of mandate. (Annex E, paragraph 4)

February: submission and discussion of proposals on all three pillars (Articles, Special &Differential Treatment and Technical Assistance & Capacity Building).

July: first full draft, report to the TNC.

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CONCLUSIONSCONCLUSIONS It is quite clear that most of the subjects under

negotiation can benefit developing countries. A successful outcome in agriculture would, for

example, level the playing field and enable developing countries to increase their agricultural exports. This could have positive effects in the overall economy, including generating jobs in other sectors

With regards to NAMA, depending on the formula that is adopted, it could help lower tariff peaks and tariff escalation in developed countries, and also facilitate increased exports by LDCs and other poor developing countries to economically advanced developing countries, including Brazil, India and China which maintain relatively high tariffs

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CONCLUSIONSCONCLUSIONS An ambitious result in services could help developing

countries to attract investment into certain key sectors of their economy, including telecommunications, tourism and financial services and improve the competitiveness of domestic service suppliers

Strengthened rules on anti-dumping and subsidies and countervailing measures will help creating a level playing field and ensure that exports of developing countries are not subjected to arbitrary duties and other measures

A successful outcome in trade facilitation will reduce red tape and help developing countries to improve on their customs procedures for the benefit of importers and exporters alike

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CONCLUSIONSCONCLUSIONS

It is clear that a lot of work remains to be done if the negotiations are to be concluded successfully in 2006 as foreseen in the HK 6th Min Dec.

Generally, WTO Members attach priority to the multilateral trading system, but their attention is increasingly being diverted by bilateral and regional trade initiatives

Perception that the WTO process is too slow and that it takes long to get results

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CONCLUSIONSCONCLUSIONS It is up to Members to strengthen the

multilateral trading system and make it responsive to the needs of business operators

For modalities for agriculture and NAMA to be achieved in April 2006, Members must redouble their efforts and demonstrate flexibility and show a greater willingness to accommodate the interests of others

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CONCLUSIONSCONCLUSIONS Trade is not a zero sum game. Exchanging

concessions may be difficult in the short term, but in the medium to long term this would benefit all Members

Developed countries and advanced developing countries should do more in terms of undertaking more responsibilities than least-developed and other poorer developing countries

Continued political involvement is necessary to move negotiations forward

There is a need for the process to continue to be inclusive (involving all WTO Members) and transparent