ITA Expansion Efforts Aim for Final Product List by July

6 June 2013

Negotiations aimed at expanding the coverage of the WTO's Information Technology Agreement - a plurilateral pact aimed at liberalising trade in information and communication technology products - are expected to be completed by mid-July, sources familiar with the talks confirmed to Bridges this week.

The 25 members involved in the talks are reportedly aiming to have a draft final list later this month, in order to then have "more serious and intensive" negotiations from 24 June onward, sources said after a 27-31 May working week hosted by Japan. A meeting during the week of 15 July will be geared toward finalising the talks.

Progress streamlining list, though sensitivities remain

The process to update the 1996 Agreement has been underway for just over a year, after six countries - Canada, Japan, Korea, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, Singapore, and the US - presented a concept paper calling for increased product coverage and membership.

The group has now expanded to 25 members out of the current ITA's total 49 participants, with the additions of El Salvador, Guatemala, and Iceland last week. The 27-country EU counts as one participant. Toward the end of last year, members discussing the expansion presented a "consolidated list" of over 350 product lines for consideration; since then, they have been working on whittling this number down to a more focused set.

Though Japan reported progress last week in streamlining the list further, trade sources say that disagreements remain over the inclusion of specific items that are sensitive for some members. For instance, the EU has reportedly argued against including flat-screen displays, according to Reuters, due to fears that this could induce US and Asian manufacturers to relocate from their current hubs in Eastern Europe.

Members who have sensitivities were asked at last week's meeting to register these without prejudice to the draft final list, sources said. The topic of customs implementation was also raised during the discussions.

Though the ITA expansion is a separate process from the Doha-related preparations for the upcoming WTO Ministerial Conference in Bali, Indonesia (see related story, this issue), trade observers say that clinching a definitive agreement in time for the high-level gathering could help restore some faith in the organisation's effectiveness and members' ability to negotiate constructively.

Reflecting today's trade

The agreement's current participants together represent 97 percent of trade in IT products. This tariff-cutting mechanism was the first to fully liberalise trade within a specific sector following the Uruguay Round of trade talks

The members negotiating the expansion aim not only to update the product list - which is nearly two decades old - but also to bring in new participants to the pact, given that many of the countries who have become large traders in information technology products since 1996 are currently not parties to the agreement.

Some current ITA members that represent large information technology industries have decided to stay out of the expansion process, however. India and Indonesia, for example, have said that the expansion is contrary to their national interests and that they therefore will not take part in the discussions.

Global revenues from the sector have more than doubled since the agreement was put in place, from US$500 billion in 1997 to US$4 trillion in 2008.

ICTSD reporting; "U.S. groups expect WTO technology trade deal by July, REUTERS, 30 May 2013; "India to skip talks on expanding ITA scope," THE HINDU, 13 May 2013.

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