DEVELOPED COUNTRIES SEEK TO RELEGATE MOST S&D PROVISIONS TO RELEVANT WTO BODIES

In an ongoing quest for 'progress' in the review of special and differential treatment (S&D) provisions, the WTO's Committee on Trade and Development (CTD) met in special sessions on 17, 18, 21, 22, & 23 October. Generally speaking, agreement-specific proposals were not responded to favourably by developed countries -- who reportedly made requests for further clarifications, commented on the inefficiency and/or impracticality of the solutions proposed, and suggested that the topics were best dealt with outside the CTD (i.e. in the relevant WTO bodies). Discussions covered the following agreements (date in brackets): Subsidies & Countervailing Measures (21st), Anti-Dumping (21st), Technical Barriers to Trade (TBT) (17th), Safeguards (23rd), and Services (23rd). Cross-cutting issues, including the latest proposal from Hungary, were addressed at the 18 October session, which also took up elements of the 7 October agenda (see BRIDGES Weekly, 9 October 2002). Ongoing discussions around a monitoring mechanism for S&D were taken up an informal 22 October session.

Members have been at odds with the issue of S&D since the first CTD meeting on the matter earlier this year. At the Doha Ministerial in late 2001, ministers agreed that "all special and differential treatment provisions shall be reviewed with a view to strengthening them and making them more precise, effective and operational." As such, Members were to examine how to make the provisions more effective and/or mandatory by 31 July 2002. However, Members failed to reach an agreement by that time (see BRIDGES Weekly, 6 August 2002) and the deadline was extended to 31 December. In addition, cross-cutting elements were incorporated into the work programme, to the disgruntlement of most developing countries.

General comments on the process

According to one trade source, responses from the major trading powers (the US, EC, Canada, Switzerland, Australia & Japan) effectively implied lengthy delays in proceeding with the mandated review of the S&D provisions. These Members held steadfastly to the belief that most of these issues were not mandated for the CTD and thus should be relegated to the relevant 'negotiating' bodies (whether the CTD special sessions are in fact a negotiating body is also debated by Members). The US reportedly repeated its statement that the CTD special sessions were not mandated to alter the WTO agreements.

Developing countries expressed great disappointment with what they view as the seemingly 'intractable' stance that developed countries have taken so far. Haiti, Kenya, Pakistan and Zambia adamantly stood by their position that the CTD was indeed the appropriate forum. In responding to a question regarding whether they felt movement was possible on any of the items under the 31 December deadline, one developing country delegate said, "it [was] still too early to speculate, while another offered personal sentiments that movement was "unlikely", and alluded to the fact that if this were the case, the impact on the overall progress of the Doha round would be 'negative and strong'.

Subsidies & countervailing measures

In the discussions on subsidies and countervailing measures (SCM), two proposals from groups of developing countries were addressed: TN/CTD/W/1 & TN/CTD/W/3/Rev.2 (the first is available at http://docsonline.wto.org, the other is not yet de-restricted). TN/CTD/W/1 involves removing the word 'may' from Article 27.1 of the SCM Agreement, which reads "Members recognise that subsidies may play an important role in economic development programmes of developing country Members," and lays down the basis for S&D in the SCM agreement.

Developed countries (Australia, US, Switzerland, Japan) raised numerous flags on this proposal, disagreeing with the assumption that subsidies are useful for development, and stating that it would change the rights and obligations of Members. Countering this argument, the delegate from Pakistan reportedly commented that he would certainly welcome such a position from the developed countries in the agriculture negotiations. The EC agreed in principle with their developed country colleagues, but indicated it would be willing to consider removing "may" if "certain" were included before the word 'subsidies'.

On the proposals found in the Africa Group submission (TN/CTD/W/3/Rev.2), relating to various mechanisms for subsidy reduction exemptions and/or extensions found in Article 27, most developed countries stated that sufficient mechanisms were already in place and that the proposed transition periods were too long to be given to all developing countries. Developed country Members stated unequivocally that all of these elements belonged in the Negotiating Group on Rules and not the CTD -- to which most developing countries disagreed.

Anti-dumping

On anti-dumping (AD), Members dealt with 2 elements from the Africa Group proposal (TN/CTD/W/3/Rev.2) -- both related to Article 15 of the AD Agreement -- which broaches the special treatment that developed countries are to show developing countries before imposing anti-dumping duties. Here the proposal asks for substantive and procedural elaboration of the provision, and specifically for the definition of key terms.

Developed countries (EC, Switzerland, US) replied again that the proper forum for this was the Negotiating Group on Rules and/or the AD Committee. Switzerland also noted its belief that the proposals on this article were not very clear and would not contribute to the desired objective of operationalising the agreement. Zambia reportedly queried later in the discussions whether the CTD special session was merely there to discuss proposals without taking any action, and expressed frustration that it had nothing concrete to report to its least- developed country (LDC) constituents (Zambia is the current representative for LDCs).

Technical barriers to trade (TBT)

On the two proposals for discussion under TBT (TN/CTD/W/2 & W/3/Rev.2), developed countries felt that the first, on mandatory and preferential technical assistance for developing countries to meet technical standards, was unreasonable and undesirable. On the Africa Group requests for a new fund to provide technical assistance specifically for TBT obligations and for impact assessments of technical standards on developing countries before implementation, developed countries were opposed. Canada, Japan, and Norway were averse to a new fund, with Norway deeming the impact assessment proposal inappropriate, as it would 'alter the rights and obligations of Members'. Switzerland, Canada and the EC felt these matters were better taken up in the TBT Committee.

Cross-cutting issues

The brief 18 October session picked up where the 7 October session ended (see link above), and saw a quick introduction by Hungary of their concept paper on preferential trading schemes (TN/CTD/W/16, searchable at http://docsonline.wto.org). Little discussion occurred on the issue of utilisation of current S&D provisions or the 'multi-tier vs. single-tier of rules' debate. In revisiting the principles & objectives discussion, the US & EC reportedly commented that development was a dynamic process and thus required equally dynamic solutions.

At press time, no information was available on the informal 22 October session dealing with the monitoring mechanism, or the 23 October session on services and safeguards. Chair Ransford Smith (Jamaica) indicated at the 21 October meeting that he would start holding consultations as of 31 October, which is the deadline to submit detailed responses to the agreement-specific proposals.

ICTSD reporting.