After holding informal consultations with both developed and developing country Members in late March and early April, General Council Chair Perez del Castillo (Uruguay) circulated an 'approach paper' on 7 April outlining how Members might move ahead with the deadlocked negotiations on special and differential treatment (S&D) for developing countries. While the paper was characterised by one source as "nothing radical", it reportedly attempts to assuage developing country fears that the core proposals on strengthening S&D provisions would disappear into the vortex that is the WTO's ominous work programme.

As indicated by a source close to the negotiations, the approach paper (currently restricted) is based on two premises. The first is that all proposals are still on the table, and the second is that the best way to proceed is to informally categorise (although not attempt to prioritise) the 80-plus proposals made to date. Perez del Castillo offers three categories, which as it were, do not differ greatly from those that have been on the table since late 2002 (see BRIDGES Weekly, 20 December 2002).

Potential categorisation of S&D proposals

The first category relates to those proposals with the best chance of success -- which would include the 12 identified as being 'ripe for harvest' (see BRIDGES Weekly, 6 February 2003). Added to these would be others identified by the Chair as having potential for movement, as well as some identified as having real developmental value (even though they may not have been responded to positively in the past). The second category encompasses those proposals that overlap with other negotiating areas and/or are already under consideration elsewhere. These proposals would be sent to the relevant bodies, which would be instructed that the item(s) be "addressed as a priority". This, reports one trade source, would include areas such as dispute settlement, subsidies, anti-dumping and agriculture, but also items such as investment-related measures, technical barriers to trade, and sanitary and phytosanitary measures. The third and final group comprises those proposals that, as they currently stand, would be difficult to move forward.

The first basket is essentially intended as the 'down-payment' for developing countries to accept moving ahead with the other two categories. Most developing countries have expressed their wanton for this 'basket' to include meaningful proposals and not just procedural items. Developed countries for their part have noted a willingness to engage on the matter further, but have reportedly indicated that they have already been as flexible as possible. Some, including Canada and Australia, have reportedly been very hesitant to proceed without looking at the controversial cross-cutting and systemic issues first (which include differentiating between developing countries, with some gaining more flexibilities than others).

The latter two categories, however, pose a serious concern to developing countries. Most developing countries have long opposed the second category in particular. This concern stems mostly from their experiences with implementation issues (see Doha Round Briefing, Vol.1 No.1), where numerous issues were delegated to other bodies, often "to be addressed as a priority", but which in their opinion saw continual discussion and little, if any, movement. The concern is that S&D issues would follow a similar path, and the Doha mandate "that all special and differential treatment provisions shall be reviewed with a view to strengthening them and making them more precise, effective and operational" will be rendered essentially worthless. The Chair has reportedly made attempts to ensure that the special sessions of the Committee on Trade and Development (CTD) will retain oversight on all three baskets.

Key questions on the path ahead

A few key questions also come to the fore regarding the process proposed by Perez del Castillo. Will Chair Perez del Castillo simply work on resolving the deadlock at the General Council level, allowing the rest of the work to go in CTD special sessions, guided by Chair Ransford Smith (Jamaica); or will Chairs Smith and Perez del Castillo tackle both the process and the substance at the General Council level and in the CTD special session? This all remains to be clarified. Another question revolves around timelines, an item that Members have had great difficulty in respecting so far on S&D. A third question -- brought up by a number of developing country Members -- is what happens to the 10 February CTD report (TN/CTD/7, available at http://docsonline.wto.org) requesting that the General Council clarify the mandate on S&D (see BRIDGES Weekly, 13 February 2003).

Thus a number of questions remain to be addressed before the process gets back underway -- one of the main ones being, should the process be accepted by all Members, which proposals will fall into which categories? To this end, the Secretariat reportedly is looking to circulate a draft categorisation of the proposals in the next two weeks.

No further meetings have been scheduled at time of press.

ICTSD reporting.