On 1 April, the special (negotiating) session of the WTO Committee on Trade and Development (CTD) -- mandated to review all special and differential treatment (S&D) provisions for developing countries -- met for the first time after the Cancun ministerial conference in September 2003. Hoping to avoid the pitfall of Members wading into well-entrenched positions, which has hindered progress in 2002 and 2003, the body's new Chair, Faizel Ismail (South African), focused discussions primarily on process issues, including the way forward and structure of the body's future work. Recognising the importance of reviving the talks, Members agreed to the Chair's request to begin informal consultations aimed at identifying areas of convergence and the best way to proceed with the S&D work programme. In a related matter, a group of developing and least developed countries circulated a submission on 5 April calling for, inter alia, "a clear road map with specific benchmarks to fulfil the mandate on the outstanding implementation issues and S&D issues in a time bound manner" (see related article, this issue).

Context-setting

After eighteen months of protracted discussions and three missed deadlines to review all S&D provisions "with a view to strengthening them and making them more precise, effective and operational", Members forwarded 24 possible recommendations (out of 88 proposals submitted; searchable under document symbol TN/CTD at http://docsonline.wto.org) for ministers to consider for an 'early harvest' in Cancun (see BRIDGES Weekly, 3 September 2003). While a large number of developing country delegations and observers characterised the proposals as being of 'dubious economic value', discussions in Cancun saw three additional recommendations tacked onto the package. The unsuccessful end of the ministerial put all 27 recommendations on hold, however.

Moving the debate forward

While reiterating the basic premise that all 88 agreement-specific proposals shall remain on the table, Chair Ismail noted that the current debate, which he characterised as being "polarised" and giving rise to "divergent perspectives" both in substance and process, had been unproductive. He called on Members to be flexible and creative in deciding, inter alia, what to do with the outstanding recommendations, how to move the debate to a more productive level, and how to meet the expectations of the Doha mandate. The meeting closed with Members giving Chair Ismail permission to proceed with informal consultations aimed at finding a way forward, addressing the key concerns of all Members -- including dealing with both agreement-specific proposals and broader cross-cutting issues (e.g. principle and objectives of S&D, differentiation, monitoring mechanism, etc.). He would, upon finding sufficient basis, reconvene a formal session before the summer break.

Reactions

Members from developed and developing countries seemed to largely welcome the initiative, with comments such as "good kick start" and "innovative approach" circulating. The US and Canada, for their part, reportedly reiterated their hope of harvesting the 27 recommendations, and proceeding with broader and deeper discussions. Another major developed country source indicated his delegation's willingness to work with the procedure, as well as work towards an outcome possibly involving adjustments in the rules. Most developed country Members also indicated that they saw S&D as part of a broader package, along with agriculture and non-agricultural market access, to be delivered by the end of the summer.

While African Members and the group of least-developed countries (LDCs) generally supported the Chair's efforts, they reiterated their belief that the 88 agreement-specific proposals should be addressed as a matter of priority, before moving the talks to broader cross-cutting issues. In addition, some felt the categorisation of proposals previously employed (three baskets: those ripe or near ripe for agreement; those which another body was dealing with already; those most divergent) should no longer be applied. Calling into question the value of adopting any of the 27 recommendations, one African delegate said they "were no different to the provisions Members were trying to strengthen," and thus did little to deliver on the Doha mandate. One acute concern raised was the apparent disregard for the sequence of the Doha 'bargain'. The mandates on S&D and other outstanding 'implementation issues' (resulting from perceived imbalances in the Uruguay Round Agreements) were two of the first major deliverables in the work programme agreed on by ministers in Doha in 2001 -- and arguably some of the most important systemic issues vis-à-vis development. As echoed in a recent submission (TN/C/W/16, searchable at http://docsonline.wto.org), most developing country Members feel neither felt there has been no "progress towards a successful resolution […] in the period after Doha".

Noting the impasse resulting when Members tried to converge on the existing 88 proposals, one trade source posited that looking at alternative ways to meaningfully address the underlying problems represented in the 88 proposals might be an effective way to proceed.

The crux of the debate

The degree of polarisation in the S&D debate has been vast. Most developed countries are concerned with issues of eligibility (including 'graduating' countries out of a flexibility once no longer required), ensuring compliance and integration as a means of promoting development, and maintaining a narrow scope of activity for the WTO. A large number of developing countries, on the other hand, feel that S&D must be provided on a non-discriminatory basis, that sufficient flexibility in the rules must be maintained in order to deviate from certain disciplines in the name of development, and that the ambit of the WTO must include tackling broader development issues (such as supply-side constraints and infrastructure issues).

In line with these perspectives, most developed countries have held that the broader principles and objectives of S&D must be discussed first and that before any meaningful strengthening of S&D occurs, there must be a mechanism to differentiate among developing countries (i.e. Brazil and Honduras should not always receive the same flexibilities). Developing countries, while diverging somewhat on the issue of differentiating among themselves, have argued nonetheless that the mandate is quite specific in its instructions to review all S&D provisions and that this must done before moving to any broader discussions.

The next meeting of the CTD special session is scheduled for 19 July this year.

For a comprehensive background on S&D prior to Cancun, see the Doha Round Briefing Series, Vol. 2 No. 13, http://www.ictsd.org/pubs/dohabriefings/cancun_updates/V2_13_SD.pdf

ICTSD reporting.