FEUD OVER TEXTILES TECHNICAL ASSISTANCE ENDS

A disagreement among developing countries that had prevented them from approving the WTO technical assistance and training plan (TATP) for 2005 was resolved at a meeting of the WTO's Committee on Trade and Development (CTD) on 10 December. The TATP had been blocked due to resistance from China, India, Pakistan and Hong Kong. These countries had objected to the plan's inclusion of four regional seminars on textiles and clothing addressing the post-quota trading environment, although the latter three countries' opposition has dwindled (see BRIDGES Weekly, 1 December 2004).

Members struck a compromise that will have programmes on textiles and clothing trade proceed as part of national technical assistance seminars -- but not of regional ones. In return for this concession, China agreed to let the CTD add language to the programme mandate saying that the seminars "will be conducted in response to the demand of beneficiaries" in light of the importance of the sector to several developing and least-developed countries. Countries including Mexico, El Salvador, Kenya, Mauritius, Sri Lanka, and Uganda had wanted textiles to remain on the technical assistance agenda.

China argues that once textiles and clothing are incorporated into regular WTO disciplines on 1 January 2005, they should be treated the same as any other non-agricultural goods -- the TATP for 2005 does not provide for technical assistance seminars in any other specific product sectors.

China has repeatedly suggested that the adjustment-related needs of smaller developing countries should be dealt with by national industries in the concerned countries, as well as through assistance from international financial institutions. WTO Director-General Supachai Panitchpakdi echoed these sentiments in a 2 December speech in Beijing, declaring that "Adjustment challenges are complex... The starting point is domestic reform. There is a role for international financial institutions in facilitating a coordinated response in support of domestic reform efforts."

Smaller developing countries, on the other hand, have stressed that they need broad-based assistance from the WTO to facilitate transition in the sector (see BRIDGES Weekly, 17 November 2004), and have criticised China's pressure to exclude the issue from the TATP as "heavy-handed". One diplomat suggested that China was unnecessarily antagonising its developing country partners over a minor issue. "There's a lot of bitterness," said one Latin American official who took part in the CTD discussions. "China failed to show solidarity with its developing country partners on this issue."

ICTSD Reporting; "China Ends Feud With Developing Nations On WTO-Sponsorship of Textile Aid Program," WTO REPORTER, 13 December 2004; "Supachai Praises Textile Tariff Elimination, Foresees Benefits to Developing Countries," WTO REPORTER, 10 December 2004.