INFORMAL CONSULTATIONS CONTINUE ON LDC, AFRICAN S&D PROPOSALS

At an informal 27 September consultation hosted by Committee on Trade and Development Special Session (CTD-SS) Chair Faizel Ismail of South Africa, developed countries commented on 14 proposals from the group of African WTO Members to improve the provisions for special and differential treatment (S&D) in particular WTO agreements. Members agreed that there was little use repeating discussions that had taken place when the proposals were first put forward in 2003, and proceeded directly to questions and comments for the African Group. According to trade sources, the US, the EU, Canada, Australia and Japan asked about what use the proposals would serve, the motivation behind them, and whether they were prompted by particular challenges with implementing the WTO agreements they seek to amend.

The least-developed countries (LDCs) and the African Group -- the two key demandeurs in the S&D talks -- face serious challenges with regard to converting these questions into concrete changes to the texts of the proposals. Intensive meetings on crucial topics such as agriculture, non-agricultural market access (NAMA) and services in the weeks remaining before the Hong Kong Ministerial Conference have underlined their limited negotiating capacity. They find it particularly difficult to participate in those discussions and simultaneously help redraft the S&D proposals as demanded by other WTO Members. A formal meeting of the CTD-SS scheduled for 4 October was postponed to allow the African Group time to consult internally, and with other countries, to refine their proposals. The LDCs are conducting a similar redrafting process (see BRIDGES Weekly, 27 July 2005, http://www.ictsd.org/weekly/05-07-27/story2.htm).

The CTD-SS is scheduled to meet 12 October. Members are set to re-examine the African Group proposals and consider what can realistically be done before, during and after the Hong Kong Ministerial Conference to enhance S&D in the WTO.

ICTSD reporting.

EU ASKS WTO ARBITRATOR TO EVALUATE REVISED BANANA TARIFF

On 26 September 2005, the EU requested a WTO arbitration panel to evaluate its recent proposal for a 187 euros per tonne most-favoured nation (MFN) tariff rate for imported bananas. This follows failed consultations on the proposal between the EU and banana producers in Latin America and African, Caribbean and Pacific (ACP) countries.

The EU is replacing its current banana import regime, which includes both tariffs and quotas for MFN suppliers, with a tariff-based system as of 1 January 2006. In August, a WTO arbitrator determined that the 230 euros per tonne MFN tariff rate proposed by the EU was too high, and would not preserve the market access available to MFN suppliers -- mostly in Latin America -- under the current system (see BRIDGES Weekly, 3 August 2005).

The EU's most recent proposal, announced on 12 September, would set MFN tariffs at 187 euros per tonne and eliminate quota ceilings on MFN bananas. It would also preserve a duty-free tariff quota for ACP producers. However, Latin American producers -- Brazil, Colombia, Costa Rica, Ecuador, Guatemala, Honduras, Nicaragua, Panama and Venezuela -- contend that the tariff was too high, while Caribbean producers have argued that even the scaled-back tariff would leave them unable to compete (see BRIDGES Weekly, 14 September 2005).

The arbitration panel will try to determine, within 30 days, if the EU's new tariff scheme would maintain market access for MFN suppliers and grant a level of preference to ACP suppliers equivalent to that they enjoy under the EU's current regime. If the arbitration panel accepts the proposal, all of the parties will be obliged to adhere to its decision.

ICTSD reporting; "EU requests new WTO arbitration on proposal for banana import regime," CHINA VIEW, 27 September 2005; "EU bananas: the failure of consensus politics," FRESH WORLD INTERNATIONAL, 30 September 2005; "EU asks for arbitration in banana dispute," CREAMER'S MEDIA ENGINEERING NEWS, 29 September 2005.