TRADE FACILITATION TALKS AIM TO MOVE TOWARDS DRAFT AGREEMENT TEXT

The chair of the WTO talks on trade facilitation (TF) told Members during a 7-8 June meeting that there is no time to waste if they want to be able to start negotiating the text of a future agreement on cutting red tape and other obstacles to the trade and transit of goods by July.

Urgency notwithstanding, delegates say that the discussions on trade facilitation have moved forward more steadily than those in other areas of the troubled Doha Round negotiations. Members continue to discuss each other's proposals while refining their own into the shape of text for potential articles of an eventual accord. Sources say that Chair Ambassador Eduardo Ernesto Sperisen-Yurt (Guatemala) would like Members to arrive at a single draft text for further bargaining in time for the negotiating group's next meeting, scheduled for 16-20 July.

Members are specifically mandated to clarify GATT articles on the freedom of transit for goods from other Member states (Article V), trade-related fees and formalities (Article VIII), and transparency in the regulation and administration of trade regulations (Article X).

The recent meeting saw an active debate on three new submissions tabled by the US and Turkey. One developing country delegate said the proposals were notable for proposing text-based language.

S&DT concerns raised again

Foremost in the discussions, however, was special and differential treatment (S&DT) for developing countries with regard to the implementation of trade facilitation obligations. The trade facilitation mandate is unique in that developing countries will not be required to implement commitments unless they receive the technical assistance necessary to do so. There have been several proposals for this process, from helping countries identify their trade facilitation needs through to the acquisition of the capacity to implement obligations -- and thus the legal responsibility for doing so.

At the meeting, developing countries once again stressed the centrality of technical assistance to the implementation of trade facilitation obligations. Sources say that Jamaica, speaking on behalf of a 'core group' of developing countries that have jointly proposed a system for implementing aid and trade facilitation commitments, called for balanced contributions from rich and poor countries. It argued that least-developed countries (LDCs) should not be required to implement any obligations. Jamaica also noted that some proposed reforms go beyond the group's mandate. Uganda, speaking on behalf of the African Group, said that development had to be an integral part of the talks.

One delegate told Bridges that the 'core group' would likely table a refined version of their earlier proposal calling for trade facilitation provisions to be divided into mandatory and 'best endeavour', with some mandatory ones kicking in only after the necessary capacity has been certifiably acquired. (see BRIDGES Weekly, 21 March 2007, http://www.ictsd.org/weekly/07-03-21/story3.htm). An LDC delegate said that it was still not clear who would actually assess capacity acquisition. Would countries 'self-assess'? Or would it be done by the WTO Secretariat or the donor country?

The extent to which trade facilitation-related commitments should be binding is becoming a more prominent point of contention. Egypt said that it would be desirable to have some commitments as 'best endeavour', so that countries could implement commitments as appropriate for their developmental context.,It added that donor countries' delivery of aid should also be carefully monitored. Developed countries generally stressed the need for comprehensive binding implementation. Switzerland stressed that it was a basic premise of the negotiations that all Members must implement all obligations. The EU said that 'best-endeavour' provisions usually result in non-implementation, although it signalled openness to an Indian proposal for 'progressive implementation' by developing countries.

The EU also reported on a recent informal retreat it organised in Evian for Members including the US, Japan, Switzerland, the Philippines, Japan, China, Bangladesh, and India to informally discuss S&DT and technical assistance for trade facilitation. It said that though there was general agreement on issues, including the non-applicability of dispute settlement in the absence of adequate capacity, participants disagreed on others, such as the notion of a deadline for developing countries to implement commitments. The EU said it would continue to hold further informal retreats on these issues.

Turkey, US proposals on transparency

Turkey's revised proposal on transparency (Article X, TN/TF/W/132/Rev.1) called for governments to publish trade-related legislation and procedures on a national website, and to establish national 'enquiry points' to deal with questions about trade-related requirements from other countries and traders. It suggested that small and vulnerable economies (SVEs) be allowed to establish regional enquiry points, as they had asked to do.

Some negotiators confessed to doubts about the Turkish proposal's provision for Members to agree on a specific interval to publish new or amended trade-related legislation and procedures on the website prior to their entry into force. A similar empty square-bracket awaited a precise maximum number of days within which national enquiry points would respond to questions. An LDC source expressed a preference for non-specific language such as 'immediately', 'rapidly' or in a 'timely manner', primarily for capacity considerations. The Turkish proposal did, however, make the full implementation of obligations by developing countries and LDCs conditional on their acquisition of capacity through technical assistance. A developing country delegate noted that the stipulation for enquiry points to operate at 'no cost or at a cost commensurate with the cost of the service rendered' could be problematic, since establishing them would involve costs such as employing staff and buying computers and telephones.

The US proposed a draft article that would require Members to maintain a website with all necessary trade-related documents and a full description of customs procedures (TN/TF/W/145). One delegate suggested to Bridges that this may not necessarily simplify access for small and medium enterprises in developing countries.

Call for clarification on 'expedited shipments'

The US also tabled a new proposal (TN/TF/W/144) outlining accelerated procedures for tracked and controlled expedited shipments. Some Members enquired about how 'expedited shipments' differed from the 'express shipments' the US had referred to in an earlier submission. Switzerland asked for clarity beyond what had been provided on the definition of 'expedited shipments'. Brazil wanted a clarification of product coverage.

Tanzania asked why the submission sought to exempt expedited shipments worth USD 200 or less from customs duties or formal entry documents, pointing out that the amount was significant for LDCs like itself, however trifling it was to the US. The EU noted that accelerated procedures already existed for certain authorised traders, and asked what additional companies were being targeted. The US promised to respond with clarifications.

Potential path forward

One source said that Sperisen-Yurt could proceed on the basis of one of two suggestions for the group's next meeting. The first would be to hold consultations with Members on various trade facilitation related issues. The second would have the sponsors of various proposals iron out differences in discussions with other Members - but not the chair - and then report on the outcomes. Members would decide on which to opt for in the coming days, the source added. Another delegate noted that it would be useful to either process for the WTO Secretariat to categorise the different proposals on the basis of how much - or little - consensus they enjoy.

ICTSD reporting.