Embed Size (px)
Citation preview
The DDA NegotiationsThe DDA Negotiations
• Trade Round launched in Doha (Qatar) at Fourth WTO Ministerial Conference, November 2001
• Previous failure in Seattle, USA in December 1999
• Concerns of developing countries – marginalisation in the MTS, lack of transparency and inclusiveness
• Members resolved to place needs and interests of developing countries at heart of negotiations
• Work Programme: 2 tracks – negotiating issues under the TNC, and non-negotiating issues under the General Council – work being carried out in various WTO bodies
Areas Under The NegotiationsAreas Under The Negotiations• Agriculture (Including Cotton)Agriculture (Including Cotton)• ServicesServices• Non- Agricultural Market AccessNon- Agricultural Market Access• TRIPS (GIs Register)TRIPS (GIs Register)• WTO Rules (AD, Subsidies, RTAs)WTO Rules (AD, Subsidies, RTAs)• DSU DSU → → outside outside Single-UndertakingSingle-Undertaking• Trade and EnvironmentTrade and Environment• Special and Differential TreatmentSpecial and Differential Treatment• Trade FacilitationTrade Facilitation
*Single Undertaking – Nothing is agreed until everything is agreed
DDA Negotiations: Key DDA Negotiations: Key Reference MaterialsReference Materials
• Doha Declaration (WT/MIN/(01)/DEC/1)Doha Declaration (WT/MIN/(01)/DEC/1)
• August 2004, General Council Decision August 2004, General Council Decision
(WT/L/579)(WT/L/579)
• Hong Kong Declaration (WT/MIN(05)/DEC)Hong Kong Declaration (WT/MIN(05)/DEC)
• Draft Agriculture Modalities (TN/AG/W/4/Rev.1; 8 Draft Agriculture Modalities (TN/AG/W/4/Rev.1; 8
February 2008) February 2008)
• Draft NAMA Modalities (TN/MA/W/103; 8 Draft NAMA Modalities (TN/MA/W/103; 8
February 2008)February 2008)
State of Play State of Play Negotiations were supposed to have been
concluded by 1 January 2005Modalities for agriculture and NAMA were to
have been agreed by March 2003Deadline was missed. Efforts to agree on the
modalities in Cancun in September 2003 also failed
A framework agreement reached in July 2004Efforts to reach agreement on full modalities
in July 2005 failedObjective to achieve full modalities also
proved elusive at the Hong Kong Ministerial Conference in December 2005
State of Play State of Play After intensive consultations in the first
half of 2006, the negotiations were suspended in July 2006
They were resumed in Feb 2007, but agreement on modalities for agriculture and NAMA have still proved elusive
Members’ positions on the key issues in agriculture and NAMA have evolved but not significantly
Members currently working on the draft texts circulated on 8 February by the Ag and NAMA Chairpersons
State of Play State of Play Whereas work had advanced on
agriculture, the same cannot be said of the NAMA text. Wide differences in the views of Members, particularly on the formula and flexibilities
Horizontal process to be chaired by the WTO DG to find key compromises. Expectation is to have agreement on the modalities by the end of May (July) 2008
Not certain at this stage when mini-Ministerial will be held
Key Issues in Agriculture Key Issues in Agriculture under the three pillarsunder the three pillars
•Market AccessMarket Access
•Domestic SupportDomestic Support
•Export CompetitionExport Competition
Agriculture-Market AccessAgriculture-Market Access
•Substantial improvement for all Substantial improvement for all agricultural productsagricultural products
•Agreement in HK that a tiered formula Agreement in HK that a tiered formula would be used to reduce tariffs – 4 tierswould be used to reduce tariffs – 4 tiers
•Progressivity – higher tariffs to be Progressivity – higher tariffs to be reduced by a greater percentagereduced by a greater percentage
•Lack of progress on the tariff bands Lack of progress on the tariff bands (thresholds) and the cuts to be made (thresholds) and the cuts to be made within each bandwithin each band
World Average TariffsWorld Average Tariffs
62
29
17
9
0
10
20
30
40
50
60
70
pe
rce
nt
MFN Applied
Agriculture Industrial
Market Access – TariffsChair’s Draft Modalities
BandBand Thresholds Thresholds
Developed Developed DevelopingDeveloping
Developed Developed Countries CutsCountries Cuts
Developing Developing Countries cutsCountries cuts
11 0-20% 0-20% 0-30% 48-52%48-52% 32% - 35%32% - 35%
22 20%-50% 30-80%20%-50% 30-80% 55-60%55-60% 37% - 40%37% - 40%
33 50%-75% 80-130%50%-75% 80-130% 62-65%62-65% 41% - 43%41% - 43%
44 75%+ 130+75%+ 130+ 66-73%66-73% 44% - 49%44% - 49%
Other Market Access Issues – Members’ Positions
• Treatment of SENSITIVE PRODUCTS Treatment of SENSITIVE PRODUCTS - 1%:- 1%: US, Cairns, BrazilUS, Cairns, Brazil- 8%:- 8%: ECEC- 15%:- 15%: G10G10
• Treatment of SPECIAL PRODUCTSTreatment of SPECIAL PRODUCTS- ≤ 20% of tariff lines: G-33- ≤ 20% of tariff lines: G-33- US – limited flexibility for developing countries; - US – limited flexibility for developing countries;
only a few tariff lines only a few tariff lines - Intermediate positions: Pakistan, Thailand, - Intermediate positions: Pakistan, Thailand,
MalaysiaMalaysia- TRQs: should it be based on domestic - TRQs: should it be based on domestic
consumption or current import volumes and the consumption or current import volumes and the cuts to be madecuts to be made
Other Market Access Issues – Chair’s Draft Modalities
• SENSITIVE PRODUCTSSENSITIVE PRODUCTS
– Number: Number: [4] [6][4] [6] per cent of [dutiable] tariff lines or per cent of [dutiable] tariff lines or [6] [8][6] [8] per cent where over 30 per cent of the per cent where over 30 per cent of the developed-country tariff lines are in the top band or developed-country tariff lines are in the top band or where tariff concessions have been scheduled at the where tariff concessions have been scheduled at the 6 digit level6 digit level
– Developing countries can designate one-third more of Developing countries can designate one-third more of tariff lines as sensitivetariff lines as sensitive
– Treatment: ⅓, ½ or ⅔ of the normal reduction for Treatment: ⅓, ½ or ⅔ of the normal reduction for developed countries. Thus if developed countries developed countries. Thus if developed countries have to reduce their tariffs by 66%, it could be 22%, have to reduce their tariffs by 66%, it could be 22%, 33% and 44%, respectively 33% and 44%, respectively
Other Market Access Issues – Chair’s Draft Modalities
• Tariff Quota ExpansionTariff Quota Expansion– Where ⅔ deviation is used, the TQ shall result in new access Where ⅔ deviation is used, the TQ shall result in new access
opportunities equivalent to no less than opportunities equivalent to no less than [4] [6][4] [6] per cent of per cent of domestic consumptiondomestic consumption
– Where ½ or ⅓ deviation is used, the TQ shall result in new access Where ½ or ⅓ deviation is used, the TQ shall result in new access opportunities equivalent to no less than opportunities equivalent to no less than [3.5][5.5][3.5][5.5] and and [3][5][3][5] per per cent of domestic consumption, respectivelycent of domestic consumption, respectively
– Higher levels envisaged if a Member chooses to have a higher Higher levels envisaged if a Member chooses to have a higher number of sensitive products. Where a Member has more than 4% number of sensitive products. Where a Member has more than 4% of its tariff lines in excess of 100%, it shall, for all its sensitive of its tariff lines in excess of 100%, it shall, for all its sensitive products, apply a further expansion of [...] of domestic products, apply a further expansion of [...] of domestic consumptionconsumption
• Partial designation – 6 or 8 digit level: issue has been a sticking Partial designation – 6 or 8 digit level: issue has been a sticking point in the negotiations. Reported deal among six countries – point in the negotiations. Reported deal among six countries – Australia, Canada, US, EC, Japan and BrazilAustralia, Canada, US, EC, Japan and Brazil
• Tariff Simplification – Bound in-quota tariffs and TQ Tariff Simplification – Bound in-quota tariffs and TQ administration – strengthened disciplinesadministration – strengthened disciplines
Other Market Access Issues – Chair’s Draft Modalities
• Special Products Special Products
– Developing countries to have the right to self-Developing countries to have the right to self-designate an appropriate number of tariff lines as designate an appropriate number of tariff lines as special productsspecial products
– Designation to be guided by the following criteria: food Designation to be guided by the following criteria: food security, livelihood security and rural developmentsecurity, livelihood security and rural development
– Minimum entitlement of 8 per cent of tariff lines and a Minimum entitlement of 8 per cent of tariff lines and a maximum entitlement of [12][20] per centmaximum entitlement of [12][20] per cent
• TreatmentTreatment– [6] per cent of tariff lines - a cut of [8] [15] per cent[6] per cent of tariff lines - a cut of [8] [15] per cent– [6] per cent of tariff lines - a cut of [12] [25] per cent[6] per cent of tariff lines - a cut of [12] [25] per cent– [8] [...] per cent of tariff lines – no cut [8] [...] per cent of tariff lines – no cut
• SVEs and RAMs – Flexible treatmentSVEs and RAMs – Flexible treatment
Other Market Access Issues – Chair’s Draft Modalities
• Special Agricultural SafeguardSpecial Agricultural Safeguard (SSG): [Expiration for developed- (SSG): [Expiration for developed-countries on the 1countries on the 1stst day of the implementation period (IP)] [number of day of the implementation period (IP)] [number of tariff lines eligible for SSG to be reduced to 1.5% of scheduled tariff lines; tariff lines eligible for SSG to be reduced to 1.5% of scheduled tariff lines; developing countries – a higher percentage; developing countries – a higher percentage; OROR
• Elimination within 4 years of the start of the IP. On the 1Elimination within 4 years of the start of the IP. On the 1stst day of the IP, day of the IP, reduction of eligible tariff lines to no more than 1.5%. Number to be reduction of eligible tariff lines to no more than 1.5%. Number to be reduced by 50% after 2 years and full elimination to occur 2 years reduced by 50% after 2 years and full elimination to occur 2 years thereafterthereafter
• Quantity trigger: Quantity trigger: For a rolling 3 year average, imports must be above For a rolling 3 year average, imports must be above 10% of domestic consumption and must have increased by at least 25% in 10% of domestic consumption and must have increased by at least 25% in absolute terms. Ratio of imports to domestic consumption must have absolute terms. Ratio of imports to domestic consumption must have increased by a factor of 0.35 or moreincreased by a factor of 0.35 or more
• Where bound rate (BR) = applied rate (AR), then remedy shall be a Where bound rate (BR) = applied rate (AR), then remedy shall be a maximum of an additional maximum of an additional ⅓ of the BR⅓ of the BR
• Where the AR is less than the BR, the remedy shall be the full margin Where the AR is less than the BR, the remedy shall be the full margin between the BR and the AR or between the BR and the AR or ¼ of the BR, whichever is greater¼ of the BR, whichever is greater
Other Market Access Issues – Chair’s Draft Modalities
• Price trigger: Price trigger: Shall not be invoked for more Shall not be invoked for more than than ⅔ of eligible tariff lines in any given year ⅔ of eligible tariff lines in any given year within the IP and the within the IP and the restrictiveness of current restrictiveness of current provisions to be effectively halved by modifying provisions to be effectively halved by modifying specific amountsspecific amounts
• Developing countries – terms and conditions of the Developing countries – terms and conditions of the SSG would remain unchanged except for tariff SSG would remain unchanged except for tariff rates which have to reflect Doha resultsrates which have to reflect Doha results
Other Market Access Issues – Chair’s Draft Modalities
• Special Safeguard MechanismSpecial Safeguard Mechanism (SSM): To be (SSM): To be available for all products. However, not to be invoked available for all products. However, not to be invoked for more than [3][8] products in any given 12-month for more than [3][8] products in any given 12-month periodperiod
• TRIGGERS: Both price and volume-based SSM will be TRIGGERS: Both price and volume-based SSM will be available. The two may not be imposed at the same available. The two may not be imposed at the same time. Neither can any one of them be imposed in time. Neither can any one of them be imposed in respect of a product which is the subject of a respect of a product which is the subject of a safeguard measure, including under Art 5 of the AoA, safeguard measure, including under Art 5 of the AoA, an anti-dumping or countervailing measurean anti-dumping or countervailing measure
• Detailed rules on volume and price triggers and their Detailed rules on volume and price triggers and their remediesremedies
Other MA issues – Chair’s Draft Modalities: Tropical Products – Annex G• Deeper tariff cutsDeeper tariff cuts
– [Where the scheduled tariff is less or equal to 25% ad valorem, it shall [Where the scheduled tariff is less or equal to 25% ad valorem, it shall be reduced to zerobe reduced to zero
– [Where the scheduled tariff is greater than 25% ad valorem, the [Where the scheduled tariff is greater than 25% ad valorem, the applicable tariff cut shall be 85%]applicable tariff cut shall be 85%]
– [Where the scheduled tariff is greater than or equal to 10%, the [Where the scheduled tariff is greater than or equal to 10%, the applicable tariff cut shall be [66][73]%], except for tariffs in the top applicable tariff cut shall be [66][73]%], except for tariffs in the top band, which shall be reduced by the tariff escalation tariff cut for that band, which shall be reduced by the tariff escalation tariff cut for that band increased by 2%band increased by 2%
– [Where the scheduled tariff is less than 10%, the applicable tariff cut [Where the scheduled tariff is less than 10%, the applicable tariff cut shall be 0]shall be 0]
• [Tropical products shall not be designated as sensitive][Tropical products shall not be designated as sensitive]
• [Implementation by developed-country members in 4 equal [Implementation by developed-country members in 4 equal instalments]instalments]
• Dev’g countries in a position to do so encouraged to do moreDev’g countries in a position to do so encouraged to do more
Other MA issues – Chair’s Draft Modalities: Preference Erosion – Annex
H• [No tariff cuts on the items listed in Annex for 10 years
• Tariff cuts to be implemented thereafter over 5 years in equal instalments]
• [Where a product is listed in the Annex and the ff conditions are met, the implementation period will be 10 years (8+2)– [the pre-Doha MFN tariff is greater than 10% ad valorem]– [the total value of trade over a 3 year representative period is
greater than $50,000 or constitutes [3][5]% of the long standing preference-receiving country’s total agricultural trade to the market concerned]
– [there is unlimited long-standing preference eligibility in the market concerned]
• Provisions to prevail where there is overlap with provisions on tariff escalation / tropical products
• Targeted technical assistance
Other MA issues – Chair’s Draft Modalities: Tariff Escalation
• Tariff escalation[Tariffs on processed products to be reduced more steeply. Instead of taking the cut that would otherwise apply to final bound tariffs in the band to which the processed product belongs (with the exception of the top band), the processed product shall take the cut applicable to tariffs that fall in the next highest band
• [Products falling in the top band to be reduced by a cut which is equal to 1.3 times the cut that would otherwise have been applicable / increased by 6 ad valorem points]
• Supplementary cuts to be moderated where the absolute difference between the processed and primary product after the application of the normal tariff formula would be 5 ad valorem percentage points or less in any given tier except the bottom tier – no additional tariff escalation adjustment to be required
• Application of adjustment formula should not lead to a higher tariff on the primary product than the processed product
Other Market Access Issues – Chair’s Draft Modalities - Commodities
• Where problems persist after the application of the Where problems persist after the application of the formula, including the tariff escalation adjustment formula, including the tariff escalation adjustment formula, Members are to engage with commodity-formula, Members are to engage with commodity-dependent producing countries to ensure dependent producing countries to ensure satisfactory solutionssatisfactory solutions
• Identification of products for the purpose of applying Identification of products for the purpose of applying the tariff escalation formula – specific targets; non-the tariff escalation formula – specific targets; non-ad valorem duties to be converted and bound ad valorem duties to be converted and bound
• Elimination of NTBsElimination of NTBs
• Joint action – intergovernmental commodity Joint action – intergovernmental commodity agreements etcagreements etc
Other Market Access Issues – Chair’s Draft Modalities - LDCs
• LDCs: No reduction commitmentsLDCs: No reduction commitments
• DFQF – 100% : By 2008 or the start of the DFQF – 100% : By 2008 or the start of the implementation period; where there are difficulties, implementation period; where there are difficulties, 97% at the beginning to be increased gradually to 97% at the beginning to be increased gradually to 100%100%
• Developing countries in a position to do so Developing countries in a position to do so encouraged to grant DFQF – phase in of encouraged to grant DFQF – phase in of commitmentscommitments
• Cotton Market Access: DFQF for LDCsCotton Market Access: DFQF for LDCs
Other Market Access Issues – Chair’s Draft Modalities - SVEs
• The term SVEs to apply to Members with economies that, in the period 1999 to 2004, had an average share of:– World merchandise trade of no more than 0.16% or less– World trade in non-agricultural products of no more than 0.1%– World trade in agricultural products of no more than 0.4%
• SVEs to moderate the two-thirds cut by developing countries by a further [10] ad-valorem points in each band
• Flexibility in the designation of special products – SVEs can deviate from the tiered formula cut for as many tariff lines as they choose to designate as SPs provided they meet the overall average cut of 24%
• Products designated as SPs need not be subject to a minimum tariff cut nor designation be guided by the indicators
Other Market Access Issues – Chair’s Draft Modalities - RAMs
• Entitled to moderate tariff cuts by [7.5] ad Entitled to moderate tariff cuts by [7.5] ad valorem percentage pointsvalorem percentage points
• Saudi Arabia, Macedonia, Vietnam, Tonga, Saudi Arabia, Macedonia, Vietnam, Tonga, [Cape Verde; Ukraine] exempted from [Cape Verde; Ukraine] exempted from undertaking cutsundertaking cuts
• For other RAMs, where there is an overlap For other RAMs, where there is an overlap between accession commitments and between accession commitments and commitments associated with modalities, the commitments associated with modalities, the start of the IP shall be one year after the end of start of the IP shall be one year after the end of the accession commitmentthe accession commitment
• Implementation period shall be 10 years (8+2)Implementation period shall be 10 years (8+2)• Flexibility in the designation of special productsFlexibility in the designation of special products
Domestic SupportDomestic Support• High levels of support by developed countries
• Few developing countries provide subsidies
• Amounts provided by most developing countries not substantial- justifiable as de minimis or under Article 6.2 of the AoA
• Agreement in HK that there will be three bands for the reduction of Overall Trade-distorting Domestic Support (OTDS) – EC in top band, Japan and US in second band, all others (including developing-country Members) in third band
Domestic Support - European CommunitiesDomestic Support - European Communities
0
20
40
60
80
Green 19 22 18 19 20 22 20.7
Blue 21 22 20 20 20 22 23.7
Amber 51 52 51 47 48 44 39.3
WTO limit 78.7 76.4 74.1 71.8 69.5 67.2 67.2
1995 1996 1997 1998 1999 2000 2001
Eu
ros
Bil
lio
n
Domestic Support - United StatesDomestic Support - United States
0
10
20
30
40
50
60
Green 46 51.8 51.3 49.8 49.7 50 50.1
Blue 7 0 0 0 0 0 0
De minimis 1.6 1.2 0.8 4.8 7.4 7.3 7
Amber 6.2 5.9 6.2 10.4 16.9 16.8 14.4
WTO limit 23.1 22.3 21.5 20.7 19.9 19.1 19.1
1995 1996 1997 1998 1999 2000 2001
US
$ B
illi
on
Chairman’s Draft Modalities-Chairman’s Draft Modalities-TN/AG/W/4/Rev.1TN/AG/W/4/Rev.1
• Base overall trade-distorting domestic support (OTDS) shall be the sum of:– (i) final bound total AMS; – (ii) 10% of value of production in the 1995-2000 base
period – representing 5% for product-specific support and 5% for non-product specific support; for developing countries 10% each
– (iii) the higher of average Blue Box payments or 5% of the average total value of production
– Thus for some developed countries, the base level would be Amber box commitment plus 15% of production
Chair’s draft modalities - OTDSChair’s draft modalities - OTDS
Bands Range Proposed Cuts
1 - EC ≥ 60 billion [75] [85] %
2 – US and Japan ≥10 billion and ≤ 60 billion
[66] [73] %
3 –Others – Developed and Developing
≤ 10 billion [50] [60] %
DOMESTIC SUPPORT
Chair’s Draft Modalities
• Under the Chairman’s proposal, US OTDS will be reduced from $48.2 billion to between $13 and $16.4 billion. Under its own proposal, it will be reduced to $22.5 billion
• According to the recent notification by the US, its payments on OTDS amounted to $ 16.3 billion in 2002, $10.2 billion in 2003, $18.1 billion in 2004 and $18.9 billion in 2005
• Estimated that because of high commodity prices last year, the US payments on OTDS amounted to $11 billion. Figure not confirmed by the US
DOMESTIC SUPPORT
Chair’s Draft Modalities
• The EC’s current ceiling is estimated at €110.3 billion ($152 billion). Cut will bring the ceiling down to €27.6 billion or €16.5 billion
• Japan expected to do more, as its overall support is more than 40 per cent of the total value of its agricultural production – a cut halfway between the cuts of the top and the second tiers
Chair’s Proposed Draft Chair’s Proposed Draft Modalities - AMSModalities - AMS
Bands Range Proposed Cuts
1 ≥ 40 billion [70] %
2 ≥15 billion and ≤ 40 billion
[60] %
3 ≤ 15 billion [45] %
Domestic SupportDomestic SupportChairman’s proposalsChairman’s proposals
• Under the Chairman’s proposal, the amber box limit of the US will be reduced from $19.1 billion to $7.6 billion
• According to figures provided by the US, AMS payments for 2002, 2003, 2004 and 2005 were $9.6 billion, $6.9 billion, $11.6 billion and 12.9 billion, respectively.
• Brazil and Canada are alleging in the dispute settle proceedings that the US exceeded its WTO limits for most of these years, a claim the US denies.
Domestic SupportDomestic Support
• PRODUCT-SPECIFIC AMS CAPS – average applied during the UR implementation period (1995-2000)
• For the US – average between 1995-2004 and 1995-2000
• S&D for developing countries – base period (1995-2000 or 1995-2004)
• DE MINIMIS: to be reduced by [50] [60] per cent by developed countries – i.e. cap at 2.5 or 2 per cent of the value of production
• S&D for developing countries: some exempted, others to make two-thirds of the cuts of developed countries
• BLUE BOX: maximum permitted value not to exceed 2.5 per cent of the average total value of agricultural production
• Lesser cut if over 40% of Member’s support placed in the blue box
• Deeper cut in AMS support for cotton
Export Competition – Chair’s Draft Modalities
• Elimination of all forms of export subsidies by 2013. Elimination of all forms of export subsidies by 2013. Budgetary outlays- 50% reduction by 2010 and the rest Budgetary outlays- 50% reduction by 2010 and the rest in equal instalments in equal instalments
• Reduction commitments also on quantity of exported Reduction commitments also on quantity of exported productsproducts
• S&D for developing countries - 2016S&D for developing countries - 2016
• Developing countries to benefit from the provisions of Developing countries to benefit from the provisions of Article 9.4 until 5 yrs after the end of the Article 9.4 until 5 yrs after the end of the implementation periodimplementation period
• Proposed strengthened disciplines on agricultural Proposed strengthened disciplines on agricultural exporting STEs and international food aidexporting STEs and international food aid
• Elimination of all forms of export subsidies for cottonElimination of all forms of export subsidies for cotton
General Reactions toGeneral Reactions toChair’s draft modalitiesChair’s draft modalities
• Most Members welcomed the draft Ag text and Most Members welcomed the draft Ag text and said could be basis for further worksaid could be basis for further work
• Since its circulation, efforts have focussed on Since its circulation, efforts have focussed on reaching compromises . The Chair’s suggestion reaching compromises . The Chair’s suggestion that Members split the difference between the that Members split the difference between the ranges proposed was not well receivedranges proposed was not well received
• More positive reaction than to NAMA draft More positive reaction than to NAMA draft modalities text. Concerns about the formula and modalities text. Concerns about the formula and the flexibilitiesthe flexibilities
NAMA – Chair’s Draft ModalitiesNAMA – Chair’s Draft Modalities• Key issuesKey issues
– Formula to be applied- Swiss formula or Swiss-type Formula to be applied- Swiss formula or Swiss-type formula (ABI formula)formula (ABI formula)
– Treatment of unbound tariffs – non-linear mark upTreatment of unbound tariffs – non-linear mark up– Flexibilities for developing countries – paragraph 8 Flexibilities for developing countries – paragraph 8
flexibilitiesflexibilities– Flexibilities for paragraph 6 countries, i.e. countries Flexibilities for paragraph 6 countries, i.e. countries
which have bound less than 35% of tariff lineswhich have bound less than 35% of tariff lines– Sectoral approachSectoral approach– NTBsNTBs– Flexibilities for LDCs, SVEs, RAMSFlexibilities for LDCs, SVEs, RAMS
--
FormulaFormula•Adoption of a simple Swiss Formula Adoption of a simple Swiss Formula
with two co-efficients with two co-efficients – [8-9] for developed countries; and[8-9] for developed countries; and– [19-23] for developing countries[19-23] for developing countries
•Product coverage to be Product coverage to be comprehensive without comprehensive without a prioria priori exclusionsexclusions
•Reductions or elimination on the Reductions or elimination on the basis of bound ratesbasis of bound rates
Formula – Treatment of Formula – Treatment of Unbound tariffsUnbound tariffs
• For unbound rates, a constant non-linear For unbound rates, a constant non-linear mark up of 20% or 30% to the MFN applied mark up of 20% or 30% to the MFN applied rate in the base year (14 November 2001)rate in the base year (14 November 2001)
• Conversion of non Conversion of non ad-valoremad-valorem duties into duties into ad valoremad valorem equivalents equivalents
• Reference period for import data: 1999-Reference period for import data: 1999-20012001
• Reductions for developed-country and Reductions for developed-country and developing-country Members in [5] and [9] developing-country Members in [5] and [9] equal instalments, respectivelyequal instalments, respectively
Flexibilities for developing Flexibilities for developing countries subject to formula –countries subject to formula –
para 8 flexibilitiespara 8 flexibilities• Applying less than formula cuts for up to [?Applying less than formula cuts for up to [?10%] of tariff lines; OR10%] of tariff lines; OR
• Keeping [?5%] of tariff lines unbound Keeping [?5%] of tariff lines unbound provided they do not exceed [5%] of the provided they do not exceed [5%] of the total value of a member’s importstotal value of a member’s imports
• Not to be used to exclude entire HS Not to be used to exclude entire HS chapters chapters
• Alternatively, where flexibility not used, Alternatively, where flexibility not used, developing-country Member can apply a developing-country Member can apply a coefficient of [b + 3-5] in the formulacoefficient of [b + 3-5] in the formula
Flexibilities for developing Flexibilities for developing countries with low binding countries with low binding
coveragecoverageAs an exception, participants with a binding As an exception, participants with a binding coverage of non-agricultural tariff lines of less coverage of non-agricultural tariff lines of less than 35 percent would be exempt from making than 35 percent would be exempt from making tariff reductions through the formula. Instead, tariff reductions through the formula. Instead, they are expected to bind [70-they are expected to bind [70-9090]] percent of percent of non-agricultural tariff lines at an average level non-agricultural tariff lines at an average level that does not exceed the overall average of that does not exceed the overall average of bound tariffs for all developing countries after bound tariffs for all developing countries after full implementation of current concessions which full implementation of current concessions which is at 28.5%.is at 28.5%. ((Developing Members concerned are: Cameroon; Congo, Côte Developing Members concerned are: Cameroon; Congo, Côte d'Ivoire; Cuba; Ghana; Kenya; Macao, China; Mauritius; Nigeria; Sri d'Ivoire; Cuba; Ghana; Kenya; Macao, China; Mauritius; Nigeria; Sri Lanka; Suriname; and Zimbabwe.)Lanka; Suriname; and Zimbabwe.)
Flexibilities for LDCs• LDCs exempted from applying the formula for LDCs exempted from applying the formula for
tariff reduction and the sectoral approach. tariff reduction and the sectoral approach. However, as part of contribution to this Round However, as part of contribution to this Round of negotiations, LDCs expected to of negotiations, LDCs expected to substantially increase the level of tariff substantially increase the level of tariff binding commitments. binding commitments.
• Individual LDCs to determine the extent and Individual LDCs to determine the extent and level of tariff binding commitments in level of tariff binding commitments in accordance with their individual development accordance with their individual development objectives.objectives.
• Duty-free, quota-free access for LDCs – Duty-free, quota-free access for LDCs – transparency ( Hong Kong Declaration)transparency ( Hong Kong Declaration)
Flexibilities for LDCs• Accordingly, by the time Members submit their Accordingly, by the time Members submit their
comprehensive draft schedules of concessions, comprehensive draft schedules of concessions, developed-country Members shall, and developed-country Members shall, and developing-country Members declaring developing-country Members declaring themselves in a position to do so should: themselves in a position to do so should:
-- inform the WTO of the products that are inform the WTO of the products that are currently covered under duty free and quota free currently covered under duty free and quota free market access for LDCs; market access for LDCs;
-- notify the internal procedures by which they notify the internal procedures by which they will implement the Decision; andwill implement the Decision; and
-- provide an indication of the possible time provide an indication of the possible time frame within which they intend to fully implement frame within which they intend to fully implement the Decision as agreed.the Decision as agreed.
Flexibility for Small Vulnerable Flexibility for Small Vulnerable EconomiesEconomies
• Search for benchmarks of vulnerability Search for benchmarks of vulnerability abandoned. Single eligibility criterion abandoned. Single eligibility criterion based on value of NAMA trade from 1999-based on value of NAMA trade from 1999-2001: 0.1%2001: 0.1%
• Two options: a formula tariff reduction with Two options: a formula tariff reduction with expanded flexibilities or a target average expanded flexibilities or a target average tariff reduction as proposed by SVEstariff reduction as proposed by SVEs
• Chair’s recommendation: tariff average Chair’s recommendation: tariff average approach, in 3 tiers based on average approach, in 3 tiers based on average bound tariffs, and including a minimum bound tariffs, and including a minimum line-by-line tariff reductionline-by-line tariff reduction
Flexibility for Small Vulnerable Flexibility for Small Vulnerable EconomiesEconomies• Where the SVE has bound Where the SVE has bound 50%50% or more of its or more of its
tariff lines, its overall tariff average shall not tariff lines, its overall tariff average shall not exceed [exceed [22-32%]. 22-32%]. Fiji – special consideration on Fiji – special consideration on account of its low level of binding coverage and account of its low level of binding coverage and the fact that SVEs will be expected to bind 100% the fact that SVEs will be expected to bind 100% of their tariff linesof their tariff lines
• Where the SVE has bound between Where the SVE has bound between 30% and 30% and 49%49% of its tariff lines, its overall tariff average of its tariff lines, its overall tariff average shall not exceed [shall not exceed [18-28%]18-28%]
• Where the SVE has bound less than Where the SVE has bound less than 30%30% of its of its tariff lines, its overall tariff average shall not tariff lines, its overall tariff average shall not exceed [exceed [14-20%]14-20%]
• SVEs to make a minimum tariff reduction of [5-SVEs to make a minimum tariff reduction of [5-10%] for [90-95] per cent of their tariff lines10%] for [90-95] per cent of their tariff lines
Flexibility for Small Vulnerable Flexibility for Small Vulnerable EconomiesEconomies• All tariff lines to be bound on 1 January following All tariff lines to be bound on 1 January following
the entry into force of the DDA results at initial the entry into force of the DDA results at initial bound ratesbound rates
• For bound tariff lines, existing bindings will be For bound tariff lines, existing bindings will be used. For unbound tariff lines, SVE to determine used. For unbound tariff lines, SVE to determine the level of the initial binding of those tariff linesthe level of the initial binding of those tariff lines
• Overall binding target average to be made Overall binding target average to be made effective at the end of the implementation effective at the end of the implementation period through 9 equal rate reductions. First period through 9 equal rate reductions. First reduction to be made 1 year after the reduction to be made 1 year after the implementation of the DDA resultsimplementation of the DDA results
• All duties to be bound on an All duties to be bound on an ad-valoremad-valorem basis basis
Flexibility for Recently Acceded Flexibility for Recently Acceded Members Members • Potential list of RAMs: Ecuador, Bulgaria, Potential list of RAMs: Ecuador, Bulgaria,
Mongolia, Panama, Kyrgyz Republic, Jordan, Mongolia, Panama, Kyrgyz Republic, Jordan, Georgia, Albania, Oman, Croatia, Moldova, Georgia, Albania, Oman, Croatia, Moldova, China, Chinese Taipei, Armenia, Former Yugoslav China, Chinese Taipei, Armenia, Former Yugoslav Republic of Macedonia, Saudi Arabia, Vietnam Republic of Macedonia, Saudi Arabia, Vietnam and Tongaand Tonga
• RAMs have to apply the formula, with the RAMs have to apply the formula, with the exception of Armenia, Former Yugoslav Republic exception of Armenia, Former Yugoslav Republic of Macedonia, Saudi Arabia, Vietnam and of Macedonia, Saudi Arabia, Vietnam and TongaTonga
• A grace period of [2-3] years shall apply on a A grace period of [2-3] years shall apply on a line-by-line basis and shall begin as of the date line-by-line basis and shall begin as of the date of full implementation of the accession of full implementation of the accession commitment on that tariff linecommitment on that tariff line
Flexibility for Recently Acceded Flexibility for Recently Acceded Members Members • An extended implementation period of [2-5] equal An extended implementation period of [2-5] equal
rate reductions to implement commitments (i.e. in rate reductions to implement commitments (i.e. in addition to the 5 or 9 equal instalments foreseen)addition to the 5 or 9 equal instalments foreseen)
• First reduction to be implemented on 1 January of First reduction to be implemented on 1 January of the year following the entry into force of the DDA the year following the entry into force of the DDA results, with the exception of those tariff lines results, with the exception of those tariff lines covered abovecovered above
• In respect of those tariff lines, the first reduction In respect of those tariff lines, the first reduction shall be implemented on 1 January of the year shall be implemented on 1 January of the year following completion of the grace periodfollowing completion of the grace period
• In both cases, each successive reduction to be In both cases, each successive reduction to be made effective on 1 January of each of the made effective on 1 January of each of the following yearsfollowing years
SectoralsSectorals •Key element in fulfilling the Doha Key element in fulfilling the Doha
mandatemandate
•Participation on anon-mandatory basisParticipation on anon-mandatory basis
•Discussions to date have focussed on Discussions to date have focussed on defining critical mass, scope of product defining critical mass, scope of product coverage, implementation period and coverage, implementation period and SDT for developing countriesSDT for developing countries
•Members participating in sectorals to Members participating in sectorals to intensify their workintensify their work
Non-reciprocal preferencesNon-reciprocal preferences• Assessment of the scope of the preference Assessment of the scope of the preference
erosion problem greatly assisted by a erosion problem greatly assisted by a Secretariat analysis of the key products, key Secretariat analysis of the key products, key countries and key markets concerned. element countries and key markets concerned. element in fulfilling the Doha mandatein fulfilling the Doha mandate
• Suggested possible solutions:Suggested possible solutions: - Aid-for-Trade to address the underlying challenges faced Aid-for-Trade to address the underlying challenges faced
by beneficiary countries – diversification of exports and by beneficiary countries – diversification of exports and strengthening competitiveness; strengthening competitiveness;
- Possible longer implementation periods; Possible longer implementation periods; - Correction coefficient – opposed by several Members, Correction coefficient – opposed by several Members,
who argue that trade measures are not apposite for who argue that trade measures are not apposite for addressing the problemaddressing the problem
Non-reciprocal preferencesNon-reciprocal preferences•Recognition that MFN liberalization will Recognition that MFN liberalization will
erode preferenceserode preferences
•Reduction of tariff on eligible products Reduction of tariff on eligible products to be implemented in [7] equal rate to be implemented in [7] equal rate reductions instead of 5 equal rate reductions instead of 5 equal rate reductions by preference-giving reductions by preference-giving countriescountries
•First reduction to be implemented on 1 First reduction to be implemented on 1 January of the [second] year following January of the [second] year following the entry into force of DDA resultsthe entry into force of DDA results
OthersOthers •Supplementary modalities: Request Supplementary modalities: Request
and offer approachand offer approach
•Low Duties: elimination encouragedLow Duties: elimination encouraged
•NTBs: Members encouraged to merge NTBs: Members encouraged to merge proposals to facilitate text-based proposals to facilitate text-based negotiations; resolution of bilateral negotiations; resolution of bilateral requests; intensification of workrequests; intensification of work
•Capacity-building measuresCapacity-building measures
•Non-agricultural environmental goodsNon-agricultural environmental goods
ServicesServices• Number of offers on the table quite satisfactory, but
problem is their quality. In some cases, the offers do not match prevailing access granted by countries
• Key issue is how to get improved offers. Will the plurilateral request/offer approach deliver improved offers?
• Proposal of developed countries that there should be a plurilateral component committing Members to a certain level of ambition
• Some developed-country Members would want an express linkage to the level of ambition in services to those in agriculture and NAMA
Services• Demand by developed-country Members that there should be a
ministerial signalling exercise around the time of agreement on agriculture and NAMA modalities. Meeting to be chaired by the DG
• Objection to the proposals by most developing-country Members who insist that any multilateral text should respect faithfully the agreed guidelines for the negotiations
• Issues of concern to developing countries: Mode 4 (Temporary movement of persons)
• GATS rules – progress on domestic regulation disciplines – draft being discussed by Members
• Draft text to be circulated (When?)→ link with timing of other texts
RulesRules• RTAS – transparency mechanism agreed in December 2006.
Applied provisionally. To be reviewed in light of experience and agreed rules incorporated as part of the Doha package
• No progress on the substantive rules – scope of Article XXIV of the GATT 1994, Article V of the GATS and the Enabling Clause
• As regards antidumping, work has advanced. Chair issued a draft text in November 2007.
• Proposals made on a number of subjects, including product under investigation/ consideration, like product, domestic injury, dumped imports, standing rules, determination of normal value, constructed export price, conditions under which export price can be disregarded, cumulative assessment of imports, price undertakings, lesser duty rule, public notice and period of data collection for investigations
RulesRules• Whereas the text contains some positive elements, it has been
criticised by many Members for its provisions on zeroing.
• Whereas the Appellate Body has ruled that zeroing is Appellate Body has ruled that zeroing is prohibited both in investigations (WA-WA and T-T) and in prohibited both in investigations (WA-WA and T-T) and in reviews, the new text only prohibits zeroing in WA-WA reviews, the new text only prohibits zeroing in WA-WA transactions.transactions.
• As regards subsidies, the proposals have focussed mostly on the following issues: clarification and improvement of the trade remedy provisions, definition of a subsidy and calculation methodology, prohibited subsidies – export and import substitution subsidies, remedies for prohibited subsidies, export credits, serious prejudice, non-actionable subsidies, subsidy notifications, SDT, natural resource and energy pricing, taxation
RulesRules• The Chairman’s text covers the following issues: benefit definition, The Chairman’s text covers the following issues: benefit definition,
specificity and regulated prices, scope of illustrative list, benefit specificity and regulated prices, scope of illustrative list, benefit calculation for regulated prices, upstream subsidies, allocation of calculation for regulated prices, upstream subsidies, allocation of benefitsbenefits
• Does not include language on the following: Dual pricing, Does not include language on the following: Dual pricing, presumption of serious prejudice, non-actionable subsidies, presumption of serious prejudice, non-actionable subsidies, “development policy space”, Inputs consumed (for drawback), “development policy space”, Inputs consumed (for drawback), harmonization of CVD & AD procedures harmonization of CVD & AD procedures
• As regards fisheries subsidies, substantial progress has been made since the resumption of negotiations in February 2007. Progress reflected in Chairman’s text.
• Prohibition of subsidies which contribute to overfishing, overcapacity and depletion of global stocks, including subsidies for vessel construction, transfer of vessels, operating costs, fishing and port infrastructure, income and price support
RulesRules• A number of exemptions: subsidies for improvement
for vessel and crew safety, selective gear/techniques, other environmentally-friendly techniques, vessel decommissioning, capacity reduction
• A number of S&D provisions for developing countries- access fees, support for artisanal fishing etc
• LDCs exempted from obligations
• Next steps: Chairman of the NG on Rules has resisted calls for a revised text to be issued before the start of the horizontal process
• Linkage with other negotiating areas
Special and Differential Special and Differential TreatmentTreatment
• Not much progress since the Cancun Ministerial Not much progress since the Cancun Ministerial ConferenceConference
• Impasse over whether the 28 Agreement-specific Impasse over whether the 28 Agreement-specific proposals agreed in Hong Kong should be harvested proposals agreed in Hong Kong should be harvested or revisited to make them more enforceable?or revisited to make them more enforceable?
• African Group not in a hurry to adopt the decisions on African Group not in a hurry to adopt the decisions on the grounds that they lack economic valuethe grounds that they lack economic value
• Decisions on 5 Agreement-specific LDCs proposals in Decisions on 5 Agreement-specific LDCs proposals in HK, the most significant being the decision on duty-HK, the most significant being the decision on duty-free, quota-free access for products of export interest free, quota-free access for products of export interest to LDCsto LDCs
Special and Differential Special and Differential TreatmentTreatment
• Issues about implementation of the DFQF decision Issues about implementation of the DFQF decision remainremain
• Category II proposals – not much progress in the Category II proposals – not much progress in the relevant WTO bodiesrelevant WTO bodies
• The African Group wants the CTD Special Session to The African Group wants the CTD Special Session to examine these proposals. Opposed by developed-examine these proposals. Opposed by developed-country Memberscountry Members
• 16 remaining category I and III proposals – focus on 7 16 remaining category I and III proposals – focus on 7 proposals. New language needed on the remaining 9 proposals. New language needed on the remaining 9 proposals as Members’ positions are widely divergentproposals as Members’ positions are widely divergent
Trade FacilitationTrade Facilitation• Good progress in the negotiationsGood progress in the negotiations
• Text-based contributions from Members covering Articles V, Text-based contributions from Members covering Articles V, VIII and X of the GATT 1994VIII and X of the GATT 1994
• Proposals have focussed on, Proposals have focussed on, inter aliainter alia, inter alia, publication , inter alia, publication and availability of information, time periods between and availability of information, time periods between publication and entry into force of rules/regulations, publication and entry into force of rules/regulations, consultations and possibility to provide comments on draft consultations and possibility to provide comments on draft rules/regulations, information on policy objectives, advance rules/regulations, information on policy objectives, advance rulings, appeals procedures and due process, impartiality rulings, appeals procedures and due process, impartiality and non-discrimination, import/export fees and and non-discrimination, import/export fees and documentation, consular transactions, cooperation between documentation, consular transactions, cooperation between customs authorities and relevant officials, transit matterscustoms authorities and relevant officials, transit matters
Trade FacilitationTrade Facilitation• Bottom-up approach has provided the Chairperson of the NGTF inputs Bottom-up approach has provided the Chairperson of the NGTF inputs
to prepare a draft text for Members’ considerationto prepare a draft text for Members’ consideration
• Main challenge would be how to come up with effective disciplines Main challenge would be how to come up with effective disciplines while at the same time giving effect to the broad provisions on while at the same time giving effect to the broad provisions on special and differential treatment for LDCs and developing countries. special and differential treatment for LDCs and developing countries. Will they be watertight or voluntary as far as developing countries are Will they be watertight or voluntary as far as developing countries are concerned?concerned?
• On implementation of obligations, two approaches – a staged On implementation of obligations, two approaches – a staged approach and a tailor-made approach which takes into account the approach and a tailor-made approach which takes into account the circumstances of each developing-country Member. Emphasis on circumstances of each developing-country Member. Emphasis on building the technical and financial capacities to implement any new building the technical and financial capacities to implement any new disciplinesdisciplines
• Timing of the Chair’s text dependent on developments in other areas Timing of the Chair’s text dependent on developments in other areas – Ag, NAMA, Services, Rules etc– Ag, NAMA, Services, Rules etc
Other IssuesOther Issues• Dispute Settlement (outside the single undertaking) – Progress has Dispute Settlement (outside the single undertaking) – Progress has
been made on the following issues: third party rights, sequencing, been made on the following issues: third party rights, sequencing, remand authority, post-retaliationremand authority, post-retaliation
• Timing of draft text based on developments in other areas of the Timing of draft text based on developments in other areas of the negotiations, even though the DSU negotiations are outside of the negotiations, even though the DSU negotiations are outside of the single undertakingsingle undertaking
• Trade and Environment: Progress has been uneven. Work advanced Trade and Environment: Progress has been uneven. Work advanced on the preparation of lists of environmental goods and services on the preparation of lists of environmental goods and services
• TRIPS Issues – Extension of the additional protection provided to TRIPS Issues – Extension of the additional protection provided to wines and spirits to other products. Members’ positions are widely wines and spirits to other products. Members’ positions are widely divergent. Progress dependent on the results of the agriculture divergent. Progress dependent on the results of the agriculture negotiationsnegotiations
• TRIPS Register – automatic legal effects or not and the issue of TRIPS Register – automatic legal effects or not and the issue of participation- should it be mandatory or voluntaryparticipation- should it be mandatory or voluntary
Process Forward• Establish modalities in Ag and NAMA: May or July Establish modalities in Ag and NAMA: May or July
2008?2008?
• Prepare schedules based on modalitiesPrepare schedules based on modalities
• Verification of schedulesVerification of schedules
• Conclude negotiations in other areas including Conclude negotiations in other areas including services, rules, development etcservices, rules, development etc
• Legal draftingLegal drafting
• Signing of Final ActSigning of Final Act
• Domestic ratification processesDomestic ratification processes
G-10
G-33
ACP
LDCs
Cairns Group
G-20
EU G-27
G–90
Recent new
African Group
ChadBurkina FasoBurundi Togo
Central African RepDjibouti DR Congo
Mali Gambia Guinea Guinea Bissau Lesotho
Malawi Mauritania NigerSierra Leone Rwanda
BeninMadagascar
SenegalUgandaZambiaTanzania
BelizeBarbadosAntigua/BarbudaDominican RepGrenada GuyanaSt Vincent/GrenadinesTrinidad/TobagoJamaica Suriname
St Kitts/Nevis St Lucia
GabonGhana
Namibia
Honduras MongoliaNicaragua
Panama Peru Sri Lanka Turkey
NigeriaZimbabwe
BotswanaCameroon
CongoCôte d’Ivoire
KenyaMozambique
EgyptTunisia Morocco
AngolaSwaziland
Mauritius
R Korea
Iceland Israel Japan Liechtenstein Norway
SwitzerlandCh Taipei
AustriaBelgium Bulgaria
Cyprus Czech R Denmark Estonia Finland France Germany Greece
Hungary Ireland Italy LatviaLithuania Luxembourg
Malta Netherlands PolandPortugal Romania Slovakia
Slovenia SpainSweden UK
Mexico
IndiaChinaVenezuela
DominicaFiji
Papua New Guinea
IndonesiaPakistanPhilippines
Cuba
Haiti
ArmeniaFY Rep Macedonia
Australia Canada Colombia
Costa Rica Malaysia
New Zealand
ChileBrazil
BoliviaGuatemala
Uruguay Thailand
Paraguay Argentina
BangladeshCambodia
Maldives MyanmarNepal
Hong Kong, ChSaudi Arabia
El SalvadorMacao, ChSingapore
Kyrgyz RQatar
UAEBruneiKuwait
BahrainEcuador
AlbaniaCroatiaGeorgiaJordan
MoldovaOman
USG–1
South Africa
Solomon Islands
