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TWN Info Service on WTO and Trade Issues (Oct19/16)
18 October 2019
Third World Network

South firmly rejects US proposal to name and shame on S&DT
Published in SUNS #8999 dated 17 October 2019

Geneva, 16 Oct (D. Ravi Kanth) - Many developing countries on Tuesday rejected a proposal from the United States at the World Trade Organization, seeking to "name and shame" developing countries if they fail to forego their special and differential treatment (S&DT) flexibilities in the current and future trade negotiations, trade envoys told the SUNS.

Intensifying its trade war against the developing countries at the WTO, the US introduced for the fourth time its much-condemned proposal on the "procedures to strengthen the negotiating function of the WTO" at the General Council (GC) meeting on Tuesday.

The US proposal seeks to bring about differentiation/graduation among developing countries for availing special and differential treatment flexibilities in the current and future trade negotiations at the WTO.

At the GC meeting, the US threatened China, India, South Africa, Indonesia, and Turkey among others that if they choose not to forego special and differential treatment (S&DT) in the current and future trade negotiations, then the US "shall no longer treat as a developing country for the purposes of the WTO any self-declared developing country Member that, in the USTR's judgement, can inappropriately seek S&DT in current and future WTO negotiations."

"In addition, the USTR shall not support any such country's application for membership in the OECD (the Paris-based Organization for Economic Cooperation and Development)," the US trade envoy Ambassador Dennis Shea explained at the GC meeting.

He suggested that the USTR will publish the list of countries that will be named and shamed on 24 October.

The US also clarified the four-point criteria for developing countries that should not avail S&DT.

The four-point criteria includes:

* A WTO Member that is a Member of the OECD, or a WTO Member that has begun the accession process to the OECD;

* A WTO Member that is a member of the G20;

* A WTO Member that is designated as a "high income" country by the World Bank; or

* A WTO Member that accounts for no less than 0.5 percent of global merchandise trade.

Adopting the divide-and-rule strategy, the US envoy said "many share our goal of reserving blanket S&DT provisions for those Members that are the relatively less developed of the over 100 Members claiming developing country status. Many have confirmed that the current situation does not lead to equitable outcomes."

Except for Brazil and Singapore, developing countries firmly rejected the US proposal on grounds that it is inconsistent with the existing treaty provisions.

Brazil said "to find a way forward, we should recognize that S&DT is by nature a flexible concept [and] it is also clear that developing country status is not to be identified with S&DT."

Brazil said it has "decided to begin to forego the use of S&DT in negotiations at the WTO."

Singapore, which spoke at the informal Trade Negotiations Committee meeting on 14 October of the need for the self-designation principle for availing S&DT, changed its position overnight by saying that it has decided to forego S&DT.

China raised a procedural point that under Rule 27 of the General Council working procedures, no member can deliver the same proposal after it is rejected three times at the previous GC meetings.

China said it will not comment on the US proposal as it was already rejected at the previous meetings.

India said that S&DT has to be made more inclusive than intrusive while South Africa said S&DT is a treaty- embedded provision.

Indonesia demanded the continuation of S&DT based on the self-designation framework.

Jamaica, on behalf of the ACP (Africa, Caribbean, and Pacific) group of countries, opposed attempts to dilute S&DT provisions.

On behalf of the African Group, Benin opposed the US proposal to bring about graduation/differentiation among developing countries for availing S&DT.

Speaking for the least-developed countries, Chad said that S&DT must continue without any interruption.

Replying to the concerns expressed by members, the US envoy further clarified on the President's memo issued in July (see SUNS #8953 dated 24 July 2019).

Ambassador Shea listed the following points:

* First, the President's memo does not instruct USTR to ask any Member to change its self-declared development status. This is consistent with the US reform proposal, which - as we have stated repeatedly - does not ask any Member to change its self-declared development status.

* Second, the President's memo does not instruct USTR to ask any Member to forego S&DT in existing WTO agreements. This is consistent with the US reform proposal, which does not ask any Member to forego such S&DT. We are not seeking to reopen existing agreements.

* Third, nothing in the President's memo or in the US proposal preclude a Member from negotiating the flexibilities it needs in a WTO negotiation. All Members negotiate their specific needs in every negotiation. We expect any country that foregoes blanket S&DT provisions in any future WTO Agreement would negotiate its needs into the agreement text.

* Fourth, several Members have asked what action USTR will take to "no longer treat as a developing country for the purposes of the WTO any self-declared developing Member that, in the USTR's judgment, can inappropriately seek S&DT in current and future WTO negotiations."

Regarding this instruction, and as directed by the White House memo, USTR is consulting with the interagency Trade Policy Staff Committee.

On 16 October, India along with 40 developing countries, is expected to offer an "inclusive and developmental" proposal on S&DT at the GC meeting, as a counter to the US proposal.

 


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