September 2000

NEED TO REVISIT W.T.O. TREATIES

At a seminar on the World Trade Organisation in Geneva recently, Malaysia’s Ambassador M Supperamaniam spoke of the need to rectify the WTO’s imbalances and to ‘revisit’ its agreements. He also spelled out seven principles for any future negotiations.

By Martin Khor

Third World Network Features

Developing countries are now a major factor in deciding issues at the World Trade Organisation, but they have to coordinate better and speak up more effectively in order to overcome the present imbalances in the trade system.

The WTO has yet to deliver benefits to developing countries, and the Uruguay Round agreements should be revisited. Members should not be diverted from this most important task by attempts to introduce new issues or a new round.

These were some of the major themes emerging from a panel discussion on current WTO issues, involving ambassadors of four developing countries, during the seminar on Current Developments in the WTO organised by the Third World Network on 14-15 September in Geneva.

Malaysia’s Permanent Representative to the WTO, Ambassador M Supperamaniam, said the Seattle Ministerial Conference proved the developing countries’ interest is now a major factor deciding the WTO’s future course of action.

‘Rather than accept, fait accompli, negotiating issues initiated by others as in the past,  developing  countries  are  now  pushing  forth  their  own  agenda.  This  is  a  vital development in the history of multilateral trade negotiations which should be accepted as being in everybody’s interest.’

Supperamaniam said that any future negotiations, if they are to take place, must be underpinned by seven principles:

·        Imbalances created by earlier agreements have to be rectified;

·        Developing countries’ interests have to be enhanced through better market access for their goods and services;

·        Current rules and future rules, if any, must not impose burdensome requirements on developing countries. They have to take into account the market and economic realities of the day;

·        Special and differential treatment has to go beyond longer time frames needed to implement the agreements;

·        The concept of reprocity cannot be applied when asymmetries continue to exist between the developed and developing countries;

·        Liberalisation should not create economic upheavals;

·        Autonomous liberalisation undertaken by developing countries must be given credit.

Supperamaniam added that negotiations are already underway in agriculture and services. ‘Additionally, developing countries are keen to have the imbalances inherent in some of the Uruguay Round agreements addressed before any new initiatives can take shape.

‘All these subjects are very substantive in nature and the WTO membership should give its undivided attention to them, rather than be distracted by calls for a future comprehensive round which does not merit a lot of support at this time.’

On the agriculture negotiations, Supperamaniam said the developed countries’ export subsidies deprive developing countries of access to third markets, and their domestic subsidies and stringent market access conditions make it hard for developing countries to sell agricultural products in the developed countries.

Hence the main objective is to redress the situation to ensure a level playing field where  developing   countries  can  fully   use   their  comparative  advantage.   Moreover, recognition must be given that the agriculture sector in developing countries is not as advanced and thus support they provide for developmental purposes has its raison d’etre.

As to services, some developing countries find a major hindrance in the developed countries’ lack of commitment to open their markets to the supply of services by the movement of natural persons, whilst other developing countries are further hampered by their lower level of development in services.

‘Under such circumstances, the services negotiations have to ensure that developing countries’ export interests are given due attention and that developing countries shall not be required to make commitments beyond what their markets can bear.’

Supperamaniam added that the imbalances in the Uruguay Round agreements are well documented. The agreements have to be revisited with the view to addressing market access impediments to developing countries resulting from the application of certain agreements.

‘Further, there has to be the acceptance that developmental aspects go far beyond longer time frames to implement the agreements. When the agreements do not assist developing countries to develop further, there is a lacuna that has to be addressed in an effective way.’

Finally, special and differential treatment has to be up front on the agenda of current and future negotiations. Ideas on this concept will have to be geared to evolving ways in which globalisation can be managed to benefit developing countries.

Later, in answering a question, Supperamaniam said if only developing countries can be more united and speak with one voice, ‘we can achieve a great deal.’ At present, this was not happening. Some delegations share the views of those who speak, but they do not voice their views. If more developing countries speak their mind and work together, they can achieve a lot.

Ambassador D Baichoo of Mauritius, who is also currently chairman of the Africa Group in the WTO, said although Africa was the region with the largest number of WTO members it remained marginalised with less than 2% of world trade.

The continuing erosion of erstwhile preferential regimes that had given them a competitive advantage has heightened the precariousness of African countries.

Also, capacity constraints do not permit Africa to take off, resulting in the perpetuation of its poor economic and social conditions.

Amb. Baichoo said that Africa has consistently with one voice spoken up on the ‘towering burdens of meeting WTO obligations, including implementation of WTO rules and provisions, notifications, reviews, and coping with existing transition periods’.

He added, ‘Not only have the various provisions for building capacity through special and differential treatment remained theoretical, but also the measures for technology transfer, and modernisation of developing countries through technical assistance, have all remained inoperative.’

Instead, African countries now realise that instead of the expected faster opening up of markets to their products, more barriers have cropped up by way of non-trade measures.

Although the participation of African countries in world trade was supposed to increase and they were supposed to be ‘mainstreamed’ in the multilateral trading system, the results today are strongly disappointing, with exclusion being the lot of many of them.

Baichoo added that the WTO has suffered due to lack of transparency in its decision-making process. ‘But not much seems to have been done so far,’ he complained.

Jamaica’s Ambassador, Ransford Smith, expressed concern about the failure to operationalise the special and differential treatment for developing countries, and warned that if there was a new round it would incur new obligations for developing countries and introduce new issues.

India’s Ambassador Narayanan spoke about the pressures for a new round. ‘We are concerned about the pressures to overload the WTO. We are not in favour of bringing in new issues.’

On the labour issue, Narayanan said developing countries which are all opposed to bringing it into the WTO must prepare to deal with it as there were indications that for the European Union and the United States this was a high priority. - Third World Network Features

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About the writer: Martin Khor is Director of the Third World Network.

2096/2000