south-north development monitor SUNS [Email Edition]

SUNS #4446, Wednesday, 2 June 1999

contents

Trade: Turkey's textile/clothing QRs held illegal (Chakravarthi Raghavan, Geneva)

Trade: Canada backs down on periodicals law (IPS, Ottawa)

Environment: US-EU divide at UN Climate Change Talks (IPS, Bonn)

Latin America: Leaders to push for Free Trade with EU (IPS, Mexico City)

Europe: Balkans bill will affect Development Aid (IPS, Brussels)

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Some excerpts from selected articles:

Trade: Turkey's textile/clothing QRs held illegal

Geneva, 1 June (Chakravarthi Raghavan) -- Customs Unions and Free Trade Agreements permitted by GATT/WTO enable their members to give mutual tariff preferences, derogating from the GATT MFN principles, but do not authorize departures from multilateral WTO obligations of their members, a WTO dispute settlement panel has ruled.

The panel ruled that quantitative restrictions (QRs) imposed by Turkey on imports of some 19 categories of textiles and clothing products from India, purportedly because of its customs union with the European Community, are WTO-illegal.

The panel found the Turkish measures were inconsistent with Articles XI and XIII of GATT and thus with Article 2.4 of the Agreement on Textiles and Clothing (ATC). The panel rejected Turkey's defense that such GATT/WTO incompatible import restrictions were nevertheless permitted by Article XXIV of GATT.

The ruling, the panel said, did not in any way render Turkey's right to form a Customs Union with the EC a nullity. The terms of the Customs Union had left enough flexibility for Turkey to adopt WTO-compatible alternatives, particularly given the share of the imports of these categories in Turkey's overall trade.

The EC and Turkey, for example, could have origin rules enabling free trade between EC and Turkey on textiles and clothing products originating in Turkey, and border measures by the EC to restrain on non-Turkish origin products entering via Turkey.

The panel (constituted by agreement of Turkey and India) was chaired by Amb. Wade Armstrong of New Zealand, and two other members - Dr. Luzius Waseschba (Switzerland) and Mr. Johannes Human (South Africa). Human became a member when Prof Robert Hudec resigned, when Turkey expressed some concern over his views in writings against regional trade agreements.

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