ITCB decries lack of commercially meaningful integration

by Chakravarthi Raghavan

Geneva, 18 June 2001 - Developing-country exporters of textiles and clothing products have expressed their frustration and disappointment over the failure of the developed countries to move towards commercially meaningful dismantling of quota restrictions on the exports of developing countries.

The complaint of the exporting countries came in a communique issued after the meeting (11-14 June) of the Council of Representatives of the International Textiles and Clothing Bureau (ITCB). The Council met at Rio de Janeiro.

The ITCB is the alliance of the developing-country exporters.

Seven years after the entry into force of the Uruguay Round Agreement on Textiles and Clothing (ATC), the communique said, barely 20% of the trade actually restrained by quotas has been notified for integration, leaving 80% of such trade pending until the last day of the process.

The ITCB members insisted that the full integration of textiles and clothing into the GATT shall be achieved by end of 2004, and urged the developed restraining countries to make use of the flexibility available under the existing provisions of the ATC to allow exporting developing countries to realize the economic benefits expected of the Agreement, particularly in the framework of the resolution of the implementation-related problems underway in the WTO General Council.

“This is one of the essential considerations in the preparation of the 4th Ministerial Conference of the WTO to be held in Doha,” the ITCB members said.

The ATC, which enables the maintenance of the old multi-fibre agreement (MFA) discriminatory quotas against developing-country exporters, calls for the progressive dismantling of these quotas, and the agreement itself is to end at the end of 2004, when the normal GATT trading rules will apply to this sector.

The Rio communique of the ITCB said: “The Council stressed that the ATC is an integral part of the WTO and that its full and effective implementation is of vital importance to the credibility of the multilateral trading system. It also emphasized the importance of full compliance with the provisions of the ATC to provide meaningful increases in access possibilities for small suppliers and least developed countries.”

“It is unfair and against the principles of multilateralism and single undertaking for some developed countries to link the pace of quota liberalization with additional market access concessions by developing countries,” the Rio communique said.

The ITCB also expressed concern at the discrimination resulting from eliminating quota restrictions on certain non-WTO countries while retaining them on developing-country WTO Members.

This is a reference to the EC eliminating quota restrictions against Russia, Ukraine, Bosnia and a few other central and east European countries.

This is viewed as even more retrograde, and a violation of the MFN principle that the EC provides better arrangements to a non-member than to a WTO member.

The ITCB also objected to the US, which maintains a so-called ‘visa’ requirement for imports of textiles and clothing products - by which it allows without any restrictions imports from the EC or other developed countries, but maintains quotas against the imports of the same products from the developing countries.

“The developed restraining countries,” the ITCB said, “should extend the benefits of liberalization in respect of integrated products to all developing countries.”

The Council noted with concern that while the large bulk of restrained textile and clothing products will only be integrated at the end of the transition period, major developed restraining countries have not yet taken measures to allow for continuous industrial adjustment and increased competition in their markets.

The ITCB members said they would remain vigilant against any “undermining of liberalization,” and to “to resist any trade harassment measures”, such as unjustified recourse to anti-dumping, safeguards and/or changes in rules of origin.

The ITCB Council elected Mr. Stuart Harbinson of Hong Kong, China, as Chairman and Mr. Alcides Prates of Brazil and Mr. William Ehlers of Uruguay as Vice-Chairmen of the session. – SUNS4917

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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