ITCB members express disappointment over ATC implementation

by Kanaga Raja

Geneva, 9 Nov 2001 - A group of 25 major textile-exporting developing countries have expressed deep disappointment and concern that the major developed countries have not yet delivered on their commitment to liberalize trade in textiles and clothing in any meaningful manner for the developing countries to benefit from.

The 25 textile-exporting developing countries, grouped under an intergovernmental organisation called the International Textiles and Clothing Bureau (ITCB), put forth their concerns in a statement by the Ministers of the ITCB members, which is to be circulated at the 4th WTO Ministerial in Doha, Qatar.

The ITCB members maintain that seven years from the Uruguay Round Agreement on Textiles and Clothing (ATC), few quota restrictions have been phased out, and added that the plans announced for the remainders of the 10-year period are no more encouraging.

The ITCB warns that unless major improvements are effected, the large bulk of quotas will remain until the end of the transitional period on 1 January 2005, that is, 701 out of 758 in the US, 167 out of 219 in the EU, and 239 out of 295 in Canada.

The ITCB notes that for over 40 years, the conduct of trade relations in textiles has been characterized by a sharp departure from the basic principles of the multilateral trading system, involving discriminatory treatment of developing countries and a set of quota restrictions on their exports.

Moreover, the ITCB points out that developed countries’ tariff protection in the sector has also remained markedly higher than their industrial tariffs in general.

The ITCB welcomed the conclusion of the ATC in the Uruguay Round as ushering in an era of great promise. Almost one third of the gains from expansion of world income from the Round was attributed to liberalization in textiles under the ATC.

The Agreement itself, says the ITCB, was designed to secure an end to the long-standing quota restrictions, in a phased and progressive manner.

The ITCB points out that in order to secure an end to these restrictions, the developing countries had to pay a price by offering significant concessions in the Uruguay Round.

The ITCB charges that while only a few quota restrictions have been eliminated, the attainment of the objectives of the Agreement has also been impeded by new restrictions in violation of the provisions of the ATC, unjustified anti-dumping actions on products already under quota restriction, and other customs and administrative formalities including changes in rules of origin.

The ITCB members also say that developing countries are deprived from the benefit of growing consumer demand in that additional access has been limited by minimum increases in quota growth rates.

Pressures are continually exerted for additional market opening by developing countries as a condition for meaningful liberalization of quota restrictions, the ITCB members complain.

The ITCB notes that while quotas are maintained on developing economies Members of the WTO, these have been eliminated on certain countries that are not even members of the WTO.

This, says the ITCB, is in obvious disregard of the fundamental principle of MFN treatment.

The ITCB says that these concerns were also raised in the previous Ministerial Conferences.

The ITCB expressed disappointment that these concerns have not received any redress despite the fact that its delegations, together with those of the other developing countries, consistently made specific suggestions for improvement in the situation, including in deliberations on implementation issues under the General Council of the WTO.

The ITCB members stress that just three years are left for completing the process of dismantling quota restrictions, and they also emphasize on the need for ensuring full and faithful implementation of the Agreement within the committed time frame.

In this respect, the ITCB members called upon the developed restraining countries to adopt immediate positive measures to ensure meaningful liberalization in the sector and allow for continuous industrial adjustment and increased competition in their markets.

The ITCB notes that the ATC already contains provisions that permit such measures. This will also help reinstate the balance of rights that was legitimately due to developing countries, the ITCB statement concludes.

The ITCB members are: Argentina; Bangladesh; Brazil; China; Colombia; Costa Rica; Egypt; El Salvador; Guatemala; Honduras; Hong Kong, China; India;

Indonesia; Democratic People’s Republic of Korea; Republic of Korea; Macao, China; Maldives; Mexico; Pakistan; Paraguay; Peru; Sri Lanka; Thailand, Uruguay and Vietnam.

Cuba, Mauritius and Singapore have observer status at the ITCB.

Apart from the Democratic People’s Republic of Korea, these countries are also Members or Observers of the WTO. –SUNS5006

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