TWN Info Service on WTO and Trade Issues (Apr12/04)
2 April 2012
Third World Network

Laos WTO accession talks in "end-game" stage
Published in SUNS #7333 dated 20 March 2012

Geneva, 19 Mar (Kanaga Raja) -- The Chair of the Working Party on the accession of Laos to the World Trade Organisation (WTO) has reported that with only one bilateral negotiation remaining (with Ukraine) and a number of new laws announced, Laos could join the WTO by the end of 2012.

According to trade officials, at the eighth meeting of the working party on 16 March, delegates examined for the first time a draft working party report outlining the legislative and institutional reforms that Laos, officially known as Lao People's Democratic Republic or Lao PDR, has undertaken, as well as the commitments that it will make.

Laos' Industry and Commerce Minister Dr Nam Viyaketh told the working party meeting that the country "understands that there is still hard work to be done, not only to have all adopted legislation promulgated to share with Working Party Members, but even further, to implement all commitments and make our legislation operational."

"Our goal is to substantially conclude our accession negotiations by mid-2012 to have our last Working Party Meeting by the end of this year when the Asia-Europe Summit will be held in Vientiane. This is an ambitious goal, but the work done, the understanding of the Members of the difficulties LDCs (Least Developed Countries) face in their transformation process and the generous technical assistance we are receiving, make this a realistic objective," he added. (See below.)

The Working Party Chair, Ambassador Yi Xiaozhun of China, said: "Provided the authorities in Lao PDR work with purpose and speed on the submission of required inputs, it would be my intention, as the Working Party chairperson, in consultation with members and the Secretariat, to hold the next meeting in July, before the summer break, to wrap up the remaining issues of the working party report".

The entire draft accession package of documents could also be circulated before the summer break, "with a view to hold a final Working Party meeting in September or October," the Chair added.

According to trade officials, the Chair said that the talks are now in their "end-game stage".

Trade officials noted that as a least-developed country (LDC), Laos's application is covered by the 2002 General Council guidelines for accelerating membership negotiations (document WT/L/508), as well as the eighth Ministerial Conference decision of December 2011 (document WT/L/846).

According to trade officials, several developing and least developed countries called for Laos' swift entry into the WTO, particularly under the General Council guidelines, and for WTO members to be flexible in the negotiations. These included Cambodia (for the Association of Southeast Asian Nations), Haiti (for the LDCs), India, Saudi Arabia (for the Gulf Cooperation Council), China, Vietnam, Pakistan, Qatar and fellow-applicant Yemen.

According to trade officials, the US, the European Union, Canada, Chinese Taipei, Ukraine, Australia, Japan, Korea and Switzerland said that they support Laos' swift entry into the WTO. Some referred to the technical assistance that they have offered Laos, and welcomed the progress made, both bilaterally and multilaterally.

The working party heard that Laos has now concluded bilateral agreements with Australia, Canada, China, the EU, Japan, Korea, Chinese Taipei, and most recently with the US (on 14 March).

Trade officials said that Laos' only outstanding bilateral negotiation is with Ukraine. Both Ukraine and Laos said that the latest talks that took place two days previously had narrowed the gaps between them.

Several members urged Ukraine to be flexible and to follow various decisions on making membership easier for least developed country applicants.

According to trade officials, Chairperson Ambassador Yi suggested that they should try to conclude their talks by mid-April.

Ukraine replied that this might be difficult even though it is flexible and pragmatic in striving for a quick agreement.

In his statement at the working party meeting, Laos' Industry and Commerce Minister said that Lao PDR is ready to make a final and crucial effort towards the goal of joining the WTO by the end of this year. "We have made a substantial and concerted effort in our accession negotiations both on the bilateral and multilateral front and we can show substantial progress," he added.

On the bilateral front, Dr Nam said that the country has concluded all bilateral negotiations except one. Lao PDR has signed agreements with Australia, Canada, China, the European Union, Japan, Korea, Chinese Taipei, and on 14 March with the United States. "We are actively engaged with Ukraine with a narrow margin to reach final conclusion. With its goodwill and understanding, Lao PDR is confident that we will conclude this last bilateral negotiation very soon."

On the multilateral front, the Minister said that Lao PDR has passed the necessary laws and regulations to ensure that they are now all in line with WTO requirements. Notably, he said that Lao PDR's licensing regime, CVA (customs valuation), SPS (sanitary and phytosanitary measures) and TBT (technical barriers to trade) are well advanced in their full adoption of WTO requirements.

At the request of Working Party members, Dr Nam said that Lao PDR has been working hard to adopt all TRIPS dispositions in a revised law.

He noted that goods subject to import licenses have been drastically reduced and Lao PDR's whole licensing system has been completely revised and brought up to international standards. Only nine products now require an automatic import license, while non-automatic licenses only apply to the importation of guns and bullets, explosives and gold bars. The Questionnaire on Import Licensing Procedures has been submitted and this provides a clear picture of the import licensing system.

The Minister also said that Lao PDR has revised its Customs Law to be in line with the CVA. "We plan to bring our legislation into full compliance with WTO rules by 2012 and to ensure full implementation by accession. Reference prices are now only applied to six products, which will be eliminated upon accession. Thanks to technical assistance received, the introduction of the ASYCUDA [Automated System for Customs Data] system is progressing well, with the aim to streamline the customs processes by harmonizing procedures within international norms."

Dr Nam underlined that Lao PDR's system for sanitary and phytosanitary measures has undergone major reforms, and is still going through a major overhaul in order to incorporate all of the principles and rules of the SPS Agreement.

Lao PDR adopts the standards and recommendations of the IPPC (International Plant Protection Convention), the OIE (World Organisation for Animal Health) and the Codex Alimentarius. The updated Action Plan reflects the work being done in this area, with a number of regulations and decrees adopted in 2011 and 2012. Thanks to the generous support of WTO members, Lao PDR is confident that it can fully implement the SPS agreement by January 2015.

The Minister stressed that Lao PDR has embarked on a major reform effort to bring its technical regulations, standards and conformity assessment into conformity with the TBT Agreement, taking into account technical difficulties.

He said that the updated Action Plan shows that Lao PDR completed its re-assessment of the institutional, legal and regulatory framework, identifying precise capacity constraints and the technical assistance needed. The legal and organizational decisions concerning the establishment of TBT and SPS Enquiry Points and Notification Units have been taken, enabling Lao PDR to take the commitment to have them operational upon accession. Lao PDR will fully implement the TBT agreement by January 2015.

On the issue of intellectual property rights, Minister Nam said that Lao PDR is a member of the WIPO (World Intellectual Property Organization), a signatory to the Paris Convention and the Patent Cooperation Treaty, and as of this week, an official member of the Berne Convention and the "Berne Union".

Lao PDR completely revised the 2007 Intellectual Property Law, taking into account the TRIPS requirements and Members' comments. Its translation would be available within the coming weeks, said the minister, adding that work has accelerated in order to achieve the goal to have all legislation in line with the TRIPS Agreement including its flexibilities for LDCs by the end of this year, and have it fully implemented by January 2016.

The Minister also highlighted other reforms undertaken throughout Lao PDR's accession process. According to Dr Nam, Lao PDR's major achievements include:

-- Trading rights: "Internal coordination and policy decisions in the right direction allowed us to bring our trading rights regime into compliance with the WTO through the adoption of the Decree on Import and Export of Goods."

-- Import regulations including on agriculture: Lao PDR has abolished all bans and import quotas for agricultural products and presently does not apply any seasonal restrictions, prohibitions or other controls. Lao PDR has only ad valorem duties, applies no quotas, no tariff quotas and has no "other duties and charges".

-- Foreign exchange and payments: Lao PDR has undergone a major conversion, by going from a managed system to an open system, complying with the obligations of Article VIII of the IMF.

-- Pricing policy is now determined by the market mechanism thanks to the revised Decree on Prices of Goods and Services.

-- Investment regime: The new Investment Promotion Law and its Implementing Decree treat domestic and foreign investment on an equal footing and are fully in compliance with WTO rules. Lao PDR's industrial policy is in line with WTO requirements, with the newly adopted official repeal to local content requirements.

-- Internal taxes are applied to local products and imports in an identical way through the harmonization of previously different excise and turnover tax rates thanks to the revised Tax Law adopted by the National Assembly in December 2011. The Value Added Tax is being implemented.

-- Fees and charges: All fees and charges for services have been converted to fixed amounts according to the costs of the services rendered.

-- Export duties: Lao PDR only applies a limited number of export duties for development and revenue purposes. Export restrictions have been brought in line with WTO requirements.

Minister Nam told the working party: "We hope this fully reflects the progress made by Lao PDR to bring its trade and economic framework fully in line with WTO requirements. We have streamlined procedures, increased transparency, reduced restrictions and committed to opening our markets to a level that has satisfied all our bilateral partners but one we are actively negotiating with. Lao PDR wants to fully participate and contribute to the multilateral trading system. Lao PDR is convinced that this objective is within reach. Clearly this will require effort and the goodwill of all parties concerned and full respect of the 2002 LDC Accession Guidelines."

According to trade officials, in their questions, working party members asked about, commented on, or praised Laos for progress on these issues. Questions and comments came from Australia, Canada, the EU, Japan and the US.

According to trade officials, Minister Nam thanked members for their technical assistance, and said that his country is on track to pass all requirements by the end of the year, and that it has already demonstrated its political and administrative will.

Laos applied to join the WTO on 16 July 1997, and the General Council agreed to set up a working party on 19 February 1998, trade officials noted. +