TWN Info Service on WTO and Trade Issues (Jun13/02)
5 June 2013
Third World Network  

Progress on S&D lagging behind in TF talks, says South
Published in SUNS #7594 dated 30 May 2013
 
Geneva, 29 May (Kanaga Raja) -- An informal open-ended meeting of the Negotiating Group on Trade Facilitation late last week saw developing countries voicing concerns over special and differential treatment (S&D), arguing that progress in this area is lagging behind the other parts of the draft consolidated negotiating text on trade facilitation.
 
According to trade officials, the developing countries also called for more balance in the trade facilitation (TF) negotiations.
 
The informal meeting on 24 May heard reports from the four "Friends of the Chair" on their discussions during the week on a number of issues in the negotiations.
 
The Friends of the Chair are Ambassadors Yonov Frederick Agah of Nigeria, Mario Matus of Chile and Remigi Winzap of Switzerland, and Mr Michael Stone of Hong Kong-China.
 
Trade officials said that "many delegations" commended the good progress that was made during the week, including the deletion of some 58 brackets from the draft text on trade facilitation.
 
However, these delegations cautioned that the negotiations need to further intensify in order to produce a good text before the summer break (in August) and for an agreement at the ninth ministerial conference in Bali this December.
 
The informal meeting began with reports from the four Friends of the Chair.
 
Ambassador Winzap of Switzerland reported on Articles 6-9bis of the draft text (relating to disciplines on fees and charges imposed on or in connection with importation and exportation, release and clearance of goods, consularisation, border agency cooperation, and declaration of transhipped or in transit goods).
 
He said that delegations have made progress, including on penalty disciplines (Article 6.2), use of electronic payment (Article 7.2), post-clearance audit (Article 7.5) and timely release of goods (Article 7.6).
 
Ambassador Agah of Nigeria said he had observed progress on a small number of issues, including on temporary admission of goods (Article 10.11), single window (Article 10.5), and use of common procedures (Article 10.8) and uniform documentation requirements (Article 10.9).
 
Ambassador Matus of Chile reported on Articles 1-3 (relating to publication and availability of information, prior publication and consultation, and advance rulings).
 
He said that progress was made on text related to enquiry points, advance rulings and appeal procedures.
 
Mr Stone of Hong Kong-China, reporting on the issue of special and differential treatment (Section II), said that 10 countries presented their needs-assessment findings on trade facilitation, bringing to 41 the number of members that have undertaken such an exercise.
 
According to trade officials, Mr Stone said that the gaps that were common in the presentations included lack of appropriate training, policies, facilities and equipment.
 
He further said that donors also made presentations, and that many countries interacted with them on possible technical assistance requirements, adding that there was a small number of changes that he could propose to the draft text.
 
According to trade officials, Egypt, however, suggested that the Negotiating Group retain the current draft negotiating text (TN/TF/W/165/Rev. 15) in view of the recent submissions by the African, Caribbean and Pacific (ACP) Group and the African Group (see below).
 
Egypt also questioned the linking of needs-assessment with the negotiations.
 
According to trade officials, India said that the Group has made very significant progress since the last meeting with the deletion of 58 pairs of brackets, adding that this new momentum in the trade facilitation negotiations should also move to the other areas of the Bali package.
 
[This was seen as a reference to the G-33 proposal on food security, the latest G-20 proposal (in a non-paper) on ending agricultural export subsidies, including cotton subsidies, in accord with the Hong Kong Ministerial Declaration, and the transparency proposal on Tariff Rate Quota administration, and the LDC waivers. In these areas, trade diplomats said, the US and the EU are blocking any compromises and accords.]
 
India also said that progress on Section II (on special and differential treatment provisions for developing country members and least-developed country members) is lagging behind, and was afraid that this could have an impact on the other parts of the text.
 
India called on the Group to redouble its meetings on Section II. It proposed that texts under negotiations be projected on the screen to facilitate drafting, and that the Secretariat provide records of meetings.
 
Switzerland said that a lot of good work had been made in the past week but the 58 brackets that were removed do not even amount to 10% of all the brackets (in the draft text), adding that one obstacle is that many delegations are not in a position to negotiate.
 
On Egypt's comment on needs assessment, it said that as a donor country on trade facilitation, it could not face parliament and justify its non-inclusion.
 
It said that the level of S&D would depend on how binding the agreement would be, adding that it saw a lot of flexibility during the past week, but that this must be reciprocated.
 
According to trade officials, the US supported the statement by Switzerland, adding that it had provided millions of dollars in trade facilitation technical assistance to Egypt since 2009.
 
The EU also supported Switzerland, saying that the Group has a long way to go, as significant brackets still remain to be removed. It added that delegations should act like international negotiators and not like divorce lawyers.
 
In the EU view, the agreement represents the most innovative technical assistance programme ever envisaged in the WTO.
 
Canada also supported Switzerland, noting that it had just funded a new technical assistance facility for African countries through the African Development Bank.
 
Responding to the US, Egypt said that the US assistance has resulted in a substantial increase in US exports to Egypt (but not to Egypt's exports). It also urged more flexibility on Section II of the draft text.
 
According to trade officials, Zimbabwe, Cameroon, Jamaica, Dominica, Pakistan, Venezuela, Turkey, Ecuador, Mexico, Malaysia, Rwanda and Morocco also called for more progress on Section II of the draft text on S&D.
 
In concluding the meeting, the Chair, Ambassador Eduardo Ernesto Sperisen-Yurt of Guatemala, said that the Group will continue to revise the draft consolidated negotiating text based on this week's meeting.
 
According to trade officials, the Chair noted the support from delegations for the process that was started in March, but warned that the current rhythm would not put the Group on track for a Bali outcome.
 
Stressing the need to intensify the work and to show flexibility, the Chair called on delegations to avoid discussions on the process and to instead focus on substance, which he said holds the key to further progress and to reaching the Bali objective.
 
He concluded that while progress had been made, the Group must speed up its work and make compromises to strike a deal, adding however that delegations are committed to negotiating constructively.
 
Trade officials said that as a result of the week's informal meeting, the Group will be issuing Revision 16 of its draft consolidated negotiating text. The next regular meeting of the Group will be in the week of 15 July.
 
According to trade officials, at an informal meeting on 23 May afternoon, chaired by Mr Stone of Hong Kong-China, two separate proposals by the African Group and the ACP Group on Section II of the draft text on trade facilitation were discussed.
 
According to the proposal from the African Group, the "modalities of the negotiations affirm that the principle of special and differential treatment (S&DT) for developing and least-developed countries ‘should extend beyond the granting of traditional transition periods for implementing commitments'."
 
It added that the mandate recommends that S&DT provisions should be precise, effective and operational in order to allow for necessary flexibility in implementing the results of the negotiations.
 
In order to operationalise this mandate, said the African Group paper, S&DT provisions of Section II has to be addressed through innovative, comprehensive, and holistic approach.
 
In this context, an effective framework for S&DT should be clearly articulated in the consolidated negotiating text.
 
This framework is envisaged to be premised on two pillars: (1) implementation flexibilities that address the concerns of developing countries and LDCs taking into consideration their actual implementation capacities; (2) effective mechanisms for the provision of predictable, sustainable, adequate, and responsive technical and financial assistance and capacity-building.
 
The Group argued that while the current consolidated negotiating text includes provisions that address the first pillar relative to implementation flexibilities
(differentiation of rules into distinct categories with different implementation conditions, early warning mechanism, and grace period for the application of dispute settlement rules), the second pillar regarding technical and financial assistance still fall short of being precise, effective, or operational.
 
"The negotiating text lacks the necessary mechanisms that ensure the efficient, timely, and secure delivery of such assistance," it stressed.
 
It underscored that institutional and operational mechanisms should be established with a view to guarantee the access of developing countries and LDCs to secure an unconditional assistance that respond to their needs and priorities.
 
While the institutional mechanism aims to undertake regular scrutiny and review of the implementation of technical and financial assistance provisions, the operational mechanism should guarantee the effective and efficient flow of assistance from donors to beneficiaries, it said.
 
The Group said that its paper addresses only the institutional aspect of the above mentioned mechanisms.
 
According to the African Group paper, the institutional mechanism is envisaged as a built-in machinery of the Trade Facilitation Committee (TF Committee) conducted in the form of dedicated sessions devoted to review regularly all the implementation-related aspects of the technical and financial assistance provisions.
 
Those dedicated sessions could help identify any difficulties related to the implementation and the possible ways to overcome them. It is suggested that the dedicated session be held, for one full day, directly before the convening of the regular session of the TF Committee.
 
The dedicated sessions can be enabled to discuss the notifications of the donor members regarding the availability of technical and financial assistance and capacity building, with a view to address the assistance from a holistic perspective. Moreover, the dedicated sessions can act as a matchmaking mechanism between the members requesting assistance and the donor members.
 
In order to ensure an effective outcome from the deliberations of the dedicated sessions, the Group said that the possibility of making recommendations should be provided, adding that the scope of those recommendations will be limited to improve the implementation of the relevant provisions and to enhance the effectiveness of the assistance.
 
"The dedicated sessions could allow for participation, as it deems appropriate, from the donor community to present their projects and explain how developing countries and LDCs can benefit from the available assistance. Furthermore, the sessions can help provide the opportunity for sharing experiences and act as a forum for constructive discussion among donors and beneficiaries."
 
Simply, said the African Group, the dedicated sessions will provide the necessary time and focus for the committee to review the progress in the implementation of the technical and financial assistance and capacity building provisions, and to ensure compliance.
 
"It is one step further toward achieving the general objective of providing a demand-driven technical and financial assistance and capacity building to developing countries and LDCs in the post-negotiations phase. Complimentary efforts are needed to establish operational mechanism that ensures the delivery and provision of timely and predictable technical and financial assistance that should be adequate and responsive."
 
The African Group viewed that the proposed text of the institutional mechanism can be placed in paragraph 8.4 of the negotiating text as follows:
 
"8.4 The committee shall hold dedicated sessions in order to review the implementation of the provisions related to technical and financial assistance and capacity building. The committee shall make recommendations, as appropriate, with a view to strengthening the effectiveness of those provisions and to improving their implementation. The dedicated sessions shall, inter alia, provide a framework for:
 
"a. Receiving requests for assistance from developing and least developed country Members;
 
"b. Analysing the responses of the developed countries to the requests for assistance from developing and least developed country members referred to in Article 8.4 (a).
 
"c. Discussing and analysing the impact of the implemented programs of assistance on satisfying the needs of the recipient countries.
 
"d. Discussing any problems regarding implementation of provisions or sub-parts of provisions related to technical and financial assistance and capacity building;
 
"e. Reviewing progress in the provision of technical assistance and financial assistance and capacity building including any developing or least developed country Members not receiving adequate technical assistance and capacity building;
 
"f. Sharing experiences and information on on-going assistance and implementation programs, including the relevant challenges.
 
"g. Reviewing and analysing donor notifications as set forth in Article 9."
 
"h. Reflecting on the establishment of efficient, demand-driven operational mechanism for the effective delivery of technical and financial assistance and capacity-building to the developing and least developed country members."
 
The ACP Group paper offers textual proposals on Section II of the draft consolidated negotiating text on trade facilitation. +