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TWN
Info Service on WTO and Trade Issues (Mar26/33)
Push
to Dismantle Development at the WTO Kuala Lumpur*, Goh Chien Yen – The United States and the European Union used the WTO Reform Breakout Session on Development at the WTO’s 14th Ministerial Conference in Yaoundé on 27 March to press for a fundamental overhaul of how developing countries claim their trade rights, setting up a sharp confrontation with Global South members over the future of the multilateral trading system. At issue is Special and Differential Treatment (S&DT), the decades-old principle that developing countries should face less onerous trade obligations than rich ones owing to vast disparities in economic and trading capacity. Washington argues that the existing self-designation framework, under which countries determine their own development status, is the root cause of dysfunction at the WTO. The US called for a “targeted approach” to S&DT that would replace these hard-fought flexibilities with narrowly tailored provisions for technical assistance, capacity-building and policy flexibility, assessed on a case-by-case basis. The EU struck a similar note, posing questions about thresholds and transition periods. The intent is clear: not all developing countries should receive the same treatment. The push from Washington and Brussels strikes at the legal foundations of the trading system. S&DT is not a concession. It is embedded in the architecture of the GATT itself. Article XXXVI of GATT 1994 recognises “a wide gap between standards of living” and stipulates that developed countries “do not expect reciprocity” from less-developed members. Several developing countries made this point forcefully. India argued that the Marrakesh Agreement explicitly protects the rights of developing countries, and that policy space for industrialisation must remain central to reform. Nigeria insisted reform must preserve genuine policy space. Saudi Arabia said S&DT must remain at the core of the WTO rulebook. China offered the staunchest defence. Beijing called for reform that upholds “true multilateralism” and places development at the centre, warning that “a power-based trading system amplifies the asymmetry between members, leaving the most vulnerable marginalised.” China endorsed making S&DT “more precise, effective, and better respond to the needs of members at different levels of economic development,” but through an integrated approach modelled on the Trade Facilitation Agreement, not through externally imposed eligibility criteria. According to Prof Abhijit Das, author of “Strategies for GATT and WTO Negotiations” and former head of the Centre for WTO Studies, the gap in standards of living between most developing and developed countries persists and has widened. Developing countries continue to confront formidable socio-economic challenges, which underscores the continued relevance of S&DT. If future WTO negotiations fail to account for these challenges and developing countries cannot secure S&DT provisions, the system would not serve the objective of economic development for a large number of countries. Das argued that any debate on harmonising obligations between developed and developing countries must start with removing the asymmetries and imbalances in existing WTO agreements, particularly the Agreement on Agriculture and the Agreement on Subsidies and Countervailing Measures, which substantially advantage developed countries. To accept that developing countries should take on the same obligations as developed countries in future multilateral trade negotiations would be a travesty of equity and fairness. Developing countries must have access to effective and precise S&DT on the basis of self-determination, Das argued. The battle over S&DT is, at bottom, a fight over what the WTO is for. *With inputs from TWN delegation at MC14, Yaoundé, Cameroon. This article is based on original news report, “Clash Over Development: US Targets Self-Designation for S&DT as China Calls for Rules-Based System,” Yaoundé, 27 March (D Ravi Kanth).
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