Transcript Visit By Egyptian Officials 26 March 2007

The DDA Negotiations
• The Ninth WTO Trade Round launched in the Qatari
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City of Doha at the Fourth WTO Ministerial
Conference in November 2001
Unsuccessful attempt to launch the negotiations in
December 1999 in Seattle, USA
Concerns of developing countries – marginalisation
in the MTS, lack of transparency and inclusiveness
Members resolved to place the needs and interests
of developing countries at the heart of the
negotiations
Work Programme: TWO tracks – negotiating issues
under the auspices of the TNC and non-negotiating
issues under the auspices of the General Council
Areas Under The Negotiations
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Agriculture (Including Cotton)
Services
Non- Agricultural Market Access
TRIPS (GIs Register)
WTO Rules (AD, Subsidies, RTAs)
DSU (outside Single-Undertaking)
Trade and Environment
Special and Differential Treatment
Trade Facilitation
Principal Elements of the DDA
• Doha Declaration (WT/MIN/(01)/DEC/1)
• 1 August 2004, General Council Decision
(WT/L/579)
• Hong Kong Declaration
(WT/MIN(05)/DEC)
Intractable Issues
Negotiations resumed in Feb 2007
after suspension in July 2006
No breakthrough as yet. Members
still clinging to established positions
What are the intractable issues in
agriculture and NAMA preventing
across-the-board progress in all the
negotiating areas?
Agriculture
• Market Access
• Domestic Support
• Export Competition
Agriculture-Market Access
• Substantial improvement for all agricultural
products
• Agreement in HK that a tiered formula
would be used to reduce tariffs – 4 tiers
• Progressivity – higher tariffs to be reduced
by a greater percentage
• Lack of progress on the tariff bands
(thresholds) and the cuts to be made within
each band
Market Access - Tariffs
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Four bands
 G-20 thresholds for developed countries, with linear cut
 EC to do more - cuts in magnitude between the EC and US
Band
Threshold
EC Cuts
US Cuts
1
0 - 20%
35%
55% - 65%
2
20% - 50%
45%
65% - 75%
3
50% - 75%
50%
75% - 85%
4
75% +
60%
85% - 90%
 Cut in top band critical issue – the rest will be proportionate to that
 Issue of disproportionality if high number of tariffs in top band (e.g.
25%-30% of tariffs)
 Increasing readiness to discuss average cut – maybe above
50%
Other Market Access Issues
• Treatment of Sensitive products
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– 1% - US, Cairns, Brazil
– 8% - EC
– 15% - G10
Treatment of Special Products
– 20% of tariff lines – G-33
– 5 products – US
– Intermediate positions – Pakistan, Thailand,
Malaysia
– TQRs – domestic consumption, current import
volumes and the cuts to be made
Other Market Access Issues
• Special Safeguard Mechanism
– Volume and price triggers
– G-33 prefers a lower threshold, while most developed
countries prefer higher thresholds
• Erosion of preferences
• Tropical products
• Commodities
Domestic Support
• High levels of support provided by developed
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countries
For budgetary reasons, very few developing
countries are providing subsidies
Amounts provided by most developing countries
inconsequential- could be justified as de minimis
(10% of the total value of agricultural production
or under Article 6.2 of the agreement on
Agriculture – investment and input subsidies)
Agreement that there will be three bands for the
reduction of AMS/OTDS – the EC in the top band,
Japan and the US in the second band and all
Members in the third band
Domestic Support - OTDS
 Must meet the mandate of effective cuts
Band
Member
Cuts
1
All other Members,
including developing
countries
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(31% - 70%)
Whatever is agreed, DGC
with AMS to do 2/3 of DDC
reductions
2
US and Japan
> 53% (53% - 75%)
3
EC
> 70% (70% - 80%)
For US, must do more
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Reduce OTDS – less than $19 billion & above very low teens
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Political link to other areas of the negotiation (works both ways)
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For EC
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Minimum cut likely to be 70% cut but could be 75%-80%
Developing countries with no AMS exempt from OTDS cut
Domestic Support
• De minimis – reductions in the level that
could be provided by developed countries:
from 5% to 2.5% or lower?
• Blue Box – reduction from 5% to 2.5 % of
the average level of total production
during a determined base period?
• Green Box – strengthened disciplines?
Export Competition
• Agreement in HK to eliminate all forms of
export subsidies by 2013
• Export subsidies on cotton eliminated by
developed countries at the end of 2006
• Parallel commitments in respect of export
credits, export credits guarantee schemes
• STEs – monopoly powers
• Food aid
NAMA
• The formula – Simple Swiss Formula with
two co-efficients or a Swiss-type formula
with variable co-efficients depending on the
average tariff rates of Members
• Overwhelming support for the use of a
simple swiss formula with two co-efficients
• Should co-effiecients be within sight of each
other?
• Yes for developed countries and no for
developing countries
• Proposals range from 5 to 30 per cent
NAMA – Other issues
• Paragraph 6 countries
• Treatment of unbound tariffs
• Flexibilities for developing countries –
paragraph 8
• LDCs, small economies etc
• Sectorals
• NTBs
Services
• Number of offers on the table satisfactory
• Key issue is the quality of the offers
• Plurilateral requests/offers – key to
improving offers on the table?
• Issues of concern to developing countries
/interests – mode 4
• GATS rules – progress in recent weeks on
domestic regulation disciplines – draft being
discussed by Members
Rules
• RTAS – transparency mechanism
• No substantive progress on WTO disciplines
• With respect to antidumping and subsidies,
Members have tabled a number of proposals
• Remains to be seen what Members will
accept
• Linkages with other areas
Special and Differential Treatment
• Not much progress
• 28 Agreement-specific proposals – should
they be harvested or revisited
• Decisions on 5 Agreement-specific LDCs
proposals in HK
• Category II proposals – not much progress
in the relevant WTO bodies
• 16 remaining category I and III proposals
Trade Facilitation
• Good progress in the negotiations
• Text-based contributions from Members –
platform for a draft text to be circulated by
the Chairman for Members’ consideration
• Special and differential treatment for LDCs
and developing countries in general
• Nature of disciplines – voluntary or
watertight?
Other Issues
• Trade and Environment
• TRIPS Issues – Extension of the additional
protection provided to wines and spirits to
other products
• TRIPS Register – automatic legal effects or
not - deadlock?
Concluding the Round: 2007?
• Challenge: how to make most of the
renewed political commitment
• Work progressing in all negotiating bodies
• Role of G4+/- mainly on agriculture;
• Other offstage bilateral/plurilateral
contacts
Process as foreshadowed
• Establish modalities in Ag and NAMA: July?
• Prepare schedules based on modalities
• Verification of schedules
• Conclude negotiations in other areas
including services
• Legal drafting
• Signing of Final Act
• Domestic ratification processes
US Domestic Considerations
• July breakthrough possible?
• TPA renewal/extension?
• US Farm Bill reform?
• Conclude Round in 2007?
THANK YOU
Edwini Kessie
Counsellor, C-TNC Division, WTO
([email protected])