sam laird chief, research, division for international trade, unctad
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What does the WTO do for the the Developing Countries? Leverhulme Lecture, Nottingham 22 April 2002. Sam Laird Chief, Research, Division for International Trade, UNCTAD. Overview. Developing countries in the GATT Development issues in the WTO Lessons from Seattle - PowerPoint PPT PresentationTRANSCRIPT
April 2002 WTO and Development 1
What does the WTO do for the the Developing Countries?
Leverhulme Lecture, Nottingham 22 April 2002
Sam LairdChief, Research,
Division for International Trade, UNCTAD
April 2002 WTO and Development 2
Overview
Developing countries in the GATT Development issues in the WTO
– Lessons from Seattle
– Trade and trade policy developments
The « Doha Development Agenda »
April 2002 WTO and Development 3
The ITO and the GATT
The Havana Charter 1947– Chapters on employment and economic activity,
economic development and reconstructions, restrictive business practices, intergovernmental commodity agreements, and the establishment of the ITO
ICITO & the GATT Development reforms in the GATT
– 1954-55 – Article XVIII, Article XVIII bis– 1964 – Part IV– 1979 – the Enabling Clause
April 2002 WTO and Development 4
Key GATT ideas Freer (not free) trade in goods through reciprocity
in negotiations Tariffs not NTBs Non discrimination (MFN & national treatment) But RTAs allowed, unilateral preferences under
Enabling Clause and waivers (Cotonou, CBI, etc) Rules for trade – progressive coverage of
disciplines Dispute settlement (consensus to accept)
April 2002 WTO and Development 5
GATT to the WTO Establishment of new organization, 1995 Inclusion of services and intellectual property Revised dispute settlement mechanism
– Unified, consensus to reject, Appeal Body
Single undertaking New market-access commitments in goods &
services Revised rules
April 2002 WTO and Development 6
Seattle - 1
Organizational problems Text too long, too ambitious
– Need to include TA and LDC measures?– Were all “Trade and…” issues ripe for deal
(investment, competition policy)?– Should all issues be in WTO (environment,
labour standards)?
April 2002 WTO and Development 7
Seattle - 2
Implementation problems– Where is the cheque?– Barriers loaded against developing countries– Backloading– Contingency protection– Need for TA, longer transition periods
April 2002 WTO and Development 8
Seattle - 3
Change in membership – 80 CPs in Punta del Este, 135 Members in
Seattle (143 in Doha) Increased complexity of WTO Most WTO Members now in RTAs
– Did they try hard enough?
April 2002 WTO and Development 9
Seattle - 4
Two conflicts of vision about WTO– WTO as key legal framework for
intergovernmental economic relations, protector of rights, rules of law Trade negotiations as a cooperative game Consensus rule-making (veto>vote)
– WTO intrusive, secretive, undemocratic lack of transparency controversial DSM cases
April 2002 WTO and Development 10
The road from Seattle to Doha
Launching of mandated negotiations in agriculture & services - BIA
Mandated reviews of WTO agreements LDC package – EBA, AGOA Work on TA budget Accessions – especially China Transparency (internal cf external)
April 2002 WTO and Development 11
Addressing implementation concerns
Problems in implementation of UR results– Textiles, DSM, AD, GPA, TBT/SPS, TRIMs, TRIPS,
RTAs S&D issues
– “Best endeavours” to take account of interests of developing countries
– Operation of GSP – not an issue– Lesser obligations by developing countries and longer
transition periods– Technical assistance
Special mechanism, committee work
April 2002 WTO and Development 12
Policy developments
Trade policy reforms in developing & transition economies in last 10-15 years– NTBs eliminated or reduced– Tariffs rationalized and cut to 10-20%– More to be done
Tariff peaks, escalation, growth of AD measures, licensing systems, local content plans, technical barriers
Protection bias against developing countries
April 2002 WTO and Development 16
Anti-dumping actions by Groups 1980-99
Source: WTO.
0
20
40
60
80
100
120
140
160
Year
No.
Developed
Developing
Transition
April 2002 WTO and Development 17
NTBs in OECD - by major sector1996
ISIC
Description Aus EU Jpn NZ Nor Mex Tur CH USA
1 Agric., forestry & fishing 0.5 7.2 7.0 0.0 0.0 5.2 0.0 0.6 2.8
2 Mining & quarrying 0.0 6.7 0.4 0.0 0.0 24.5 0.0 0.0 0.4
21 - Coal mining n.a. 42.9 n.a. n.a. 0.0 0.0 n.a. 0.0 0.0
22 - Crude petroleum n.a. 0.0 n.a. n.a. 0.0 46.2 n.a. n.a. 0.0
23 - Metal ores n.a. 4.4 n.a. n.a. 0.0 0.0 n.a. n.a. 4.0
29 - Other n.a. 3.6 n.a. n.a. 0.0 0.0 n.a. 0.0 2.3
3 Manufacturing 1.7 5.4 2.5 0.0 0.9 12.9 0.3 0.1 8.1
31 - Food, bevs., tobacco 8.3 11.1 8.6 0.0 0.0 1.9 0.0 0.8 1.2
32 - Textiles & apparel 0.0 75.4 28.7 0.0 24.3 70.6 0.0 0.0 68.3
33 - Wood & wood prods 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.8
34 - Paper & paper prods 0.0 1.9 0.0 0.0 0.0 0.0 0.1 0.0 1.3
35 - Chem. & pet. prods 0.6 1.6 1.4 0.2 3.7 3.8 0.0 0.0 3.2
36 - Non-metallic min. prods 0.5 0.0 0.0 0.0 0.0 0.4 6.6 0.0 6.1
37 - Basic metal industries 0.0 0.6 2.6 0.0 0.0 36.5 0.1 0.0 30.4
38 - Fabricated metals 0.2 0.0 0.0 0.0 0.0 15.1 0.0 0.0 6.1
39 - Other 0.0 0.0 0.0 0.0 0.2 31.9 0.0 0.0 1.7
Total 1.5 5.6 2.8 0.0 0.4 11.8 0.2 0.1 7.2
April 2002 WTO and Development 18
Trade developments
Developing countries share of world trade highly variable– 33% in 1947, 20% in 1973, 28% in 1999– Countries which have diversified to
manufactures have generally done better– Decline of 2 percentage points following Asian,
Russian, Brazilian crises, but strong recovery Few trade policy reversals
April 2002 WTO and Development 19
Doha – The New Agenda Extended market access - potential gains
– BIA - Agriculture - $70bn, Services - $300bn?– PLUS - Manufactures - $70bn – added at Doha
Other immediate negotiations– AD, subsidies, environment
New negotiations in 2003? Subject to consensus– investment, competition policy, transparency in government
procurement, trade facilitation Further study
– electronic commerce S&D provisions, technical assistance
April 2002 WTO and Development 20
Doha – Other parts of the deal
TRIPS Subsidies Implementation Cotonou Agreement Bananas Labour standards - ILO business
April 2002 WTO and Development 21
Issues: To what extent does WTO system contribute to economic development?
Promotion of good policy:– Transparency, Tariff reduction & binding, elim. of
QRs, licencing TBT/SPS, state trading, RTAs
– GATS, agriculture, textiles (at last?!)
– BUT: AD/CV, BOP. Subsidies? Safeguards? TRIPS?
Significant direct implementation costs:– Customs valuation, AD/CV, TRIPS, TBT/SPS, textiles
Significant investment (indirect) costs:– Customs valuation, GATS, TRIPS, TBT/SPS
April 2002 WTO and Development 22
Issues: To what extent does trade contribute to economic development?
Linkages between investment, trade and growth plus debt and poverty
Effects on income distribution, wages and employment
Need for social safety nets, structural adjustment programmes
April 2002 WTO and Development 23
Development links with some specific issues
Other issues– Environment– TRIPS– DSM– Trade and … issues– TBT/SPS– RTAs
April 2002 WTO and Development 24
Is Doha a time bomb? Development issues – now a top priority
– Genuine concern or fear of stalemate in WTO?
Is a development friendly outcome of the DDA guaranteed?
What is the future of S&D treatment?– More enforceability? Greater differentiation? Issue-
oriented treatment? More “policy space”?
Regionalism and/or multilateralism?