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Implementation issues dealt with casually

by Bhagirath Lal Das

Geneva, 2 Oct 2001 - The draft paper put forward by the Chairman of the General Council Mr. Stuart Harbinson and the WTO Director-General, Mr.  Mike Moore on ‘implementation issues’ have been given the appearance of importance and long coverage, but with no real decision on the major issues.  Hence, the assertion in para 10 of the Draft Ministerial Declaration (the Harbinson text) that the Ministers “attach the utmost importance to the implementation issues and related concerns raised by Members and are determined to resolve them” appears more rhetorical than providing any substantial benefit to the developing countries.

The implementation issues have been covered by a separate paper “Draft Decision on Implementation-Related Issues and Concerns”, with two annexes: annex I which includes issues for decision by the General Council before the fourth Ministerial Conference, and annex II which includes drafts for decision by the fourth Ministerial Conference.

The only clear decisions of specific and implementable nature in Annex I are:

(I)  The Agreement on Sanitary and Phytosanitary Measures prescribes that while introducing a measure, a Member will allow “longer time frame” for compliance in case of the products of interest to the developing countries. The SPS agreement also says that a Member should allow “reasonable interval” between the publication of a measure and its actual application. The chairman’s text on implementation has prescribed that the “longer time frame” and the “reasonable interval” will not be less than six months.

(ii)  The agreements on TRIMs and Customs Valuation allow for the consideration of the requests of developing countries Members for extension of the time frame of compliance beyond five years. This period has been extended for some developing countries that had applied for it.

(iii) The Agreement on Subsidies provides for lesser obligations for some countries that have been listed there as having GNP per capita less than US$ 1000 per annum. The chairman’s paper on implementation has provided that a country will continue to be in this list until its GNP per capita per annum reaches US$ 1000 at 1990 prices for three consecutive years. Further, it also provides that a country which is taken out of this list will be again included in it if its GNP per capita per annum falls below this critical level.

All other decisions in this Annex are in the nature of “urging or requesting the Members”, “reaffirming some earlier position”, “directing the relevant WTO bodies to consider an issue further”, “taking note of some action” and similar formulations.

As far as Annex II is concerned, the only clear and implementable decision is on what is called “growth-on-growth” quota levels in textiles. It means that the growth in the quota in a year will be calculated over the base in the previous year which would have already included growth over the earlier year. Considering that the growth rates themselves are very meagre, the provision of growth-on-growth will give only a marginal benefit to the countries. And even this meagre benefit will be relevant only for the next three years, as the developed countries are obliged to remove all quota restrictions on 1 January 2005.

The other provisions in Annex II are in the nature of “instructing or directing or requesting the relevant WTO body to consider an issue”, “taking action based on a future decision of a relevant WTO body”, “calling upon anti-dumping investigating authorities to examine with special care”, “urging Members to offer cooperation in customs valuation process” and similar formulations.

A glaring cosmetic, and totally ineffectual provision is in para 6 of Annex II which “urges Members to apply, where possible, a higher de minimis level” in countervailing duty investigations. This is not in the form of obligation at all. First it uses the operative phrase “urges” and then it dilutes it further by putting in the phrase “where possible”. It is really amazing to find such a provision in this text, which claims to cater to the needs of the developing countries.

The above analysis indicates the casual manner in which the implementation issues have been dealt with in the chairman’s paper on implementation. The benefits to the developing countries are at best extremely meagre. The paper is rather long, perhaps to give an impression of a serious attention and treatment; but it is extremely short on beneficial results for the developing countries.

In fact the assertion in para 10 of the Draft Declaration that the Ministers “attach the utmost importance to the implementation issues...and are determined to resolve them” appears ironical to the extent of being even an affront to the intelligence of the developing countries Ministers who are expected to be satisfied by this effort.

The developing countries are too conscious and aware by now to be carried away by such rhetoric and promises in the GATT/WTO system. They have been experiencing such tricks and treatment in the system for too long a period now.

Also, by separating out the implementation issues into a separate text, there is a risk that it will get into a second track, the first track being that of the issues in the Work Programme.

In fact, the chairman’s text physically separates the implementation issues which is in para 10 and the Future Work Programme which is in paras 11-35. The past experience has shown that once some new work programme starts in the GATT/WTO system, it takes the central stage and other work gets relegated to the back stage.

Already, the implementation issues have remained on the table for the last 3-4 years and yet these have not received adequate attention, as is apparent from the chairman’s text. With this history in mind and with the treatment given to it in the chairman’s text, there is grave risk that the implementation issues will fall by the way side, once the Future Work Programme starts.

These implementation issues have emerged out of the experiences of the developing countries in the implementation of the agreements from 1995 onward.  Most of these had been identified up to 1998. There are new experiences since then and there may be new issues in implementation. But the risk is that there may be a pressure to freeze the implementation issues to the existing list and the new issues may not get entry for consideration.

What should the WTO and the developing countries do?

First, the implementation issues should be brought on to the main stream of work in the Work Programme and should be on a faster track than the issues included in the Future Work Programme. The time-target for completion of the work on the implementation issues should be very much earlier than that for the Future Work Programme.

Second, there should be a decision that the implementation issues to be considered in the Work Programme are not limited to the ones listed so far.  Based on further experience of the developing countries, new issues may be brought up and will be included in the Work Programme.

(* Mr Bhagirath Lal Das who wrote this comment is a former ambassador of India to the GATT, and a former Director of UNCTAD’s Trade Programme.) – SUNS4979

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