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KEY DEVELOPING COUNTRIES INSIST ON IMPLEMENTATION


by Martin Khor




Lausanne, 26 Oct 99 -- Two leading developing countries, India and Egypt,
have insisted at the Informal Ministerial Meeting in Lausanne that the
WTO Seattle Conference deal adequately with correcting the present
imbalances in the WTO agreements and in their implementation, and not
to take up new issues that are not related to trade or the trading system.

In his intervention at the meeting, the Indian Minister of
Commerce and Industry, Murasoli Maran, said our objectives should
seek not only an open multilateral trade system but one which is
also fair and equitable and perceived to be so.

A principal issue therefore is what should be the overall scope
of the WTO's mandate. "Should it confine itself to predominantly
trade issues or should its mandate be broadened to cover other
areas?" he asked, recalling that in the Uruguay Round efforts to
encroach on other issues were steadfastly pursued by some members
for the first time.

However it was possible to limit such expansion to trade related
issues only and TRIPS and TRIMS agreements came about as a
result.

"Many countries including my own were not convinced even at that
time that this was the right course to follow although we went
along with the consensus. Five years after Marrakesh we are even
less persuaded.

"We now see further proposals seeking to have disciplines on
investment per se. We also see suggestions relating to labour
standards. We also see environment concerns are sought to be used
to protect domestic industry.

"We are strongly opposed to non-trade issues which only have
tenuous links with trade being brought into the WTO agenda. To
seek to deal with extraneous subjects on the basis of principles
governing commercial transactions and based on the sole reasoning
of trade advantage could ultimately distort development itself."

Maran added the second key issue at stake is the need to ensure
fairness and equity in the WTO system from the viewpoint of
developing countries.

"We are not talking here merely of provisions on special and
differential treatment (which have largely consisted of longer
transition periods and technical assistance) which even by
themselves are inadequate and insufficient. In fact such meagre
palliative do not address the needs and aspirations of developing
countries.

"The WTO disciplines should allow sufficient freedom and
flexibility to developing countries to pursue their development
strategies and must make a distinction between developed and
developing countries where such a distinction is warranted.."

Another key issue is that some of he UR agreements carry inbuilt
imbalances that have come to light even more dramatically during
their implementation in the last five years.

"Also in the Uruguay Round, the developing countries provided
enhanced market access by sharply reducing their tariffs. Yet
in textiles, which is of particular interest to developing
countries, there is no meaningful integration of restrained items
even after five years. Also trade defence measures including
antidumping and subsidy investigations are initiated in other
areas, crippling our export effort."

Maran added: "Not surprisingly there is deep scepticism
prevailing among our people about WTO and its benefits. Therefore
it is imperative the Seattle agenda is balanced and developing-
country friendly. Only then can the final results be balanced
and contribute to development.

"It is absolutely essential that issues of implementation are
addressed upfront and key imbalances removed. Also the review
process needs to reconsider the full impact of limiting policy
options on the competitiveness of developing countries,
particularly in respect of subsidies, IPRs and TRIMS. Special
and differential treatment should be made part of contractual
obligations.

"All these are essential pre-requisites to assure developing
countries that when their interests are at risk the WTO system
will respond positively to fully address their concerns. We have
heard several calls for development to be at the core of the
agenda. If this objective is to be realised, it must be ensured
the WTO system subserves development and does not subvert it.
Only then will this organisation have credibility in the eyes of
the developing world."

Maran quoted Mahatma Gandhi as saying that "for human beings the
object in view should be the good of all, with the weak being
served first." He added:"Only on this foundation should we seek
to build a new and just world order."

The Egyptian Minister of Economy and Foreign trade, Youssef
Boutrous Ghali stressed four points in his intervention. Firstly,
the future negotiations must focus on agriculture and services.
Egypt is eager to export more agricultural products especially
to Europe which is now a closed enclave in this area.

Secondly, there is a problem of imbalances in benefits in the
WTO. The developing countries had suffered a lot since the
Uruguay Round and they were even tired. After the Uruguay Round,
there was an imbalance in benefits, whether due to problems in
the agreements themselves or due to the developed countries not
implementing some of their binding obligations.

If the next Round is to succeed in development, it must start by
developed countries implementing the agreements. And for
successful implementation, there is a need to renegotiate certain
items.

Thirdly, he said, the developed countries were misusing certain
trade measures against the exports of developing countries.
Developing countries were thus calling for reformulation of these
measures by placing limitations on their use so they would not
be misused, especially against developing countries. "We have to
reinterpret these measures," he said.

Fourthly, there are calls for negotiating labour and environment
issues. However these have nothing to do with international trade
and should be dealt with by the ILO (for labour) and the post-
Rio Summit mechanisms (for environment). Dealing with these
issues in the trade context means their being used as a weapon
to make further demands which could be protectionist.

Mr Ghali told the media that at Lausanne there was a closer
meeting of views. The real discussions, he said, were in the
corridors where there was some flexibility in exchange of views.
In the main hall, countries put forward and maintained their
positions that were held since months ago.

He also said that Egypt is looked on as playing a leading role
in the developing world. Egypt would be arranging for a meeting in
Cairo in the second week of November to help in coordinating the
views of developing countries in the context of the Seattle
conference.

The Minister of Foreign Relations of Brazil, Luiz Felipe
Lampreia, said Brazil was in favour of the new Round. In Brazil's
view, agriculture is the number one priority. There is a strong
demand from civil society for more balanced and fair trade rules.

"Exceptions to the system (in agriculture and textiles for
example) are perceived in Brazilian society as damaging to our
interests. The reason is simple, there are no specific trade
rules for chemical products, for instance. Why should there be
exceptional rules for agriculture which is the sector in which
we are more competitive?"

Lampreia said "we have to be vigilant and also avoid creating new
and unjustified barriers. On environment, certain issues deserve
close attention and could be the subject of rules, as long as
they do not lead to disguised trade restrictions.

On labour standards, "we do not believe there is any purpose in
linking labour standards to trade rules protectionist
motivations." (SUNS4538)

The above article first appeared in the South-North
Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief
Editor.
[c] 1999, SUNS - All rights reserved. May not be reproduced, reprinted
or posted to any system or service without specific permission from SUNS.
This limitation includes incorporation into a database, distribution via
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For information about reproduction or multi-user subscriptions please contact
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