TWN Info Service on WTO and Trade Issues (Dec05/01)

1 Dec 2005

African Ministers adopt Declaration on WTO's Hong Kong meeting

On 24 November, the African Union conference of Trade Ministers adopted a Ministerial declaration entitled Arusha Development Bencdhmarks for the WTO's 6th Ministerial Conference in Hong Kong.

Below is an article about the declaration.

With best wishes
Martin Khor


African Ministers adopt Declaration on WTO's Hong Kong meeting

By Martin Khor, Arusha, 25 Nov 2005

The African Union Conference of Trade Ministers ended on 24 November evening after a session in which the Ministers discussed their strategy for the WTO's Hong Kong Ministerial Conference.

Following this, the meeting considered a draft of the Ministerial Declaration prepared by senior officials. With several amendments to the draft, the Declaration was adopted. The Declaration is called the Arusha Development Benchmarks for the Sixth WTO Ministerial Conference.

At press time, the finalised document was not yet ready. However, much of the text was available and the following are some of the highlights.

In two sections on reclaiming the Development Agenda and on development issues, the declaration expressed concern about the inadequacy of recent proposals on subsidies and their failure to incorporate development flexibilities. The Ministers reiterated the need for "full inclusiveness and transparency" in the negotiations to ensure political ownership of the process and outcome.

The declaration said that the success of the Round will be measured by its development outcomes and for Africa the priority areas are market access for products of export interest to Africa; removal of structural distortions in agriculture; obligations to be undertaken by African countries should be proportional and commensurate with their development level; and increased financial assistance for countries that will experience adjustment costs and technical assistance.

"We are concerned at the failure to deliver any tangible results on development issues, despite the characterisation of the work programme launched at Doha as a 'development round'", said the Ministers.

Accordingly, the Hong Kong meeting must ensure substantive movement towards addressing implementation related issues; policy space and flexibilities should be mainstreamed in all aspects of the negotiations; progress on work on special and differential treatment including work on establishing a framework agreement on development; and all issues related to Africa's needs are properly reflected in the outcomes of negotiations are fully taken into account.

On agriculture, regarding export competition, the Ministers called for 2010 to be the end date for eliminating all export subsidies. State trading enterprises in Africa should be exempted from applying any disciplines.

On domestic support, the declaration called for review of Green Box criteria to provide policy space for developing countries, and a review and tightening of the Green Box criteria for developed countries to ensure that it is non or minimally trade distorting.

It also called for tightening the criteria for blue box measures and disciplines to prevent box shifting. African countries must be exempted from de minimis and AMS reduction commitments.

On market access, there should be full operationalising of the proportionality principle in tariff reduction, and provision of policy space and flexibilities for African countries and substantial improvement in market access for their products.

The declaration called for Special Products to be designed and treated in a way that provides maximum flexibility, and the Special Safeguard Mechanism for developing countries should be operationally effective. Specific and concrete mechanisms to solve the preference erosion problems must be devised within the WTO and this should be a paramount consideration when designating sensitive products by developed countries.

On NAMA, the Ministers view as a critical element "an appropriate formula or any other tariff reduction approach that incorporates development factors and concerns and would allow African countries to pursue industrial policy, employment creation and diversification objectives and take as priority the SDT and less than full reciprocity."

Other critical elements include a methodology to be agreed on to identify products likely to be affected by erosion of preferences, for special treatment in the negotiations in line with the ACP and African Group proposals; and preservation of policy space that takes into account African countries' developmental, financial and industrial needs and averts the risks of de-industrialisation and fiscal revenue constraints.

The flexibilities must allow African countries the means to determine their commitment levels, including binding coverage, commensurate with their development objectives.

The declaration stressed that flexibilities for developing countries is an essential element of the NAMA package and cannot be made conditional to other elements, including the formula, nor as fulfilling the less than full reciprocity principle. Flexibilities under para 8 are stand alone and should not be linked to the formula. The conditions (in the flexibilities) constitute a minimum requirement as they impose constraints on policy space.

Sectoral initiatives should also be excluded because of their potential detrimental effects on Africa.

On services, the declaration stated the Ministers' concerns on complementary approaches. They opposed the inclusion of approaches that are incompatible with the spirit and structure of the GATS.

The declaration added that establishing any quantitative individual or collective targets would undermine the flexibilities for developing countries in the GATS provisions and the existing negotiating guidelines. "We are therefore opposed to qualitative and quantitative targets, modal targets as well as sectoral negotiations, or any language on the plurilateral request/offer approach that goes beyond the negotiating guidelines."

The Ministers also stressed the importance of maintaining the GATS provisions for the right of members to regulate their services sector and open up fewer sectors and liberalise fewer types of transactions in line with their development situation.

The declaration also contained other sections, including on TRIPS and health, LDCs, trade facilitation, aid for trade, rules, trade and environment, accession, and small economies.