TWN Info Service on WTO and Trade Issues (Jan08/05)

29 January 2008

The following article was published in SUNS on 23 Jan 2008.  Permission is required for reproduction from SUNS (

Martin Khor

Trade: Revised NAMA text to follow revised agriculture text
Published in SUNS #6398 dated 23 January 2008

Geneva, 22 Jan (Kanaga Raja) -- The Chair of the WTO Negotiating Group on Market Access for Non-agricultural Products (NAMA), in his first open-ended meeting of the new year, announced that he will be waiting for the revised draft "modalities" text on agriculture before deciding on his revised NAMA text and how to proceed.

The Chair also reported that there is still divergence among members on the coefficients in the tariff reduction formula and other elements of the modalities, adding that the key issues in NAMA can't be dealt with until the "horizontal process" starts.

Ambassador Don Stephenson of Canada told delegates at an open-ended informal meeting of the Negotiating Group on Monday that he would issue his revised text either simultaneously or slightly afterwards (from the issuance of the agriculture text).

(The chair of the agriculture negotiations told members last week that he would be producing an improved and comprehensive revised draft modalities text at the end of the month.)

The NAMA Chair said that he would provide a chance for the Negotiating Group to comment on the text before the start of the "horizontal process".

At the informal meeting Monday, Ambassador Stephenson reported on the informal consultations that he held the whole of last week on all the topics in the NAMA negotiations, as well as briefed members on the process ahead.

The Chair said that the key issues in NAMA, such as the formula and related issues, cannot be dealt with until the horizontal process starts. In fact, this is the case with most NAMA issues.

With respect to his revised text, the Chair said that it would be "closer to a negotiating text" than his July 2007 text, with brackets mostly on the numbers (coefficients, percentages, implementation periods, etc).

He added that he would be "economical" on the issue of brackets but he would not pretend that there is consensus where there is not.

He also noted that there is almost consensus on the "architecture" of the modalities - that is, the way to proceed in the tariff reduction exercise.

According to trade officials, Ambassador Stephenson reported that in the discussion on the formula and flexibilities for tariff reduction, "nothing happened" last week since there is still divergence on the coefficients and other elements of the modalities.

The Chair noted that the final figures depended on the balances inside and outside the NAMA negotiations.

On Small, Vulnerable Economies and countries with low binding coverage, the Chair said that the architecture has essentially been agreed.

On Least Developed Countries and their contribution, he said that he will insist on the fact that they are not supposed to make any tariff reduction, and they are encouraged but not required to bind their tariffs to a maximum possible level.

He said that he will also incorporate in his revised text that the Least Developed Countries seek early implementation of the Hong Kong Ministerial Declaration on Quota Free, Duty Free market access.

On Recently Acceded Members, in particular, the four countries applying the formula (Oman, Croatia, China and Chinese Taipei), there is wide support for longer implementation periods but not for further flexibilities like a higher coefficient.

On Product Coverage, there is no change, since two Members continue to have items with different classifications than the others and they refuse changes.

According to trade officials, members that spoke insisted on their well-known positions.

Many developing countries called for the right balance between Agriculture and NAMA in the new text, in which, they said, Members' positions have to be reflected. They also insisted on the development dimension of this Round.

Trade officials said that a "middle ground group" of ten developing countries rejected new flexibilities and asked for the ambition to be not reduced in NAMA.

The EC wanted all the proposals on Non-Tariff Barriers to be attached to the Chair's new text.

According to trade officials, the US rejected further flexibilities and said that the range of coefficients proposed by the Chair for developing countries (19-23) barely meets the mandate of the negotiation to reduce high tariffs, tariff peaks and tariff escalation.

The NAMA-11 developing countries, on the other hand, said that the proposal would mean "massive consolidation of tariffs for developing countries".

Bolivia asked for special treatment that would substantially preserve its present bound tariff rates, therefore not limiting the application of policies aimed at industrial development, product and export diversification, poverty alleviation and reduction of social inequalities.

It pointed out that it is one of the poorest countries in Latin America, and is characterized by a very fragile social and economic fabric - 62.7% of the Bolivian population live in conditions of poverty and a quarter of the population face conditions of extreme poverty.