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TWN Info Service on WTO and Trade Issues (Nov07/12)

8 November 2007


The following article was published in the SUNS on 1 November and is reproduced with permission.  Any reproduction and recirculation requires the permission of SUNS (sunstwn@bluewin.ch).

Best wishes
Martin Khor
TWN


G33 paper spells its latest position on special products
Published in SUNS #6356 dated 1 November 2007
By Martin Khor (TWN), Geneva, 31 Oct 2007

The Group of 33 has presented its latest paper on special products, at a "Room E" meeting on the Doha agriculture negotiations at the WTO.

The informal paper was orally presented by the Philippines on behalf of the G33 on Monday, and it was also circulated at the meeting. The paper, dated 25 October, sets out the G33's latest position on SPs.

The "Room E meeting" was chaired by the Chair of the agriculture negotiations, Ambassador Crawford Falconer of New Zealand; 36 delegations are invited to the small-group meeting.

The G33 comprises over 40 developing countries with mainly defensive interests in agriculture.

According to the G33 paper, SPs are important for the operationalisation of the Special and Differential Treatment mandate and development dimension of the Doha Development Agenda. For developing country Members, operationally effective modalities for Special Products and Special Safeguard Mechanism are central to reaching agreement in these negotiations.

The G-33 welcomed the discussion and engagement in the Room E on Special Products, but it is also anxious to see any positive developments on the other important issues of the agriculture negotiations.

The G-33 underscored that its willingness to continue to further contribute is subject to new and significant movements in other crucial areas of the agriculture negotiations.

According to the paper, the modalities for SPs essentially have two main parts, first, modalities for self-designation, and second, modalities for the treatment of SPs.

On self-designation, the paper said this issue had been agreed on in the Hong Kong Declaration and the Framework Agreement of July 2004 - that self-designation of SPs shall be based on the criteria of food security, livelihood security, and rural development. Furthermore, indicators would assist in guiding this process.

In a section on "Approach for Designation of Special Products", the G33 paper said that the group agrees with the Chair that a one-size-fits-all' approach for selection of SPs should be discarded.

The Chair's second option in Paragraph 97 of the Draft Modalities Text is the appropriate way ahead and a constructive base upon which the architecture of SPs can be further developed. Therefore, the G-33 considers that this tailored approach which constitute a Hybrid Approach should comprise the following vital elements:

(I) There shall be no less than a certain minimum percentage of SPs available for all developing countries without guidance by the indicators;

(ii) The minimum number of SPs would be higher than the number for Sensitive Products for developing country Members;

(iii) Over and above this minimum number, developing country Members shall be entitled to designate an additional number of SPs that will be guided by the indicators. One of the indicators shall be sufficient to guide the designation of SPs;

(iv) This minimum number shall be higher for SVEs;

(v) SVEs unable to use provision (iii) above shall be entitled to designate additional number of SPs;

(vi) Specific additional flexibilities shall be available for RAMs;

(vii) Developing country Members not availing their entitlement to designate Sensitive Products shall be entitled to self-designate an additional number of SPs.

In a section on "Indicators," the paper said that the G-33 is of the view that the approach for designation of SPs and the indicators are very closely and intrinsically related.

"It would be unacceptable to having a list of indicators that would result in making it impossible for developing country Members to self-designate their SPs. The G-33 has already revised its indicators at the Jakarta Ministerial Meeting in March 2007.

"It may not be possible for the G-33 to consider any further review or revision of indicators unless the Chair's tailored approach as has been specified in Paragraph 5 above is agreed."

The paper added that the quantification of indicators as required by other members is neither necessary nor would it be an easy task.

"In fact, there are WTO Agreements where relevant factors have been listed out in qualitative terms and have not really been quantified," said the paper. "The G-33 is of the view that if qualitative guidelines can serve the purpose for some other WTO agreements, then the same treatment should also be given to the indicators for SPs.

"One specific threshold for each indicator for a group of countries as diverse as G-33 Members, as well as for other developing country Members would be extremely difficult to be determined."

The paper said that the concept of open to verification', as has been raised by the Chair, has no direct relevant jurisprudence and has not been used in any WTO Agreements.

Nevertheless, said the G-33, it is committed to transparency and objectivity provided that the following three principles are observed:

(I) Transparency and verifiability would only be undertaken within the existing WTO standard practices;

(ii) Regional, national, sub-national data available with the developing country Members should also be acknowledged duly recognized and the verifiability is not interpreted to mean any compromise on self-designation;

(iii) Qualitative indicators are equally valid and therefore must also be agreed as a valid basis to self-designation of SPs.

In a section on "Treatment of Special Products", the G33 highlighted the following basic principles:

(I) More flexible and favourable treatment for SPs must include no tariff reduction commitment and therefore a substantial percentage of SPs must be exempted from tariff reduction commitments;

(ii) For those SPs that shall be subjected to tariff reduction, the structure of treatment of SPs should be flexible to duly take into account diverse situations and different tariff structures;

(iii) Neither TRQ expansion or creation nor tariff capping should be applied to SPs;

(iv) Additional flexibilities for treatment of SPs shall be made available for SVEs and RAMs.

The G-33 stressed that its "graded approach" to treatment provides the best solution, while emphasizing the fundamental importance of SPs in the first grade being exempted from any commitments. The group is open and ready to further discuss the details of the treatment for the two remaining grades.

The paper concluded on the issue of "Footnote 2" of the Chair's modalities paper. In that footnote, the Chair suggested an alternative approach to market access in developing countries, similar to the Uruguay Round approach, in which developing countries would be asked to undertake an overall cut of 36% with a minimum cut of 15% on each tariff line.

The paper said that "the G-33 is of the view that the Chair's proposal on Footnote 2 would be unacceptable if it means that there would be no operationally and effective SPs and SSM as part of the final package of the Doha Development Round."

According to diplomats, although the G33 paper was presented and circulated, the Chair did not respond to its points during the Room E meeting on Monday, and neither was there any response from other members.

Instead, the discussion on special products focused on new ideas on this issue put forward by the Chair (see SUNS #6355 dated 31 October 2007).

 


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