TWN Info Service on WTO and Trade Issues  (Mar08/16)
19 March 2008
Third World Network

NAMA meeting discusses flexibilities and Chair's options
Published in SUNS #6436 dated 17 March 2008

By Martin Khor, Geneva, 14 March 2008

WTO members in a small group format today discussed how to proceed with the negotiations on non-agricultural market access (NAMA), focusing on the options for flexibilities that the Chair of the NAMA negotiations had put forward in a 28 February paper.

There was no agreement on how to treat the whole set of issues on coefficients (for the Swiss formula to cut tariffs) and flexibilities for developing countries, and the possible relationship (if any) between the coefficients and the flexibilities.

The Chair, Ambassador Don Stephenson of Canada, had proposed a menu of 8 options as "possible ideas on formula/flexibilities" in his paper, that has caused some confusion and controversy in the last two weeks.

In today's Room E discussion, various WTO members gave their opinion on some of the options. According to a trade official, developed countries (particularly, the US and EU) were in favour of Options 1, 2 and 3. They also were happy with Option 6 linking the coefficient with the level of participation in sectoral commitments.

Option 1 has two variations on "flexibilities within flexibilities", while Option 2 is on a "sliding scale" approach (in which acceptance of a lower coefficient allows a developing country to have a higher degree of flexibilities). Option 3 allows for a combination of flexibilities. (See SUNS #6428 dated 5 March 2008 for article detailing the 8 options).

However, two countries, Venezuela and Argentina, indicated their preference for the Chair's Option 8, which does away with the tariff-reducing Swiss formula and replaces it with a "Uruguay Round-like agriculture modality" (in which the developing countries "combine an average cut with a tariff ceiling and a minimum line-by-line cut."). Venezuela said it could only accept an approach similar to Option 8.

The NAMA-11 group of developing countries, represented by South Africa, took a basic view of this stage of the negotiations, instead of wanting to join in providing a commentary on the 8 options.

It laid out three fundamental points -- (1) that the current negotiations should focus on the architecture of modalities but not the level of ambition (which should be left to the horizontal process to settle); (2) that there is need to settle the question of coefficients before considering flexibilities, including the Chair's options for flexibilities; and (3) that the Chair has to re-instate the numbers for the flexibilities within brackets, which he had removed in his latest draft.

On the third point, the NAMA-11 stood by its position that the numbers for the flexibilities that had been in brackets in the Chair's first draft should be expanded.

At the end of the meeting, Stephenson said that he would convene another Room E meeting next week to continue discussion on flexibilities, including his 8 options.

(A more detailed report on the NAMA meeting and situation will be in the next issue of SUNS). +