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TWN
Info Service on WTO and Trade Issues (Nov25/12) WTO:
Facilitator’s blueprint sidelines self-designated framework for S&DT Geneva, 13 Nov (D. Ravi Kanth) -- Ahead of a meeting on 13 November on "development and special and differential treatment (S&DT)," the facilitator overseeing the discussions on the reform of the World Trade Organization has issued a one-page document of challenges and options that seemingly undermine the Doha- mandated issues on S&DT, while giving a short shrift to the development-friendly architecture as proposed by developing countries, said people familiar with the development. The facilitator reportedly sidelined the existing unfulfilled mandates from the Doha Round by emphasizing "differentiation" among developing countries for availing of self-designated and treaty-bound S&DT, while paying little attention to the goal of making S&DT simple, precise and effective. In a restricted one-page note to members, titled "Development and S&DT - Reflections on Exploring Reform," seen by the SUNS, the facilitator, Ambassador Petter Olberg of Norway, argued that "advancing development in the WTO involves enabling developing Members, particularly least-developed countries (LDCs), to secure a fair share of global trade in line with their needs." He suggested that "key priorities ... include maintaining adequate policy space, ensuring effective special and differential treatment (S&DT) and other flexibilities, fulfilling development-related mandates, and strengthening technical assistance and capacity-building." The facilitator said that "development benefits also depend on the effective implementation of existing WTO agreements," adding that "commitments made under the Uruguay Round, supported by open and market-oriented policies, contribute to a fairer multilateral trading system and greater integration of developing Members, including LDCs." SOUTH RAISES ALARM Several African and other developing countries appear to be alarmed by the manner in which the facilitator has allegedly undermined the Doha ministerial mandate (on special and differential treatment provisions), which expressed concerns "regarding their operation in addressing specific constraints faced by developing countries, particularly least-developed countries." A trade envoy, who asked not to be quoted, pointed to paragraph 44 of the Doha ministerial declaration, in which trade ministers called for reviewing all S&DT provisions "with a view to strengthening them and making them more precise, effective and operational." The ministers had also endorsed "the work programme on special and differential treatment set out in the Decision on Implementation-Related Issues and Concerns," where all the issues are clearly articulated. According to another trade envoy, the facilitator has not only discarded the unresolved issues but also called for differentiating S&DT among developing countries, despite its treaty-bound and self-designated nature. This call for "differentiation" was echoed by the facilitator when he argued that "the changing global economy highlights the need to ensure that S&DT is effective for those that need it the most." People familiar with the development noted that this approach echoes the demands of the United States and other industrialized countries such as Japan, which oppose the continuation of S&DT based on a self-designated framework. To recall, the Trump administration in its first term proposed such differentiation, a move that was fiercely opposed by China, India, and other developing countries. Recently, China announced that it would forgo its S&DT entitlements in current and future trade negotiations while emphasizing that this would not alter its previous S&DT flexibilities written into its accession protocol, particularly on agriculture. Although the facilitator acknowledged in passing that "despite overall economic growth, many developing and least developed Members continue to face structural challenges, underscoring the importance of S&DT," an African trade negotiator, who asked not to be quoted, said the underlying goal seems to be "one of sabotaging the Doha S&DT architecture." CHALLENGES & OPTIONS Several trade envoys, who asked not to be quoted, said that the facilitator, under his own responsibility, has issued a "top-down" agenda by seemingly trivializing the issues concerning development and S&DT by framing them as "concrete challenges" and presenting his own "options." The challenges and options outlined in the facilitator's note are as follows: 1. Challenge: Lack of Effectiveness and Relevance of S&DT * Includes: "Blanket application of S&DT"; "Outdated, redundant, or non-operational provisions"; "Untargeted, open-ended exemptions"; "Implementation gaps, not design, create shortcomings"; "Difficulty in adapting S&DT to evolving development needs of Members." Options: a. "Secretariat to compile information on S&DT use, beneficiaries, and gaps to support a fact-based reform discussion." b. "Use Trade Policy Review findings to better link technical assistance to actual needs." A trade envoy said this "evidence-based approach" would be tantamount to taking away S&DT flexibilities from members and letting the WTO Secretariat decide who should avail of them. 2. Challenge: Lack of Differentiation and Criteria for S&DT Major challenge: "Self-designation practices no longer reflect current economic realities." Includes: "Lack of objective criteria or transparency to determine who qualifies"; "A one-size-fits-all approach is unsustainable"; "Politically sensitive nature of imposing external criteria." Options: 1. "Reaffirm treaty-embedded nature of S&DT." 2. "Emphasize S&DT as a tool for integration into global trading system." 3. "Avoid destabilizing the Marrakesh balance while modernizing provisions." 4. "Allow flexibility for practical implementation." A South American trade negotiator said these options do not reflect members' positions or the Doha mandate. 3. Challenge: Lack of Integration and Equity Includes: "Development should include fair distribution of trade outcomes, not only S&DT"; "Need to ensure that S&DT supports genuine integration"; "Some developing Members have become major competitors yet still enjoy S&DT including exemptions." Options: Explore Targeted and Needs-Based Approaches, such as: * "Explore shift from open-ended exemptions to time-bound, targeted S&DT based on demonstrated need." * "Explore voluntary opt-outs." * "Draw comparative lessons from other international organizations using needs-based approaches." 4. Challenge: Lack of Flexibility, Needs-Based Support, and Responsiveness Includes: "Current S&DT lacks needs-based or targeted approaches"; "absence of mechanisms for crisis responsiveness, waivers, or "trigger-ready" measures"; "balancing flexibilities while maintaining treaty obligations is complex." Options: Based on exploring defining differentiation criteria, such as: * Exploring "objective criteria for S&DT eligibility (e.g., World Bank income, OECD membership) while considering limitations of GNI (gross national income) only approaches." * Exploring "mechanisms for challenging self-designation for transparency and accountability." * "Consider gradual, politically sensitive differentiation approaches that respect sovereignty." 5. Challenge: Political and Institutional Challenges Includes: "Potential destabilization of treaty balance if S&DT is altered"; "Disagreement on whether reform should focus only on future negotiations or also correct imbalances caused by existing rules." Options: * Explore "trigger-ready" mechanisms or crisis waivers to enhance adaptability. * "Align S&DT provisions with evolving economic realities, including graduation and transition mechanisms for LDCs." * "Explore making flexibilities more effective and credible by targeting rather than eliminating them." 6. Challenge: Technical Assistance and Capacity-Building * Includes: "Lack of systematic tools to monitor or assess S&DT utilization and impact"; "Concerns over neutrality, oversight, and accountability in Secretariat support." Options: * Strengthening "coordination and impartiality of technical assistance." * Ensuring "closer alignment between capacity-building and S&DT provisions to enhance operational impact." In conclusion, a trade envoy who asked not to be identified, said the "top-down" agenda on development and S&DT outlined by the facilitator "appears to be dead on arrival." Critics argue that Ambassador Olberg "came out in his true colours to kill the self-designated framework for availing of S&DT," regardless of existing rules and the Enabling Clause that remain the bulwark of the S&DT architecture. +
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