WTO Doha Negotiations on Rules

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WTO Doha Negotiations on Rules

• Workshop on the main issues and challenges in the
  multilateral trading system
• Dhaka, 9-12 July 2007

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Outline

• Overview
• Anti-dumping (AD) (and CVD)
• Subsidies (fishery subsidies)
• Regional trade agreements (RTAs)
• Way forward conclusion

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I Overview

• Mandated by the Doha Ministerial Declaration
  (paras 28-29)
• Form an integral part of single undertaking
• No interim timeframes to be completed at the
  end of the round (originally 2005)
• Negotiating Group on Rules (NGR)
• July Package (2004) - Reaffirm Members
  commitment to progress

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II AD/CVD

• Doha Ministerial Declaration (para 28)
• In the light of experience of the increasing
  application of these instruments
• Aimed at clarifying and improving disciplines
• While preserving the basic concepts, principles
  and effectiveness of these Agreements and their
  instruments and objectives
• Taking into account the needs of DCs LDCs

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II AD use peaked in 2001 (364), 213 initiations
in 2004
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II Major Users India, US, EC
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II Major Affected Countries China but also
other DCs
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II Affected Sectors - Steel, chemical plastics
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II Three Phases of Negotiations

• 2002-09/2003
• Identification of issues (141 submissions by
  Cancun)
• Some 50 issues identified
• 10/2003-2004
• Elaborated proposals (55 submissions) - 45 on
  AD/CVD
• 2005
• Third generation text-based proposals
• Friends ( Brazil, HK (China), JPN, Korea,
  Pakistan, Singapore, Taiwan PC, Thailand), US,
  EU, CAN, Aus, India, China, Egypt

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II State of Play (1)

• Friends ? Stronger disciplines to reduce the
  discretion of national investigation authorities
• Mitigate the excessive effects of AD
• Prevent AD from becoming permanent
• Strengthen due process transparency
• Reduce the costs for authorities respondents
• End unwarranted investigation at an early stage
• Improve substantive rules for dumping injury

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II State of Play (2)

• US ? Preserve the basic concepts, principles
  effectiveness transparency procedural related
  improvements
• EU ? Disclosure, lesser duty rules, cost of
  responding to AD, excessive information
  requirements
• China ? Similar to Friends, emphasis on SDT
  (lesser duty)

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II Issues (1)

• Dumping margins - exchange rates (Egypt),
  prohibition of zeroing, determination of normal
  value, price comparison, like product, product
  under consideration)
• Injury definition of domestic industry, injury
  determination, material retardation (Egypt),
  cumulation

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II Issues (2)

• Duties mandatory lesser duty rule, de minimis
  margins, negligible imports, public interest
• Procedures case initiation, duty assessment,
  reviews, non-confidential info, verifications,
  conduct of investigation, comment procedures,
• Others - Circumvention and DS

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III Fishery Subsidies

• Doha Min Declaration (para 28)
• Clarify and improve WTO disciplines on fisheries
  subsidies
• Taking into account the importance of the sector
  to developing countries.
• 75 of fish stocks overexploited, fully exploited
  or significantly depleted
• Overcapacity 250
• 20-25 of the industry's revenue from subsidies
• Global fishery subsidies estimated at 20 billion
  (400 billion in agriculture)
• Harmful subsidies as a factor for stock depletion

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III State of Play (1)

• Friends of Fish (Aus, Chile, Iceland, NZ,
  Norway Peru)
• win-win-win for environment, development
  trade
• Subsidies contribute to the depletion of fish
  stocks
• Japan/Korea
• Poor management fishery resources, rather than
  subsidies, is the source of stock depletion
• No need for fishery-specific disciplines

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III State of Play (2)

• Friends ? Negative list approach
• Broad prohibition of subsidies having revenue or
  cost impacts for the fisheries industry
  over-capacity and over-fishing
• Management frameworks, general infrastructures,
  social insurance programme, access,
  decommissioning
• JPN/Korea ? Positive list approach
• Red - Fisheries subsidies related to IUU
  fisheries fishing vessel construction engaging
  in poorly managed fishery
• Green - conservation sustainable utilization of
  fishery resources, research on fisheries resource

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III State of Play (3)

• Discussion moved to specific subsidies (to be
  permitted/prohibited) beyond the structure of
  disciplines
• Management framework
• Decommissioning
• Artisanal fisheries
• Access fees for distant water fleets
• Aquaculture

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IV Regional Trade Agreements

• Doha Ministerial Declaration (para 29)
• Clarifying and improving disciplines procedures
  under the existing WTO provisions applying to
  RTAs.
• Takes into account the developmental aspects of
  RTAs
• 12/2002 - Issue identification
• 10/2002 Mid 2003 Transparency issues
• 03/2004 - Parallel discussion on transparency
  systemic issues
• 03/2005 - Specific proposals (ACP, Aus, EU)

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IV Notified RTAs in Force 1948-2004
Source WTO
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IV World Trade under RTAS
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IV RTAs Background

• WTO rules conceived ineffective in disciplining
  RTAs
• GATT XXIV, Enabling Clause
• GATS V
• Deep integration behind-the-border measures
• WTO-plus (WTO-minus)
• Emergence of N-S RTAs (Euro-Med, ACP-EU EPAs,
  GCC-EU, US FTAs Jordan, Morocco, Bahrain)
  (Oman, UAE under negotiations)
• Reinvigoration of S-S RTAs (UMA, GCC, COMESA)

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IV GATT Article XXIV5-8

• Duties and ORRCs must be eliminated on
  substantially all the trade (SAT) among parties
  
• Duties and ORCs must not on the whole be higher
  or more restrictive than prior to the RTA
  formation
• Reasonable length of time for the formation of
  CU/FTA should exceed 10 years only in
  exceptional cases
• Substantially the same duties ORCs (CU)
• Notification, examination reporting by CRTA

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IV Systemic Issues

• How much is substantially all the trade? 90?
  How to measure?
• How long is reasonable period of time? What are
  the exceptional cases? How long is reasonable
  in such cases? 12 years?
• Flexibilities for DCs - Coherence of rules
  involving DCs
• What are ORRCs? ROO?
• Retroactive application of future rules
• How should WTO monitor, examine and decide on WTO
  compatibility of an RTA?

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IV SAT Requirement

• Australia
• 95 tariff line coverage (HS 6 digit)
• 70 tariff line coverage at the entry into force
• No exclusion of highly traded produces (0.2 or
  top 50 traded products) significant exports
  (2 of total trade)
• EU
• Trade volume based measurement of SAT (possibly
  combined with tariff line approach)
• Threshold level subject to negotiations
• ACP
• Lesser product/trade coverage through the
  application of favourable methodology and/or
  lower threshold

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IV Transitional periods

• Australia
• Transition period strictly limited to 10 years
• Longer than 10 years limited to Interim
  agreements
• ACP
• SAT other disciplines to be applied at the end
  of transition period
• Clarify exceptional cases
• Longer transition periods by DCs

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IV Flexibility for Developing Countries

• ACP
• SDT in the application of Art XXIV conditions
• Due consideration of developmental dimension in
  the examination process
• EU
• Clarification of existing flexibilities for DCs
  (differentiated thresholds, longer transition
  period)
• Disciplines on SS RTAs under Enabling Clause by
  larger developing countries
• China
• SDT to be applied to all DCs

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V Way forward (1) AD/SCM

• NGR Chairs July 2005 Report
• AD/CVD specific characteristics of rules
  negotiations Mandate general (clarify
  improve) while the existing rules are highly
  detailed, painfully negotiated and complex text
• Involve a very large number of highly specific
  questions.
• Internal trade-offs is limited (heavily in one
  direction), particularly AD
• Outcome closely linked to other areas
  (agriculture or NAMA) ? comparable level of
  details is required for external trade-offs

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V Way forward (2) AD/SCM

• Outcome on AD is essential component of overall
  balance of DWP
• Need to define the scope of negotiations ? time
  is limited before MC6 conclusion by 2006
• Text based negotiations needed in 2006
• Specific action for MC6? No Chairs text in sight

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V Way forward (3) - RTAs

• Further refinement on transparency issues
• More work on systemic issues to define by MC6 the
  scope and broad parameters of systemic issues
  negotiations

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V Conclusion

• WTO rules affect predictability and security of
  the market access opportunities for Arab States
  (AD/CVD as NTBs)
• Affect countrys trade policy practice to ensure
  fair trade leveling the playing field (dumping
  subsidies distort international trade)
• RTAs rules affect terms conditions of Arab
  regional integration efforts
• Need to ascertain their interests both as the
  user of trade policy instruments as exporters
  in the light of the overall trade development
  policy objectives

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• Thank You