The Doha Development Agenda

1
The Doha Development Agenda

• An Update
• World Bank
• December 1, 2005

2
Key Messages

• A successful Doha Round is very important from a
  development perspective
• Hong Kong Ministerial December 13-18, 2005
  originally expected to agree negotiating
  modalities for agriculture and non-agricultural
  market access (NAMA), plus progress in services,
  rules, trade facilitation and development
  dimension
• WTO Members now recalibrating expectations for
  Hong Kong, but maintaining the initial ambition
  for the Round
• Hong Kong an intermediary stage on the way to
  full modalities aim to agree on a range of
  numbers the outer parameters in the July 2004
  frameworks, and corresponding texts in the
  rule-making part of the negotiations
• Draft Declaration issued November 26
• Sights must not be lowered if Doha is to be a
  true development round
• There is a lot of work to do before end 2006

3
Important progress has already been made

• Conditional agreement on elimination of export
  subsidies
• Narrowing of Singapore Issues to trade
  facilitation only
• TRIPS waiver on access to medicines
• July 2004 Framework Agreement elements on
  agriculture
• Development at the center of a trade round

4
Outstanding issues

• Key issues remain to be resolved
• Agriculture, in particular market access
• Cotton
• Developing countries, especially MICs, on NAMA
• Services
• Including benchmarks
• Development dimension
• Complementary agenda on aid for trade

5
Agricultural Market Access
Proposal Cut on highest tariffs Sensitive products Tariff Cap Deved/ Deving
US 10/10 90 1 75/x
EU 10/28 60 8 100/150
G20 10/12 75 lt or 1 100/150
G10 10/10 45/50 10/15 NO
Numbers indicative only
6
Large cuts are needed to reduce actual trade
distorting domestic support
US billion
percentages refer to degree of overhang
7
NAMA

• Definition of the formula
• Agreement on Swiss formula, but not on
  coefficients
• Flexibility for developing countries
• Some groups seek special treatment
• Newly acceded, small and vulnerable
• Differentiation among developing countries
• EU proposes the same coefficient for developed
  and advanced developing countries (with some
  additional flexibilities) - but this is very
  controversial
• Participation in sectoral negotiations?
• E.g., jewels, sports equipment, pharmaceuticals
• Treatment of unbound tariffs
• How to calculate the base rate for reductions?

8
Services

• 69 offers, plus 30 revised (EU25 counted as 1),
  but low quality and lack of momentum
• Mandatory quantitative benchmarks for coverage of
  commitments in service sectors?
• Opposed by many developing countries
• Plurilateral negotiations
• Mandatory participation benchmarks?
• Overall objectives for modes
• GATS rules
• Broad agreement to continue negotiations and
  intensify efforts

9
Trade Facilitation

• Solid progress to date
• Large number of proposals, broad participation
• Special and differential treatment (SDT),
  capacity building (CB) and technical assistance
  (TA) integral parts of any agreement
• Link between TA and CB and implementation of
  commitments will be a critical part of the
  negotiations in 2006
• Expectations that negotiations in this area will
  move from Uruguay Round-style best endeavor
  approach to commitments of secure financing for
  implementation
• Role of international organizations, including
  Bank
• Where next?
• Text based negotiations on Articles V, VIII and
  X of GATT 1994?

10
Development Issues

• Proposals to strengthen SDT
• Focus on 28 (of the 88 proposals) agreed in
  principle for Cancùn, PLUS 5 agreement-specific
  proposals from LDCs
• Duty and quota free access for all LDC exports
• Resistance from countries concerned with
  preference erosion
• Benefits require flexible rules of origin
• Concerns re preference erosion and net food
  importers
• Losses may be less than expected offsetting
  gains time period for implementation
  utilization of existing preferences likely price
  rises for food
• Serious problem for a few countries, who will
  require increased international assistance aid
  for trade- to cope with transitional adjustment
  costs
• Adjustment costs should not be a reason to deny
  the benefits of liberalization to the vast
  majority of developing countries
• Extended transition periods for affected products
  raise risk reducing gains from the round

11
Aid for Trade

• Important complement to but not substitute for
  an ambitious Doha Round
• Integrated Framework (IF)
• Increased funding, plus enhanced ability to
  leverage much larger bilateral and multilateral
  resources
• Including to address infrastructure constraints
• Geneva-based task force of donors and LDCs
  working on a new governance structure, for
  agreement in April 2006
• Contributions likely pending agreement on
  governance
• Adjustment
• Diagnostics and assistance
• Regional/cross-country needs
• Exploring need for additional mechanisms

12
Aid for Trade contd

• LDC proposal
• Enhanced IF adjustment facility managed by the
  WTO infrastructure fund debt relief, swaps and
  buy-back
• Increased focus in bilateral programs
• Scope to make progress in Hong Kong
• Proposals in Nov 26 draft Declaration

13
Rules

• Some highlights
• Debate on clarification of disciplines on
  anti-dumping and subsidies (including fisheries
  subsidies) expected to become more intense in
  2006
• Progress on transparency procedures concerning
  RTAs, but limited progress on strengthening
  systemic disciplines

14
Conclusion

• November 2005, WTO Members recalibrate
  expectations for Hong Kong, but maintain the
  initial ambition for the Round
• The hardest decisions of the Doha Round will now
  need to be made in early 2006
• End of 2006 target for completion (US TPA expiry,
  June 2007)
• There is too much at stake to lower sights on
  Doha
• Bank will continue to contribute through
• Advocacy for an ambitious, pro-development Round
• Research on trade policy and reform
• Aid for trade, including cooperation on enhanced
  IF
• TA and CB at global and country levels, including
  greater integration of trade into country programs