RISWTO Public Symposium1 World Trading System and Development: Issues and Challenges Nagesh Kumar RIS

RIS WTO Public Symposium 1

World Trading System and Development: Issues and

Challenges

Nagesh Kumar

RIS

www.ris.org.in



Multilateral Trade Negotiations and Development

• Process of trade liberalization for reaping efficiency gains

• Recognition of different levels in development and capacities of countries

• Concept of special and differential treatment (S&DT) incorporated


Trade and Development since the Uruguay Round

• Turning point• Major commitments in trade liberalization• Substantial obligations placed on

developing countries: TRIPs, TRIMs and GATS

• Promise of market access in agriculture, textiles and clothing and GATS mode 4

• These promises not coming through


Trade Liberalization in Developed Countries: Growing Asymmetries

• High Peak Tariffs, Tariff Escalation and Specific Duties– Specifically on goods exported by poor countries

• Elusive Market Access in Textiles and Clothing

• Continued Protection of Agricultural Products


Trade Liberalization in Developed Countries: Growing Asymmetries 2

• Resistance to Movement of Natural Persons

• Quotas and Non-tariff Barriers

• Stringent Environmental Requirements

• Contingent Protection: Anti-dumping

• Proliferation of RTAs/FTAs


Protectionist Industrial Policy

• Growing R&D Subsidies

• Distortionary Investment Incentives

• Export Subsidies to Manufacturers

• Growing Subsidies to Agriculture

• Continued Use of policies akin to Local Content Requirements


Implications for Development

• GATT/WTO not related to trade liberalization or growth of trade: empirical studies

• Declining terms of trade and share of developing countries in world trade

• Adverse mercantilist balance• Substantial income transfers and loss of policy space• Record of growth in 1990s has been poorer compared to

1980s and inequalities have risen • Inequitable sharing of the fruits of globalization


Doha Development Agenda

• A new round of trade negotiations launched in 2001 in Doha

• Attempt to address some of the development concerns:• Phase-out of all export subsidies on agricultural products and

substantial reduction of domestic support• Elimination of peak tariffs on products of export interest to

developing countries; modality for tariff reduction based on less-than-full-reciprocity

• Primacy of public health over IPRs• Launch of negotiations on Singapore Issues only on the basis of

‘explicit consensus’ at the Fifth Ministerial• Review of S&DT provisions to make them effective


Progress of the Doha Agenda and Cancun

• All the important deadlines for Doha Agenda were missed in the pre-Cancun phase

• Going back on the spirit of Doha Development Agenda

• Agricultural subsidies vs. market access

• Non-agricultural market access

• Push to launch negotiations on Singapore Issues


Collapse of Cancun Ministerial

• A Case-Study in Asymmetric Process of Decision-making

• Draft Ministerial texts heavily influenced by the submissions by the Quad countries

• Neglected the widely supported submissions by developing country coalitions

– Singapore Issues; Agriculture– Cotton subsidies

• A question mark on the sustainability of the multilateral trade negotiations


An Agenda for Reform

• An Independent Commission for Development Assessment of the system

• Reform of the decision-making process• Broad-based and representative secretariat• WTO Watchdog of Developing Countries• Strengthening the Provision of Technical, Legal

and Financial Assistance• Support for Trilateral cooperation


Some Issues for Proactive Action by Developing Countries

• Framework Agreement on Movement of Natural Persons

• Framework Agreement on S&DT

• Framework Agreement on Transfer of Technology

• Framework for Protection of Traditional Knowledge and Biodiversity


Thank you

Documents

RISWTO Public Symposium1 World Trading System and Development: Issues and Challenges Nagesh Kumar RIS