Doha Round and Progress Made on Key Developmental Issues Veena Jha Veena Jha Coordinator UNCTAD India Programme TERI 3 May 2006 UNCTAD

The case for S&DT and development issues Leveling the playing field : Leveling the playing field : Economic size Economic size Institutional, human and financial capacities Institutional, human and financial capacities Market power Market power Economic operators Economic operators Calibrated reciprocity Calibrated reciprocity S&DT is also good for developed countries, including their large economic operators: S&DT is also good for developed countries, including their large economic operators: Creating customers & thus new market opportunities.

Key development issues in DWP 4 inter-linked dimensions to development issues in the Doha Ministerial Declaration 4 inter-linked dimensions to development issues in the Doha Ministerial Declaration  Implementation issues – para 12 of the DMD  S&DT issues- para 44 of DMD  LDCs specific issues – para 42 of DMD  S&DT shall be an integral part of various negotiating issues

Implementation issues Doha mandate Doha mandate -- Negotiations on implementation issues to be an integral part of the Doha Work Programme -- Possibility of early harvest envisaged Progress so far Progress so far --Deadlines breached, but no meaningful decision reached. -- Deeper understanding of concerns, but no convergence of conflicting positions --Many issues being discussed, but active engagement mainly on GI extension and TRIPS-CBD issues.

Disappointments & growing disillusionment Missed deadlines Missed deadlines Disagreement over « intent » of Doha mandate; Disagreement over « intent » of Doha mandate; Disagreement over the appropriate forum; Disagreement over the appropriate forum; Disagreement over « principles » & specifics and over which first; Disagreement over « principles » & specifics and over which first; Lack of genuine engagement by developed countries; Lack of genuine engagement by developed countries; Changing content of monitoring mechanism Changing content of monitoring mechanism

S&DT issues Doha mandate Doha mandate -- Make S&DT more precise, operational, effective and mandatory Progress achieved Progress achieved -- An informal categorisation of 88 proposals -- No concrete results despite serious work

Implementation and S&DT issues: Way forward Formalise the prioritisation of S&DT and Implementation issues in terms of their commercial and development values. Formalise the prioritisation of S&DT and Implementation issues in terms of their commercial and development values. Conclude examination of the proposals with decisions being taken on issues of top priority by the time modalities for agriculture and NAMA are finalised. In respect of other issues final decision should be taken before the end of Conclude examination of the proposals with decisions being taken on issues of top priority by the time modalities for agriculture and NAMA are finalised. In respect of other issues final decision should be taken before the end of 2006.

LDC specific issue: DFQF Doha mandate para 42 Doha mandate para Commitment to the objective of duty-free quota- free (DFQF) market access for products originating in LDCs.

DFQF: HK Ministerial Declaration Developed-country Members shall, and developing country Members declaring themselves in a position to do so should: provide duty-free and quota-free market access for all products originating from all LDCs by 2008 or the start of the implementation period Developed-country Members shall, and developing country Members declaring themselves in a position to do so should: provide duty-free and quota-free market access for all products originating from all LDCs by 2008 or the start of the implementation period At least 97 per cent of products originating from LDCs to be initially covered with steps taken to progressively achieve full coverage At least 97 per cent of products originating from LDCs to be initially covered with steps taken to progressively achieve full coverage

DFQF: implication of 3% exclusion LDCs have small export basket which cannot be significantly expanded to increase number of products LDCs have small export basket which cannot be significantly expanded to increase number of products Bangladesh’s export to US limited to 602 items out of 10, 265 items at 8-digit – 5% coverage Bangladesh’s export to US limited to 602 items out of 10, 265 items at 8-digit – 5% coverage Bangladesh’s export to Japan confined to 281 items out of 9255 items – 3% coverage Bangladesh’s export to Japan confined to 281 items out of 9255 items – 3% coverage Three-fourth of Bangladesh’s export earnings come from 1 product group – garments/ apparels; 6 items constitute 90% of exports Three-fourth of Bangladesh’s export earnings come from 1 product group – garments/ apparels; 6 items constitute 90% of exports Nepal’s major exports are garments, carpets and towels Nepal’s major exports are garments, carpets and towels 3% exclusion has the potential to restrict meaningful market access for LDCs 3% exclusion has the potential to restrict meaningful market access for LDCs

DFQF: India’s initiative Based on detailed work by UNCTAD India Programme, GOI has decided to extend unilateral tariff preferences to African LDCs. Based on detailed work by UNCTAD India Programme, GOI has decided to extend unilateral tariff preferences to African LDCs. Main objective is to include products of export interest to these countries Main objective is to include products of export interest to these countries

Benefiting from DFQF: Supply side constraints LDCs export efforts hampered by LDCs export efforts hampered by  Inadequate trade-related infrastructure  Inadequate compliance with product standards  High cost of trade facilitation measures  Low competitiveness Innovative solutions needed to address supply side constraints of LDCs Innovative solutions needed to address supply side constraints of LDCs

Benefiting from DFQF: Addressing supply side constraints Encourage regional integration of production networks Encourage regional integration of production networks Providing technical assistance for improving export marketing, market entry services and management knowledge Providing technical assistance for improving export marketing, market entry services and management knowledge Providing training for skill enhancement and meeting standards Providing training for skill enhancement and meeting standards

New paradigm for addressing LDCs supply side constraints New paradigm for addressing LDCs supply side constraints Asian countries have low cost of providing most of the services required for addressing LDCs supply side constraints. Asian countries have low cost of providing most of the services required for addressing LDCs supply side constraints. New paradigm required – Harness financial resources of developed countries with low cost technical delivery by certain developing countries New paradigm required – Harness financial resources of developed countries with low cost technical delivery by certain developing countries

DFQF: Way forward Devise and implement appropriate aid-for- trade packages Devise and implement appropriate aid-for- trade packages Complex rules of origin should not undermine the market access provided to LDCs Complex rules of origin should not undermine the market access provided to LDCs 3% exclusion should not result in excluding items of interest to LDCs 3% exclusion should not result in excluding items of interest to LDCs Put time limit within which 97% would be extended to 100% coverage Put time limit within which 97% would be extended to 100% coverage

S&D for LDCs in specific areas of negotiations S&D is an integral part in all pillars of agriculture negotiations S&D is an integral part in all pillars of agriculture negotiations Progress achieved Progress achieved -- LDCs not required to make a contribution in market access and domestic support pillars -- In NAMA negotiations, LDCs would not be required to apply the formula nor participate in sectorals

Conclusions Regional cooperation between Asian and African countries can bring greater stability, better policy coordination, improved infrastructure planning and a more dynamic pattern of trade and development. Harnessing the synergies between developed countries and certain developing countries would facilitate LDCs to maximise their benefits from the Doha Work Programme. This model can be applied to South Asian countries as well. Regional cooperation between Asian and African countries can bring greater stability, better policy coordination, improved infrastructure planning and a more dynamic pattern of trade and development. Harnessing the synergies between developed countries and certain developing countries would facilitate LDCs to maximise their benefits from the Doha Work Programme. This model can be applied to South Asian countries as well.

Forward Looking S and D Re-think and re-posit the case for S&DT; Re-think and re-posit the case for S&DT; Internalize S&DT into national development strategies Internalize S&DT into national development strategies Make effective use of S&DT provision; Make effective use of S&DT provision; Continuosly seek more, better & effective S&DT Continuosly seek more, better & effective S&DT Seek a broad-based set of S&DT provisions which commercially meaningful & promote core development interests Seek a broad-based set of S&DT provisions which commercially meaningful & promote core development interests

Issues at Stake for the Doha Mandate Preserve principles of non-reciprocity of Part IV of GATT, non-full reciprocity of DMD, and Enabling Clause; Preserve principles of non-reciprocity of Part IV of GATT, non-full reciprocity of DMD, and Enabling Clause; Internalize costs of implementation & adjustment into agreements or via positive coherence with IFIs; Internalize costs of implementation & adjustment into agreements or via positive coherence with IFIs; Watchful on effectiveness of S&DT. Watchful on effectiveness of S&DT.

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