ARJUN KARKI

LDC package

World Trade Organization Director-General Roberto Azevedo’s ongoing Nepal visit is the first ever of a WTO top official. Azevedo’s key agenda is to start mobilizing WTO members like Nepal around the stalled Work Program of the Doha Development Agenda (DDA) since 2008. The current DDA trade negotiations started more than a decade back in 2001 in Doha at the 4th WTO Ministerial Conference and after subsequent ministerial meetings, the negotiations collapsed in 2008 in Geneva over failure of consensus in agriculture import safeguard measures.

As Nepal is a member of the least developed country (LDC) Group, the implementation of the full LDC package should be the key agenda with Azevedo. The LDC package agreed in Bali in December 2013 at the ninth WTO Ministerial Conference constitutes four issues: duty-free-quota-free (DFQF) market access, preferential rules of origin, services waiver and DFQF market access of cotton including elimination of its export subsidies. However, the LDC package is still not a binding agreement containing “best endeavor” language only. In Bali, it was agreed that “issues in the Bali package where legally binding outcomes could not be achieved will be prioritized”. So, Nepal needs to take this opportunity of Azevedo’s visit to place the Bali LDC package on the top of the agenda. 

On DFQF market access, the decision carries only a best endeavor commitment whereby developed countries “shall seek to improve” their DFQF coverage for LDC products when the LDCs had demanded a more concrete improvement from the commitment in Hong Kong in 2005. On preferential rules of origin, the decision carries a non-binding language when the LDCs had demanded for a binding agreement for LDC-preference schemes. 

On implementation of services waiver allowing developed countries to provide LDCs with preferential market access in services which was adopted in the eight ministerial conference in 2011, there is still no binding commitment to do so but a mere promise of a high-level conference on the issue with a best endeavor language saying “where developed and developing members in a position to do so, shall indicate sectors and modes where they intend to provide preferential treatment to LDC services and service providers”. 

On DFQF access for cotton by January 1 2015 including elimination of export subsidies for cotton, the decision only agrees to the continuation of discussions with no mandate to deliver on a concrete outcome by a specified date. The entire LDC package therefore carries non-binding deliverables by developed partner countries.

Recalling Bali negotiations, we must remember that this very weak LDC package also was held hostage by the developed countries. The LDC package was pre-negotiated in Geneva itself in the lead-up to Bali and therefore, was to be simply formally adopted in Bali but amidst the major battles with regard to the proposals on food security and trade facilitation, it was held hostage as developed countries were adamant for an outcome: either all or nothing. LDC Watch engaged in intensive lobbying with both LDC and non-LDC governments in Bali for a “LDC Package Now” urging LDCs to stay firm and demand the adoption of the LDC package while urging non-LDC governments to give an early harvest to LDCs with or without any deal in Bali. As usual, the developed countries gained most and while the developing countries including LDCs lost most.

Going back to the very purpose of the launch of the current DDA, ministers recognized that trade is an engine of development. Acknowledging the fact that developing countries make up the majority of WTO members, they agreed to make positive progress to ensure that developing countries and in particular LDCs reap the benefits of international trade corresponding to their development needs. 

The DDA is also intrinsically linked with the Millennium Development Goals (MDGs) with specific focus on MDG 8, developing a global partnership for development. The “development” dimension, therefore, is at the heart of the DDA negotiations which is best translated by the Doha Ministerial Declaration stating “The majority of WTO Members are developing countries. We seek to place their needs and interests at the heart of the Work Program adopted in this Declaration”.

As the total global trade share of the 49 UN-defined LDCs merely accounts for just over one percent, there cannot be more urgency to place the LDCs at the heart of the trade negotiations. This also questions the legitimacy of the WTO and the “development” element of the DDA. Moreover, the Istanbul Program of Action for the LDCs for 2011-2020 also comprises trade as one of its priority areas for action. Azevedo must, therefore, prioritize an early harvest of the LDC package and start nurturing a legacy of leadership which worked in the development interests of the most marginalized and vulnerable LDCs.

The author is the international coordinator, LDC Watch

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Source: myrepublica.com (05/06/2014)