Trade policy is changing fast. Many governments have swept away non-tariff barriers and rationalised and reduced tariffs. As proposals to extend the scope of the WTO are debated, should southern states widen the agenda of multi-lateral trade negotiations beyond what, in WTO jargon, is called the ‘built-in agenda’?
A paper from the University of Nottingham’s Centre for Research in Economic Development and International Trade (CREDIT) argues that it is in the interests of developing countries to broaden the agenda and take on new WTO commitments. It looks in detail at the wide range of trade issues either already under the WTO aegis or likely to be included in the near future. It cites evidence that adherence to WTO rules gives developing countries credibility, improves governance and attracts productivity-boosting foreign investment.
Most developing countries have chosen not to become members of the Government Procurement Agreement (GPA). Fearing that foreign companies may be able to use their market power to drive out local firms, many developing governments want to avoid the costs of information and contract compliance under the GPA. The report asks whether non-GPA accession will prevent developing economies from winning export contracts for which they would otherwise be able to tender.
Further points made by the study include:
- Developing countries have much to gain from successful negotiations on agriculture. A further 40 percent reduction in tariff protection and agricultural subsidies would lead to an increase of some US$70 billion by 2005 much of which would reach poorer, rural communities.
- Trade-Related Aspects of Intellectual Property Rights (TRIPS), relating to protection of copyright, trademarks and patents are contentious as developing countries oppose plant and animal patentability and are wary of biotech and pharmaceutical multinationals.
- The 11-year grace period before least developed countries have to implement TRIPS could be counter-productive if it blocks them from attracting technology-intensive investments.
- As the number of anti-dumping cases increases, there is a risk that gains achieved through market access negotiations may be subverted by anti-dumping actions.
- Procedures for examining the WTO-applicability of the rapidly spreading number of regional trade agreements (RTAs) are bogged down.
The reports suggests the need for:
- Reinforcement of anti-trust laws to ensure that competition can prevail and the benefits of trade reforms are passed on to consumers.
- Judicial reform to ensure more transparent application of commercial law.
- Periodic examinations to monitor developments in RTAs and clarify preferential rules of origin.
- Assisting developing nations to improve technical capacity to participate in negotiations about standards and meet notification requirements.
Source(s):
‘The WTO agenda and the developing countries’, CREDIT Research Paper
#00/5, Centre for Research in Economic Development and International Trade,
University of Nottingham, by Sam Laird May 2000 Full document.
id21 Research Highlight: 2 October 2001
Further Information:
Sam Laird
E. 8075
DITC/UNCTAD
Palais des Nations
1211 Geneva 21
Switzerland
Tel:
+41 22 917 5760
Contact the contributor: Sam.Laird@UNCTAD.org
UNCTAD, Switzerland
CREDIT, University of Nottingham, UK
Other related links:
'Mega trading blocks: friend or free trade?'
'Post-Seattle blues: whither the WTO?'
WTO
OECD focuses on trade
The World Bank also concentrates on international trade
