shaheed(bhagat(singh(college
TRANSCRIPT
MODEL WTO’13
ECONOMICS ASSOCIATION OF
SHAHEED BHAGAT SINGH COLLEGE PRESENTS
BACKGROUND GUIDE
JOINT MEETING OF THE SUB COMMITTEE OF LDCs AND TRADE
POLICY REVIEW BODY
DEPUTY DIRECTORS-‐GENERAL-‐ABINASWAR DAS& ROHAN KATYAL ADDITIONAL DIRECTOR-‐GENERAL-‐AMAN SAHANI AGENDA-‐TRADE POLICY REVIEW WITH EMPHASIS ON LEAST DEVELOPED COUNTRIES *THIS GUIDE MAY NOT BE USED AS EVIDENCE * ONLY UN/REUTERS/WTO REPORTS WILL BE ACCEPTED AS EVIDENCE
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LETTER FROM THE EXECUTIVE BOARD
Dear Delegates,
It is our pleasure to welcome you to the Model WTO Conference 2013. We hope that this guide prepared by us will help you in order to develop a basic understanding of the agenda under discussion.
This guide is in no way meant to serve as a source, or a framework for your research. Instead, please glance over this guide in order to understand the nature of the agenda item which is to be discussed.
The terminology employed in defining this agenda item is sufficiently clear and easy to understand. Hence, please do not let this guide restrict the scope of your research in any way whatsoever. Remember to place an emphasis on originality with respect to the solutions you wish to propose.
The following pages intend to guide you with the nuances of the agenda as well as the Council. The Guide chronologically touches upon all the different aspects that are relevant and will lead to fruitful debate in the Council. It will provide you with a bird’s eye view of the gist of the issue.
You are the representative of your allotted country and it is our hope that you put in wholehearted efforts to research and comprehensively grasp all important facets of the diverse agenda. All the delegates should be prepared well in order to make the council’s direction and debate productive. After all, only then will you truly be able to represent your country in the best possible way.
We encourage you to go beyond this background guide and delve into the extremities of the agenda to further enhance your knowledge of a burning global issue.
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INTRODUCTION The WTO was born out of negotiations, and everything the WTO does is the result of negotiations. The bulk of the WTO’s current work comes from the 1986–94 negotiations called the Uruguay Round and earlier negotiations under the General Agreement on Tariffs and Trade (GATT). The WTO is currently the host to new negotiations, under the ‘Doha Development Agenda’ launched in 2001.
Where countries have faced trade barriers and wanted them lowered, the negotiations have helped to open markets for trade. But the WTO is not just about opening markets, and in some circumstances its rules support maintaining trade barriers — for example, to protect consumers or prevent the spread of disease. For reference go to http://wto.org/
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SUB COMMITTEE ON LDCs The mandate of the Sub-‐Committee on Least-‐Developed Countries (LDCs) is to look specifically at issues of particular importance to LDCs. Since the Doha Ministerial Conference in 2001, the Sub-‐Committee on LDCs focuses on the implementation of the WTO Work Programme for the LDCs. The Work Programme addresses the following systemic issues: (a) Market Access for LDCs; (b) Trade-‐related Technical Assistance and Capacity Building Initiatives for LDCs; (c) Providing, as appropriate, support to agencies assisting with the diversification of LDCs' production and export base; (d) Mainstreaming, as appropriate, into the WTO's work the trade-‐related elements of the LDC-‐III Programme of Action, as relevant to the WTO's mandate; (e) Participation of LDCs in the multilateral trading system; (f) Accession of LDCs to the WTO; (g) Follow-‐up to WTO Ministerial Decisions/Declarations. Refer to http://docsonline.wto.org/imrd/directdoc.asp?DDFDocuments/t/WT/COMTD/LDC11.doc for information on WTO work programme for LDCs. Refer to http://docsonline.wto.org/imrd/directdoc.asp?DDFDocuments/t/WT/COMTD/LDC10.doc for information on LDC-‐III Programme of Action.
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TRADE POLICY REVIEW BODY (TPRB) Individuals and companies involved in trade have to know as much as possible about the conditions of trade. It is therefore fundamentally important that regulations and policies are transparent. In the WTO, this is achieved in two ways: governments have to inform the WTO and fellow-‐members of specific measures, policies or laws through regular “notifications”; and the WTO conducts regular reviews of individual countries’ trade policies — the trade policy reviews. These reviews are part of the Uruguay Round agreement, but they began several years before the round ended — they were an early result of the negotiations. Participants agreed to set up the reviews at the December 1988 ministerial meeting that was intended to be the midway assessment of the Uruguay Round. The first review took place the following year. Initially they operated under GATT and, like GATT, they focused on goods trade. With the Creation of the WTO in 1995, their scope was extended, like the WTO, to include services and intellectual property.
The importance countries attach to the process is reflected in the seniority of the Trade Policy Review Body — it is the WTO General Council in another guise.
The objectives are:
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To increase the transparency and understanding of countries’ trade policies and practices, through regular monitoring
To improve the quality of public and intergovernmental debate on the issues
To enable a multilateral assessment of the effects of policies on the world trading system.
The reviews focus on members’ own trade policies and practices. But they also take into account the countries’ wider economic and developmental needs, their policies and objectives, and the external economic environment that they face. These “peer reviews” by other WTO members encourage governments to follow more closely the WTO rules and disciplines and to fulfill their commitments. In practice the reviews have two broad results: they enable outsiders to understand a country’s policies and circumstances, and they provide feedback to the reviewed country on its performance in the system.
Over a period of time, all WTO members are to come under scrutiny. The frequency of the reviews depends on the country’s size:
The four biggest traders — the European Union, the United
States, Japan and China (the “Quad”) — are examined approximately once every two years.
The next 16 countries (in terms of their share of world trade) are reviewed every four years.
The remaining countries are reviewed every six years, with the possibility of a longer interim period for the least-‐developed
countries.
For each review, two documents are prepared: a policy statement by the government under review, and a detailed report written independently by the WTO Secretariat. These two reports, together with the proceedings of the Trade Policy Review Body’s meetings are published shortly afterwards.
LEAST DEVELOPED COUNTRIES OR LDCs The WTO recognizes as least-‐developed countries (LDCs) those countries, which have been designated as such by the United Nations. There are currently 48 least-‐developed countries on the UN list, 33 of which to date have become WTO members. Refer to http://www.unohrlls.org/en/ldc/25/ for the characteristic of LDCs and the consolidated list of LDCs compiled by the UN Refer to http://www.wto.org/english/thewto_e/whatis_e/tif_e/org7_e.htm for the list of countries recognized by WTO as LDCs
The map shows LDCs highlighted in blue, as recognized by the UN.
TRADE AND LDCs Issues surrounding global trade regulations and LDCs have gained a lot of media and policy attention thanks to the recently collapsed Doha Round World Trade Organization (WTO) negotiations being termed a development round. During the WTO, Hong Kong Ministerial it was agreed that LDCs could see 100 percent duty-‐free, quota-‐free access to U.S. markets if the round were completed. But analysis of the deal by NGOs found that the text of the proposed LDC deal had substantial loopholes that might make the offer less than
the full 100 percent access, and could even erase some current duty-‐
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free access of LDCs to rich country markets. Dissatisfaction with these loopholes led some economists to call for a reworking of the Hong Kong deal.
Five other agencies that together with the WTO constitute the Integrated Framework of action for the Least Developed Countries. They addressed issues of market access, special and differential treatment provisions for developing countries, participation of developing countries in the multilateral trading system, and development questions, especially the interests of developing countries in competition policy.
PROBLEMS FACED BY LDCs Characterized by low level of development employment constraints, increasing stiffer competition in the wake of globalization and trends in the market, LDCs face a tougher challenge and road ahead in order to improve their socio economic conditions
Refer to http://unctad.org/en/Docs/tdbex49summary-‐LDCs_en.pdf for a comprehensive view on the problems faced by LDCs
NON-‐TARIFF BARRIERS TO TRADE
Non-‐tariff barriers to trade (NTBs) are trade barriers that restrict imports but are not in the usual form of a tariff. Some common examples of NTB's are anti-‐dumping measures and countervailing duties, which, although called non-‐tariff barriers, have the effect of
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tariffs once they are enacted.
Their use has risen sharply after the WTO rules led to a very significant reduction in tariff use. Some non-‐tariff trade barriers are expressly permitted in very limited circumstances, when they are deemed necessary to protect health, safety, sanitation, or depletable natural resources. In other forms, they are criticized as a means to evade free trade rules such as those of the World Trade Organization (WTO), the European Union (EU), or North American Free Trade Agreement (NAFTA) that restrict the use of tariffs.
TYPES OF NON-‐TARIFF BARRIERS
1. Specific Limitations on Trade:
1. Quotas 2. Import Licensing requirements 3. Proportion restrictions of foreign to domestic goods (local
content requirements) 4. Minimum import price limits 5. Embargoes
2. Customs and Administrative Entry Procedures:
1. Valuation systems 2. Anti-‐dumping practices 3. Tariff classifications 4. Documentation requirements 5. Fees
3. Standards:
1. Standard disparities
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2. Intergovernmental acceptances of testing methods and standards
3. Packaging, labeling, and marking
4. Government Participation in Trade:
1. Government procurement policies 2. Export subsidies 3. Countervailing duties 4. Domestic assistance programs 5. Charges on imports:
1. Prior import deposit subsidies 2. Administrative fees 3. Special supplementary duties 4. Import credit discrimination 5. Variable levies 6. Border taxes
6. Others: 1. Voluntary export restraints 2. Orderly marketing agreements
TARIFFS AS BARRIERS TO TRADE Customs duties on merchandise imports are called tariffs. Tariffs give a price advantage to locally produced goods over similar goods that are imported, and they raise revenues for governments. One result of the Uruguay Round was countries’ commitments to cut tariffs and to “bind” their customs duty rates to levels, which are difficult to raise. The current negotiations under the Doha Agenda continue efforts in that direction in agriculture and non-‐agricultural market access.
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Refer to http://www.wto.org/english/news_e/news12_e/stat_23oct12_e.htm
For WTO’s latest data on trade and tariffs.
AID FOR TRADE Aid for Trade helps developing countries, and particularly least developed countries, trade. Many developing countries face a range of supply-‐side and trade-‐related infrastructure obstacles, which constrains their ability to engage in international trade.
The WTO-‐led Aid for Trade initiative encourages developing country governments and donors to recognize the role that trade can play in development. In particular, the Initiative seeks to mobilize resources to address the trade-‐related constraints identified by developing and Least-‐developed countries
Refer to http://wto.org/english/tratop_e/devel_e/a4t_e/a4t_ldcs_e.pdf for WTO’s aid for trade initiative with emphasis on LDCs.
PROTECTIONISM Government actions and policies that restrict or restrain international trade, often done with the intent of protecting local businesses and jobs from foreign competition. Typical methods of
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protectionism are import tariffs; quotas, subsidies or tax cuts to local businesses and direct state intervention. This policy contrasts with free trade, where government barriers to trade are kept to a minimum. In recent years, it has become closely aligned with anti-‐globalization. The term is mostly used in the context of economics, where protectionism refers to policies or doctrines which protect businesses and workers within a country by restricting or regulating trade with foreign nations. Refer to http://www.reuters.com/article/2012/11/26/eu-‐russia-‐wto-‐idUSL5E8MQA5L20121126
ANTI-‐DUMPING If a company exports a product at a price lower than the price it normally charges on its own home market, it is said to be “dumping” the product. Its focus is on how governments can or cannot react to dumping — it disciplines anti-‐dumping actions, and it is often called the “Anti-‐dumping Agreement”.
WTO Members agreed at the Doha Ministerial Conference to launch negotiations in the area of “WTO Rules”. These negotiations relate to the following subject matter: the Agreement on Implementation of Article VI of GATT 1994 (better known as the Anti-‐dumping Agreement)
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Specific TRIPS issues The WTO’s Agreement on Trade-‐Related Aspects of Intellectual Property Rights (TRIPS), negotiated in the 1986–94 Uruguay Round, introduced intellectual property rules into the multilateral trading system for the first time. It’s one of the three main areas of work in the WTO, alongside trade in goods and services. The TRIPS Council’s job is to monitor how countries are applying the TRIPS Agreement and to discuss issues that arise from that.
The areas of intellectual property covered by the TRIPS agreement are:
• Copyright and related rights • Trademarks, Including Service Marks • Geographical Indications • Layout Designs of integrated circuits • Undisclosed Information including trade secrets
*The delegates are expected to have a basic knowledge of the Paris Convention for the protection of Industrial Property.
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The Purpose of this TPRB
• Resolving the problem of discriminatory trade policies and practices.
• Discussing Progressive Trade Liberalization • Directing Aid For Trade for with respect to the decision taken in
the Hong Kong Ministerial Conference • Negotiating conflicting Trade Policies • Reviewal of Anti-‐Dumping Laws • Discussing barriers to easy market access for LDCs and reaching
a conclusive solution. • This TPRB may also take up Dispute Settlements among
countries violating WTO rules and Agreements.
Thanking You Executive Board Model WTO 2013 Abinaswar Das Rohan Katyal Aman Sahani (Deputy Director) (Deputy Director (Additional Director General) General) General)
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