Joint NGO statement January 2002
Services Non-agricultural Investment Competiton
Assistance Process Conclusion
A genuine development agenda for the Doha round of WTO negotiations
Joint statement signed by CAFOD, Save the Children, Oxfam, Action Aid,
World Vision, Christian Aid, The Fairtrade Foundation, Traidcraft, ITDG and
World Development Movement
this paper in PDF format (196 K)
The WTO's Doha Ministerial has launched a new round of international trade
negotiations, due to begin with the first meeting of the Trade Negotiations
Committee on 28 January 2002 and scheduled to end by 1 January 2005. At the
conclusion of the Uruguay Round in 1994, calculations by the UNDP and OECD
showed that within six years global income would grow by US$200-500 billion as
a result of the round. However, it was acknowledged that all these gains would
go to the industrialised countries of the OECD and to the richer middle-income
developing countries. Even before implementation had started, LDCs were
predicted to lose US$600 million a year and Sub-Saharan Africa US$1.2 billion a
year from the Uruguay Round.
If the Doha Round is to have a genuine 'development agenda', this situation
must not be allowed to repeat itself. Yet even as it forecasts a rise of US$355
billion in global income by 2015 as a result of the new round of trade
liberalisation, the World Bank's Global Economic Prospects 2002 has
already predicted that the greatest income gains will accrue to Western Europe.
Developing countries as a whole are forecast to enjoy around 50 per cent of the
extra income, but the World Bank acknowledges that there will be wide variation
in their experiences. In both Sub-Saharan Africa and South Asia, according to
the Bank's predictions, net gains will be minimal - and lower in both cases
than the aggregate losses resulting from displacement due to trade
The Ministerial Declaration adopted by WTO members at Doha on 14 November
2001 fails to address the most pressing needs either of the poorest countries
or of the world's most vulnerable communities. This means that the people who
most need a share in global prosperity are still those least likely to obtain
it. The comprehensive changes needed to make the global trading system work in
the interests of the poor require major reforms far beyond the scope of the
programme outlined below. Yet these measures give an indication of the
immediate steps which are needed if the Doha Round is to have any claim to be a
genuine development agenda.
- implementation issues should be resolved as an urgent priority:
Inclusion of the implementation agenda within the single undertaking means
developing countries are being asked to pay twice for the concessions they won
during the Uruguay Round. Outstanding issues from that Round must be resolved
as an urgent priority, and implemented on a definitive basis at an early stage
(as provided for in Ministerial Declaration para 47).
- more favourable access for developing country textiles exports: The
Council for Trade in Goods (in its recommendations to the General Council by 31
July 2002, as required by Implementation Decision para 4) must call for
immediate implementation of the proposals for growth-on-growth increase in
quota levels, bearing in mind that WTO members are already required to abolish
all quota restrictions on textiles by January 2005. Industrialised countries
should be required to provide evidence of how they will achieve that schedule,
including measures to assist workers and small companies in the adjustment
process and measures to avoid creating protectionist pressures.
- phasing out of export subsidies and credits, and reorientation of
domestic support: There must be immediate and substantial reductions
leading to the phasing out of export subsidies and credits, as well as an end
to the abuse of food aid, so as to grant fair market access to developing
countries' exports and to prevent the ruinous dumping of subsidised produce on
developing country markets. There must also be a reorientation of domestic
support for agriculture in industrialised countries so as to promote rural
development and environmental objectives. In addition, industrialised countries
should implement existing tariff reduction commitments immediately, and
eliminate tariff escalation and tariff peaks in order to increase market access
for all agricultural products, including processed products. These measures
should be implemented on a definitive basis at an early stage (as provided for
in Ministerial Declaration para 47).
- a Development Box in the Agreement on Agriculture: The Development
Box should also be introduced to the Agreement on Agriculture as an early
undertaking, as provided for in Ministerial Declaration para 47. The details of
content to be included in the Development Box should be finalised within the
Committee on Agriculture, and must enable developing countries to address their
development needs, including both food security and rural development. To be
genuinely pro-poor, the Development Box must target small farmers and staple
foods, and include both domestic support and border measures.
- implementation of the Marrakesh Decision: The Doha Ministerial
approved the Committee on Agriculture's recommendations on the implementation
of the Marrakesh Decision regarding food aid, technical and financial
assistance in the context of aid programmes to improve agricultural
productivity and infrastructure, financing normal levels of commercial imports
of basic foodstuffs, and review of follow-up (Implementation Decision para
2.2). These recommendations should now be implemented.
- full and thorough assessment, including revision of GATS:
Developing countries and civil society organisations from around the world have
consistently called for an assessment of services trade liberalisation and the
future impact of GATS, both in order to preserve developing country service
industries from inappropriate competition and to protect vulnerable communities
from the negative consequences of services trade liberalisation. The text of
GATS must also be revised where necessary in the light of this assessment
- credit for autonomous liberalisation: In order to reflect the true
extent of liberalisation already undertaken in the context of structural
adjustment and other reform programmes, developing countries must be granted
credit for such commitments in the current market access negotiations. At the
same time, as reiterated in the GATS negotiating guidelines adopted in March
2001, developing countries must not be pressured to undertake GATS
liberalisation commitments which are not in line with their own development
- increased level of commitments under mode 4 of GATS: Industrialised
countries must extend commercially meaningful liberalisation commitments on
mobility of labour to match the commitments already made on mobility of
capital. However, care should be taken not to exacerbate current problems in
transfer of skilled personnel from basic service sectors in developing
countries such as health and education.
4. NON-AGRICULTURAL MARKET ACCESS
- full assessment as a prerequisite to any market access negotiations:
The modalities to be established for these negotiations (under Ministerial
Declaration para 16) must ensure that a full and thorough assessment of the
development implications of non-agricultural market liberalisation in
developing countries is conducted prior to the start of any negotiations. The
world's poorest countries have identified such an assessment as essential in
order to minimise the negative impacts on their economies of market access
negotiations for non-agricultural goods.
- less than full reciprocity in liberalisation commitments: The
modalities for any future negotiations must reaffirm the flexibility for
developing countries to protect their domestic industries from external
competition, as stated in the Ministerial Declaration. In this respect, the
relevant provisions of Article XXVIII bis of GATT 1994 affirm "the needs
of less-developed countries for a more flexible use of tariff protection to
assist their economic development and the special needs of these countries to
maintain tariffs for revenue purposes". The commitment to less than full
reciprocity should be operationalised through early offers from industrialised
countries of reductions in tariff peaks and tariff escalation.
- no new negotiations on trade and investment: The Doha Ministerial
Conference succeeded in launching a new work programme for the WTO only as a
result of the last-minute clarification on new issues from the Chair. This
clarification that each WTO member has "the right to take a position on
modalities that would prevent negotiations from proceeding" should be
included as an Annex to the Ministerial Declaration itself, as required by
diplomatic convention, not simply as a statement in the record of the meeting.
The EU and the WTO Secretariat should respect the consistent opposition of the
clear majority of developing countries to WTO negotiations on the new issues of
investment, competition policy, transparency in government procurement and
trade facilitation, and refrain from including such negotiations within the
single undertaking of the new round.
- TRIMS: Given the acknowledged importance of FDI linkages for
development, the review of TRIMS mandated under Article 9 of that Agreement
should provide for unlimited extensions for transitional periods under TRIMS
Article 5.2; should provide for an exemption for developing countries from
disciplines on the two performance requirements listed in the TRIMS Annex
(local content and trade balancing); and must under no circumstances add more
requirements to that list. In the meantime, the Council for Trade in Goods
should automatically grant all requests from developing and least developed
countries for extensions of transitional periods under TRIMS Article 5.3.
- GATS: Article XVI of GATS prohibits the imposition of access
conditions on FDI in service sectors committed for liberalisation, unless
countries specify such limitations in their national schedules. Given the
acknowledged development benefits of conditions such as foreign equity caps or
joint venture requirements, and as reiterated in the GATS negotiating
guidelines agreed in March 2001, developing countries should not be asked to
commit access conditions to the request-offer process during the current phase
of services negotiations.
6. COMPETITION POLICY
- no new negotiations on trade and competition policy: As with
negotiations on trade and investment, the clear majority of developing
countries have expressed consistent opposition to WTO negotiations on trade and
competition policy. More widely, the WTO is regarded as an unsuitable forum for
such negotiations, and the EU should refrain from including them within the
single undertaking of the new round.
7. TRANSPARENCY IN GOVERNMENT PROCUREMENT
- no new negotiations on transparency in government procurement: Once
again, the EU and the WTO Secretariat should respect the consistent opposition
of the clear majority of developing countries to WTO negotiations on the issue
of transparency in government procurement, and refrain from including such
negotiations within the single undertaking of the new round.
8. TRADE FACILITATION
- no new negotiations on trade facilitation: As with the other new
issues, the EU and the WTO Secretariat should respect the consistent opposition
of the clear majority of developing countries to WTO negotiations on trade
facilitation, and refrain from including such negotiations within the single
undertaking of the new round.
- TRIPS and public health: Following the Doha Ministerial's
affirmation that the TRIPS Agreement does not and should not prevent countries
from taking measures to protect public health, the Council for TRIPS must lift
restrictions on the export of drugs to developing countries which have decided
to override a patent or which do not recognise drugs patents, but which do not
have the capacity to produce cheap generic equivalents. This can be done
through the use of TRIPS Article 30.
- TRIPS and food security: In order to protect the
large number of farming communities worldwide which depend on locally saved
seed and local livestock breeds for their food security and sustainable
agricultural production systems, the mandated review of TRIPS Article 27.3(b)
must clarify that there can be no patents on genetic resources for food and
agriculture. The review should also ensure that flexibility is permitted for
developing countries to implement national sui generis options so that they can
protect the rights of their farmers. It must ensure that the TRIPS Agreement is
fully compatible with the International Treaty on Plant Genetic Resources for
Food and Agriculture (PGRFA), and with the provisions of the Convention on
Biological Diversity (CBD) on prior informed consent and benefit sharing. In
the meantime, the TRIPS Council should affirm that no patents inconsistent with
CBD Article 15 are to be granted or recognised, and that issues concerning
PGRFA will be referred to the FAO.
- Review of TRIPS: The scheduled review of TRIPS in 2002 should assess
the Agreement's development impact with a view to allowing developing countries
greater flexibility in determining the length and scope of patents from a
public interest perspective. In addition, the deadline for TRIPS compliance for
all developing countries should be based on their achievement of development
milestones rather than arbitrary dates.
10. WTO RULES
- negotiations on anti-dumping: The negotiations on WTO rules under
the Agreements on Implementation of Article VI of GATT 1994 and on Subsidies
and Countervailing Measures (Ministerial Declaration para 28) must put an end
to the abuse of anti-dumping disciplines as a protectionist measure by
- fisheries subsidies: The inclusion of fisheries subsidies within the
context of the negotiations on WTO rules, with a view to clarifying and also
improving the disciplines relating to such subsidies and with explicit
reference to developing country concerns, offers an opportunity to protect
developing country fleets from the unfair competition and over-exploitation
many have suffered to date. States such as the EU which employ fisheries
subsidies must undertake to reduce them significantly.
11. DISPUTE SETTLEMENT UNDERSTANDING (DSU)
- a balanced DSU for use by all WTO members: Negotiations for reform
of the DSU (mandated to conclude by May 2003) must ensure that developing
countries can make effective use of the system. Negotiations should explore the
possibility of a system which is not ultimately based on the threat of trade
sanctions by individual WTO members (DSU Article 22), given that this system is
of no practical relevance to the majority of developing countries.
12. SPECIAL AND DIFFERENTIAL TREATMENT (S&DT)
- S&DT measures must be made mandatory, legally binding and
enforceable: The Committee on Trade and Development is to report to the
General Council by July 2002 with recommendations on the legal implications of
making S&DT measures mandatory. The Committee should propose that all
S&DT measures be made mandatory, legally binding and enforceable through
the WTO's dispute settlement system.
- Framework Agreement on S&DT: As part of the above programme, the
proposal for a Framework Agreement on S&DT submitted by a group of
developing countries (WTO document WT/GC/W/442) should be developed so as to
enshrine the concepts of S&DT and non-reciprocity at the heart of the WTO.
Trade liberalisation must not be allowed to undermine the national policy and
development objectives of developing countries. In particular, S&DT should
go beyond the provision of longer transitional periods for developing countries
to implement the same rules as industrialised countries, and should take the
form of positive discrimination within the rules in favour of developing
countries and in line with their level of development.
- tariff-free and quota-free access for all LDC exports: All OECD
countries should grant all LDC exports tariff-free and quota-free access to
their markets, in order to honour the non-binding commitments which have been
included in Ministerial Declarations from Singapore in 1996 to Doha in 2001.
The EU must extend its 'Everything But Arms' initiative to encompass all
exports (including rice, bananas and sugar) as of now, following the lead taken
by New Zealand during 2001. The Sub-Committee for LDCs must include this
guarantee of free access in the work programme which it announces to the first
General Council of 2002, and the Director General must report on progress by
all OECD countries in his December 2002 interim report on LDC issues and in his
full report to the Fifth Ministerial Conference.
- no anti-dumping or other contingency protection measures against LDC
exports: As with the provisions for free market access for LDC exports, it
is essential to the increasing participation of LDCs in the global economy that
all other countries refrain from using anti-dumping or other protectionist
measures against LDC exports.
14. WORKING GROUPS ON DEBT & FINANCE, TECHNOLOGY TRANSFER
- debt cancellation as a prerequisite to a fair world trading system:
Many of the macroeconomic developments which developing countries need if they
are to benefit from international trade require high levels of domestic
savings, investment and other finance. With many countries still unable to
generate this development finance due to their continuing debt burden, the
WTO's Working Group on Debt and Finance must send a strong message to
international financial institutions, particularly the World Bank and IMF, that
substantial and meaningful debt cancellation beyond the Enhanced HIPC
initiative is a prerequisite to a fair world trading system.
- need for significant resource flows from North to South: Even with
substantial and meaningful debt cancellation, many of the world's poorest
countries will still not have the financial resources to guarantee their people
basic rights. The WTO's Working Group on Debt and Finance must also draw
attention to the need for a massive injection of new resource flows from North
to South, requiring all OECD countries to meet the UN aid target of 0.7 per
cent of GNP as a first priority.
- investigate WTO barriers to technology transfer: The WTO's Working
Group on Technology Transfer should address the restrictions on performance
requirements and access conditions for investment included within the WTO's own
agreements, whereby those agreements may themselves block the transfer of
technology to developing countries.
15. TECHNICAL ASSISTANCE AND CAPACITY BUILDING
- upgrade 'best endeavour' commitments: The commitments in Ministerial
Declaration paras 38-41 must be translated into action if developing countries
are to be able to participate fully at the WTO. Technical assistance and
capacity building must address the broad range of steps needed to ensure proper
participation by developing countries. This includes negotiating capacity in
Geneva, interdepartmental research and negotiating capacity in capitals, and
ways to involve civil society in dialogue with governments in order to achieve
both a clear identification of interests and proper ownership of the process.
- adapt WTO negotiations to maximise developing country participation:
It is self-defeating to commit resources to technical assistance and
capacity building and then to structure WTO negotiations so that they exclude
developing countries from the possibility of effective participation. The
discussions on capacity building must also address how to adapt the WTO's
negotiating timetable and process to the capacity constraints facing developing
- Trade Negotiations Committee must not become a permanent Green Room:
In view of the WTO's acknowledged failure to involve developing countries
fully in past negotiations, the Trade Negotiations Committee established to
oversee the Doha Round of negotiations must conduct proceedings in the fairest
and most open manner possible. Its proceedings and those of the negotiating
mechanisms it establishes must be transparent and documented, with an open
system for reporting irregularities. Furthermore, it is essential that the
individual chosen to chair the Trade Negotiations Committee command the full
trust and respect of all developing country members.
- code of conduct for new round: Given the many reports of untoward
pressure and extraneous linkages used before and at Doha to force developing
countries into agreeing to a comprehensive new round, industrialised countries
should sign up to a code of conduct committing them not to use such underhand
tactics during the new round of negotiations. Again, there should be a
'whistleblowing' system for reporting irregularities.
- greater external transparency: External transparency is one further
mechanism for building accountability into the procedures of the WTO, given the
exclusion of civil society from formal WTO processes. Civil society
organisations and parliamentarians should be granted greater access to WTO
processes, as well as to national processes for formulating trade policy. In
addition, all WTO documents should be declassified and published immediately on
presentation, so as to increase the organisation's transparency worldwide.
We do not accept the mercantilist paradigm which says that the world's
richest countries must win further concessions from the poorest as a reward for
redressing the imbalances of the world trading system. If the WTO and its
member states wish to present the new round of negotiations as a Doha
Development Agenda, they must enshrine the principles of S&DT and
non-reciprocity at the heart of the WTO. This entails both unilateral and
multilateral action in advance of the conclusion of the round as a whole -
action which will bring benefits to the world's poorest communities at no
significant cost to the rich.
The world's poor deserve a genuine development agenda. It is up to the WTO
and its member states to deliver one.