Bridges Weekly Trade News Digest • Volume 16 • Number 28 • 18th July 2012

Laos Approaches Final Stages of WTO Accession Process

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Laos is on track to complete its WTO accession negotiations after this year’s summer break, officials announced last week, with the Asian country’s membership in the Geneva-based trade body widely expected to be formalised before 2012 comes to a close.

Laos formally announced at a 12 July Working Party meeting that it had finished its series of bilateral negotiations with WTO members, clearing one of the last major hurdles of the accession process.

“We’ve had very constructive bilateral discussions in these last few days, in which we basically agreed on all outstanding commitment language,” Laos’ Industry and Commerce Minister Nam Viyaketh told the meeting. “This has convinced us that we will be able to finalise all substantial issues within this meeting, in order to have our last Working Party Meeting right after the summer break to seek the approval and adoption of the accession package by members, before endorsing it to the General Council for adoption later this year.”

Laos completed its bilateral negotiations after finalising a deal with Ukraine last month, the last WTO member to agree to terms. During the process, Ukraine’s strong positions on lowering tariffs in certain sectors reportedly prompted Laos to take the unusual step of requesting intervention from senior diplomats. The WTO accession process dictates that all member countries must consent to the terms of the agreement before an applicant can become a member.

If it accedes, Laos - officially the Lao People’s Democratic Republic - will become the sixth least developed country (LDC) to finish negotiations to join the trade body since 1995. The country’s negotiators hope to have their accession package ready to present to the Working Party of delegations negotiating the membership bid once the WTO reconvenes in September.

The Working Party’s approval of the accession protocol is the last step before the accord is brought to either the WTO General Council or Ministerial Conference for approval by all WTO members. The package will then require domestic ratification before WTO membership can become official.

Yemen accession on the horizon?

Ukraine also reportedly remains the final holdout in negotiations surrounding Yemen’s entry into the WTO. Yemen, another least developed country, is the next furthest along in the WTO accession process.

A source with knowledge of the negotiations noted that talks between Yemen and Ukraine, however, were “still a bit dicey,” and Yemen did not appear ready to make concessions demanded by Ukraine.

The accession of the world’s poorest members to the Geneva-based trade body has been a point of discussion of late, with a WTO sub-committee recently reaching a preliminary agreement on new accession guidelines for LDCs. (See Bridges Weekly, 4 July 2012) The new guidelines are an attempt to “further strengthen, streamline, and operationalise the 2002 LDC accession guidelines,” in line with the instructions given to members by ministers at last December’s WTO Ministerial Conference, and is expected to be approved at next week’s General Council meeting.

Sources note that the accessions of Laos and Yemen, however, are likely to be little affected by the new LDC accession guidelines, given how far along both countries already are in the process. A delegate from a WTO-member LDC noted that, had the guidelines been in place earlier in the Laos and Yemen negotiations, they “would have served as a useful reference point” but might have been unable to fully prevent hard-line negotiating stances like the one that the Ukraine has apparently taken.

Only five LDCs have completed negotiations to join the global trade body since the initial 30 LDCs acceded to the WTO in 1995. These five include Cambodia, Nepal, Cape Verde (who has since graduated from the LDC designation), Samoa, and Vanuatu. Of these, Vanuatu is the only one whose membership has yet to be formalised, as the accession accord still needs to be ratified domestically.

ICTSD reporting; “Laos clears WTO entry hurdle, Yemen still trying,” REUTERS, 7 June 2012; “Ukraine resists global pressure to let Yemen join WTO,” REUTERS, 17 July 2012.