WTO Ministerial Section • Volume 9 • Number 38 • 9th November 2005
NAMA Chair: State Of Affairs Is Bad
WTO negotiations on industrial tariffs are "becoming more confused" and "in dire need of political input," Chair Ambassador Stefan Johannesson of Iceland told Members at an informal 8 November meeting of the Negotiating Group on Non-Agricultural Market Access (NAMA). Reporting on his recent consultations with delegates, he said that there was little convergence on the coefficients to be associated with the tariff reduction formula or the flexibilities to be accorded to developing countries when making tariff cuts. He said that Members had even been unable to agree on the products to be covered by NAMA disciplines — fish products, for instance, are currently counted as farm products.
"My overall impression about the state of affairs of the NAMA negotiations is bad," said Johannesson while warning Members that he would be unable to come up with draft ministerial declaration text for the Hong Kong Ministerial Conference if they did not resolve some of their differences. "I am not producing texts on elements on which I do not see some convergence. This is a truly bottom up approach. You need to give me something to work on otherwise the process is doomed to fail."
South Africa tabled a statement (TN/MA/W/65) on behalf of countries including Argentina, Brazil, China, Egypt, Pakistan, India, and Indonesia denouncing the attempts by some Members to link the flexibilities accorded to developing countries by Paragraph 8 of the NAMA mandate in Annex B of the 2004 July Package (WT/L/579) to the structure of the tariff reduction formula (see BRIDGES Weekly, 28 September 2005).
Paragraph 8 provides for allowing developing countries to choose among cutting tariffs on some products by levels lower than those required by the formula, exempting a smaller number from formula cuts altogether, or retaining some unbound tariff lines, subject to certain conditions. The sponsors of the paper said that their minimum requirements for these ’stand-alone’ flexibilities were the figures provided for in brackets in the July Package, namely less than formula cuts on 10 percent of tariff lines, or not applying the formula to 5 percent of tariff lines.
The US and the EU, among others, have argued that developing countries should generally have to give up these flexibilities in return for a more lenient formula. Assigning developing countries a higher coefficient would allow them to retain relatively higher tariffs after making the reductions required by the formula. There was little time for discussion at the 8 November meeting, but Norway intervened to stress its belief that all of the paragraphs of the July Package were linked.
Barbados tabled an informal document on behalf of several countries suggesting that all Members whose merchandise trade accounted for less than 0.090 percent of global commerce should not be required to apply the tariff reduction formula. Instead, they should be allowed to make an average cut of 15 percent, with minimum reductions of 10 percent for each tariff line.
Johannesson said that he would convene another informal meeting on 11 November for Members to give him guidance on what to include in a text for ministers in December.
ICTSD reporting.