WTO Ministerial Section • Volume 9 • Number 12 • 13th April 2005

Seven Asian Countries Agree to Push Forward on NAMA

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Ministers and senior trade officials from seven Asian WTO Members have decided to try to reach a preliminary agreement on trade liberalisation in industrial goods by July, following an informal meeting on 10 April in Chiba, Japan. Notably, they appeared to agree with Japanese suggestions for tariff reduction that have proven controversial in ongoing talks at the WTO. Participants also pledged co-operation in the run-up to the WTO’s December Ministerial Conference in Hong Kong.

Representatives from China, Hong Kong, Indonesia, Japan, the Philippines, Singapore, and Thailand agreed to aim for consensus on the contours of a formula for cutting tariffs, along with some specific numerical targets for coefficients associated with tariff reduction. The July target corresponds to WTO Members’ timeline for agreeing on ‘first approximations’ of an eventual package to be adopted at Hong Kong (see BRIDGES Weekly, 16 February 2005).

Japanese Trade Minister Shoichi Nakagawa told local news wires that the attendees had supported a personal paper he had put forward, in which he called for "higher rates of reduction" to higher tariffs. He also said that they had agreed that setting maximum limits for duties on some goods for which tariffs have remained ‘unbound’ thus far was "essential," and that the tariff-reduction formula would apply to such tariffs as well. Nakagawa’s paper further specified that the July approximations should include a "clear indication of the flexibility elements that would be available to development needs."

WTO talks on market access for industrial goods are currently deadlocked over the shape of the tariff reduction formula. During the last meeting of the WTO Negotiating Group on Non-Agricultural Market Access (NAMA), developing countries including Brazil and India had criticised US and EU proposals for sharp cuts to higher tariffs, arguing that they would place a disproportionate burden on developing countries (see BRIDGES Weekly, 23 March 2005).

Nakagawa has promised to meet informally with other WTO Member governments to try to find a way out of the stalemate. WTO NAMA Chair Ambassador Stefan Johannesson of Iceland also attended the meeting, and agreed with Nakagawa that ministerial-level meetings among WTO Members would help push the overall negotiations forward.

Chinese officials took part in the Chiba gathering in spite of a diplomatic spat among Japan, China, and Korea over recent changes to a Japanese history textbook. Calling for a boycott of Japanese goods on 9 April, anti-Japanese demonstrators in several places in China attacked Japanese consular buildings and companies, accusing Tokyo of glossing over its actions during its invasion of their countries during and before the Second World War. In contrast, Bloomberg reports that South Korean Trade Minister Kim Hyun-Chong, cancelled his plans to attend the meeting only days before it was due to take place.

According to the Japanese trade ministry, non-agricultural products account for over 90 percent of global trade. The next meeting of the WTO Negotiating Group on NAMA is scheduled for the last week of April.

ICTSD reporting; "Report: Progress Made on WTO Trade Deal," ASSOCIATED PRESS, 11 April 2005; "Asian economies to aim for preliminary nonfarm WTO accord by July," KYODO NEWS, 10 April 2005; "Tokyo bid to break tariff deadlock," FINANCIAL TIMES, 11 April 2005; "Japan calls for apology from Beijing over riots," FINANCIAL TIMES, 11 April 2005; "S. Korean Trade Minister Cancels Trip to Japan Talks," BLOOMBERG NEWS, 7 April 2005.