United Nations Conference on Trade and Development

Workshop on WTO Accession

UNDP/UNCTAD
Goods Commitments
Belarus, October 2008
Ralf Peters
Trade Negotiations and Commercial Diplomacy Branch, DITC

UNCTAD, Geneva
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WTO and GATT

Source: WTO

GATT Basic principles: Trade without

discrimination
MFN-clause (Most-Favoured-Nation): Art. I
Countries cannot (normally) discriminate between their
trading partners. E.g. give the same tariff to all trading
partners (between foreign suppliers)
National treatment: Art. III
Once goods have cleared customs, imported goods must be
treated equally to domestically-produced goods (between
domestic and foreign supplier)
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Other important GATT Provisions

Article
2: Schedule of Concessions (Bound rates: maximum ceiling level,
mentions exceptions such as anti-dumping, normally Article VI)
11: Elimination of quantitative restrictions (Export restrictions allowed for
food security)
19: Special Safeguard (emergency action on imports if quantity increased
AND causes or threatens to cause serious injury; right to prevent injury)
20: General exceptions (protect human, animal or plant life or health)
24: Free-trade Agreements (only under conditions)
28: Modification of schedules (negotiate change but pay compensation)

Outline of the
Agreement on Agriculture
Three Pillars
Market Access
Tariffication
Tariff reduction
Minimum access
Special Safeguard

Domestic Support
AMS reduction
Green Box
de minimis

Export
Subsidies
Reduction
Prohibition of
new subsidies

Special and Differential (S&D) Treatment for DCs and LDCs

Related Agreements, e.g. Marrakesh Decision
Establishment of a Committee on Agriculture
Continuation of the reform process

Tariff Schedule

Saudi Arabia

Market Access: Current Tariffs

Source: UNCTAD TRAINS and UNCTAD calculations based on WTO CTS

Specific Problems:
Tariff escalation
Tariff peaks
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MARKET ACCESS COMMITMENTS

Agriculture
Entry Average Staging
Date Bound (%) (years) TRQ SSG

Entry Average Staging

Date Bound (%) (years) TRQ SSG

Ecuador

01/96

25.8

YES YES Moldova

07/01

12.4

Bulgaria

12/96

34.9

56

YES YES China

12/01

15.7

YES

Mongolia

01/97

18.4

C. Taipei

01/02

13.1

YES YES

Panam a

09/97

26.1

14

YES YES Arm enia

02/03

14.8

Kyrgyzstan 12/98

11.7

Macedonia 04/03

15

YES

Latvia

02/99

33.6

YES

Nepal

04/04

41.4

Estonia

11/99

17.7

Cam bodia

10/04

28.1

Jordan

04/00

25

10

Saudi Arabia12/05

12.1

Georgia

06/00

12.1

Viet Nam

01/07

20.9

YES

Albania

09/00

10.6

Tonga

07/07

19.2

Croatia

11/00

10.4

YES

Ukraine

05/08

10.6

YES

Om an

11/00

30.5

Cape Verde 07/08

19.3

Lithuania

05/01

15.6

YES

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CHINA

CHINESE TAIPEI Saudi Arabia

Dec 2001

Jan 2002

Dec 2005

16 %

13 %

12 %

65 % (cereal)

500 % (deer velvet)

340 % (chicken offal)

200 % (tobacco)
Specific tariffs

0 25 %

0 25 %

5 - 15 %

Tariffs
Average
Max
Mostly in
TRQs

Wheat, corn, rice,

soybean oil, palm oil,
rapeseed oil, sugar,
wool, cotton
e.g Rice
In-quota:
MFN:
Quantity:
Staging:

Pork, chicken, milk,

peanuts, red bean,
garlic, sugar, fresh
fruits, sugar, dried
mashroom

Sugar
1%
In-quota:
65 %
MFN:
9,636,000 mt Quantity:
4 years
Staging:

None

12.5 %
143 %
205,000 mt
4 years

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SSG

CHINA
None

CHINESE TAIPEI
77 tariff lines

Saudi Arabia
None

Pork, poultry,
milk,
garlic, red beans,
fresh fruits (pears,
persimmons),
peanuts,
sugar
Special
treatment

Rice:
None

import prohibition
Quantity:
205,000 mt

Some alcohol,
pork:
import prohibited

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Domestic Support
In WTO terminology, domestic support is classified by
boxes according to their effect on production and
trade
Amber box: trade distorting support, to be reduced
Blue box: production limiting support
Green box: not or minimal distorting support

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To be reduced & bound

Amber Box

Green Box

Product specific support

Market price support
Payment on output
Input Amber
subsidiesBox
Investment subsidies

Non-product specific support

De minimis Development

Domestic
Support

Blue Box

Research
Training
Extension
Infrastructure
Pest & disease control
Public stockholding
Domestic food aid
Decoupled income
support
Support to structural
adjustment
etc.

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Domestic Support COMMITMENTS

AMS

Staging
(years)

de
m inim is

Exp.
Sub.

Ecuador

10

Bulgaria

79% cut

Mongolia

10

Panam a

10

Kyrgyzstan

Macedonia

Latvia

5 (8 until 2003)

Estonia

Jordan

13% cut

Georgia

Albania
Croatia
Om an
Lithuania

AMS

Staging
(years)

de
m inim is

Exp.
Sub.

20% cut

8.5

20% cut

10

5 (10 until 2008)

20% cut

Nepal

10

Cam bodia

10

10

Saudi Arabia 13% cut

10

10

10

Viet Nam

Yes, no cut

10

10

Tonga

10

20% cut

Ukraine

Yes, no cut

10

Cape Verde

10

15% cut

Moldova

Yes China
0

C. Taipei

Yes Arm enia

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FOR AGRICULTURAL NEGOTIATIONS

Tariffs

Bind & evtl. reduce

Non-tariff barriers

Eliminate

Tariff rate quotas

Safeguard

(Amber)

Bind & Reduce

(Blue)

(Green)

Provide information

Export subsidies

Bind & eliminate or reduce

State trading enterprises

Article XVII of the GATT

Taxation regime

Article III of the GATT

Product quality standard

Agreements on SPS,
15 TBT

Agri policies
Farm subsidies

Other trade policies

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Negotiating Process
Multilateral Track

Working Party (WP)

meetings
(negotiations on rules)
1.

Memorandum of Trade Regime

2. Questions & replies

3. Working Party Report

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Doha: Negotiating Mandate

Single undertaking

Impl. Issues and SDT review

Agriculture
Services Market access (reduction of trade barriers)
NAMA
Rules (AD, SCM & RTAs)
AD = Anti Dumping
SCM = Subsidies Countervailing Measures
TRIPS
RTA = Regional Trade agreements
TRIPS = Trade Related Interlectual Property
Trade and Environment

Singapore issues

DSU = Dispute Settlement Understanding

Trade Facilitation (part of single undertaking)

Non single undertaking

DSU Review

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Market Access: Agriculture

Formula:
line-by-line
increasing cuts
Level of ambition, S&D?
Exporter importer
Deved deving
Preferences

Initial tariffs:
Bound rates

Start

Flexibilities:
Exempt some
lines, SP & SeP
Special Products (SP)
Products essential to achieve food security,
livelihood security and rural development
Sensitive Products (SeP):
Selected number of tariff lines will receive
flexibility in tariff cuts (but access is improved)

Result:
Meaningful better access?
Protect vulnerable farmers
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Draft Modalities Text July 2008:

Recently acceded members
Market Access
Moderate cuts under the tiered formula by 8 ad valorem
percentage points in each band
Exempt their final bound tariffs at or below 10 per cent
VRAMS and SLI_RAM_EIT completely exempted from cuts
Overlapping commitments? Start of implementation for such
tariff lines one year after the end of implementation of accession
commitment
Implementation period for RAMs prolonged by up to two years
after the end of the developing countries implementation period
VRAMs: Very recently acceded members (Saudi Arabia, Macedonia, Vietnam, Tonga, Ukraine);
19
SLI_RAM_EIT: Small low income RAMs with economies in transition

Draft Modalities Text July 2008:

Recently acceded members
Domestic Support
OTDS and AMS cuts: VRAMs and SLI_RAM_EIT
exempted; other RAMs 2/3 of cuts
De minimis: VRAMS and SLI_RAM_EIT exempted;
other RAMs with 5% de minimis 1/3 of cuts + five years
longer implementation period
For RAMs, the maximum permitted value of support
shall be 5 per cent of the average total value of
agricultural production in the 1995-2000 period
VRAMs: Very recently acceded members (Saudi Arabia, Macedonia, Vietnam, Tonga, Ukraine);
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SLI_RAM_EIT: Small low income RAMs with economies in transition

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Offensive interests
Merchandise Trade:
Important factors for Acceding Countries

Development strategy
Advantages of being a WTO member, e.g.
- market access (tariffs, NTBs)
- attracting investments
- dispute settlement
- rule-making
- national lobby groups
- domestic reforms,
Low tariffs: good for consumers and imported inputs
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Challenges in addition
to advantages of WTO

Defensive Interests
Merchandise Trade:
Important factors for Acceding Countries

Protect some sensitive industries (infant industries)

Maintain tariff revenue
Recognition for unilateral liberalisation

Defensive
Interests

=> Starting negotiations from applied rates (no rule)

Formula does not apply BUT
Members take impact on their tariffs into account
Sectorials: Acceding C. may be asked to participate
New rules will apply

Link

Doha
Round

New commitments reduce gap

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Importance of Agricultural Sector

Value added of agricultural sector in developing countries:
9 per cent
Employment:
38 per cent
Rural population
even higher
f
o
t
en
c
r
pe rade
0
1 ld t
r
wo

European Union:
bound and applied tariff rates
Olive oil, refined
Sugar, raw

Tea

Note: New AVEs (Paris), Five products with tariffs above 500% not plotted.

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Developing countries:
bound and applied tariff rates
Kenya bound and applied tariffs

Bound at ceiling level

Tariffs in per cent

120
100
80

bound

60

applied

Lower applied rates

40
20
0
0

200

400

600

800

Number of tariff lines

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Related WTO Agreements

All WTO agreements and understandings on trade in goods
apply to agriculture (e.g. customs valuation, emergency
safeguard measures)
Where there is a conflict: AoA prevails
Agreement on Agriculture
Marrakesh Decision
for LDC and NFIDC
Sanitary and
Phytosanitary Measures (SPS)

Trade Related Aspects of

Intellectual Property
Rights (TRIPs)

Technical
Barriers to Trade (TBT)
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MARKET ACCESS COMMITMENTS

non-agriculture
Entry Average Max ad Average
Date Bound (%) valorem Applied

Ecuador

01/96

21.1

40

Bulgaria

12/96

23.6

40

Mongolia

01/97

17.3

30

Panam a

09/97

22.9

81

Kyrgyzstan 12/98

6.7

20

Latvia

02/99

9.4

Estonia

11/99

Jordan

Entry Average Max ad Average

Date Bound (%) valorem Applied
Moldova

07/01

20

4.1

China

12/01

9.1

50

9.6

C. Taipei

01/02

4.8

90

Arm enia

02/03

7.5

15

2.3

4.8

Macedonia 04/03

6.2

25.5

8.7

55

2.2

Nepal

04/04

23.7

60

13.7

7.3

30

0.1

Cam bodia 10/04

17.7

42.5

15.9

04/00

15.2

30

12.2

Saudi Arabia12/05

10.5

20

Georgia

06/00

6.5

20

6.9

Viet Nam

01/07

12.4

100

15.7

Albania

09/00

6.6

20

5.6

Tonga

07/07

17.4

20

Croatia

11/00

5.5

25

Ukraine

05/08

4.8

25

Om an

11/00

11.6

20

7.2

Cape Verde 07/08

15.3

55

Lithuania

05/01

8.4

30

2.4

8.8

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