Trade concerns

The European Union expressed concern that Argentina’s import licensing measures covering some 600 products have restricted its exports to that country, that there were delays in issuing non-automatic import licences and that the whole system appeared to be part of an import substitution policy. The United States, Switzerland, Japan, Turkey, Peru, Canada and Colombia expressed similar concerns. Japan added that Argentina’s action was contrary to the G-20 pledge for standstill on trade restrictions. Argentina’s representative said the Committee on import licensing has been dealing with the issue and that he would convey the concerns to his capital.

Korea said that Brazil’s 30% tax on imported automobiles and requirements to use domestic components are against the WTO national treatment principle and the WTO Agreements on Subsidies and on Trade-Related Measures. Japan, EU, US, Canada, Colombia, Chinese Taipei, Australia and Hong Kong, China supported Korea’s statement. Japan added that Brazil’s action was contrary to the G-20 declaration against protectionism.  Brazil said that its rising currency had led to a substantial increase in imports of automobiles. It said that the measure in question was provisional in nature, and would expire next year. Instead of using trade remedies like anti-dumping duties, Brazil said it had chosen to establish positive incentives to encourage investment and research.

The United States reiterated its concerns that Ecuador’s new mixed tariff system (ad valorem duty plus additional charge per certain quantity) would result in exceeding its 30% tariff binding under the WTO on footwear and textile products. It said that Ecuador had not clarified the ad-valorem equivalent, nor the methodology it had used. The EU, Canada, Japan and Switzerland supported the US statement. Ecuador said it had met the transparency requirements of the WTO, and reiterated that trade flows on these products have remained at the same level or had even increased.

Argentina expressed concern about EU restrictions on its exports of honey resulting from the recent ruling of the European Court of Justice requiring authorization for sale of honey containing pollen from genetically-modified maize. It said that thousands of Argentinian beekeepers and small farmers have been affected by this ruling since the ruling indicated that pollen is now an ingredient of honey, and contradicted FAO standards. Uruguay, Canada, Mexico and the US expressed similar concerns. The EU said the Commission is discussing this matter with non-EU countries, and that an opinion on food safety of the product in question should be available soon.

The EU and Norway, in a joint statement, welcomed improvements in Ukraine’s customs valuation procedures, although they said some challenges remained. The US, Switzerland and Canada also encouraged Ukraine to continue with its reforms. Ukraine said it would continue discussions on this subject with interested members, adding that 90% of its customs valuation of goods are now based on the transaction value (declared value) required by the WTO.

 

Transitional review of China

Japan expressed concerns about China’s export restrictions on non-ferrous metals, rare earth, coal, natural sand and chemical fertilizers. The US gave an overview of concerns that it had expressed in various WTO Committees about China’s trade measures. It said China has made noteworthy progress in implementing its accession commitments but more work lies ahead.  The EU said the WTO requires not a one-off but ongoing work to meet obligations, and reiterated concerns about China’s export restrictions.

China said that it had not spared any effort to fulfil its accession commitments. It said that its average tariffs have gone down from 15.3% upon accession to 9.8% today — much lower than those of other developing countries. It had overhauled 2,300 laws related to trade. Regarding Japan’s concerns, China said the measures were taken to conserve exhaustible natural resources.

 

EU’s waiver request for Pakistan

The European Union recalled that almost a year ago it tabled its request for tariff preferences for Pakistan to help the country recover from massive flooding. It has now submitted a revised request that takes into account the systemic concerns expressed by several members, and stressed that the measure is for two years only.

The United States and Norway supported the EU request. Viet Nam said its concerns had been addressed in bilateral talks, and that it was now ready to support the EU request. Morocco said it could support the EU request but would have preferred prior consultations with the EU since the waiver request covers textiles, a capital sector of its economy. Bangladesh, Indonesia, Peru and Argentina said they were still studying the revised request, and requested more consultations with the EU. Brazil expressed reservation about the request and asked the EU for consultations on possible effects on Brazilian exports.

Pakistan said the revised EU request made clear that this waiver would not be a precedent for the future, thus it had addressed the systemic concerns of some members. The EU said it has done its best to respond to the consultations, but it was clear that some complexity remained. It would like to consult with members, and hoped for a unanimous agreement as soon as possible.

The Council took note of the statements and agreed to revert to this matter at its next meeting.

 

Preferential tariff treatment for LDCs

India and China reported new initiatives to further open their respective markets to the least-developed countries (LDCs).

India said that its scheme, open to all LDCs, would cover 94% of its tariff lines. It was deliberating on a further expansion of the product coverage of this scheme. India urged members, especially the developed countries, to implement the duty-free, quota-free decision of the Hong Kong Ministerial Conference for LDCs.

China said that preferential tariffs now cover 98% of its imports from LDCs. It added that President Hu Jintao at the G-20 Summit in Cannes pledged to expand further its programme for LDCs.

Zambia, on behalf of other LDC members, thanked India and China, and urged other members to follow suit.

The Council forwarded the notifications by India and China to the Sub-Committee on LDCs.

 

Work programme on electronic commerce

Cuba reiterated a joint proposal from itself, Ecuador, Nicaragua, Bolivia and Venezuela for more effective participation of developing countries in electronic commerce as a means to combat poverty, and hoped that this could be dealt with at the upcoming WTO Ministerial Conference.

The United States, Argentina, Australia, India, El Salvador and the Dominican Republic expressed support for a reinvigoration of the Council’s work programme on e-commerce.

The EU said that drafting sessions for the upcoming Ministerial Conference have made good progress regarding future WTO work on e-commerce.

 

Waivers

Canada, in urging approval of a two-year extension of its Caribbean Initiative (CARIBCAM) for Commonwealth countries in the region, underlined the development benefits of the programme. Barbados, Jamaica, and Trinidad and Tobago said the Canadian initiative was particularly beneficial to small and medium-sized enterprises.

The European Union requested a five-year extension of the waiver on its preferential treatment to the Western Balkans. It said that the termination of the programme would bring negative repercussions to the region, especially in the context of the current global economic situation.

The Council approved the extension of the waivers for these two programmes, and forwarded them to the General Council for adoption.

 

Regional trade agreements

The Council noted the notification of the following regional trade agreements, and forwarded them to the Committee on Regional Trade Agreements for examination:

• Free Trade Agreement between Peru and the EFTA states
• Free Trade Agreement between the EU and the Republic of Korea
• Free Trade Agreement between Guatemala and Chinese Taipei
• Free Trade Agreement between Peru and the Republic of Korea
• Free Trade Agreement between Colombia and the EFTA states
• Free Trade Agreement between India and Japan
• Free Trade Agreement between Canada and Colombia
• Free Trade Agreement between the EU and Papua New Guinea.