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WTO NEWS: 1998 PRESS RELEASES

PRESS/90
16 February 1998
More information technology products proposed for tariff elimination

The Committee of Participants on the Expansion of Trade in Information Technology Products, on 12 February, began considering proposals for expanding the product coverage of the WTO agreement on eliminating tariffs on information technology products (Information Technology Agreement or ITA).

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Fourteen participants--Australia; Canada; the European Communities; Hong Kong, China; Israel; Japan; Malaysia; Norway; the Philippines; Singapore; Switzerland; Chinese Taipei; Turkey; and the United States--have submitted “wish lists” for hundreds of IT product categories to be covered by ITA II. These include printed circuit board manufacturing equipment; flat panel display manufacturing equipment; capacitor manufacturing equipment; audio, radio, television and video apparatus; telecommunications products; electrical/electronic machines; instruments; and parts and inputs for IT products.

Several participants, including Canada, the European Communities, Malaysia, the Philippines and the United States, reported to the Committee that they would soon start domestic consultations on the proposed products. The ITA Committee has until 30 June 1998 to decide on what new products are to be annexed to the agreement.

At the close of the meeting, the Committee elected Mr. Martin Harvey, Deputy Permanent Representative of New Zealand, as its Chairperson. The participants thanked Mr. Anwarul Hoda, WTO Deputy Director-General, for having chaired the group since the Singapore Ministerial.

Note to Editors:

The WTO Ministerial Declaration on Trade in Information Technology Products (ITA) was agreed at the close of the first WTO Ministerial Conference on 13 December 1996 in Singapore. The ITA provides for participants to eliminate customs duties and other duties and charges on information technology products (contained in the annexes) by the year 2000, on an m.f.n. basis (applied to all WTO members). The Declaration, however, provides that implementation is contingent on expanding ITA participation to cover approximately 90 per cent of world trade in IT products by 1 April 1997. The ITA participants on 26 March 1997 agreed that this criterion had been met. They also established a Committee on the Expansion of Trade in Information Technology Products, which will monitor the implementation of the ITA, discuss and approve expansion of product coverage and approve requests from other countries to participate.

The current 43 participants to the ITA account for 93 per cent of world trade in IT products. They are: Australia; Canada; Costa Rica; the Czech Republic; EC 15; El Salvador; Estonia; Hong Kong, China; Iceland; India; Israel; India; Iceland; Indonesia; Japan; Korea; Liechtenstein; Macau; Malaysia; New Zealand; Norway; the Philippines; Poland; Romania; Singapore; the Slovak Republic; Switzerland; Chinese Taipei; Thailand; Turkey; and the United States. Estonia and Chinese Taipei are in the process of acceding to the WTO.

The ITA provides for the “staging” of tariff cuts in four equal rate reductions (25% each time): 1st - 1 July 1997; 2nd - 1 January 1998; 3rd- 1 January 1999; and 4th - complete elimination of duties no later than 1 January 2000. In addition to regular customs duties, the ITA Declaration also provides for the elimination of other duties and charges (ODCs) by 1 July 1997 (except if otherwise specified in a participants schedule).

World trade in office machines and telecom equipment is significant -- $626 billion in 1996, or about 12.2 per cent of world merchandise trade. The ITA covers six main categories: computers, telecom equipment, semiconductors, semiconductor manufacturing equipment, software and scientific instruments. The ITA does not currently cover consumer electronic goods.