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release:
Reforms have contributed to first signs of economic recovery
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The meeting has allowed Members to come to a far better understanding
of Burundi's trade and economic policies and of the very real
challenges it faces. In this we have been very much assisted by the
Burundi delegation, led by Minister Charles Karikurubu. I would like
to thank Minister Karikurubu for the open and very committed approach
to this TPR. As a result, we have come to a better appreciation of
the reform agenda facing Burundi and I think we all appreciate the
willingness of the Burundi Government to pursue such reforms,
notwithstanding the enormous difficulties arising out of the prolonged
crisis that has confronted Burundi. This had been evidenced by recent
steps taken to improve macroeconomic management and liberalize trade.
Members welcomed the reactivation of Burundi's inter-ministerial
coordination committee on the WTO as a way of enhancing its
participation in the organization.
Members noted the extreme dependence of Burundi on exports of coffee,
and, to a lesser degree, tea. A number of policy-related factors have
hindered export diversification, and Burundi's ability to derive
development benefits from its participation in international trade.
High protection for “traditional” sectors has discouraged investment
in non-traditional agricultural exports, while the mixed nature of
tariff escalation has not encouraged investment in certain processing
activities. Extensive state intervention crowds out private sector
activity. The high cost of certain services, an underdeveloped
financial sector, and high transport costs related to Burundi's
landlocked situation have also contributed to supply-side
bottlenecks.
Members stressed that improvements to Burundi's business environment
could be made through reforms to the investment code aiming at
eliminating its bias toward import substitution, and establishing
simple and transparent procedures. Further tariff reductions would
reduce current reliance on a myriad overlapping incentive schemes;
fewer exemptions could in turn mitigate the fiscal impact of tariff
reforms. Members also emphasized the importance of proceeding with
the privatization programme, and, in parallel to this, of developing
adequate regulatory frameworks and competition policy. They
recognized that reforms needed to be accompanied by the provision of
adequate technical assistance, including in capacity building.
Members said that the Integrated Framework, in which Burundi
participates, could help to meet priority technical assistance needs,
and integrate trade reforms into its overall strategy for poverty
reduction.
Members noted Burundi's participation in COMESA, and the efforts
undertaken to fully integrate into the COMESA customs union by 2005.
They also noted the gains that could potentially accrue to Burundi
from improvements in market access that would arise from a completion
of negotiations under the Doha Development Agenda, while acknowledging
that Burundi would need specific assistance to help it meet sanitary,
phytosanitary, and technical requirements in export markets. They
stressed that the stability and predictability of Burundi's trade
regime could be enhanced by increasing the scope of bindings on
non-agricultural products, lowering ceiling bindings on agricultural
products, transposing pre-Uruguay Round tariff concessions into the HS
nomenclature, and undertaking a greater level of commitments under the
GATS. They also urged Burundi to adopt WTO-consistent customs
valuation procedures as part of the wider process of customs reforms,
and to respect the principle of national treatment in the application
of certain domestic taxes.
Some clarification was sought regarding procurement procedures and
domestic preferential margins under the existing regime. On
intellectual property rights, Members sought further information on
existing legislation. Clarification was also sought on the following
issues:
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measures taken to promote sustainable development;
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trade facilitation, pre-shipment inspection;
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import licensing procedures;
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incentives for production and exports, including export processing
zones;
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contingency trade remedies;
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technical assistance needs, “mainstreaming” trade into the Poverty
Reduction Strategy Paper; and
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the regulatory framework for telecommunications.
Members appreciated the responses provided by the Burundi delegation,
and looked forward to further replies.
I believe that this meeting of the TPRB has allowed an in-depth
reflection on how it may be possible to develop a blueprint for policy
action that would place Burundi on a higher growth path. It has drawn
attention both to Burundi's determination to pursue its reform agenda
and to areas in which policy reforms could enhance transparency and
predictability in Burundi's trade regime, and contribute to its
further integration into the multilateral trading system. I trust
that the main considerations of this meeting will be incorporated into
the Integrated Framework process in order to strengthen the linkages
between trade and poverty reduction. I urge all Members to support
Burundi in its efforts to take up its challenges, and to pay
particular attention to its request for technical assistance.
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