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10 April 2000

General Council: informal hods

Monday, 10 April, 10:30 a.m. - Director-General's Report

Thank you Mr. Chairman. Since I last reported to the General Council on 28 March I have continued consultations on the points identified at the 7/8 February Council, in co-operation with you and assisted by my deputies. We have consulted with a wide range of the membership, and I believe we are getting a picture of the possibilities for early action on the elements identified in February. We have received thoughtful and constructive inputs from many delegations, including last week from four major trading economies, and I want to thank delegations for their co-operation and the positive spirit they are continuing to show.

Let me recall my report to the General Council on 7 February. In it I identified several points which were widely seen as immediate priorities – not excluding any further action that Members may decide to take in due course on other areas of interest and concern. These points were, as you are all aware, measures in favour of least-developed countries; reinforcement of technical co-operation and its funding; transition periods and implementation issues in general; and internal transparency and effective participation of Members. I have also been encouraged to see what more we can do for non-residents and how we can better involve smaller missions whose workload is so overwhelming.

On the LDC issue in particular, I undertook to report back on progress before the Easter break. However, in the interests of transparency and of the confidence-building to which we are all committed, I would like to give you as full a report as I can today on all the points, bearing in mind that consultations are continuing – not least today - and so my report cannot be taken as definitive.

Before moving to the specific points it might be helpful to refresh our understanding of what we are working towards. These are issues which have been seen by Members as addressing urgent needs and as making a positive contribution to building confidence. This is not a mini-Round, nor a substitute for a Round. This is equally not a package, where trade-offs among elements are envisaged and where progress in one element may influence progress in others. These elements are for consideration in their own terms – I pointed out, for example, at the February Council that the measures in favour of LDCs were never to be seen as a trade-off or leverage, and many Members endorsed this point.

This means that we should not encourage artificial expectations that all of these issues will necessarily be at the same state of evolution by the time of the 3 May Council. Personally I hope we will have solid results to show in all areas by then, and I am working hard to this end. I suggest, though, that we will maximize our chances of consolidating the confidence-building work of recent months if we continue to let our ambition be guided by realism and pragmatism.

Now let me turn to the specific points on which we have been consulting.

First, measures in favour of least-developed countries. I can report that there appears to be wide agreement to improve market access opportunities. A number of major traders are prepared to provide tariff- and quota-free access consistent with domestic requirements and international agreements under their respective preferential schemes for essentially all products originating in LDC Members. Other Members, both industrialized and developing, have also indicated their willingness to enhance LDC access to their markets. I hope others will soon do so, and I encourage them to. I need fresh information and news from capitals as soon as possible. Today would be a good opportunity.

Clearly, we need now to move to widen the participation in these actions as far as possible, and to agree as necessary on the terms within which they will operate. We will also need to bear in mind the concerns raised by other developing countries about possible trade diversion. A provision for regular review of the effect of these access measures has been suggested in this context, as has a suggestion that we monitor or register progress on expanding access opportunities.

Other Members have expressed the view that the measures proposed should be seen as steps in a process, and that the membership's commitment to further action to improve LDC market access should be reaffirmed. Such a forward-looking indication would, I suggest, be especially important in view of the fact that it does not seem possible to go as far to open up access for LDC exports right now as the LDCs themselves - and others - had hoped. But we must start. We have much to gain from a dynamic, progressive, evolving attitude.

Of course many Members - including LDCs themselves - have emphasized that market access is only part of the picture. This is why it is important that the other measures we have been discussing, to help with building capacity to trade and to participate more fully in the trading system, are put into effect. The need to make the Integrated Framework deliver better results has been stressed in our consultations, and I can tell Members that improving the WTO's input to the IF is a top priority for me. I discussed the improvement of the IF a week ago with Geneva-based agencies, then with the UN Secretary-General and other UN agency heads last week, and I am going to Washington tomorrow to take it up with the heads of the World Bank and the IMF. We will be discussing new ways in which we can get assistance in training and technical assistance with these partners; I want to see us live up to the high ideals of coherence expressed so often by political leaders.

I think it would be useful for Members to consider what additional elements we might consider for the LDC package, bearing in mind the proposals submitted by the LDCs themselves in the run up to Seattle. The LDCs' own proposed action plan provides many constructive ideas.

I will now move to the second issue. Capacity-building through technical co-operation is of key importance not only to LDCs but to developing countries as a whole and to economies in transition. Here I think we are within sight of an expansion of the resources Members enable us to devote to this vital activity, within the content of an improved planning and monitoring framework. There are clearly problems with bringing the necessary funding for this activity into our regular budget, as many had hoped would be possible. However, there are indications that Members are keen to pursue as a priority the means of meeting our needs on a stable and predictable basis, taking into account the continuing importance of voluntary extra-budgetary contributions and of programmes undertaken in co-operation with other international institutions. We need to plan ahead for programmes not just projects and make more effective use of taxpayers money in a targetted, accountable cost effective manner. This I believe we will be able to do.

Thirdly, implementation and – in particular – transition periods. This is, I believe, a key area in terms of consolidating confidence across a wide spectrum of the membership. The results of our consultations so far on transition periods, together with the work that has been done in the relevant Councils and Committees, have been to narrow the scope of the outstanding problems. But there is more work to be done. The TRIMs area, for example, remains one where we still need to find acceptable ways of reconciling individual and multilateral considerations, and we will be carrying out further intensive consultations in co-operation with the Chairs of the General Council and the Goods Council. We will also need to consult further on issues raised by some Members in connection with other Agreements.

On the wider question of how to handle the broader range of implementation-related issues raised by Members, I see growing acceptance of the principle of a procedure or mechanism under the General Council. In my view this is a very positive development. What we need to work out more clearly is how it would operate, its terms of reference and time-frame, and the respective roles of the General Council and the subordinate bodies within the framework.

Furthermore, the major trading partners to whom I referred earlier have also suggested possible action on a number of technical and procedural measures relating to the implementation of the agreements on TBT, SPS, Agriculture and Services, in order to address a number of developing-country concerns.

Lastly, there is the issue of internal transparency and more effective participation of Members, on which the Chairman held an informal Council on 28 March. We have received – and continue to receive – thoughtful inputs from Members on these issues and others which they see as related. I think there is a lively and productive discussion under way. How far it will produce specific points of agreement by 3 May is not yet clear, but I know the Chairman will be continuing consultations and I think we can already take some satisfaction from the areas of common understanding that have shown up so far.

For example many delegations expressed the view that as much as possible we should do our work in full meetings such as this. That smaller meetings (and we have had many) are simply held to help facilitate understandings to take to the full membership. That's why we are having this informal meeting, to be as transparent as possible, to involve as many as possible. That's why I hope this discussion is positive, that delegations express their needs and report what they can do.

That is my report on the present state of our consultations, Mr. Chairman. In co-operation with you I will be continuing consultations to develop the various elements I have mentioned, so that we can present as soon as possible more concrete points to the General Council for its consideration. We are making useful progress in a number of areas, but there is more that we can realistically hope to achieve in others. My colleagues and I will be working hard over the next days to do so, and I would encourage delegations to intensify their discussions among themselves as well as with the Chairman and me.