WTO: 2014 NEWS ITEMS

INFORMATION TECHNOLOGY AGREEMENT


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The original Information Technology Agreement (ITA) was struck in 1996 and has contributed to the massive increase in trade in information technology products. The China-US breakthrough reached at the APEC leaders' summit is an important step towards a definitive deal covering a larger range of products. Negotiations must now be finalised by all WTO members participating in the ITA.

The Director-General said:

“I strongly welcome the announcement of this breakthrough, which represents a significant step forward in the negotiations on an expansion of the ITA. I hope it will create renewed momentum, enabling negotiations to be concluded as quickly as possible. Agreement on expanding the ITA would be the first successful tariff-cutting negotiation in the WTO for over a decade and a half and, crucially, would benefit all WTO members, not just the ITA participants, because the tariff cuts would be applied in a non-discriminatory manner.

“An expanded ITA would be great news for the WTO and the multilateral trading system. It would show that it is possible to deliver negotiated outcomes in the WTO that benefit everyone.”

The existing ITA covers a large number of high technology products, including computers, telecommunication equipment, semiconductors, software, scientific instruments, as well as most of the parts and accessories of these products.

The ITA currently has 52 participants, representing 80 WTO members (the 28 EU members are counted as one ITA participant), which account for approximately 97 per cent of world trade in IT products. The total amount of import duties eliminated under the ITA were estimated at US$1.6 trillion in 2013.

In the light of new technological developments, efforts have been underway since 2012 to extend the Agreement to cover approximately 200 additional products, including many new generation communication, data and medical devices. Members currently engaged in these negotiations account for approximately 90 per cent of world trade in the products being proposed for inclusion in the product expansion negotiations.

Exact figures on the impact of the ITA expansion are not available as negotiations are not yet finalized. Still some estimates envisage a liberalization package that could range from US$0.8 trillion to US$1.4 trillion of annual trade. This is bigger than the current trade in automotive products and three times bigger than trade in the clothing sector.

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