WTO: 2016 NEWS ITEMS

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Members called for a fourth consultation with Ecuador to take place in June when the country is due to have finished dismantling the import surcharge. Faced with a “highly unfavourable economic climate”, Ecuador has been implementing the surcharge since 11 March 2015 to safeguard its balance of payments. The surcharge, which covers about 30 per cent of imports, comprises:

  • 5 per cent on “non-essential capital and primary capital goods”
  • 15 per cent on imports of “medium need”
  • 25 per cent on ceramics, tyres, motorbikes and TVs
  • 45 per cent on final consumer goods.

In line with the plan it presented at the October 2015 meeting to phase out the import surcharge by June 2016, Ecuador announced that it has reduced the highest surcharge rate on imports by 5 percentage points, from 45 per cent to 40 per cent since 31 January. Ecuador reiterated that it will phase out the 5 per cent surcharge by April, and reduce monthly by a third the remaining surcharge rates before phasing them out by end June.

Ecuador notified the measure to the WTO in April 2015.

Several members expressed sympathy with Ecuador’s balance-of-payments difficulties and welcomed Ecuador’s information sharing.

Several other members welcomed Ecuador’s efforts to comply with its phase-out plan but they called on Ecuador to accelerate the dismantling and to resort to less trade distorting measures. They reiterated concerns about whether the measure could be economically justified and whether it is in line with WTO rules. They also expressed concerns about the negative impact the measure has on exports from other WTO members, including agricultural products, bovine and ovine products, and products from the textile, iron and steel industry.

Read the concerns members expressed in previous consultations here.

To justify the need for the measure, Ecuador provided additional clarifications on its economic and balance-of-payments situation and prospects, and outlined the results of the third evaluation of the impact of the measure.

 

Next steps

Following requests by WTO members, the Committee on Balance-of-Payments Restrictions is scheduled to resume its consultations with Ecuador in June following a fourth evaluation by Ecuador of how the measure is helping to improve its balance-of-payments situation.

 

Ukraine

Also at this meeting, Ukraine announced it has entirely dismantled its import surcharge, which has been imposed on imports since 25 February 2015. This is in keeping with the timeline that Ukraine presented to WTO members in 2015.

Consultations between Ukraine and WTO members took place at three meetings of the Committee in 2015 to determine whether Ukraine’s measure was in conformity with WTO rules.

On 19 June 2015, members had adopted a report on the consultations reflecting their inability to reach consensus. One member did not consider Ukraine’s measure to be compatible with WTO rules.

Read the reports on the consultations regarding Ukraine’s measure here:

Members adopt report on Ukraine’s import surcharge imposed for balance-of-payments reasons  

Consultations on Ukraine’s import surcharge conclude without consensus

Members consult with Ukraine on its import surcharge imposed on balance-of-payments grounds

 

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