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IWOGDA Phase-II (Information Note) |
Information Note: CUTS-CITEE Brainstorming Meeting,
Jaipur, 28-29 June 2004
IWOGDA II & ABMA
“Improving market access for all countries is the ethos of the WTO,” said Pradeep S. Mehta, Secretary General of CUTS International, in the inaugural session of a two-day brainstorming meeting organised by CUTS Centre for International Trade, Economics & Environment (CUTS-CITEE).
The meeting assembled experts from
Africa, South and North America, Asia, and Europe to discuss interim progress
of the projects: ABMA (Achieving Better Market Access), which deals with issues
that are hindering market access opportunities of poor countries, and IWOGDA
(International Working Group on the Doha Agenda), which in its second phase,
deals with Trade Facilitation (TF) and Transparency in Government Procurement
(TGP). The first phase of IWOGDA dealt with the other two
In this regard Mehta said that TF and TGP are “in essence good governance tools, in the sense that they are going to reduce corruption, reduce transaction costs and ease commerce as such, thereby enhancing welfare. Opponents to multilateral agreements on these issues often argue that in a WTO context the kind of obligations that a country may be asked to undertake may prove to be too costly or perhaps beyond the capacity of developing countries to implement. However, a positive outcome of international pressures and discussions at the WTO, whether there are international negotiations or not, is that domestic reforms start moving in.”
The structure of the sessions foresaw an introduction by one expert followed by group discussions. The talks were thought provoking, throwing up far more questions than answers. Bernard Hoekman, Research Manager of the International Trade Group at the World Bank posed three questions while introducing the first session on TGP: “Firstly, how important is transparency in the area of government procurement? Secondly, what do we actually need for effective transparency? And thirdly, what can an international agreement do to achieve transparency?”
Hoekman suggested a possible soft law approach instead of a multilateral agreement on TGP within the WTO. Some developing country experts contemplated such a soft law approach as a potential trap towards a full-fledged agreement. Given the lack of information and narrow knowledge base, Hoekman concluded that further research in the area was needed and observed that the IWOGDA was a good initiative. In this context, technical and financial assistance is required in order to conduct possible cost benefit analyses and help to set priorities.
In his
intervention, Ron Watermeyer, President of the South African Institution of
Civil Engineering, declared that procurement is mainly a technical issue. He
presented a synthesis of five country reports written for the IWOGDA II project
(
Gale Raj from the Geneva-based South Centre mentioned that framing the topic (TGP) as a corruption issue may send the wrong message as if developing countries would not want an anti-corruption agreement. Ron Watermeyer recommended the initiation of reforms because of good governance and social objectives. Whilst all participants agreed on the importance of transparency it was repeatedly questioned why an agreement that was supposedly not about market access would have to be in the WTO. Michaela Eglin, a Geneva-based independent consultant, remarked that transparency is one of the core principles of the WTO. “You cannot say no to transparency,” said Diana Montero Melis of CUTS, “However, some developing countries’ governments see it as putting a foot in the door that will ultimately lead to market access in favour of OECD countries,” she added.
Brian Rankin
Staples, Principal of the Trade Facilitation Services in
Staples also said: “TF requires political will and that is often not there.” An argument in favour of a multilateral agreement on TF would also contend that its inclusion in the WTO would lock-in positive reforms if resource and capacity restraints are properly addressed. He remarked how before 9/11 the primary focus for customs authorities had been imports. The model had then been put on its head as the fear of terrorism and increasing trade security led countries to envisage new initiatives that focus on verifying exports whereby the “border was pushed back”. Staples quoted the Journal of Commerce and argued that the most effective way of improving trade security is to ensure that it eventually results in a positive economic impact and that the public and the private sector will benefit from the full integration f trade facilitation and trade security.
Eduardo Bianchi, Argentinean economist and the author of a country case study on TF, questioned the security agenda and wondered whether the issue would not be more of a market access problem. In this context, Michaela Eglin argued that what the WTO is doing is merely elaborating upon the GATT blueprint and that for developing countries TF has become a restricted market access issue. The point raised by some of the participants, including Staples, was that the current OECD-led initiative was possibly too premature as many developing countries were not ready yet to implement the necessary reforms.
Toni Matsudaira, Technical Officer of the WCO, argued that the WTO trade facilitation work should be consistent with the existing international instruments and work, it should not limit the scope to the customs sector, it should include appropriate capacity building incentives.
Eduardo Bianchi introduced the session of TF country experiences and said, “In the short run, TF measures may increase some transaction costs. However, in the long run lower transaction costs will lead to greater transparency and predictability which will benefit not only exporters and importers, but also governments and consumers at large.”
Navin Dahal from
the South Asia Watch on Trade, Economics and Environment mentioned the lack of
political will and the fact that different countries may have different
priorities. Bianchi and Hoekman emphasised on the importance of conducting cost
benefit analyses in order to be able to set priorities. Salvator Barayandema
from the SYDONIA Project in
Bipul
Chatterjee, Director of CUTS-CITEE, introduced the first session on ABMA by
stating the aims of the project. Samar Verma, Policy Advisor at Oxfam GB in
Among others, discussions focused on the movement of natural persons (MNP). Gale Raj identified the issues in her paper on Mode 4: Visa process issues, costs incurred, cumbersome mechanisms, requirements of developed countries, etc. According to many participants, a future research agenda should include analysis of specific tariffs on agricultural products and how are they impacting the livelihoods of the poor.
The last session focused on anti-dumping and other trade remedial measures as well as South-South cooperation. Valeria Raiteri from the Latin American Trade Network and Aradhna Aggarwal from the Indian Council for Research on International Economic Relations started the discussions by presenting the salient points of their papers. Both agreed on the fact that anti-dumping is more often harmful than beneficial and suggested the use of safeguards as an alternative. Eduardo Bianchi pointed out that developing countries often become new users of AD after having suffered AD and that AD is often used to sustain collusive agreements.
The general
consensus among the participants was that the use of AD in retaliation to
another country often harmed the country more than it benefited. Sandwip Kumar
Das from
The discussion moved on towards the ‘reinvention’ of South-South trade after UNCTAD XI. Eglin stated that the best way to promote South-South trade is the same way you promote the multilateral system, i.e. low tariffs, trade preferences etc. In this context, Hoekman mentioned that the incidence of tariff-based protection is higher among developing countries.
The meeting ended with a vote of thanks on behalf of CUTS-CITEE. The organisers hoped that the meeting had contributed to an exchange of ideas and points of view as well as to clarify how to take the two projects, IWOGDA II and ABMA, forward. A future research agenda would come out of the discussions as it was one of the objectives of the meeting. Many participants remarked that CUTS-CITEE is in an ideal position to facilitate communication among researchers and different communities concerned with trade and development. Its network had been further enhanced with this meeting, which had acted and created a platform for understanding.
The usual disclaimer applies. Every care has been taken in the drafting of this note. CUTS-CITEE is not responsible for any inadvertent errors. Readers who identify errors that should be corrected may send notice to citee@cuts.org. The Proceedings of the meeting will be circulated firstly among the participants and will be then made available for the general public.
