Bali Package WTO Ninth Ministerial

Conference

Bali, 3-7 December 2013

Ravi BhattaraiUnder Secretary

WTO Commitment Implementation SectionMinistry of Commerce and Supplies

. The WTO Ministerial Conferences

• Ministerial Conference(MC) is the Apex Body of the WTO under the governance structure set up by the “Marrakesh Agreement establishing the WTO”,.

• Ministers from all the member states meets at least once every two years.

• The Ministerial Conference can take decisions on all matters under any of the multilateral trade agreements.

The Ministerial Conferences of WTO

The Conference Date Venue

1st Ministerial Conference 9-13 December 1996 Singapore

2nd Ministerial Conference 18-20 May 1998 Geneva

3rd Ministerial Conference 30 November – 3 December 1999

Seattle

4th Ministerial Conference 9-13 November 2001 Doha

5th Ministerial Conference 10-14 September 2003 Cancun

6th Ministerial Conference 13-18 December 2005 Hong Kong

7th Ministerial Conference 30 November –2 December 2009

Geneva

8th Ministerial Conference 15-17 December 2011 Geneva

9th Ministerial Conference 3-7 December 2013 Bali, Indonesia

3

The Ninth WTO Ministerial Conference: An Overview

• Held in Bali, Indonesia from 3-7 December, 2013• 159 member countries and 23 observers participated the

meeting along with representatives of different intergovernmental organizations and accredited NGOs, media among others.

• Chaired by Mr. Gita Wirjawan, Trade Minister of Indonesia.• Was viewed with much expectation by all WTO members for

delivery in Bali in some low hanging fruits of DDA.• Was a negotiating Ministerial conference of WTO where the

delegates of all member countries engaged in negotiation process throughout the event.

• Accession of The Republic of Yemen as a New Member of WTO

Nepal’s Participation

• A high level delegation participated in the Conference

• Two roles– National delegation– LDC Coordinator

Nepal played a very effective role as leader of LDCs’ Group in WTO

Nepal came into lime light in the WTO

MC9: The Declaration • The Declaration consists of three different parts.

Part I. Regular Work under The General CouncilPart II. Doha Development Agenda andPart III. Post Bali Work

• With adoption of the declaration members:- Welcomed the decision concerning the extension of the

transition period under article 66.1 for LDCs and the decision on the accession of LDCs.

- Welcomed Yemen as a new member.- Reaffirmed principles and objectives set out in the Marrakesh

Agreement establishing the WTO, recalled Doha and other ministerial declaration reaffirm their commitment to give effect to them.

MC 9: The Decisions

Part I – Regular Work Under the General Council1.Decision on TRIPS Non-Violation and Situation

Complaints2.Decision on Work Programme on Electronic

Commerce3.Decision on Work Programme on Small

Economies4.Decision on Aid for Trade5.Decision on Trade and Transfer of Technology

MC9: The DecisionsConti.…

Part II- Doha Development Agenda1. Agreement on Trade Facilitation2. Agriculture

• General Services• Public stockholding for Food Security Purposes• Tariff rate Quota Administration• Export Competition

3. Cotton 4. Development and LDC Issues

• Preferential Rules of Origin• Operationalization of LDCs Service Waiver• Duty Free Quota Free Market Access• Monitoring Mechanism on Special and Differential Treatment

MC9: The DecisionsConti.…

Part III-Post Bali Work– Reaffirmed commitment to DDA and regular

work of the WTO– Instruct the Trade Negotiations Committee to

prepare within the next 12 months a clearly defined work programme on the remaining DDA Issues.

– Committed to further contacts amongst Members and DG to move forward

MC9 Decisions:Agreement on Trade Facilitation(T.F.)

• T.F. is a concept directed towards reducing the complexity and cost of the trade transaction process.

• Main objective of trade facilitation is: make trade easier, faster and cheaper, byspeeding up customs procedures; providing clarity, efficiency and transparency; reducing bureaucracy and corruption, and Using advance technologies.

T.F. : Mandate

1.Clarify and improve relevant aspects of Articles of GATT 1994:

Article V – Freedom of TransitArticle VIII – Fees and Formalities connected

with Importation and ExportationArticle X - Publication and Administration of

Trade Regulations

2.To ensure adequate technical assistance and support for capacity building in this area for developing countries and least developed countries.

T. F.: Agreement/Composition

1. T.F. Agreement consists two sections: – Section I: consists main provisions– Section II: consists the provision of Special and

Differential Treatment for developing countries and LDCs;

– Three Categories of Provisions: A,B and C

2. Section I has 13 Articles which consist 49 provisions; 3. Section II guides how developing and least-

developed countries implement this Agreement;4. Developed Country Members should implement this

Agreement upon entry into force where as developing and least-developed country Members have been provided specific transition period.

T.F.: S&DT Provisions for LDCs• LDCs will only be required to undertake commitments

to the extent consistent with their individual development, financial and trade needs or their administrative and institutional capabilities.

• LDCs can implement Category A provisions within one year after entry into force of the Agreement where as the other Members should implement upon entry into force of the Agreement;

• LDCs and developing countries require the acquisition of implementation capacity through the provision of assistance and support for capacity building to implement Category C provisions.

T.F.: Timeline for LDCs• Notification and implementation of Category

A: up to one year after entry into force of this Agreement;

• Notification of Category B and their indicative date of implementation: up to one year after entry into force of the Agreement;

• Confirmation of indicative date within two years of Category B Notification, if couldn’t – request for extension;

T.F.: Timeline for LDCs• one year after entry into force of the Agreement:

Notification of Category C;• One year after Notification of Category C: notify

the information of required assistance and support

• Within two years of notification of required assistance: enter into arrangements for assistance and notify the indicative date of implementation of the concerned provision;

• Within 18 Months of assistance arrangement, report of the progress and list of definitive date of implementation;

T. F.: Timeline for LDCs• If problems faced in submitting definitive

dates, notify to the Committee – committee extends the date and address the problems;

• If definitive date notify but problem faced in implementation, Early Warning Mechanism can be used;

• 18 Months for developing countries and Three Years for LDCs are the automatic extensions as Early Warning Mechanism;

• LDCs and developing country members may shift provisions between category B and C

T.F.: Grace Period for the Application of DSU for LDCs

• For a period of 6 years after entry into force of this Agreement, DSU shall not be applied for LDCs in Category A provisions;

• For a period of 8 years after implementation of a provision under Category B and C by an LDC Member, DSU shall not be applied;

• Members shall exercise due restraint in raising matters under the DSU involving least developed country Members.

Decision on Agriculture

• On Agriculture, The WTO ninth Ministerial took four major decisions as following:1. General Services 2. Public Stockholding for Food Security

Purpose 3. Understanding on Tariff Rate Quota

Administration Provisions of Agricultural Products, as Defined in Article 2 of the Agreement on Agriculture

4. Export Competition

General Services

• The scope of General Services of Annex 2 ( Green Box Measures) of Agreement on agriculture widened to programmes aimed to contribute rural development, Food Security and Poverty alleviation, particularly in developing countries

• The provisions covered under general services were as listed below:– Research;– Pest and Disease Control;– Training services;– Extension and advisory services;– Inspection services;– Marketing and promotion services;– Infrastructural Services

DoA: General Services Conti…

• The following are decided to be added in the non exhaustive list of general services in Bali Ministerial:– Land Rehabilitation;– Soil Conservation and resource management;– Drought management and flood control;– Rural employment programmes;– Issuance of property titles; and – Farmer settlement programme.

• The decision provides new avenues for members to provide non trade distortive subsidies in Agriculture sectors.

Public Stockholding for Food Security Purposes

• An Interim Mechanism on public stockholding for food security purposes.

• The mechanism will be continued until a permanent mechanism is adopted which is supposed to be adopted by 11th ministerial.

• With this decision, Developing country members are allowed to provide support for public stockholding programmes for food security purposes.

• The support is limited to traditional staple food crops.• These supports are refrained to be challenged from

the WTO Dispute Settlement Mechanism until permanent solution.

P.S. for Food Security Purpose Conti…

This decision consists of some other related provisions which includes • Notification and transparency: Developing members benefiting

from this decisions must notify to the Committee on Agriculture about the details of their public stockholding programme.

• Anti-circumvention/Safeguards: Benefiting member should ensure that stock procured under such programmes do not distort trade or adversely affect the food security of other Members.

• Consultation: the benefiting member shall upon request hold consultation with other member if it is exceeding or is at risk to exceeding its Aggregate Measurement of Support Limit.

• Monitoring : The Committee on Agriculture shall monitor the information submitted under this decision.

• A Work programme is established to find a permanent solution.

Tariff Rate Quota Administration

Understanding on Tariff Rate Quota Administration Provisions of Agricultural Products, as Defined in Article 2 of the Agreement on Agriculture

• It contains a number of provisions on procedural and transparency aspects.

• Related to tariff quota administration of scheduled tariff quotas under AOA.

• The agreement on Import Licensing shall apply to the Agreement on Agriculture with some additional flexibilities.

• Committed governments to addressing issues of quota under-fill through simplification of procedures, including exploring whether economic operators that are unable to utilize quota allocations “would be prepared to make them available to other potential users”

Export Competition

• Reaffirm the commitment to the parallel elimination of all forms of export subsidies and disciplines on all export measures with equivalent effects and regret for not being able to achieve this objective in 2013 as envisaged in Doha Declaration.

• Key priority on the agriculture negotiation because of its highly trade distortive effects.

• Revised draft modalities for agriculture (TN/AG/W/4/Rev.4) remains an important basis for negotiation in export competition.

• It remains a priority issue for the post Bali Work Programme.• Member committed to enhance transparency and to improve

monitoring as well as agreed to held dedicated discussion on an annual basis in the Committee on Agriculture to examine development in the field.

• The 10th Ministerial Conference will review the situation regarding export competition.

Cotton

• Reaffirming the previous decisions adopted in this issue, member agreed to hold a dedicated discussion on a biennial basis to examine trade related developments across the three pillars of Market access, domestic support and export competition in relation to cotton.

• The basis for discussion will be notification made by members to the WTO.

• Reaffirmed the need of development assistance in the cotton sector in the LDCs.

Decisions on LDCs Issues:Preferential Rules of Origin for LDCs

• Considered that DFQF Market Access for LDCs can be effectively utilized if accompanied by simple and transparent rules of origin.

Main features of the RoO Guidelines:• Categories of Products- wholly obtained Products and

Substantial or Sufficient Transformation• Advalorem Percentage Criteria, Change of Tariff

Classification and Specific Mfg. or Processing Operation• Calculation of Costs- exclusion/inclusion- in favor of LDCs• Documentary Requirements - self certification & Mutual

Customs Cooperation & Monitoring• Transparency- Notification, annual review by CRoO and

report to GC• Secretariat provide review report to sub committee on

LDCs

Operationalization of the Waiver Concerning Preferential Treatment to Services and Service

Suppliers of LDCs • Members are encouraged to extend preferences to

LDCs’ services and service suppliers. These preferences may accord improved market access, including through elimination of economic need tests and other quantitative limitations.

• Member may accord preferences similar to those arising from preferential trade agreements to which it is a party noting that preferential treatment.

• With respect to the application of measures other than those described in Article XVI of GATS, may be granted subject to approval by the Council for Trade in Services under paragraph 1 of the waiver Decision.

Operationalization of the Services WaiverConti....

• Members underline the need for enhanced technical assistance and capacity building to help LDCs benefit and aimed at strengthening the domestic and export services capacity of LDCs,

• Optimal use of existing aid-for-trade channels (EIF:TA and CB work of relevant international institutions.)

• Council for T.I.S. High level meeting - 6 month after LDCs' collective request identifying sectors and Modes of supply

• LDCs are invited to include their services related needs in their respective national development strategies and in their dialogues with development partners.

Duty Free Quota Free Market Access For LDCs

• A decision encouraging WTO members to go an extra mile in providing a access to markets free of duties and quotas for LDCs.

• Developed country member, not providing 97% DFQF market access shall seek to improve their existing DFQF coverage for products originating from LDCs.

• Developing country members shall seek to provide increasingly greater market access prior to next ministerial conference.

• Member shall notify DFQF MA schemes for transparency.• Annual review of DFQF schemes by Committee on Trade and

Development and report to the G.C. and The G.C. instructed to report to the next MC.

Monitoring Mechanism on

Special and Differential Treatment • Members decide on establishing a new tool in the WTO to review

the functioning of the flexibilities available to developing countries including LDCs and contribution to their integration into the Multilateral Trading System.The scope, functions/terms of reference and operation of Monitoring Mechanism are as following:Scope: All S&DT provisions contained in WTO Agreements, Ministerial

and General Council decisions.Function and TOR of The Mechanism:- Focal point to analyze and review the implementation of S&DT

provisions and will compliment other related existing mechanisms.– Can make recommendations to the related WTO bodies for

consideration of actions to improve the implementation of S&DT.– The Mechanism will operate in Dedicated Sessions of CTD.– The Mechanism meet twice a year and additional as required.– The Mechanism shall be reviewed 3 years after its first formal meeting

and thereafter when necessary.

WTO MC9 : Outcomes

• WTO still Relevant in Global Trade• Global Trade Regime Strengthened• Revitalizing DDA and Its Remaining Issues• Development and LDCs Issues became The

Core Issue in WTO Trade Regime• LDCs can get benefits from AfT/EIF and S&DT

Provisions• Decisions can be meaningful Only After

Implementation- Post Bali Work Programme

WTO MC9 : Way Forward

1.Preparation for Post Bali Work Programme within 12 months including AfT/EIF

2. Identify & Prioritize the Trade Sector Needs

3.Need to Strengthen Domestic Service Capacity

4. Identify the Services Supply Capacity

5.Submission of Services Sectors and Modes of Supply

6.Preparation for High Level Meeting of CTIS

7.T.F. Institutional arrangements- existing/new

WTO MC9 : Way ForwardConti….

8.Preparation for implementation of S&DT Provisions on T.F. Sec.II

9. Need Identification-

- Institutional/Infrastructure development/C.B.

- Personnel Development/Trainings/C.B.

- Technology adoption/application

10. Cooperation/Coordination with Stakeholders - Regular Meetings(Gov.,Pvt. & Donors)

Possible Implications for Nepal

1. DFQF Market Access, Preferential RoO and LDCs Services Waiver Can help our Exports(Goods/Services) by easing procedures/formalities & simplifying documents plus Transition Benefit.

2. Trade Facilitation – Category C and Assistance for Simplification and Capacity Building, Transitional period for LDCs to implement/comply the provisions .

3. S&DT Provisions for LDCs – Nepal can be benefited

4. Freedom of Transit –Recognized/Clarified :

- Need to Enhance Support & Assistance and

Capacity Building for LDCs

5. . Aid for Trade and Transfer of Technology:

- Nepal can get more assistance from AfT/EIF & Others

Possible Implications for NepalConti....

6. Agriculture Issues: Priority on Post Bali WP

- Some Flexibilities on TRQ administration

- Expansion on General Services: Flood/Draught Mgmt , Soil Conservation, rural development etc.

-Food Security Provision for Poor as Interim Mechanism

7. Monitoring Mechanism for S&DT Provisions can be implemented in favor of LDCs /Nepal

Thank You

for Your

Kind Attention