Press-Release

Embargoed until 15.15 IST, 1 September 2003

 

Developing Countries Must Take Proactive Steps in
Cancun and
Beyond

New Delhi, 1 September 2003. In the Uruguay Round, developing countries undertook substantially higher commitments for trade liberalization compared to developed countries. Developed countries have continued to impose peak and high tariffs, specific duties and NTBs on imports from developing countries. A startling example is the fact that tariffs collected by the US on $2 billion worth of imports from Bangladesh are higher than those imposed on imports worth $30 billon from France, highlights a new World Trade and Development Report 2003, brought-out by Research and Information System for the Non-Aligned and Other developing Countries (RIS).  

Releasing the Report, Shri K. C. Pant, Deputy Chairman, Planning Commission emphasized, ‘A handful of developed countries generally exercise disproportionate influence on the outcomes of these negotiations, while the developing countries, which form the majority of the membership, have little effective say in the process.’

 According to Dr Nagesh Kumar, Director General, RIS, ‘As a part of the strategic trade policy, developed countries are increasingly subsidizing industrial and innovative activity and are imposing policies akin to outlawed local content requirements.’ Resort to regionalism and contingent protection has also grown. These trends have adversely affected the place of developing countries in the world trade and their terms of trade. With the liberalization of trade and investment regime, growth rates of developing countries have declined in the 1990s compared to the previous decade and inequalities have increased.  These trends do not bode well for the long-term sustainability of the world trading system, the Report laments.

 Against this background, the RIS Report examines the trends and asymmetries in the emerging multilateral trading system from a development perspective. It also outlines an agenda for developing countries for the Cancun Ministerial and beyond to restore the development focus and, more importantly, popular confidence in the multilateral trading system. The RIS Report reiterates that trade liberalization should be seen as a ‘means’ and not the ‘end by itself’. The ‘end’ beyond any doubt should be sustainable development in all parts of the world, with principles of efficiency and equity providing the basis.

The RIS Report calls for various systemic reforms and recommends setting up of An Independent Commission to Make a Development Review of the Multilateral Trading System as also Reform of the Decision-making Process. Some of the proactive initiatives that need to be taken by developing countries include evolving A Framework Agreement on Movement of Natural Persons; A Framework Agreement on S&DT; A Framework Agreement on Transfer of Technology and Phase-out of R&D Subsidies and Investment Incentives, Dr. Kumar added.