World Trade Organization (WTO)

WTO Doha Round Bulletin - Special Release

Week ending 2 August 2004 (Issue 2004/25a)

This bulletin, summarising key WTO Doha Round-related activities, is issued by the Office of Trade Negotiations, Department of Foreign Affairs and Trade.

Key Issues

Framework Package agreed in Geneva

Agreement was reached late on 31 July in Geneva on a " Framework Package" which will guide the next phase of the Doha Round negotiations on agriculture, non-agricultural market access, services and trade facilitation. In a press release Mr Vaile described the agreement as "a very important step forward for the WTO. The agreement means we have achieved a key Australian objective of keeping the Doha Round moving forward so as to deal comprehensively with our global trade interests". Members have agreed that the next WTO Ministerial Conference will be held in Hong Kong in December 2005.

For agriculture the negotiating framework contained in Annex A addresses the three pillars of export subsidies, domestic support and market access. The framework breaks new ground by locking in a historic commitment by WTO members to eliminate agricultural export subsidies, which have had a tremendously damaging impact on Australian farm exports. The agriculture framework will also allow negotiations to proceed on removing unfair subsidised competition through government-supported export credit programs and establish new measures to manage the delivery of food aid in such a way as not to distort trade. On market access the framework provides for an approach to cut tariffs and open markets. This last pillar is not as ambitious as Australia would have liked, but is much stronger than the proposals put forward last year at Cancún. Members will be allowed to designate an appropriate number of "sensitive products" which may be subject to lesser, but nevertheless substantial, improvements in market access.

The agreed negotiating framework in Annex B for non-agricultural products (including fisheries forestry, industrials, minerals and fuels) essentially replicates the Derbez text from Cancún last year. It allows work to continue on a non-linear harmonising formula approach to reducing tariffs across-the-board to a similar level, reducing tariff peaks and tariff escalation, with the option of supplementing this with sectoral initiatives. However, as a number of members had difficulties with the Derbez text, it was also agreed that the specifics of certain elements, including the formula, would be the subject of additional negotiations during the next or ‘modalities’ phase of negotiations.

Australia and other like-mindeds were able to secure greater prominence for services in the Framework Package. The text on services (Annex C) also commits members who have not done so to make services offers as soon as possible. It also calls for higher quality and more comprehensive offers, with no a priori exclusion of any service sector or mode of supply, and sets a May 2005 deadline for revised offers.

Uncertainty since Cancún over the Singapore issues (investment, competition policy, transparency in government procurement and trade facilitation) was put to rest with agreement in the Framework Package that work on only trade facilitation would proceed under the Doha Round. Competition policy, investment, and transparency in government procurement will however remain on the WTO Work Programme. While the final modalities are yet to be decided, work on trade facilitation in the WTO has the potential to substantially reduce the costs of doing business for Australian exporters by improving the efficiency of transit, customs and border procedures.

Development issues were extensively covered in the Framework Package, recognising the need to implement the development aspects of the Doha mandate. Developing countries have committed to further liberalisation, although the special concerns of least developed countries (LDCs) have been recognised through exempting them from making new market access commitments in agriculture and industrials during this Round. How to balance the need to integrate developing country members into liberalisation commitments under the Round while also providing appropriate levels of flexibility for them to meet their own development needs and concerns will continue to be a significant issue in the next phase of modalities negotiations.

Mr Vaile has reiterated that while the package represents a significant step forward, there remains a long way to go. "Australia will be pressing all sides to now move ahead quickly on these negotiations, and we will be working hard to ensure they deliver results that will benefit all Australian exporters".

A complete outline of the framework package as well as an outline of developments under each of the categories of agriculture, NAMA, Services, the Singapore issues and Development issues can be located at the DFAT website or via the URL: http://www.dfat.gov.au/trade/negotiations/doha_framework_package.html

Contact Us

Trade Policy Section
Office of Trade Negotiations
Department of Foreign Affairs and Trade
BARTON ACT 0221
Fax: (02) 6261 3514
or e-mail trade.consult@dfat.gov.au

This bulletin is issued by the Office of Trade Negotiations, Department of Foreign Affairs and Trade. It summarises key WTO Doha Round-related activities over the past week.

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