Download Role of WTO_BPokhrel - (EEC)

Second Part
Role of WTO in LDCs’ Trade
with special Reference to Nepal
Dr. Badri Pokhrel
Joint Secretary
Ministry of Commerce and Supplies
Trade Profile of LDCs
 Out of 49 LDCs, thirty-two are Members of the
WTO; twelve LDCs are in the process of
accession and enjoy observer status at the WTO.
 The share of LDCs in world trade has gone up in
recent years, although by a small margin.
 LDCs accounted for nearly 0.8 per cent of world
trade in 2007, up from 0.4 per cent in 2000.
 The share of LDCs in merchandise trade was 0.9
per cent in 2007; the share was only 0.4 per cent
for services trade.
Share of LDCs in world GDP and Trade
0.85
0.8
0.75
0.7
0.65
Total trade: 0.8% of World
Goods: 0.9%
Services: 0.4%
Total trade: 0.8% of World
Goods: 0.9%
Services: 0.4%
0.6
0.55
0.5
0.45
0.4
199019911992199319941995 199619971998199920002001 200220032004200520062007
Share of GDP
Share of Trade
Trade Scenario:Nepal
Total Trade
2005/6
2006/7
2007/8
Import
160,677,924
195,808,412
239,177,876
Export
59,77,6874
58927,097
58545,059
Surplus/Digit
100,901,050
136,881,315
180,632,817
Source: Trade & Export Promotion Centre, Nepal, Nov,2008
Major markets and products
 The market base of LDCs is narrow. European
Union and the United States jointly account for
nearly 50 per cent of LDC export
 Developing countries are becoming important
destinations, with China emerging as the third
largest destination. South-South trade represents
45 per cent of LDC exports
 Export concentration continues to be the feature of
the LDCs' export profile. On average, three
products generate more than 70 per cent of export
revenues.
Major Markets for LDC merchandise exports
35
2000
30
2006
25
20
15
10
5
0
Thailand
Japan
China
European Union
United States
Benefits of the MTS
 There is wide recognition that trade is an engine
for economic growth and development.
 Trade helps global allocation of resources,
enhances output and productivity and increases
overall welfare gains.
 WTO deals with multilateral rules of trade among
nations. As a rule-based multilateral trading
system, WTO helps ensure that its Members abide
by the agreements.
 The underlying objective is to ensure that trade
flows smoothly.
Contd.
 WTO ensures enforcement of rules through
dispute settlement. There is increased certainity
about trading conditions
 WTO is a consensus-based organization where
developed and developing countries have equal
weight
 WTO accords flexibility in the Rules to developing
countries and LDCs to integrate into the
multilateral trading system
 The Doha Development Agenda (DDA)
negotiations could ensure improved market
access, reduction in trade-distorting subsidies,
more fair and equitable trade rules, thereby
allowing LDCs to benefit from trade
Doha Development Agenda (DDA)2001
 Negotiations could ensure-improved Market
Access
 Reduction in Trade distorting subsides
 More fair and equitable trade rules
 Addressing special emphasis of LDC
 Opening of Trade in services
Duty-free and Quota-free
market access for LDCs
 Members at the Hong Kong Ministerial agreed to provide
LDCs with Duty-free and Quota-free (DFQF) market access on
a lasting basis. Developed countries are asked to provide such
access to at least 97 per cent of products originating from
LDCs at the start of the implementation period of the Round.
 There is also call for progressive improvement of market
access with a view to achieving 100 per cent DFQF coverage
of LDC products
 Call for improving upon preferential rules of origin to facilitate
exports from LDCs
Facility in TRIPS to LDCs
LDCs are exempted from providing patents (both products and
processes) to pharmaceutical products until 1 January 2016.
LDCs are exempted from granting exclusive marketing rights
with respect to pharmaceutical products.
Decision adopted to oblige the developed country Members to
submit annual reports on actions taken by them in
encouraging technology transfer to the LDCs).
LDCs are allowed more time to provide protection for
trademarks, copyrights, and other intellectual property under
TRIPS Agreement, until 1 July 2013.
Nepal’s motivation
 Integrate in economy to global mainstream
 Capitalize market access opportunities
 Accelerate domestic institutional capacity
 Attract FDI
 Benefit from positive discrimination
 Keep consistency (Supply and
Administration)
 Assure to and from predictability
Nepal’s commitment
Policy
Comply WTO Agreements
Implement CV, TBT, SPS, TRIPS
 Publishing new laws and amending the existing
Market
Tariff binding-agro 42%, non agro 24.
Phasing out ODC by 10 yrs
Phasing out Tariff on 148 IT Products
Open 70 Sub sectors of Service trade.
Ongoing Efforts
Institutional arrangement and reform
 MOCS-a focal ministry
 Establish separate division-ITCD
(Originally WTOD)
 Focal Points
 Capacity enhancing of Custom, Copyright, Registrar,
Pattern/Trademark offices, Enquiry Points
 Forming WTO units in different business
organizations
 Strengthening Geneva Mission
Contd.
Policy Reform amendment
 Enactment of different acts and rules
 Different new policies-formed, Reviewed, Stage
of revision.
Infrastructure development
 Birgang dry port (rail linked)
 Biratnagar, Bhairahawa dry port (road linked)
 Installed Physical facilities in land customs and
TIA, Kathmandu.
 Explore alternative transit routes
Contd.
External Resource Mobilization
 NTIS 2003 and 2009 updating
 ENTReC and EU-WTO Assistance project
 EU-SPS/TBT measures
(Norwey in Nepalese honey)
 USAID-Trade facilitation
 WTO, ITC, UNDP, WB, UNCTAD, UNESCAP,
WIPO and others are supporting (and willing to
support) in Trainings, Workshops and capacity
building
Benefits from WTO membership
Tangible
Policy Compatibility/Reform
Capacity building (Human, Institutional)
Infrastructure development
Market access, diversification
Trade and Competitiveness assessment
Contd.
Intangible
 Knowledge and strength of other member countries
 Awareness (Private, Sector, government, Civil
Society,..)
 Self motivation to be competitive
 Enforce to search alternatives
(Bilateral, regional) markets and products
SWOT Scenario
Strength
 Bio diversity
 Service Trade capacity
 Abandont water resource
Weakness
 Low Skill/Quality
 Financial Shortage
 Political instability
Opportunity
 Wide Market
 Competitive Capacity
 Equal footing with other members
 LDC facility
Threat
 Revenue loss
 Dependency
 Collapse of domestic industries
Thank You