RESTRICTEDWORLD TRADE
ORGANIZATIONWT/BOP/R/64
21 November 2002
(02-6478)
Committee on Balance-of-Payments Restrictions
REPORT ON THE CONSULTATIONS WITH BANGLADESH
1. The Committee resumed consultations with Bangladesh on 2 October 2002 under the
Chairmanship of Ambassador Anda Cristina Filip (Romania).
2. The Committee had before it the following documents:
WT/BOP/R/60 Report on the Consultations with Bangladesh
(18 March 2002)
WT/BOP/N/61/Rev.2 Communication from Bangladesh
(1 October 2002)
WT/BOP/G/12 Statement by Bangladesh
(30 September 2002)
A. OPENING STATEMENT
3. The opening statement by the representative of Bangladesh was circulated as WT/BOP/G/12
(reproduced in Annex 1).
B. DISCUSSION IN THE COMMITTEE
4. One Member considered that given its unique situation, the Committee could go along with
the request to grant Bangladesh a further seven year s to maintain restrictions on the remaining four
products.  Other Members emphasized that as a l east-developed country with special development
needs and continued balance-of-payments difficulties, Bangladesh warranted exceptional treatment.
Members stressed that the timetable could be approved on the understanding that there would be the
regular biennial consultations as provided for unde r Article XVIII:B and that a phase-out plan would
be presented to the Committee in five years time, encouraging Bangladesh to remove restrictionsahead of schedule if possible. One Member pointed out that Article XVIII:C should be available to all
developing and least-developed countries and that its purpose was distinct from that of
Article XVIII:B.
C. C
ONCLUSIONS
5. The Committee resumed consultations with Bangladesh and approved the maintenance of
import restrictions for balance-of-payments purposes under Article XVIII:B on four additional
products until 2009: chicks (01.05), eggs ( 04.07), cartons (48.19), and common salt (25.01).
Members recognized the unique circumstances of Bangladesh's least-developed country status and the
continuing balance-of-payments difficulties it faced.  Members recalled the conclusions agreed on
15 December 2000 (WT/BOP/R/57) with regard to Bangladesh's maintenance of import restrictionsWT/BOP/R/64
Page 2
for balance-of-payments purposes, and welcomed the fact that Bangladesh had already begun the
removal of these restrictions under the agreed timetable.  Members understood that Bangladesh would
continue to consult on a regular basis with the Committee as required under the WTO provisions,
biennially in 2004 and 2006.  It was agreed that Bangladesh would present a phase-out plan to the
Committee no later than 2007.  In light of any improvement in its balance-of-payments situation,Members encouraged Bangladesh to consider bringing forward the phase-out of its restrictions.WT/BOP/R/64
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Annex 1
Opening statement by the representative of Bangladesh
1. At the meeting of the Committee on Balance-of -Payments Restrictions on 27 February 2002,
the restrictions that Bangladesh wished to maintain on certain categories of products had been
discussed.  The Committee was informed that the restrictions due to be lifted on 1 January 2002, on
two categories of products, had indeed been removed.  It was agreed that the remaining ten categories
of products on which restrictions existed would be phased out in accordance with the deadlines agreed
within the Committee.
2. I am happy to report that the authorities in Bangladesh have appreciated the views and
decisions of the Committee.  Every attempt would be made to phase out the restrictions well within
the dates agreed to in the Committee.
3. Among the products that were covered under the restrictions is "sugar", where the date of the
phase out was 1 July 2005.  However, well in advance of the anticipated date, all restrictions on theimport of sugar have been lifted.  There are no further restrictions on the import of sugar.  The
Government has taken this measure despite very adverse circumstances.  The fifteen sugar mills in
Bangladesh employ almost 20,000 regular workers and 9,000 seasonal workers.  A large number of
sugarcane growers are directly dependent on the sugar industry.  Despite the difficulties, the
Government decided to take this measure.  We are currently on track with regard to the other nineitems.  We hope that the Committee will appreciate the efforts of the Government for trade
liberalization, as demonstrated once again through this step.
4. There still remain four products – eggs, chicks, cartons and common salt – on which it is the
intention of the Government to maintain the restrict ions for some time.  Accordingly, a notification to
this effect was circulated under WTO document G/ C/7 dated 16 January 2002.  It was our intention, at
that stage to invoke Article XVIII:C for these four categories of products as we require a longer
period of import restrictions on them.  A few countries did express interest in consulting with us on
our invoking Article XVIII:C.
5. Following extensive consultations, some of which was through the good offices of the
Chairman of the Council for Trade in Goods, the diffic ulties in using this provision of the GATT rules
are clearer.  The history of using Article XVIII:C in GATT days has been elaborated upon in
document WT/COMTD/39/Add.1 dated 11 September 2002.  Its use subsequent to January 1995 hasbeen detailed in document WT/COMTD/39 dated 24 July 2002.  It appears that the procedure for
invoking Article XVIII:C has not been laid down clearly.
6. Although, at first reading, the provisions of Arti cle XVIII:C appear to have great potential for
use by developing countries, particularly the least-developed among them, the absence of clear
procedures for invoking the Article has created some obstacles.  While it should be possible to resolveany doubts about the method of application, it would require time to agree on the procedures.
7. Following detailed consultations with interested delegations, it appears that our requirements
for import restrictions for these four categories of products could be met under Article XVIII:B.  The
balance-of-payments situation in Bangladesh is in a difficult position, following a fall in export
revenue in fiscal year 2001-2002 after rising steadily for many years.  At the same time, incomparison, imports have continued to surge.  This places severe strains on the country's balance-of-
payments.WT/BOP/R/64
Page 4
8. Taking into account these factors, and the need for a speedy resolution of this matter, we are
of the view that the import restrictions on these four products could be maintained under
Article XVIII:B.  These restrictions would remain in place for a total of 7 (seven) years.  At the end of
the 5 (five) year period from commencement of the restrictions, Bangladesh would discuss with the
Committee the phase out period for the restrictions.  In the intervening period, Bangladesh will informthe Committee, within two years, of the balance-of-payments position.
9. We hope that members of the Committee will take into account our developmental and
balance-of-payments needs, and agree to the current proposal.
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