RESTRICTEDWORLD TRADE
ORGANIZATIONWT/COMTD/M/33
7 May 2001
(01-2321)
Committee on Trade and Development
Thirty-Third Session
NOTE ON THE MEETING OF 9 APRIL 2001
Chairman:  H.E. Mr. Nathan Irumba (Uganda)
A. ADOPTION OF THE DRAFT AGENDA
1. The Chairman said that the draft agenda for the meeting, contained in airgram
WTO/AIR/1505 of 12 March, was adopted with the following additions:  (i) consideration of the
WTO Members' Contribution to the Internationa l Conference on Financing for Development, and
(ii) a proposal to hold a joint meeting of the CTD and the Budget Committee.
B. ELECTION OF CHAIRMAN OF SUB-COMMITTEE ON LEAST-DEVELOPED
COUNTRIES
2. The Chairman said that, following consultations, understood that there was consensus to
appoint Ambassador Simon Fuller, Permanent Representative of the United Kingdom to the WTO.
Ambassador Fuller was educated at the University of Cambridge.  Prior to his posting to Geneva last
year, Ambassador Fuller was Ambassador to the Or ganisation for Security and Cooperation in Europe
and has also served his country with distinction in a number of posts at home and overseas.  This was
so agreed.
C. FINANCING FOR DEVELOPMENT – INPUT BY THE WTO TO UNITED NATIONS
HIGH-LEVEL CONSULTATION IN 2001
3. The Chairman noted that in his faxes of 26 March and 4 April, he had envisaged that the CTD
might be in a position to adopt the WTO Members' Contribution to the UN International Conference
on Financing for Development.  The text had now been discussed on a number of occasions.
Comments had been provided in writing by the Eu ropean Union, Egypt, Korea, Switzerland and the
United States.  The Secretariat had been in touch with several delegations to clarify certain points andprepared the text that was now before the CTD.  Two further proposals for amendments to the text,
one by Argentina and one by the United States, were available in the room.  He reminded Members
that the text was in the form of a political statement, and did not constitute in any way a binding legal
commitment on Members.  This should provide leeway to all Members.
4. The Chairman asked whether the text and the further amendments by Argentina and the
United States were acceptable.  If so, he proposed to make a clean version available to the Co-chairs
and Bureau of the Preparatory Committee for the In ternational Conference at an informal meeting
with them later that day.  He would then forward the text formally so that it could be distributed to all
members of the Preparatory Committee for its meeting on 2-8 May.WT/COMTD/M/33
Page 2
5. The representative of Argentina explained that his suggestion on paragraph 11 was linked to
the negotiations on agriculture.  He was concerned that terms agreed in the previous meeting had been
amended in the present text.  He suggested that  "all Members" commit themselves to the reform
process in agriculture, which did not go beyond the decision at the end of the Uruguay Round, not just
"many Members" as in the new text.
6. The representative of the United States said that the paper had progressed well, but that two
paragraphs need further work.  In paragraph 16  there had been some adjustment to the language
regarding the distribution of gains from the trading system.  He proposed that this should read
"Since 1995 there has been a decline in the share in world trade of the least-developed countries".
That point was worth making.  He recognised that some countries felt there was a maldistribution of
benefits and suggested some language which preserved that thought.  Something pro-active needed to
be added at the end to suggest ways in which to start to deal with the issue which had been identified.In paragraph 17, he believed it would be better to state the issue in a positive way that all could agree
where there was further work to be done in the WTO to ensure the widest distribution of benefits.
7. The representative of Cuba felt that the text did not contain the essence of the problems which
most affected trade for developing countries; it simply listed the contradictions of the multilateral
trading system, qualifying them as "economic".  From a general standpoint the document listed someof the obstacles faced by developing countries in order to take advantage of the WTO and reiterated in
most paragraphs that free trade policies and the system of multilateral trade standards could contribute
most to economic growth and poverty alleviation in  these countries.  It would not be revealing any
great secret to state that economic liberalization has left unfulfilled many promises and the results had
not been those expected.  This was shown in ECLAC Notes, in a special edition of March past, whichshowed that, while Latin America and the Caribbean had been particularly active in carrying out trade
liberalization, the liberalization of financial markets and of capital flows, economic growth,
productive transformation, increased productivity and the reduction of inequality had been
disappointing.  Economic growth had been insufficient and unstable.  The report should also be
critical of the role that developed countries could and should play in providing technical and financialassistance to developing countries.  This would permit the developing countries to devote more
resources to social and development programmes.  On specific points, she underlined that solutions
such as those mentioned in paragraph 6 on the efforts to be made by governments to create internal
resources such as increasing self-sufficiency did not take account of the heterogeneity of developing
countries and the diversity of problems, above all taking account of the limited access to external
resources.  Likewise, drawing attention the last sentence of paragraph 4 and the first of paragraph 6,
she said there was no automatic relationship between trade liberalization and promoting economicgrowth to alleviate poverty.  Thus, a book published by ECLAC called "A decade of light and
shadows in Latin America in the 1990s", a study of 91 countries, recognised that during the first part
of the decade profound disparities in world incomes were accentuated.  The relation between the
average income of the top 5 per cent and the bottom 5 per cent changed form 78:1 in 1988 to
114:1 in 1993.  The study also stated that the influence of trade on growth decreased, and it added thatthe large part of the population of Latin America (83.6 per cent) lived in countries where this
inequality increased between 1975 and 1995, reaching levels which were the worst in the world.  It
was also known that during the 1990s, economic liberalization increased in the 1990s in the
least-developed countries, but the main trends in the world economy did not justify their expectations.
The poorest countries, instead of converging on the growth of their developed partners, had fallen intoa vicious circle of stagnation and recession , with the risk of marginalization leading to the unequal
distribution of costs and benefits from the processes of globalization and liberalization.  It was
therefore not correct to affirm as it did in paragraph 7 that the principle of equity contributed to a
favourable economic environment for development, given that in this forum there was equity among
unequals, implying an injustice which maintained and increased the historical advantage of thedeveloped countries over the least-developed countries.  On paragraph 11,  the document should not
only recognise the concern about barriers faced by developing countries, but also the need toWT/COMTD/M/33
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eliminate protectionist measures and policies as well as technical regulations and standards which
under the guise of environmental or social intentions are being used as new barriers to exports of the
developing countries.  Thus, Cuba suggested that the document should include the dismantling of
technical barriers to trade and the elimination of tariff peaks on manufactured exports of interest to the
developing countries.  The final sentence of the  same paragraph recognised the concern of someMembers about the possible negative effect of on development of some trade measures.  Cuba wished
to reiterate its views on the proliferation and real negative effects of unilateral economic measures in
trade to pursue political objectives.  The document should recognise that unilateral economic
measures affect the trade and development of the developing countries, harmed the international
economic and political environment and particularly affected the economies and development efforts
of developing countries, especially their capacity to mobilize resources in the area of trade to finance
development, as well as being incompatible with the rules of international trade.  The lack of financial
resources for development was one of the principal problems to be resolved through international
cooperation and it was therefore necessary to reach an agreement on this.  Any international
cooperation on development should respect the right of governments to decide on their national
development priorities and hence the specific needs for cooperation.  The process of globalization of
the world economy imposed a financial burden on developing countries which could not beunderestimated.  Integration in the world economy could not ignore this reality nor accept it with a
kind of fatalism.  It was necessary to reform the rules of international trade in order to address the
inequalities and imbalances which existed so that trade liberalization would provide benefits to all
WTO Members and positive efforts should be made so that  the developing countries, especially the
least-developed, could obtain that share in the growth  of international trade that corresponded to their
economic development needs, in line with the Marrakesh Agreement.  Finally, Cuba wanted to
emphasise that the WTO Members' contribution to the Conference on Financing for Development did
not constitute a binding commitment and was theref ore a rhetorical document that would not lead to
concrete initiatives to mobilize financial resources for development.
8. The representative of the European Commission was not 100 per cent happy with the
language because some of the straightforward messages on financing for development had been
diluted and that was the inevitable price for a consensus document.  On the other hand the EU was
quite pleased that some of their suggestions had been taken on board.  The EU was ready to adopt the
paper as it stood.  The new proposals were basica lly also acceptable, but the EU would like for
political reasons to see the word "all" deleted from the Argentine proposal, so that the fourth sentence
of paragraph 11 would read "Members consider that…"  Other changes were acceptable.  In response
to Cuba, the document was balanced:  it did not say that liberalization was good and all should carry itout.  It did have the right parameters that there were certain other conditions, constraints and issues to
take into account.  He hoped the paper would be acceptable as a first step and showed that the WTO
was able to deliver a message.  Fine tuning could be done later.  This was not necessarily the final
word.  It would depend how the process went on.  A more in-depth contribution by the WTO might
yet be possible on some individual issues.  He supported efforts to conclude that day and urged otherdelegations to take a similar view.
9. The representative of Egypt had been ready to adopt the paper, although it had minor
comments.  He was surprised by the new comments which made adoption more difficult.  On
paragraph 11, there was a proposal to delete part of the sentence that some measures were disguised
restrictions on access and replace it with "owing to the possible trade restrictive effects".  Egyptpreferred the previous language as a statement of developing countries' views.  The previous language
only referred to some measures where as the new language said that all the measures had possible
trade-restrictive effects. Egypt did not agree with the word "possible", because in certain cases it was
evident that they did have trade-restrictive effects.  So Egypt preferred the original language or to
delete the word "possible" from the new language.  Regarding the US proposed amendments toparagraph 16, there was a reference to efforts that included measures to build capacity in developing
countries.  These efforts were not necessarily part of the on-going process to address the issues ofWT/COMTD/M/33
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implementation.  Egypt had commented to that ef fect in a previous meeting and this had been
resolved in later versions of the paper.  He suggest ed that the final sentence should start "Efforts are
also exerted to build capacity.." and so on, as suggested by the US.  He also noted that the US wanted
to suggest how to deal with certain problems, but this was a wider issue and the CTD was not the
forum to deal with implementation issues.  On pa ragraph 17, there was an attempt to take away some
of the elements that were important for Egypt.  It  would be acceptable to include the US comments as
well as the original language.
10. The representative of Ecuador had some difficulties in accepting the document in view of the
amendments that required further discussion.  In paragraph 11 referring to the "possible" effects of
non-tariff measures on developing countries, Ecuador considered that there were definite
trade-restrictive effects.  In paragraph 17 Ecuador would like to hold broader consultations to find a
balance in what was being stated.  This was linked  to what was being discussed in other WTO bodies.
Retaining the original language would have facilitated adoption of the text.  The references to
investment and competition policy seemed to draw in ferences about the content of future negotiations.
There was a need to go more carefully or include the specific view of developing countries on these
issues.
11. The representative of India agreed with Egypt and Ecuador on paragraph 11.  On
paragraph 15 in  the second line the word "significant" should be dropped, as agreed at the previous
meeting.  Later in the same paragraph there was a reference to locking in reforms through binding
commitments.  He suggested an additional sentence based on the guidelines recently adopted in the
services meeting that credit and recognition needed to be given for autonomous liberalization. He
suggested that paragraph 16, read "The Marrakesh Agreement was designed to be a majorachievement…"  On paragraph 17, he did not see th e need to drop the second sentence nor the later
reference to the analytical stage.  The US proposal could be added.  Cuba had also raised points that
merited closer attention.
12. The representative of Korea, referring to Egypt's comments on paragraph 11 and to the
statement by the chair that the statement did not co ntain a binding legal commitment, said that in the
spirit of compromise, he could agree to the deletion of the word "possible" in the last sentence and
without the word "possible" in the previous sentence.  On paragraph 17, the deleted second sentence
covered the same issues as the first sentence which was why Korea had proposed its deletion.
Regarding the reference to investment and competition issues in the last sentence, Korea would like to
delete the reference to the "analytical stage" which everyone knew was the situation and it was not
necessary to repeat the phrase.
13. The representative of Bangladesh referred to the Argentine proposal on paragraph 11 on the
reduction of tariffs for industrial goods, while LDCs were seeking elimination of tariffs for their
exports.  The LDCs' views should be reflected.  Re the US proposal on paragraph 16, he commented
that while the first part referred to the declining share of the LDCs, this stress on the LDCs was absent
form the later part of the paragraph.  There was also an implication that LDCs' capacity constraints
were really being addressed as if the WTO work was sufficient to correct imbalances.  This was notcorrect and there should again be a stress on LDCs.  On paragraph 17, Bangladesh would like the
words "additional" and "beneficial" to be replaced by "more" and "required".
14. The representative of Argentina said that, in  relation to Bangladesh's comments, Argentina
had made no proposal on industrial tariffs.  Argentina had no difficulty in putting on record that the
EU for political reasons was not able to accept the mention that "All" Members were part of theprocess following the Uruguay Round.  Argentina unde rstood the problems of the EU with the words
"similar" and with the words "elimination of tariffs  and export subsidies" and could live with this
additional concession to the EU.WT/COMTD/M/33
Page 5
15. The representative of Chile supported Argen tina fully, and agreed with the elimination of
some terms such as "elimination" or "similar" in paragraph 11.
16. The representative of Kenya agreed with India's suggestion to amend paragraph 15.  
17. The Chairman said that there was yet no clear agreement on the text.  Consultations would be
needed.
18. The representative of the European Union said that the proceedings of the day had been unfair
to delegations which had accepted the deadlines and made comments on time.  He asked for strict
deadlines for completing the document.
19. The Chairman said the objective was to reach a balanced text before the next session of the
Preparatory Committee on Financing for Development, and he asked Members to put their comments
to the Secretariat in writing by the end of the week.
20. The representative of Canada  asked for clarif ication on whether there would be a new text on
which to comment.
21. The Chairman said he would carry out consultations and hoped to send out a modified text
acceptable to all.
D. PROPOSAL FOR JOINT INFORMAL MEETING OF THE BUDGET COMMITTEE AND
THE CTD ON TECHNICAL COOPERATION
22. The Chairman said that Switzerland now wished to propose a Joint Informal meeting of the
CTD and the Budget Committee to discuss technical cooperation.   He added that this would not be
the first such event, there having been such a meeting in May 1999.  It had also been agreed the
previous year to try to arrange such a meeting before the finalisation of the budget for 2000, but thisproved impossible to arrange in the time available.
23. The representative of Switzerland said that the idea was to reactivate the proposal and hold
the meeting in early 2001.  She hoped the Chairman would be able to consult with the chair of the
Budget Committee on the date for such a meeting.
24. The representative of the United States did not have a fundamental objection but had doubts
about the usefulness of such a meeting.  There was a need for some reflection among Members
particularly on the paper by Mr. Ravier to think about the way technical assistance was provided and
to try to make the most of available resources.  The Swiss idea  was sound but he was unsure whether
it could do more than what had been achieved in the two committees thus far.
25. The representative of Norway supported the Swiss proposal.
26. The representative of Kenya also supported the Swiss proposal.  It could produce a powerful
statement for capacity-building purposes.
27. The Chairman said that in the light of the discussion he would engage in the consultations that
had been proposed and advise the CTD of the arrangements for a joint informal meeting of the CTD
and the Budget Committee.  It was so agreed.WT/COMTD/M/33
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28. The Chairman reminded Members that a  Seminar on Electronic Commerce was to be held on
9 May, and the next formal session of the CTD would  be on 22 May 2001.
29. The 33rd Session of the CTD was closed.
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