RESTRICTEDWORLD TRADE
ORGANIZATIONWT/GC/W/140
3 February 1999
(99-0400)
General Council
AGREEMENTS BETWEEN THE WTO AND THE IMF AND THE WORLD BANK
Annotated Checklist of Issues Raised by Delegations
At the General Council meeting of 11 December 1998, the Secretariat was requested to
compile a checklist of the key points raised by delegations in the course of discussions under the
agenda item dealing with "Agreements between the WTO and the IMF and the World Bank".  The
Secretariat has annotated the checklist to indicate, with regard to the issues raised, what activities it is
already engaged in or is planning to carry out in  collaboration with the IMF and the World Bank, and
areas where the Director-General considers that further guidance from delegations would be helpful.
I. FORUM FOR DISCUSSIONS WITH MEMBERS
Issue: An appropriate forum is needed for the Director General to consult with and report to
Members on the Secretariat's activities carried out under its "Coherence" mandate.
Commentary: In accordance with the Decision adopted by the General Council regarding
the Agreements between the WTO and the IMF and the World Bank (WT/L/194, paragraph 2):
"The Director-General shall inform Members and consult with them regularly as to matters relating to
the implementation of the Agreements.  To this effect, the Director-General shall, inter alia , hold
consultations with Members under the auspices of the Chairman of the General Council, asappropriate but at least two times per year.".
To date, the consultations and reporting referred to in this Decision have been carried out at
meetings of the General Council (WT/GC/M/ 25, 31, 32; WT/GC/W/68, WT/GC/13).  In order to
provide for a more focused, and possibly less formal, consultation process so as to better address thesubstance and to allow the Director-General to take account of Members' interests and concerns in the
Secretariat's contacts with the IMF and World Bank, consideration should be given to inviting the
Chairman of the General Council to supplement periodic discussions on this topic at regular meetings
of the General Council by convening as necessary, at the request of Members or of the Director-
General, special meetings dedicated to discussion and follow-up of matters related to the "Coherence"
mandate.
II. REPORTS ON WORK CARRIED OUT UNDER THE "COHERENCE" MANDATE
Issue: Periodic reports should be made to the General Council on work carried out under the
"Coherence" mandate, on how the WTO is contributing through this work to achieving greater
coherence in global economic policy-making, and on how the work is contributing to the avoidance of
duplication among institutions.
Commentary: A joint report by the Director-General, the Managing Director of the IMF and
the President of the World Bank was issued on 19 October 1998 (WT/GC/13).  This was
supplemented by an oral report by the Director-General to the General Council meeting on 11WT/GC/W/140
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December 1998.  Further reports will be made in conformity with the General Council's decision
(WT/L/194), and will cover the points raised above.
III. AUTONOMOUS TRADE LIBERALIZATION
Issue: In order to encourage Members and observer governments to pursue and sustain
autonomous trade liberalization initiatives, a clear assurance should be provided that their initiatives
will be recognized by other WTO Members in the context of an exchange of concessions undertaken
through a multilateral trade negotiation or WTO accession proceedings.
Commentary: Through the process of binding trade liberalization commitments under WTO
rules, the WTO offers a mechanism to extend to ot her WTO Members a benefit additional to the value
a WTO Member derives itself from its autonomous trade liberalization initiatives, including thoseundertaken in the context of economic and financial reform programmes supported by the IMF and
the World Bank.  Typically, this is carried out in the context of multilateral trade negotiations or WTO
accession proceedings, when the balance of WTO rights and obligations is extended and increased.
The process applies most obviously to binding import tariffs in the area of trade in goods and binding
schedules of access commitments in the area of trad e in services, but it can apply equally to trade
liberalization commitments undertaken in other areas that are covered by WTO rules (e.g., domestic
support and export subsidy commitments undertaken in the Agreement on Agriculture).
Consideration should be given to drafting a Declaration by WTO Members to clarify how
autonomous trade liberalization initiatives are to be treated in the context of multilateral tradenegotiations and WTO accession proceedings.  As a preparatory step, a technical background paper
could be prepared by the Secretariat.
IV. TRADE POLICY ADVICE AND CONDITIONALITY OF THE IMF AND THE
WORLD BANK
Issue: Cooperation should be conducted in such a way as to respect fully the separate
mandates and decision-making processes of the three organisations.  Cooperation between the WTO,
the IMF and the World Bank must not compound the complexities of conditionality nor result in
cross-conditionality or extra conditions on WTO Members.  The trade policy advice and
conditionality of the IMF and World Bank shoul d be WTO-consistent.  WTO Members should be
informed about the trade policy advice offered by the IMF and the World Bank to their member
governments, and the trade policy conditionality  that is attached to their lending activities.
Commentary: Consistent with the Uruguay Round Declaration on the Contribution of the
World Trade Organization to Achieving Greater Coherence in Global Economic Policy-making, the
Secretariat pays particular attention to ensuring th at in pursuing and developing cooperation with the
IMF and the World Bank, the mandate, the confidentiality requirements and the necessary autonomyin decision-making procedures of each institution are respected, and the imposition on governments of
cross-conditionality or additional conditions is avoided.
With regard to the WTO-consistency of trade policy advice offered by the IMF and World
Bank to their member governments, working procedures  are in place for them to request, as they feel
necessary, information from the WTO Secretariat about the operation of WTO Agreements, it being
understood that the Secretariat is not in a position to offer a definitive interpretation of the provisions
of the Agreements.
With regard to information about the trade po licy advice and conditionality of the IMF and
the World Bank, arrangements are in place pursuant to the Agreement between the International
Monetary Fund and the World Trade Organization (W/L/195, paragraph 11) under which the IMF
provides the WTO, promptly after circulation to its Executive Board and for the confidential use ofWT/GC/W/140
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the WTO Secretariat, copies of its country documents on common members and on IMF members
seeking accession to the WTO, subject to the consent of the member concerned.  These documents
contain details of the IMF's trade policy advice and conditionality.  They are used by the WTO
Secretariat for reference purposes, notably in the course of the preparation of Secretariat documents
for the Trade Policy Review Mechanism.
V. SURVEILLANCE OF TRADE POLICIES
Issue: Surveillance of trade policies is an area of shared experience among the three
organisations, in the WTO through the Trade Policy Review Mechanism.  The IMF and the WTO, in
particular, should apply a harmonized framework for their work in this field.
Commentary: The TPR Division uses IMF documentation extensively in preparing the
Secretariat TPR reports particularly with respect to the macroeconomic environment.  There is also
frequent informal contact with IMF and World Bank Staff on data and related questions with respect
to the countries for which reports are being prepared.
VI. COOPERATION IN TRADE-RELATED TECHNICAL ASSISTANCE AND
CAPACITY-BUILDING
Issue: The complexity of the implementation process stemming from the Uruguay Round,
and the prospective need for support to pursue and implement the results of further WTO
negotiations, indicates the importance to developing countries of being able to call upon the IMF and
the World Bank, as well as other international organisations such as UNCTAD, for trade-relatedtechnical assistance and capacity-building.  Arrangements should be made to ensure their cooperation
in this area.
Commentary: Members have received recent information on the operation of the Integrated
Framework for Trade-Related Technical Assistance for Least-Developed Countries, in which the IMF
and the World Bank are both participating (WT/ COMTD/LDC/W/12).  In addition, the WTO, the
IMF and the World Bank have been working with th e BIS, OECD and EBRD as sponsors of the Joint
Vienna Institute, which was established to provide training support for countries making the transition
from centrally-planned to market-based economies.   See also Item X, below.
VII. THE DECISION ON MEASURES CONCERNING THE POSSIBLE NEGATIVE
EFFECTS OF THE REFORM PROGRAMME ON LEAST-DEVELOPED AND NETFOOD-IMPORTING DEVELOPING COUNTRIES
Issue: This matter should be reviewed regularly in the course of consultations between the
WTO, the IMF and the World Bank.  Information should be provided on whether any country has
taken advantage of financing from the IMF's Compensatory and Contingency Financing Facility
(CCFF) to assist it in dealing with any possible negative effects of the reform programme.
Commentary: The IMF and the World Bank report regularly to the Committee on
Agriculture on this matter, most recently at the Committee's meeting on 17-18 November 1998.  The
IMF advised the Committee then that 27 least-developed and net food-importing countries, nine more
than in 1997, were currently receiving financial support for their adjustment programmes or to dealwith emergency situations, and the World Bank provided an overview of the Bank's lending
programmes in terms of agricultural development projects, structural adjustment lending and
emergency lending (G/AG/GEN/31).  The IMF has informed us that to date no call has been made on
its CCFF in this context.WT/GC/W/140
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VIII. THE BALANCE-OF-PAYMENTS PROVISIONS OF GATT 1994
Issue: The WTO and the IMF should consult on how account might be taken of the impact
of volatile capital movements when describing the adequacy of monetary reserves of a WTO Member
that is invoking the balance-of-payments provisions of GATT 1994.
Commentary: The WTO will discuss with the IMF the possibility of undertaking joint
technical work on this issue.
IX. SMALL STATES
Issue: The joint Commonwealth Secretariat/World Bank Task Force on Small States should
be invited to make a contribution to the discussions in the WTO on the concerns and problems of
small economies.
Commentary: The WTO Secretariat is represented on the Advisory Board of the Task
Force.  The Task Force has offered, once its final report has been drafted, to address the Committee
on Trade and Development on its results and findings.
X. PREPARATIONS FOR THE THIRD WTO MINISTERIAL CONFERENCE
Issue: The IMF and the World Bank have agreed to help the WTO Secretariat respond to
Members' requests for an improved understanding of issues that arise in the course of preparations for
the Third Ministerial Conference.  The work that is being conducted by the staff in the High Level
Working Group on Coherence should provide support, especially to developing countries, to betterunderstand the financial and monetary implications of further WTO negotiations so that this can be
taken into account in framing the mandates for those negotiations.  It can also set a framework for
possible input from the Interim and Development Committees prior to the Third Ministerial
Conference.  Areas in which delegations indicated they felt the IMF and World Bank might be
requested to conduct analytical work are:  in helping Members understand better the implications forfuture WTO negotiations of recent economic, financial and monetary developments, as regards, for
example, their effects on the availability of trad e financing, exchange rate movements, commodity
price developments, foreign indebtedness and the terms of trade;  in helping elaborate a better
understanding of each Member's trade and devel opment interests;  and in helping developing
countries prepare for the negotiations on agriculture and services.  WTO Members should receive
reports on the results of work that is carried out by the IMF and the World Bank in support of the
Third WTO Ministerial Conference.
Commentary: The World Bank is already in the process of implementing a project on the
WTO negotiations scheduled to begin in 2000, involving both research and dissemination of
knowledge focused primarily on developing countries.  Much of the associated research will be done
through the participation of developing country scholars.  The WTO Secretariat is involved in theresearch component of the project.  The results of the research will be presented to a global trade
policy audience in the period leading up to the Ministerial Conference.  It will also figure centrally in
a series of full dissemination and training programmes in developing countries.  These programmes
will target, inter alia , the policy advisors and decision makers in developing countries.  The idea is for
this project to become the central focus for te chnical assistance in the course of further WTO
negotiations.
Consideration should be given to compiling a list of specific issues on which Members would
wish to request analytical input from the IMF and World Bank, and to how the results of their work
can best be disseminated to Members in the WTO.  Consideration might be given to inviting the IMFand World Bank to keep Members informed periodically of the results of work they are doing in
support of the Third Ministerial Conference.WT/GC/W/140
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XI. PROPOSALS FOR FURTHER DISCUSSIONS AMONG MEMBERS
Issue: Members should examine in more depth substantive issues pertaining to items listed
in WT/GC/13, such as trade liberalization measures adopted in the context of IMF and World Bank
programmes, the relationship between investment, capital account transactions and the GATS,technical assistance, and tariff policies and reforms including those of acceding countries.
Commentary:  The Secretariat would welcome further guidance from Members on which
issues they consider should take priority in its t echnical work with the staff of the IMF and the World
Bank.
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