WORLD TRADE
ORGANIZATIONWT/MIN(03)/ST/30
11 September 2003
(03-4793)
MINISTERIAL CONFERENCE
Fifth Session
Cancún, 10 - 14 September 2003Original:  English
MALAYSIA
Statement by the Honourable Dato' Seri Rafidah Aziz
Minister of International Trade and Industry
Firstly, I would like to congratulate Cambodia, a fellow ASEAN Member, and Nepal, as they
will be admitted into the WTO Membership later today.   Their accession  is especially  meaningful, as
it marks the entry of the first two Least-Developed Countries into the WTO since 1995.  I amconfident that they will actively contribute towards improving the multilateral trading system.
Malaysia also looks forward to the early accession of other ASEAN Members, Laos and
Vietnam, into the WTO.
The Doha Development Agenda has generated much interest amongst the trading nations of
the world, in the hope that, the expansion of trade, can contribute directly towards economic and
social development.
The Ezulwini Statement issued in Swazil and, by the Smart Partnership Movement,
comprising 14 WTO Members, on 15 August 2003, reiterated their belief in the role of the WTO, in
bringing about fair and rule-based trade.  Towards this end, the decisions of the WTO must reflect theviews of all Members, and priority be given to developmental concerns.  This is in keeping with the
fundamental objectives of the WTO.
However, it is regrettable that hardly any progress has been achieved, over the two years,
since Doha.  Except for the Agreement on TRIPS and public health, most of the otherimplementation-related issues remain unresolved.
Negotiations in agriculture, which is fundamental, and upon which the progress of the entire
negotiations hinge, remain contentious, and continue to be at an impasse.
Malaysia would like to reiterate her position, on the latest situation, on the
agricultural negotiations:
1. High bound tariffs must be reduced to a more reasonable level;
2. Trade distorting domestic support, and export subsidies, by developed Members,
must be eliminated;  and
3. Developing countries must be allowed to use export credit, on reasonable terms, to
promote their exports.WT/MIN(03)/ST/30
Page 2
On non-agriculture market access, Malaysia is supportive of a non-linear approach, but any
formula to be agreed upon, must accommodate the developmental needs of developing countries,
which are already liberal, but, may have high tariffs, in selected strategic industries.  It is also
Malaysia's position, that export taxes and restrictions, are not a part of the current negotiations.
Malaysia cannot accept any proposal for a sectoral approach, in respect of market access, for
non-agricultural products, particularly if it involves the mandatory participation by all.  If at all, the
sectoral approach is adopted, participation by developing countries shall be on a voluntary basis.
On services, Malaysia subscribes to the WTO principle of progressive liberalization, and will
further liberalize sectors where and when Malaysia is ready.  Developed countries should not pressure
developing Member countries to bind their services sectors, prematurely.  In this regard, Malaysiawants the Emergency Safeguard Measures for the services sectors to be in place.
Much has been discussed, regarding special and differential treatment (S&D), and
flexibilities, for developing, and least-developed countries.  Malaysia does not doubt that every WTO
Member agrees to, and abides by, this principle.  However, the issue is, how the principles aretranslated into effective market access, by countries which are in a position to provide such
opportunities.  Malaysia would like to emphasize that, in every negotiation, developing and the
least-developed countries be given the following flexibilities:
1. Longer time-period for implementation e.g. ten years for developing countries, as
opposed to five years for the developed;
2. Less than full reciprocity in tariff reduction, for example a 20 per cent reduction by
developing countries, as opposed to a 60 per cent reduction by the developed;  and
3. The necessary policy space to pursue developmental objectives, for example, the use
of incentives to develop  strategic industries which are key to economic development.
The question of graduation and differentiation of developing countries, in the context of
special and differential, has been raised by several Members.  This is tantamount to trying to
re-interpret the mandate, and definition of, special and differential treatment, and also the principle of
"less than full reciprocity."  Malaysia opposes any attempt to divide and segregate, amongstdeveloping countries.
The "New Issues" that is inve stment, competition, transparency in government procurement
and trade facilitation continue to be advocated by  several Members for inclusion into the negotiations
process.  These issues remain contentious, and are opposed to by most WTO Members.
In Doha, we decided that negotiations on these issues can only commence if there is explicit
consensus - and clearly up to now, there is none.  It is obvious that the proponents pushing to include
these issues for negotiations, have not been able to convince other Members of the utility of WTO
rules in these areas.
Under these circumstances, Malaysia will not agree to begin negotiation on any of these
issues, and suggests the clarification process be continued, beyond Cancún.
While there are many issues brought here for Ministers' attention, we should be pragmatic,
and focus our attention to those issues with convergence in position amongst Members.
For issues where divergent views remain, more time should be given for deliberations
towards achieving an acceptable solution.WT/MIN(03)/ST/30
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Undoubtedly, improved multilateral rules and greater market liberalization, would indeed
contribute towards the expansion of world trade, which can have positive spin-offs among the trading
nations.
But there are costs involved.  No country can be expected to subscribe to universally
applicable multilateral rules in trade, if the costs are onerous, and if they lose sovereign rights to
determine policy measures, which have direct impact upon their developmental goals and objectives.
In his opening remarks, Secretary Derbez alluded to the hope of achieving an ambitious
package of decisions in Cancún.  The problem that has been faced by the WTO, since Doha, is the
expectation of that ambitious outcome.
Within the diversity of the WTO Membership, there are differing levels and scope of
ambition.  Some Members are extremely ambitious, anticipating everything to be in one single
undertaking.  Others can only have limited ambition, being unable to meet onerous obligations for
further concessions.
In Cancún, it is important that we work towards extracting, from those different levels and
scope  of ambition, realistic common denominators, and to have pragmatic decisions, which lend
themselves to the required consensus, and therefore, enable this Cancún Ministerial Meeting to be a
success.
It is important that this Ministerial in Cancún not be evaluated simply as either being a
success or a failure.  Cancun is not supposed to be, and should not be, an "either-or" situation.  We
have various options open to us, to enable the Meeting to come up with a Statement or a Text which
can give clear guidance on the future work beyond Cancún.  The Meeting should not be trivialized byany "all-or-nothing" hardline positions.
We must have the wisdom to extract, from the menu of issues, those which can expeditiously
lend themselves to consensus.  We should be brave and pragmatic enough to defer, till later, issues on
which a consensus cannot, as of now, be attained.
We must not take on more than we can accommodate, but rather, we need to ensure, through
judicious management of the varied positions and standpoints, issues which can quickly be negotiated
upon for agreement, and come up with Ministerial directives on what work needs to be done after
Cancún.
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