RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/MA/M/13 
6 August 2004 
 (04-3348) 
Negotiating Group on Market Access  
   
MINUTES OF THE MEETING 
 
Held in the Centre William Rappard on 9-11 June 2004
 
 
Chairman: Ambassador S. H. Jóhannesson (Iceland) 
 
 
Subjects discussed                      Page  
 
1. Examination of NTBs based on S ecretariat document JOB(04)/62 .....................................1  
2. Proposal on a Sectoral Agreement for Raw Materials – the Primary Aluminium 
Case –  Communication from the United Arab Emirates (TN/MA/W/37/Add.1)...............1  
3. Statement by Participants ...................................................................................................... ..4 
4. Date of the ne xt meeting ....................................................................................................... ..12 
______________ 
   The Negotiating Group adopted the agenda for the meeting as contained in WTO/AIR/2324 
with the inclusion of the "date of the ne xt meeting"  under "other business".  
 
1. Examination of NTBs based on Secretariat document JOB(04)/62 
1.1 The discussion under this agenda item was held in informal mode.   
 2. Proposal on a Sectoral Agreement for Raw Materials – the Primary Aluminium Case –  
Communication from the United Arab Emirates (TN/MA/W/37/Add.1) 
2.1 The representative from the United Arab Emirates
 (UAE) stated that decades ago a number of 
the current WTO Members had ambitious plans for lib eralising raw materials and for helping to build 
a fair level playing field. The Punta del Este Declar ation called for the fullest liberalization of trade in 
natural resource-based products, including in their processed and se mi-processed forms". Despite the 
drive of some key players such as the US, Canada and Australia, the Tokyo Round and the Uruguay 
Round (UR) failed to reach these important objectiv es, although trade in raw materials and primary 
products mattered a great deal to many countries. For a large number of developing countries, for instance, export of ores, minerals and non-ferrous metals provided – and still provided – more than 
half of their export earnings. Today more than ev er raw materials were making headlines, more than 
ever investments upstream were directed into  developing countries and emerging economies. 
Developed countries were focussing on high value- added products downstream and were increasingly 
concerned by their access to suffici ent, stable and competitive supplies of raw materials and primary 
products. From the Punta del Este Declaration to the Doha and then the Cancún Declarations, there 
had been only missed opportunities for liberalising raw materials, which represented the fuel of 
industry and were key elements for competitiveness a nd development.  Did Members not think that it 
was time to finish the job now? The UAE had presented on 19 May 2003 a communication to the 
NGMA in which it had underlined the priority that should be given in the current WTO negotiations 
to  products of substantial expor t interest to developing countries. In line with the objectives and TN/MA/M/13 
Page 2  
 
commitments of the Doha Ministerial Declaration (in particular paragra ph 16) and of the Cancún 
Ministerial statement of 14 September 2003, and as preliminarily indicated in its above mentioned 
communication, the UAE proposed a sectoral agreement for the complete liberalization of raw materials, including non-ferrous metals; with primary aluminium as the strategic priority of the UAE.  
This zero-for-zero sectoral proposal could include all the raw materials considered as global 
commodities, of interest to WTO Member States. Pa rticular attention had to  be given to non-ferrous 
metals due to the importance of metals in the wo rld industry and trade and to the continuous growth 
of their consumption. In this respect the UAE want ed to stress that primary aluminium was its second 
most important industry after oil. The growth of the primary aluminium  industry was essential to the 
country's economic and social development. It's producer DUBAL, had massively invested to reach 
the world's top level for its standards in terms of technology, quality, environment and labour policies. 
The UAE also emphasised the strategic importance of  primary aluminium in the wider context of the 
Gulf Co-operation Council (Saudi Arabia, Kuwait, Ba hrain, Qatar, UAE and Oman). As stated in its 
above mentioned communication of 19 May 2003, th e complete elimination of tariffs and NTBs on 
primary aluminium  was a UAE priority within the DDA.  
 
2.2 Advantage of this proposal in the political context of this round
: the liberalization of raw 
materials, and in particular of non-ferrous meta ls (long sought since the UR) would be equally 
beneficial for both developed and the developing countries. In deve loped countries, high value-added 
fabricating and semi-fabricating industries would see their competitiveness in crease by access to duty-
free supplies of their raw materials. In developi ng countries, raw materials and primary products 
generally constituted strategic exports for thei r emerging industries and were of paramount 
importance for the success of their economic developm ent and diversification. Therefore liberalising 
raw materials would positively impact the dynami cs of the NAMA negotiations and would represent a 
win-win  achievement for the WTO.  
2.3 "Lowest duties" and primary aluminium
: besides zero-for-zero sectoral proposals, the 
elimination of the lowest duties would be instrumental in achieving the objectives of this round, especially in view of supporting developing countries,  since tariffs at low levels were generally 
applied by developed countries.  The level at whic h a tariff was considered "low" was not yet defined 
in the WTO, although some Members had proposed figures. The UAE wished to propose that "lowest 
duties" be defined as a rate under 6% so that  duties on primary aluminium imports could be 
eliminated in the last major developed regional markets where they were still applied. Such an 
agreement had to be facilitated by the fact that  all major developed regional markets for primary 
aluminium in the world were net importers and that their metal deficit would increase in the 
foreseeable future. Primary aluminium was here defined according to the heading 76.01 of the 
Brussels nomenclature: unwrought primary aluminium from the potlines of smelters. Aluminium 
demand (expected to exceed 27 million tonnes in 2005) was increasing in the world thanks to its 
physical, economical and environmental properties; ma inly in its key applications (transportation, 
building, packaging, consumer goods). A growi ng consensus was taking shape among WTO Members 
of the importance of sectoral agreements in paralle l with the "formula" or, eventually, the "formulae". 
The liberalization of primary aluminium, a hist orical objective in multilateral negotiations, would 
create a worldwide fair level playing field. It would encourage productive investments upstream and 
downstream for this environment friendly metal. It  would globally stimulate an industry which was 
evolving as a model for sustainable development. Th e elimination of tariffs on raw materials would 
stimulate major sectors of the world industry and st rongly contribute to achie ving the priorities of the 
DDA.   
 
2.4 The representative of Kuwait, speaking on behalf of the GCC countries
 expressed support for 
the UAE proposal which he hoped would have a sa tisfactory outcome. The GC C Members' support of 
this proposal was based on various considerati ons. The UAE proposal materialised the clear and 
explicit meaning of  paragraph 16 of  the Doha mandate which insisted on the priority of initiatives, 
like sectoral tariff elimination for products of subs tantive interest to developing countries. Such 
initiatives constituted effectively a prerequisite for reaching an overall balance of benefits from the  TN/MA/M/13 
 Page 3 
 
 
NAMA package. In this respect, the primary alum inium industry was one of the most important 
emerging industries in the GCC countries and one w ith considerable potential for growth. For that 
reason and others, which were detail ed in the UAE proposal, this group of Members reiterated that the 
elimination of all tariffs on primary aluminium remained a major strategic objective in the NAMA 
negotiations, as well as the DDA.  Besides this proposal could be considered as a real opportunity to 
reach a sectoral win-win agreement which should strengthen the co-operation and the convergence 
between the interests of both developed and develo ping countries. Indeed as stipulated in the UAE 
proposal, there was no doubt that the complete liberal ization of primary aluminium would be mutually 
profitable for those countries. On the one hand, it would enhance the competitiveness of developed 
countries industries; on the other hand it would contribute to facilitating the access of a strategic 
product originating from the GCC countries and ot her developing countries. Furthermore,  the 
abolition of tariffs applied to primary aluminium, which were generally the lowest, would not produce 
any considerable consequences for importing Member s, especially since ther e was a quasi-consensus 
to remove lowest tariffs on all non-agricultural prod ucts.  It was vital for the GCC countries that a 
positive result be obtained on primary aluminium on the basis of the UAE proposal. Recently  positive 
progress in some sensitive areas of the Doha nego tiations had been observed and he hoped that the 
NAMA negotiations including the sectoral com ponent would follow the same tendency. 
 
2.5 The representative of Canada  welcomed the UAE submission as  a constructive contribution to 
the NAMA discussions.  In particular, the submission illustrated that the sectoral approach could be a 
useful complement to a formula approach in th ese negotiations.  Canada also welcomed the UAE's 
inclusion of the critical mass concept whereby prin cipal importers and exporters in a given sector 
would participate in such a sectoral agreement. In cer tain sectors, this would mean that the majority of 
Members could participate on a voluntary basis. Of course the fact that non-ferrous metal was one of 
Canada's sectoral priorities lent greater weight to  Canada's welcome on this proposal.  Canada also 
welcomed the UAE proposal to address low tariffs. Rega rding the UAE's  specific suggestion that all  
tariffs at 6% or lower be eliminated, Canada had sugg ested in a similar vein eliminating tariffs at less 
than 5%.  Canada was ready to discuss levels proposed by others and would examine the UAE 
proposal closely.  Canada hoped that this new pr oposal would be followed by submissions by other 
Members and as Kuwait had pointed out especially by  developing Members so that their priority  
sectors and their ideas on the process could be factored into the Group's deliberations. 
 
2.6 The representative of New Zealand  supported the UAE proposal both as an exporter of non-
ferrous metals and because of the systemic value that this initiative gave to the NAMA negotiations.  
 
2.7 The representative of the United States  stated that her delegation thought that the tabling of 
this proposal was a very helpful and constructiv e development. Her delegation was particularly 
pleased to see that there was recognition that sectoral  negotiations were an essential component of the 
Group's work and could offer benef its to both developing and develope d countries at the same time. 
Like Canada, her delegati on believed that this proposal reflected in many ways some unfinished 
business from the UR in the area of non-ferrous metals.    2.8 The representative of Hong Kong, China
 commended the efforts made by the UAE and 
believed that this was a very good demonstration that all Members in  particular developing Members 
could identify their own sectors of export interest in a possible sectoral component in the NAMA 
negotiations. 
 
2.9 The representative of Singapore  welcomed the UAE initiative.  It was a good demonstration 
that developing countries could identify sectors of expor t interest and of potential growth interest to 
them.  While Singapore did not have a particular  interest in primary aluminium, it nonetheless 
welcome this initiative as a constructive one.   TN/MA/M/13 
Page 4  
 
2.10 The representative of Kenya
 thanked the UAE for their proposal. He wished to note, however, 
that the Group had not yet decided on whether a sector al approach was going to be used or not.  For 
this reason, Kenya felt that this proposal would be better discussed after such a decision had been 
made.  
 
2.11 The representative of Australia  welcomed the proposal by the UAE.  Australia saw raw 
materials including non-ferrous metals as very impor tant inputs in industrial production processes and  
tariff elimination on these tariff lines would be of clear benefit to a wide range of developed and 
developing countries.   2.12 The representative of Malaysia
 welcomed the effort by the UAE on its sectoral proposal on 
primary aluminium.  Malaysia's position on the sectoral component was that it should be voluntary 
rather than compulsory. 
 
2.13 The representative of India  stated that at this stage, hi s delegation was unable to express any 
specific comments on this proposal because it was not sure whether such a modality would be adopted 
by this Group. However, the information provided was very useful and would come in handy at the 
appropriate time. 
 
2.14 The representative of Mauritius  joined his voice to that of Kenya in underlining that the 
Group had  not yet taken a decision on whether th ere would be a sectoral component to the NAMA 
negotiations. Taking such a decision at this point in time would be tantamount to prejudging the 
outcome of the negotiations. Nonetheless, his delega tion felt that this issue could be addressed not 
necessarily under  paragraph 6 of the NAMA Derbez text, but possibly paragraph 12 where it was 
stipulated that one could consider the possibility of eliminating low rates of duty.  
 
2.15 The representative of Chile  stated that, in his view, tariffs had to be neutral and sectoral 
initiatives discriminated against sectors and therefore could distort the flows of investment among other things.  His delegation favoured approaches wh ich liberalized trade acro ss-the-board.  However, 
Chile welcomed the proposal because it dem onstrated a desire for liberalization.  
 
2.16 The representative of Cuba
 stated that the Group had not yet decided whether the sectoral 
approach should be used in this  negotiation.  Cuba reiterated its  position that sectoral approaches 
should be voluntary. 
 2.17 The Negotiating Group took note
 of the statements. 
 
3. Statement by Participants 
3.1 The representative of Hong Kong, China  on behalf of the delegati ons of Canada, the US and 
Hong Kong, China, stated that he wished to repor t on a plurilateral session that the three delegations 
had organised. The objective of that session was to discuss some key elements for defining a sectoral 
tariff component under a critical mass approach. Twenty  delegations were inv ited to this informal 
session. The co-hosts had thought of a number of elements to help focus the discussion, and these elements were: the choice of sectors, elements th at could define particip ation, determination of 
appropriate threshold for critical mass, nature or  specific sectoral initiative, product coverage and 
special and differential treatment. In overall terms the discussion was useful. A number of important questions were discussed such as how to decide the choice of sectors to be covered; How to determine 
the product coverage or what woul d be the nature of a specific sectoral initiative. Without prejudicing 
the outcome of further negotiations on the framewo rk, there was general recognition that these were 
important issues to be further deliberated in th e post-framework stage. Th e co-organizers found the  TN/MA/M/13 
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discussion useful and would continue their efforts to furthering the discussion with the view to building a more common understanding on a possible sectoral component in the NAMA negotiations. 
 
3.2 The representative of Sri Lanka
 stated that as the Group moved towards the July package, he 
wished to take this opportunity to welcome the proposal contained in the letter sent by EC Commissioners Lamy and Fischler.  He sought a fe w clarifications on this proposal and wished to 
make a few observations to facilitate further action in this regard. After studying the letter from the 
Commissioners, his authorities had raised certain queries on how the EC would envisage the 
extension of the concessions available for the LD Cs to "other weak and vulnerable developing 
countries in a similar situation". To achieve these objectives, Sri Lanka believe d that paragraph 9 of 
Annex B of the Derbez text, should be amended, before it became Annex B of the July package, to 
read as ".... grant on an autonomous basis duty-free and quota-free market access for non-agricultural 
products originating from least-developed countr ies and other weak or vulnerable developing 
countries in a similar situation". When this was implemented, it  would finally remove the great 
inequality that Sri Lanka was experiencing in the Eu ropean Union.  Sri Lanka presently faced tariff 
peaks for most of its exports to this market, wh ile competitors from the ACP and the G90 had duty-
free access through Cotonou, EBA, or other prefer ential trading arrangements. Sri Lanka's two main 
markets were the US and the EU (which together  accounted for nearly 70% of Sri Lanka's total 
exports). A single product, textiles and clothing, accounted for more than 50% of Sri Lanka's total 
exports. Unfortunately, unlike many of its compe titors, Sri Lanka received no tangible preferential 
market access either to the EU or to the US for textiles and clothing. This made Sri Lanka extremely 
vulnerable. Such vulnerability would be exacerbate d after the phasing out of quotas for textiles and 
clothing under the ATC, at the end of this year. This was highlighted in the IMF study which was 
presented to the Council last month and also by NGOs, for example the Oxfam study  titled "Stitched 
up" which was also released last month. Anothe r Oxfam study, which was released just before the 
Cancún Ministerial, had underlined, "However, the av ailable evidence suggests that the EU's common 
external tariff (CET) is fundamentally anti-poor. Here  too the principle of perverse graduation applies. 
In Britain, tax rates on imports of goods from I ndia are around four times higher than for the US, 
rising to over eight times higher for countries such as Sri Lanka".   
 
3.3 What made a developing country weak and vulnerable? When a country had to pay tariff 
peaks and its competitors, including countries which we re at a higher level of development and with 
much higher income levels, received duty-free access for the same products, it was extremely difficult 
to be competitive. When this happened in one or mo re of that developing country's main markets, it 
become weak and vulnerable in those markets fo r those products, despite following best practices 
which were recommended by this organization.   3.4 Sri Lanka had noted that the EU had pointed out that their proposal could be achieved with 
only minimal changes to the Derbez text. Similarly,  Sri Lanka believed that the problems countries 
such as Sri Lanka faced in the EU market could also  be solved through very limited changes in the 
non-reciprocal preferential arrangements and the pref erential rules of origin. The most vulnerable 
developing countries were those countries, which were at similar or lower leve ls of development to 
those who had enhanced preferential access to their main market, but who did not have that same 
privileged access to those developed country markets.  Sri Lanka hoped that the intention of the EU 
proposal was to level the playing field for all th e weak and vulnerable economies exporting to its 
market. Otherwise, it would be difficult to see much tangible benefits out of these proposals for 
countries which did not have special trading arrangements with the EU.   3.5 Sri Lanka also understood that the EU e ither had reciprocal pr eferential arrangements 
(leading to FTAs) or was in the process of negotiatin g such reciprocal preferential arrangements with 
almost all  members of the G-90. When the EC propo sed that the "G-90 should not have to open their 
markets beyond their existing commitments", woul d a consequence be the non-erosion of the 
preferences the EU presently enjoyed or was in the process of negotiating  vis-à-vis  the G-90 markets?  TN/MA/M/13 
Page 6  
 
Sri Lanka also noted that some ACP member stat es had proposed grandfathering their preferential 
access in the EU markets, in the document WT/C OMTD/SE/W/11, released simultaneously with the 
Commission's own proposal.  Sri Lanka furthe r observed that the ACP communication of 
30 March 2004 (TN/MA/W/47) stated that: "changes w ill result from the erosion of tariff preferences 
under non-reciprocal schemes such as GSP, Cot onou, CBI, AGOA, EBA, CARIBCAN. There is a 
need to look at the particular situation of the ACP with regard to specific products and main markets".  
Sri Lanka believed that there was a strong need to  look at the issues related to preferences from a 
broader perspective of all developing countries an d not only the "particular situation of ACP (or 
G-90). The ACP and the G-90 had deep preferential tariff cuts including duty-free access to the EU. 
Sri Lanka which had a lower per ca pita income level than a large number of ACP member states did 
not have such access.  Sri Lanka believed that a s light modification of paragraph 15 of Annex B was 
required, to reflect the concerns of all developing  country Members with regard to non-reciprocal 
preferences.   3.6 Under the circumstances illustrated earlier, it would be extremely difficult for Sri Lanka to be 
competitive in the EU with its apparel exports when quotas were phased out. The phasing out of 
quotas along with the non-availability of preferential acc ess would lead to the loss of market share, 
which would result in unemployment, disinvestment and de-industrialisation, leading to a deepening 
of poverty and affecting social progress at a ti me when Sri Lanka was trying to achieve the 
Millennium Development Goals. The position of Sri Lanka and of four others  countries, which were 
vulnerable to quota phase out was highlighted by th e Oxfam Study which was released last month. 
That study proposed 1) in the context of NAMA ne gotiations, developed count ries should reduce their 
average tariffs on textiles and clothing to the av erage for manufactured goods (4%) by 2010. They 
should also urgently eliminate sharp tariff peaks in this sector;  2) Developing countries not classified as LDCs, but earning more than 50% of total export revenue from this sector, hence highly clothing 
dependant, should be granted preferences for their te xtile and clothing exports equivalent to those 
offered to LDCs at least until 2010; 3) The LD C exports and the exports from other weak and 
vulnerable developing countries in a similar situat ion should obtain duty-free access to the EU, 
provided the value addition in the exporting countr y was equal to at least 25% of the good's final 
value.   3.7 From the above, it was clear that the steps wh ich were necessary to assist the countries which 
were weak and vulnerable could not be taken thr ough the multilateral process alone. Some had to be 
taken "on autonomous basis" by the developed countries. This was particularly true when 
vulnerability was a result of the discriminatory practices adopted by the developed countries. Sri Lanka believed that the EC could translate into action its reference "to other weak or vulnerable 
countries in a similar situation", by both taking an  autonomous initiative, as well as by supporting the 
necessary amendments for the Derbez text to reflect the concept.  
 3.8 The representative of Bangladesh
 wished to remind the membership of the LDCs' 
vulnerability as well as their negotiating position.  The socio-economic condition of the LDCs 
deserved special attention. The precarious condition that existed in the LDCs were recognized during 
the UR and in subsequent negotiations. Recognisi ng  the special needs and to ensure effective 
participation of the LDCs in the world trading sy stem and to improve their trading opportunities, a 
number of Ministerial Decisions were adopted . These Decisions were now part of the WTO 
Agreement and he wished to cite a few of them. In paragraph 2(i) of the Decision on Measures in Favour of LDCs, Ministers had agreed that the expeditious implementati on of all special and 
differential measures taken in favour of LDCs incl uding those taken within the context of the UR 
should be ensured through inter alia  regular reviews. In paragraph 2(ii), Ministers agreed that 
m.f.n.concessions on tariffs and n on-tariff measures agreed in the UR on products of export interest to 
LDCs might be implemented in a dvance and without staging. Ministers also agreed to improve GSP 
and other schemes for products of pa rticular export interest to LDCs. In paragraph 3, Ministers agreed 
to keep under review the specific needs of LDCs and to continue to seek the adoption of positive 
measures which would facilitate th e expansion of trading opportun ities in favour of LDCs.  In  TN/MA/M/13 
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Article XI.2 of the Marrakesh Agreement establishi ng the WTO, there was a  provision that LDCs 
would only be required to undertake commitments and concessions to the extent consistent with their 
individual development, financial and trade needs or their administrative and institutional capabilities. 
Even in the Doha Ministerial Declaration, the sp ecial needs and priorities of the LDCs had been 
recognised. Therefore, the demand of the LDCs fo r no reduction commitments, flexibility in binding 
tariff lines, binding commitments for duty- and quota-  free market access for all products within the 
year 2004, and the establishment of a mechanism to  offset losses due to the erosion of preferences 
was fully consistent with the Ministerial Decisions , Declaration and needs of the LDCs.  Hearing a 
Member disagree with providing duty- and quota- fr ee market access to LDCs was unfortunate. The 
LDCs urged the Membership to provide bound duty-free and quota-free access to all products 
originating from the LDCs within the year 2004 as s tipulated in the Dakar Ministerial Declaration. 
Such a commitment was necessary to ensure predictability and long term investment. 
 
3.9 The representative of Kenya  stated that recently there had been a meeting of a number of 
trade minister in Guyana, Georgetown and in thei r communication they had welcomed the initiative of 
the EC of asking other Members to exempt the w eak and vulnerable Members of this organization, 
essentially G-90 from reduction commitments.  Howe ver, there was no definition of what was 
"essentially G-90". The issues that Sri Lanka had ra ised went beyond this recent initiative because Sri 
Lanka had touched upon the ACP-EU  Cotonou Agreement which was an agreement that existed for 
sometime already.  A waiver was already in place.  If Sri Lanka had a problem with that waiver, the matter could be raised during the annual review of that waiver.  Regarding G-90, it was too early to 
raise the concerns that Sri Lanka had raised b ecause one did not know whether Sri Lanka was going 
to be in that group.   
3.10 The representative of Tanzania
 associated his delegation with the comments made by 
Bangladesh and Kenya.  Sri Lanka had suggested that the bound duty-free and quota-free market 
access that was being proposed for exports originat ing from LDC, should be extended to Sri Lanka 
and other weak and vulnera ble developing countries. 
 3.11 The need for duty-free quota-free market acc ess for LDCs was nothing new.  Its contextual 
genesis could be traced back to the UR negotiations, and had been incorporated in relevant Articles of 
the WTO Agreement, and subsequent decisions of the organization to which Bang ladesh had referred.   
The WTO membership had all along acknowledged th e vulnerability of LDCs as a basis for special 
treatment.  Paragraphs 16 and 50 of the Doha Work Programme, for example, provided that the 
negotiations shall take fully into account the special needs and interests of the forty-nine LDCs, which 
were currently vulnerable and severely marginalized  in the world economy.  LDCs were in that 
category because of their low income, weak human resources and low level of economic 
diversification.  LDCs particularly encount ered higher tariffs on processed goods than on 
commodities, and this had been one factor forc ing them into heavy reliance on a few primary 
commodities, mostly agriculture, which in most cas es suffered from price fluctuations.  Trade which 
was predominantly composed of primary commodi ties held back chances for these countries to 
develop their technological infrastructure.  C onsequently, these countries remained underdeveloped 
with further marginalization in the world economy, and millions of their people sinking into deeper 
poverty.  3.12 It was in this context that Ministers res ponsible for trade of LDCs, met in Dakar Senegal 
during the first week of May this year, and adop ted a Declaration.  In the area of NAMA, the 
Ministers stated that although the Derbez Text to ok on board the LDC concerns regarding exemption 
from reduction commitments, the text needed improve ment.  Specifically, the Ministers proposed that 
developed countries should provide  bound duty-free and quota-free market access for all products 
originating from LDCs within the year 2004, with realistic, flexible and simplified rules of origin, 
which took into account the industrial capacity of LD Cs.  The Ministers also encouraged developing 
countries to extend such facilities to products from LDCs.  Insofar as the proposal for duty-free and TN/MA/M/13 
Page 8  
 
quota-free market access was concerned, the message was that if Members opened their markets to 
LDCs, the increased export opportunities would gene rate added trade and development for these 
countries. 
 
3.13 The representative of  the European Communities
 stated that she wished to focus on the issues 
raised by Sri Lanka. First of all, the voice of Sr i Lanka was extremely important in this Negotiating 
Group because it was the voice of a developing country that was seeking to  improve its offensive 
interest. This was most welcome and it showed th at this Round had all the possibilities to offer 
increased market access for all Members.  LDCs had been considered beneficiaries of a particularly generous type of market access, that was to say qu ota- and duty-free access. It was not the role of the 
EC to establish who was going to be the next benefici ary in line. By this, she meant that there was a 
negotiating process.  The Commission had launched an  important message that the EU was willing to 
engage in a discussion on how to treat the weakest a nd most vulnerable Members of this institution. In 
that respect, it sufficed for all Members to read th e submissions and to see for instance that the EU 
thought it worthwhile to undertake a sectoral init iative on textiles with the participation of all 
Members.  In that initiative, mu ch of the offensive interest th at Sri Lanka has quoted could be 
satisfied.  Of course the fundamental point was how the whole membership would envisage working 
with the concept of weakest and most vulnerable in  order for this concept to be accommodated in the 
future modalities that the Group would discuss. As Kenya had said it was too early to discuss who 
was in and who was out. Her delegation was very satis fied to see that at least the political concept had 
a favourable echo in this institution.  There were several ways of defi ning the G-90, and one could also 
think that the ones who had no negotiating capacity we re certainly the weakest and most vulnerable 
within this institution and their interests should no t be prejudiced because they did not have a voice. 
The initiative of the two Commissioners was dictated by that type of concern.  The letter of the 
Commissioners was a letter written in political langua ge.  Essentially G-90 meant what it might mean 
to each individual delegati on.  As far as the EU was concerned, she could only assure Members of the 
EU's full commitment to discuss the concept and to  see ways of accommodating the needs of every 
single individual that would consider itself weakest and most vulnerable.  However, that would not be 
enough because this was a negotiating process and it wa s for the rest of the membership to establish 
who the weakest and most vulnerable Members were.  Moreover, she did not interpret references to 
the ACP-EU Cotonou agreement by Sri Lanka as a requ est for a review of that agreement. What she 
had understood was that he was referring to th e paper presented by some Caribbean Members 
(TN/MA/W/47) where a number of preferential agreements were cited.  It was a wider issue, and she did not interpret this as a reference to only the EU's  preferential schemes. As regarded the position of 
the EC on several aspects that had been raised by  Sri Lanka, she recommended that Members read the 
EU submission.  
 
3.14 The representative of Chile
 referred to a recent meeting of APEC Ministers Responsible for 
Trade which was held in Chile from 4-5 June.   Their approved statement on the DDA negotiations 
concerning NAMA went as follows:  "Consequently, bearing in mind that the development dimension 
permeates all areas of the negotiation, we commit a nd direct our officials to work with a sense of 
urgency to achieve by July 2004 results that incl ude: .... a negotiating framework for non-agricultural 
market access, on the basis of the Derbez text, that is balanced and provides for real improvements in 
market access and addresses non-tariff barriers".  On  Sri Lanka's reference to the so-called proposal 
by the EC, from a formal point of view, he had not  seen such a proposal.  No such proposal had been 
officially submitted to this Negotiating Group.  While the Group could discuss elements in the 
abstract, it should be discussing concrete proposals because otherwise the Group would be speculating 
about the content and the meaning of so-called pr oposal. What the Commissioners had done was to 
send a political message. In that context, the right  question to be asked was whether what Members 
had envisaged by way of special and differential treatment in the NAMA negotiations was enough so 
as to not impose an undue burden on some economies,  the so-called weak and vulnerable. That was 
the question that the Group should be asking.  If th e special and differential treatment was not enough, 
then the Group should be working on that issue, inst ead of creating more confusion with categories of  TN/MA/M/13 
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countries. As far as a the concept of a country or  economy being weak and vulnerable was concerned, 
it was a fallacy. In any given economy there were di fferent sectors, some sectors might be weak and 
vulnerable, but other sectors might be highly competitive. So Members had to refine the analysis and say that in some sectors some economies were weak and vulnerable. 
 
3.15 The representative of Trinidad and Tobago
 stated that the constitu ent regions of the ACP 
were currently engaging in WTO compatible econo mic partnership agreement negotiations with the 
EC.  He stressed that the Cotonou Agreement curr ently benefited from a waiver as highlighted by 
Kenya. Members like Sri Lanka and others which ha d a fundamental problem in this area could seek 
to resolve this issue bilaterally with the EC.  Tr inidad and Tobago also wished to indicate in their 
capacity as coordinator for the ACP Geneva Group, that the ACP welcomed the political message, 
signalled in Commissioners Lamy and Fischler's letter  which he expected would be discussed further, 
both before and beyond the July horizon. 
 
3.16 The representative of Paraguay  wished to second the statement by Sri Lanka.  Sri Lanka had 
referred to a paragraph in Commissioners Lamy and Fischler's letter which stated that this 
organization had to take into account the different needs of developing countries, especially the weak 
and vulnerable in the system.  When referring to  weak and vulnerable economies, Paraguay was a 
landlocked country which did not allow it to reach main markets quickly and in a cost efficient 
manner.  Paraguay considered itself one of the w eakest and most vulnerable economies of the system 
which was why his delegation agreed with what Sri Lanka had said on the need to have access to 
markets. The vital importance of access to mark ets for the development of countries had been 
recognized. The diversification of exports of the weakest and most vulnerable Members could benefit 
their development and give the right political pe rspective to the Round which was called the Doha 
Development Round.  
 
3.17 The representative of Barbados  stated that Ministers in one paragraph of the communiqué 
from the G-90 meeting held on 3-4 June in Geor getown, Guyana had stated that they were: 
"Encouraged by the initiative of the EU to r ecognize G-90 countries and their proposals to exempt 
them from further commitments in some areas".  Barb ados as a member of G-90 had also participated 
in that meeting and endorsed this view.  Barba dos welcomed the letter and initiative taken by the 
Commissioners with regard to G-90 countries.  In  this regard, she had also taken note of the 
intervention by EU.  With respect to the referenc e by Chile, she was pleased that Chile had no such 
thing as a weak or vulnerable economy, however, fo r Barbados it was a reality and Barbados lived 
this phenomenon on a day-to-day basis.  Th e entire WTO membership had recognised the 
phenomenon of small and vulnerable economies, i. e. inherently weak economies, through the 
adoption of paragraph 35 of the Doha Ministerial Declaration which mandated the membership to not 
only consider and examine issues related to trade -related problems of small vulnerable economies but 
also to formulate responses to those constraints.  3.18 The representative of Bolivia
 stated that the EU proposal  transmitted a political message 
about the need to address the concerns of  weak and vulnerable countries.  Her delegation also took 
this message to mean addressing the concerns cont ained in the Doha Ministerial Declaration.  
 3.19 The representative of Peru
 supported the statement by Chile.  For Peru it was very important 
to not create different categories of developing Member s.  It  was also important to establish in the 
framework provisions on special and differential trea tment and also the principle of less than full 
reciprocity in reduction commitments. Her delegatio n believed that an agreement on a framework on 
modalities should be reached before the end of July.  However, she warned that such an agreement 
would be put at risk if one tried to incorporate types of concepts that had no precedents and which 
were the result of special negotiations.   TN/MA/M/13 
Page 10  
 
3.20 The representative of Venezuela
 agreed with Chile and Peru. The EU proposal was not clear. 
As to the task before the Negotiating Group whic h was to finalize the framework between now and 
July, her delegation saw problems in discussing this  topic now.  Venezuela believed that developing 
countries had different realities and faced different  problems.  The present text as it stood had the 
possibility of  taking these concerns into account. 
  
3.21 The representative of Costa Rica  agreed with Chile, Peru and Venezuela. This concept of G-
90 had not been translated into a formal proposal in this Group and therefore Costa Rica preferred not 
to refer to it. With reference to Sri Lanka's statem ent, in particular on the erosion of preferences, the 
DDA had a very clear mandate for the Negotiating Group; there could be no a priori  exclusions when 
establishing the modalities. Exclusion or not of certa in products would be th e result of negotiations 
where the principle of the Enab ling Clause according to which tariff preferences should not be a 
barrier for a greater multilateral liberalization should be kept in mind.  This was why Costa Rica could 
not agree with Sri Lanka and with the ACP document circulated in TN/MA/W/47.   Costa Rica believed that the Group should respect the spirit of the Enabling Clause and should focus on mfn 
tariffs. The question of preferences should be di scussed with the countries granting the preferences 
and the Bretton Woods organizations. Tariff pref erences was a problem for development which 
should not be perpetuated.  3.22 The representative of Ecuador
 supported the statement made by  Chile, Peru and Venezuela on 
this subject. Ecuador thought that to establish th is category of vulnerable and weak countries would 
not contribute to a better systemic operation as well as substantive operation of the ongoing NAMA 
negotiations. Ecuador had said earlier that the NAMA Derbez text represented a delicate balance and 
any modification would mean that these very closel y inter-connected paragraphs would affect the 
adoption of the framework of modalities.   
3.23 The representative of Uruguay
 supported the comments made by Chile, Peru, Venezuela, 
Costa Rica  and Ecuador. The proposal from Sri Lanka would have to be analysed very carefully since 
this concept could create a new categorisation am ong developing countries and consequently generate 
discrimination among developing countries. Her delegation reserved the right to discuss any 
modification of paragraphs 11 and 15 of the NAMA Derbez framework text. This text had been the 
result of long negotiations and represented a certain balance. 
 
3.24 The representative of Mauritius  stated that the "weak and vulnerable" was not a concept, it 
was a reality.  A reality that the LDC economies and those that were landlocked faced; their economies were in a terrible mess.  Commissioners  Lamy and Fischler has been trying to send a 
political message to try to see how the concerns  of these countries could be addressed. On the 
EU-ACP relationship that had been mentioned by Sri Lanka, he pointed out that the trade regime 
governing this relationship was opera ting under a WTO waiver.  Mauritius realized that this situation 
could not go on forever, and as a result it was curre ntly negotiating a WTO compatible FTA with the 
EU.    3.25 The representative of Colombia
 supported Chile, Peru, Venezuela, Ecuador, Uruguay and 
Costa Rica.   Colombia was particularly concerne d by the systemic consequences which this issue 
might have on the whole system and on the results  which the Group was supposed to achieve by the 
end of July.  Those speakers had already elaborated  on the consequences if the Group were to take up 
at this juncture such concepts and ideas. Colo mbia also supported what was said by Costa Rica 
regarding erosion of non-reciprocal preferences. 
 
3.26 The representative of Sri Lanka  stated that the concept of weak and vulnerable had came from 
the EU Commission and not Sri Lanka.  Sri Lanka w as only responding to it, and had tried to see how 
that concept could be taken  further because it wa s valid and should be considered seriously.  Sri 
Lanka was not weak and vulnerable as a country;  Sri Lanka was weak and vulnerable in a sector 
because many of Sri Lanka's competitors had duty-fr ee access into one of Sri Lanka's main markets  TN/MA/M/13 
 Page 11 
 
 
while Sri Lanka faced peak duties. When one ha d to pay 12% duty while competitors entered the 
market duty free then one became weak and vulnerable in  that particular market and in that particular 
product. There were other products on which Sri Lanka  had lost its market share continuously due to 
this reason. That was why Sri Lanka was concerned about the preferential system.  Some delegations 
had said that this matter should be addressed else where, however, this Group was all about market 
access. This was the Development Round.  Most Me mbers had been looking at market access from a 
defensive side only. What about Sri Lanka's own ma rket access interest to developed country markets 
or to other developing country markets. This ha d not been addressed, and it had to be the main 
priority of this Group to address offensive market ac cess interest.  He had noted that the discussion in 
the Group had become largely restricted to NTBs, because most developing countries did not have 
problem with tariffs. They had duty-free access but wh at about those Members which paid mfn tariffs 
or sometimes tariff peaks.  Such a situation had to be addressed which was why he had highlighted it 
in this forum. Secondly, with regard to LDCs, Sri Lanka understood their concerns but they should 
also recognise that a large number of developing co untries with a very high level of development, 
high per capita income had better access to devel oped country markets than Sri Lanka which was a 
low income developing country. Sri Lanka was the only small low income developing country which 
did not get preferences to one large market due to the rules of origin in place and due to the discriminatory nature of extending preferences.   3.27 The representative of Mexico
 stated that this issue was difficult since there was no real 
definition of the expression "weak and vulnerable".  Even on a  political level, the concept was not 
clear. Mexico feared that this concept might lead to a differentiation of deve loping countries based on 
a criterion which was not clear at this time. Therefore, Mexico agreed with Chile, Paraguay, Costa Rica, Peru and Venezuela.  For the time, Members we re trying to seek a frame work of work for July. 
Introduction of such a concept would put at risk th e July package.  His delegation was not trying to 
detract its importance, but this concept was not very clear. 
  
3.28 The representative of Kenya
 stated that the discussion showed that the issue boiled down to a 
new categorisation of developing co untries. There had been references to discrimination, however, he 
wished to point out that agreements which Members were currently implementing already 
discriminated in this fashion such as the Decision on Net-Food Importing Developing Countries or Article 6 of the Agreement on Agriculture. Memb ers not covered by these provisions had never 
complained. So, Kenya was surprised by the nega tive reaction of Members to the idea of a new 
category of countries being created. This concept was not a creation of the EC, it was initially proposed by a number of African countries.  3.29 The representative of Korea
 stated that the initiative by the EC regarding special treatment for 
the weak and vulnerable was both interesting a nd contentious. Interesting because it spoke for 
Members who needed most to benefit from the global trading system, and contentious because it 
triggered an issue which had systemic implications .  Korea was pleased to hear from the EC that the 
question of who would be considered  weak and vulnerable would be ne gotiated in the future. At this 
stage, he was not sure whether his government coul d follow the EC initiative. Nevertheless, he wished 
to indicate that his government had undertaken a re view to see how far Korea could respond to the 
invitation made in the current Derbez text for du ty- and quota-free treatment to LDC Members.   
 3.30 The representative of Chile
 stated that the representative of Kenya had alluded to the 
existence of articles which established categories of  countries. That was not correct.  These articles 
provided a set of circumstances which if applicable to  a country enabled that country to make use of 
certain rights contained therein. The category of countries remained the  "developing countries".  
 3.31 The Chairman
 stated that in this session, he had held  a number of consultations which he had 
found very productive. He appreciated the initiative th at delegations had taken to meet with him and 
encouraged them to continue.  In these consultations , many delegations had raised the question of the 
July process.  In this regard, a TNC meeting was for eseen at the end of June where he was expected to TN/MA/M/13 
Page 12  
 
make a report. This report would be factual on the status of work in the Group with some personal 
assessment of where the Group was and where it n eeded to go.  His assessment could change 
depending on a number of factors.  He intended to hold informal consultations leading up to that TNC 
meeting. A second TNC meeting was foreseen on 22 Ju ly, and the idea was for the relevant Groups to 
produce a draft outline in agriculture and NAMA for in clusion in an annex.  Regarding agriculture, 
many delegations continued to make a procedural  linkage between NAMA and agriculture. This was 
the reality and there was no sense working against it.  Having said that, it did not mean that the Group 
could wait until the last moment to produce a framew ork for the July package.  The Group needed to 
start to think about this product it was supposed  to produce.  The Chair of the Committee on 
Agriculture in Special Session had mentioned the need for "conditional trust", and that was a wise 
way of characterising how the Group should work.    
 3.32 The Negotiating Group took note
 of the statements. 
 
4. Date of the next meeting 
4.1 The Negotiating Group took note  that its next meeting was scheduled for 6-8 July 2004, 
subject to confirmation.   
__________