RESTRICTEDWORLD TRADE
ORGANIZATIONWT/COMTD/M/22
21 January 1999
(99-0200)
Committee on Trade and Development
Twenty-Second Session
NOTE ON THE MEETING OF 2 NOVEMBER 1998
Chairman:  H.E. Mr. Iftekhar A. Chowdhury (Bangladesh)
A. ADOPTION OF THE AGENDA
1. The Committee on Trade and Development (CTD) adopted the provisional agenda contained
in WTO/AIR/936/Rev.1.
B. REVIEW OF THE APPLICATION OF SPECIAL PROVISIONS IN THE
MULTILATERAL TRADING AGREEMENTS AND RELATED MINISTERIAL
DECISIONS IN FAVOUR OF DEVELOPING COUNTRY MEMBERS, IN
PARTICULAR LEAST-DEVELOPED COUNTRY MEMBERS
2. The Chairman recalled that since the last meeting, the Moroccan delegation had submitted a
paper entitled:  "Review of the Application of Special Provisions in the Multilateral Trade
Agreements and Related Ministerial Decisions in Favour of Developing Country Members
(WT/COMTD/W/46).  Following open-ended informal consultations, consensus had emerged that the
Secretariat should prepare a letter to Members containing a questionnaire regarding any difficulties
being experienced by Members in the implementatio n of special and differential provisions in the
WTO Agreements.  The Chairman emphasized that the Secretariat would compile and analyze any
replies, but make no judgements.  This letter and questionnaire had now been circulated to Members.
3. The representative of Egypt sought confirmation of his delegation's understanding that the
Secretariat, while awaiting responses, woul d commence work based on information currently
available in the Secretariat, such as from trade policy review reports, reports from technical missions
by the Technical Cooperation Division, statements made by delegations, and other sources.
4. The Chairman confirmed the understanding by the representative of Egypt;  and, it was
agreed that the Secretariat should circulate the questionnaire with the attached annex, and compile
replies, but make no judgements.
C. ELECTRONIC COMMERCE
5. The Chairman recalled that the delegation of Egypt had submitted a Working Paper on
"Electronic Commerce in Goods and Services" circulated as WT/COMTD/W/38 in March 1998.  The
Working Paper included several proposals, inter alia , the proposal that the Secretariat should be
requested to prepare an analytical paper on enhancing the participation of developing countries in
electronic commerce and the use of information technology in the integration of developing countries
in the multilateral trading system.  He further recalled that at the informal consultations on
16 September 1998, the Secretariat informed the Committee that it was preparing a document on theWT/COMTD/M/22
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development dimension of electronic commerce.  Furthermore, on 25 September, the General Council
adopted a comprehensive Work Programme on Electronic Commerce.  In the Work Programme,
terms of reference were allocated to four WTO bodies.  In this regard, the Committee had been asked
to examine and report on the development implications of electronic commerce, taking into account
the economic, financial and development needs of developing countries.  The issues to be examinedincluded:
- Effects of electronic commerce on the trade and economic prospects of developing
countries, notably of their small and medium-sized enterprises (SMEs), and means of
maximizing possible benefits accruing to them;
- Challenges to and ways of enhancing the participation of developing countries in
electronic commerce, in particular as exporters of electronically delivered products:role of improved access to infrastructure and transfer of technology, and of movement
of natural persons;
- Use of information technology in the integration of developing countries in the
multilateral trading system;
- Implications for developing countries of the possible impact of electronic commerce
on the traditional means of distribution of physical goods;
- Financial implications of electronic commerce for developing countries.
6. The Chairman said that the Secretariat had made good progress on the paper, but required
more time because of the need for further internal consultations and coordination which were
required.  He reminded the Committee that two useful documents on electronic commerce were
already available namely, the Working Paper submitted by Egypt, and the Special Study by theSecretariat on Electronic Commerce.  The Chairman urged the Secretariat to circulate the paper by
mid-November.  This would make it possible for the Committee to have substantial discussions on the
issue at its next meeting.
7. The representative of Egypt sought a status report from the Secretariat on the preparations of
an outline for a seminar on electronic commerce.
8. The Chairman informed the Committee that the draft proposals for such a seminar were under
preparation, and would be submitted to the Committee either before or at the next session of the CTD,
following internal-Secretariat consultations and coordination.
D. TECHNICAL ASSISTANCE ACTIVITIES: THREE-YEAR PLAN: 1999-2001
9. The Chairman informed the Committee of document WT/COMTD/W/48 dated
20 October 1998, and invited comments.
10. The representative of Tanzania commended the Secretariat for a comprehensive substantive
document, which responded to the requests by delegations.  Paragraph 4 showed the commendable
increase by the WTO in the range of its technical cooperation and training activities.  The Secretariat's
approach for the future was similarly commendable, for instance, having regard to paragraph 7 of the
document which referred to "improved productivity rate programmes".  This was important.  Hisdelegation was impressed with the future approach towards decentralization and the increase in
regional presence through the use of other regional institutions.WT/COMTD/M/22
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11. However, his delegation was concerned with the question of funding raised in paragraph 12 of
the Secretariat document.  The delegation of Tanzania was concerned with how the funding
mechanism could be improved for greater efficiency and predictability, determining the possibility for
any increase in funding; and was also interested in the views of other Members.  Views were being
expressed that perhaps funding for technical cooperation and training activities would be better madethrough the regular budget, rather than the continuation with the current system of ad hoc Trust
Funds.  His delegation commended the developed country Members who were contributing to the
various Trust Funds.  On the specific Trust Funds and the contributions to these Trust Funds, his
delegation expressed an interest to know the status of the pledge of US$10 million announced by the
Prime-Minister of the United Kingdom at the 50
th Anniversary Meeting.
12. The representative of the European Communities commended the Secretariat for a very good
and innovative document on triennial planning for technical cooperation and training activities,
particularly in paragraph 8 and other paragraphs.  The Secretariat was encouraged to pursue the paths
it had suggested such as with regard to the use and "empowerment" of local and regional institutions,
and the use of new technologies to increase productivity.  However, the European Communities
hoped that technical assistance would not suffer from increased demands made on the Secretariat to
support other activities in the future.  Her delegation did not see any conflicts in the activities in theSecretariat that would lead to a reduction of technical cooperation activities.
13. The representative of the United Kingdom responded to the questions by the representative of
Tanzania on the announced contribution of US$10 million for trade-related technical cooperation over
the period April 1998 to March 2000.  The money was to be spent not only at the WTO, but also at
UNCTAD, at the International Trade Centre (ITC), and conceivably also on bilateral projects.  Someprojects had already been set up at the ITC and UNCTAD, but not yet at the WTO, although his
delegation was in the process of finalizing an offer to the WTO;  a pledge would be made to the
WTO, possibly before the end of the year.
14. The representative of Norway thanked the Secr etariat for the Three-Year Plan, even though
the Plan raised concerns about its financing.  There had been a rapid increase in technical cooperation
and training activities since 1995.  His delegation was encouraged by the improvements in these
activities as shown by the use of new technologies and the organization of regional seminars, which
were cost efficient and effective and should be increased.  His delegation had noted from the
Secretariat document, the possibility of a funding shortfall for future demand technical cooperation
and training activities.  This situation could force difficult choices and prioritization.  He underscored
the principle that technical cooperation and assistance should be demand-driven, but if available funds
are limited, LDCs should be given priority.  Furthermore, constraints on funding for technicalcooperation should lead to increased cooperation amongst WTO, ITC and UNCTAD and increased
out-sourcing of parts of WTO's t echnical cooperation and assistance activities to ITC, UNCTAD, and
possibly also to other organizations.  On the concerns expressed by the representative of Tanzania on
the financing of technical cooperation, his delegation's position was that the only viable solution was
to increase the core fund.
15. The representative of the United States expressed appreciation for the Secretariat document
which highlighted issues of importance that the Committee will face in the coming years, particularly
questions relating to implementation of the various agreements, and awareness and
consciousness-raising requirements in order for Members to fully understand their rights and
obligation in the WTO.  She expressed appreciation of the joint initiative by the WTO and the WIPOon the TRIPS Agreement to provide enhanced technical assistance for countries requesting assistance
on implementation.  The need for countries to meet their obligation by the year 2000 would place
more emphasis on technical cooperation and assistance in 1999.WT/COMTD/M/22
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16. The representative of Bangladesh commended the Secretariat for its valuable document.  As
an LDC, his delegation attached importance to technical cooperation and training activities and was
benefitting immensely from such activities.  His delegation appreciated the current focus on the
regional spread of the activities, and would like to see it expanded.  Like Tanzania and Norway,
Bangladesh was also concerned with the funding of technical cooperation and training activities.While expressing gratitude to the generous contributions from donors, his delegation was concerned
that funding was uncertain, irregular and ad hoc.  His delegation would recommend that funding for
technical cooperation activities should become part of the regular budget;  the General Council should
work to this end.  His delegation also wondered how technical cooperation and assistance
programmes could be critically evaluated, as if they were being financed from the regular budget,
whereas the funding was from individual donors.  His delegation would welcome the views of other
Members on this observation.  If the activities surrounding the LDC programme were not funded fromthe regular budget, it would be difficult to imagine a predictable programme for LDCs.  His
delegation supported the proposal by the representative of Norway to accord priority to LDCs in the
event of budgetary short-falls, he was confident that developing country delegations would not object
to the Norwegian proposal.
17. The representative of Egypt, while welcoming the Secretariat document, raised several issues
and concerns.  First, the way in which activities were counted was sometimes misleading.  For
instance, an activity involving a large amount of resources and many man hours by a large Secretariat
delegation could not be compared to another activity over a day or two and involving only one
Secretariat official.  He hoped that more accurate measures would be devised for monitoring and
evaluating technical cooperation and assistance activities, rather than using the number  of activities
which were not always indicative of size, scope and the nature of the activities.  Second, as was
evident in paragraph 6 of the document, his delegation was concerned with the fact that much of the
Secretariat's activities was tied up with dispute settlement; when assistance was requested, his
delegation and several others were often confronted by the fact that Secretariat officials were
occupied with dispute settlement procedures that require their full attention.  This problem requiredfurther attention.  Third, his delegation attached importance to the use of information technology in
the delivery of technical assistance, mentioned in paragraph 7 of the report.  Egypt felt that the use of
information technology could assist developing countries in addressing some of the difficulties
associated with the implementation of WTO Agreem ents.  His delegation requested the Secretariat to
prepare a background note on activities taking place in relation to the use of information technology
for the delivery of technical assistance, the Secretariat's thinking on the nature, and the scope for
development of information technology in this regard.
18. Fourth, his delegation supported the idea of out-sourcing of technical assistance, such as the
sub-contracting of technical assistance, mentioned in paragraph 8 of the document, because of the
limited resources available to the Secretariat.  However, this idea might need examination by the
Committee on Budget, Finance and Administration.  His delegation hoped that this could be done in
order to allow out-sourcing to experts outside the Organization.  Fifth, while cooperation between the
WTO and other organizations was important, Egypt was concerned with the imbalance between the
need for observance of obligations within the WTO and the relegation of technical assistance to other
organizations.  This had been observed, by his delegation, with regard to the joint initiatives with
WIPO on the TRIPS Agreement and with the ITU and telecommunications.  This issue required
further examination.  The problem was that the objective of the WTO was to have different Membersimplement their commitments, whereas the objective of some other international organizations
included such things as issues relating to long-term human resource development, and not necessarily
the implementation of commitments in the WTO.  Sixth, Egypt welcomed the trend towards regional
cooperation.  However, it had to be borne in mind that in some cases, national requirements were
specific and different from regional needs, therefore, a balance needed to be struck.  Next, hisdelegation shared the concern expressed on funding, and supported the position emphasized by
Tanzania on the need for predictability in funding.  Additional information and greater transparencyWT/COMTD/M/22
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were required on conditions attached by donors on their contributions to the Trust Funds as well as
their stated priorities for technical assistance.  De legations had a right to know of conditions attached
by donors to contributions and to their technical assistance offers.  Lastly, the representative of Egypt
noted that in paragraph 18, the Secretariat stated that the global objectives of its technical cooperation
objectives, as summarized in a previous document, continued to be valid.  However, his delegationwas concerned that some of the objectives incorporated in the WTO guidelines had not been explicitly
included in the overall objectives, including the full  integration of beneficiaries into the multilateral
trading system and strengthening human capacity-building in developing countries.
19. Finally, on the activities per se , his delegation, in addition to the position stated by the
United States, felt that it was important that technical assistance and cooperation should aim at
assisting developing countries after the transitional period and assist developing countries in the
preparation of future negotiations.
20. The representative of Philippines, speaking on behalf of ASEAN, commended the Secretariat
for its comprehensive background document.  She noted the increase in the request for technical
cooperation and assistance activities by developing countries.  This thrust should be encouraged.
ASEAN attached importance to the trade policy courses, and to this end commended the Secretariat
for arranging, at least, two trade policy courses annually in English.  These courses were widelysought after.  Finally, her delegation sought clarification, following the re-structuring of the
Secretariat, on the nomenclature of the Technical  Cooperation Division, which now no longer had the
"Training" component in the title.  Her delegation sought assurance that training courses would
continue undiminished.
21. The representative of Switzerland welcomed the Secretariat paper.  His delegation attached
importance to several issues under this agenda item.  These included the discussion of the Secretariat
Three-Year Plan for technical cooperation and trai ning activities, transparency in funding and
execution of such activities, critical evaluation of technical cooperation activities, and lessons to be
learned from such activities.  He posed several questions on the Three-Year Plan;  for instance, his
delegation felt that more detailed description of projects would assist in better judgement of theprojects.  The financing of technical cooperation and training activities presented a problem to be
solved.  The large number of Trust Funds and their operation were non-transparent, confusing,
impractical for both donors and the Secretariat, and placed a management burden on the Secretariat.
Switzerland believed there should be multilateral trade-related technical cooperation, managed in
detail and evaluated by the Secretariat, which would limit the detailed involvement and evaluation of
donors.  In this regard, more had to be done.
22. Responding to the views expressed by Egypt on dispute settlement, the representative of
Switzerland stated that this was a core activity of the Secretariat, and should not be reduced.  By
contrast, technical cooperation was not a core WTO activity, and was not an area of comparativeadvantage for the WTO relative to other organizations.  Accordingly, out-sourcing should be pursued,
and more thinking was required on activities which should be out-sourced.  Before a final position
was taken, detailed evaluation was required to determine, for instance, which activities should be out-sourced and which retained for execution by the Secretariat.  Regarding measures for the evaluation
of technical cooperation and training activities, his delegation agreed with the representative of Egypt
that the number of activities was not a good measure.  However, in the absence of any other measure,
Members had to work on this quantitative basis with its limitations.  For instance while 141 activities
had been planned for 1998, according to the Secretariat document, the actual number of activitieswas 277, almost double the number planned.  This highlighted several problems, including those of
predictability for planning purposes and the divergence between plans and reality.  Closer
examination showed that the variance in the figure s was accounted for by external invitations to the
Secretariat, together with the follow-up to the HLM for LDCs, which was expressed separately as anWT/COMTD/M/22
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additional category.  His delegation was firmly of the view that a detailed analysis of technical
cooperation and training activities was only possible after a detailed evaluation.
23. The representative of Canada commended the Secretariat for an excellent paper.  Her
delegation emphasised the importance and the desirability of the regional approach, the link-up with
regional institutions and funding institutions.  The regional approach was particularly important in thelight of upcoming negotiations.  Her delegation supported the Secretariat approach to reach-out to
other organizations and the emphasis placed on the training of trainers.  She considered that a main
issue in technical assistance arena was the lack of coherence at the regional level.  Coherence could be
improved both improved both horizontally with bett er coordination amongst donors, and vertically by
ensuring a proper sequence in the delivery process.  The Three-Year Plan and the follow-up to the
HLM and the Integrated Framework were steps in the right direction.  Her delegation shared
expressed concerns on ensuring appropriate funding for technical cooperation and assistance.
24. The representative of Australia commended the Secretariat for an interesting and thorough
paper that provided the basis for transparency in the area of technical cooperation.  She expressed
satisfaction for the attention given to issues of increased productivity and out-sourcing especially in
regional areas where there would be greater expertise and familiarity with problems to be addressed.
Australia was also satisfied with the follow-up to the High-Level Meeting.  Her delegation wasencouraged by the cooperation between the Secretariat and other international organizations,
particularly in areas where there was complementarity, such as WIPO.  The Secretariat Paper showed
that there was growing demand for technical cooperation in areas that were comparatively new for the
WTO.  The WTO would be under pressure to respond, and there was much to be learnt in the future.
Financing issues needed to be explored.  Greater focus would be required on the value-added aspectsin the best roles of the WTO such as noted by Egypt with regard to implementation and the mandated
future negotiations.  While noting and agreeing to the links between broader development aims,
infrastructure, human resource development, and an ability to implement WTO commitments, her
delegation emphasised the importance of the need for a careful examination of the Secretariat's
expertise, capacities, and how best to work with  other organizations to fulfill the needs of this
Organization.  The WTO had an important role to play in trade and development for developing
countries, but it was only one aspect, and there were many other organizations that could contribute.
Finally, her delegation welcomed the transparency which brought out the important linkages in the
area of technical cooperation.
25. The Chairman invited Mr. Jean-Maurice Léger, Director, Technical Cooperation Division, to
respond to the issues and questions raised.
26. Mr. Léger began by saying that technical cooperation was not the exclusive responsibility of
the Technical Cooperation Division, but was the responsibility of all Divisions in the Secretariat.
More than 50 per cent of technical cooperation activities in 1998 were undertaken by other divisions
in the Secretariat.  Second, human resources in these divisions might, in future, be diverted to other
processes and issues, such as those leading to the 3rd Ministerial Conference, to the mandated
negotiations, and to the increased recourse by developing countries to dispute settlement procedures.
27. On the specific matter of financing, Mr. Léger stated that the Secretariat currently expected a
considerable shortfall in resources for 1999.  He indicated that in 1998, the Secretariat would have
spent approximately Sfr5 million in connection with Technical Cooperation activities of which the
regular budget is Sfr741,000 only.  Currently, a shortfall existed of Sfr3 million, representing,
according to average cost calculations for 1998, 20 regional seminars or 150 technical cooperationmissions.
28. Regarding the method of reporting technical cooperation activities, the Secretariat was willing
to consult with interested delegations to determine how best to improve on reporting of activities, forWT/COMTD/M/22
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example, either with regard to number of staff hours, or in the number of days, or whether such
activities were at the national or regional level.
29. In response to the request from the Egyptian delegation, he noted that the Secretariat would
prepare a background note on information technology.  This was a new field, holding a lot of promise
for technical cooperation and training.  As suggested by Egypt, the Secretariat would reviseparagraph 18 of its paper, taking into consideration the issue of full integration, and the strengthening
of human and institutional capacity.
30. In response to the representative of the Philippines, the Director confirmed that the Division
was still responsible for training; and explained that the change in the name of the Division took place
was based on the fact that training could be delivered in different ways such as through
video-conferencing, cassettes, and other means that were not available in the past.  Furthermore,
training could suggest to some delegations that only a one-way communication was envisaged.  Thiswas not the case.  Training was a two-way communi cation, and the Division had as much to learn
from delegations with regard to culture and approaches to training, as delegations had to learn from
the experts either from the WTO or from experts in other international organizations assisting the
WTO in the training courses.  For these reasons, it was felt proper to assume the title of Technical
Cooperation Division.
31. Responding to the observation by Switzerland that comparison of the planned activities for
1998 relative to those that actually took place showed an approximate doubling of the numbers,
Mr. Legér said that based on the Secretariat's short experience since 1995, this was not unusual.  Most
missions that took place could not be foreseen at the time when the Secretariat requested developing
countries to provide indications of technical assistance needs for the following year.  In addition,many actors were involved in each mission such as the Secretariat, the hosting country, account had to
be taken of funding resources as well as coverage, participation and documentation; and all of these
had an impact on the exact dates and coverage of these actual missions.
32. The representative of Switzerland requested clarification on two issues:  first, on the
definition of the background note request by Egypt; and, second, on the reasons for the divergence in
the Secretariat's Plan figures for technical cooperation activities envisaged at the beginning of 1998
and the final actual figures for the same year. On the latter, he noted that although discrepancies could
arise, the doubling of figures between Plan figu res and actual figures was significant, and the
Secretariat should try to improve on the system to ensure more predictability.
33. In response, Mr. Hoda, Deputy Director-General, recalled that technical cooperation activities
are Member-driven.  To the extent that Members could state early in the year what activities they
foresee, and to the extent that information existed on the activities of other organizations,improvements could be made.  However, current experience showed that Members' requests do not
arrive at the beginning of the year but as time goes on.  The situation was very similar with
international organizations.  Some could give early notice of the activities that they would like the
Secretariat to participate in, while others could no t.  The Secretariat could correctly anticipate the
numbers if it the entire planning was within its complete control.  Inputs from other Membersrequesting technical assistance and from other international organizations desirous of collaboration
with the WTO could not be fully anticipated.
34. Mr. Léger clarified the second issue raised by the representative of Switzerland.  He recalled
that since last year, there had been several WTO Secretariat initiatives on information technology.
These included making available to Members through the Document Dissemination Facility (DDF),the previous day's documents in all official languages together with a search capability; and
installation in LDC Members, WTO Reference Centres with connection to the Internet, access to the
WTO website, and access to the Information Development website which is a joint undertaking withWT/COMTD/M/22
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the World Bank.  This year, the WTO Secretariat had used, at least on two occasions,
video-conferencing means for training purposes, and it intended to place more emphasis on this
vehicle in the near future.  Technical cooperation training courses would be available on the WTO
internet website, by 15 November 1998.  Videos  are being developed on WTO Agreements, for
example, one is currently being developed on the Agreement on Textiles and Clothing.  These videoswould explain the agreements with their rights and obligations.
35. The representative of Switzerland agreed that the use of information technology was
important for technical cooperation.  However, he wondered if separate papers should be requested
for on each area of technical cooperation.  Regular separate reporting on technical cooperation
activities should cover every area, including the use of information technology means.  His delegation
was not certain as to the need for the paper requested by Egypt.  His delegation had understood the
question by Egypt and the consequent request to the Secretariat to ask the Secretariat to describe thepossible ways for using information technology to deliver technical cooperation and assistance, and
hence improve the cost efficiency and operation of technical cooperation and assistance.  If this was
the understanding, Switzerland would not oppose the request by Egypt.
36. The representative of Egypt saw no a contradiction between the statement by the
representative of Switzerland and the preliminary descriptions by the Secretariat.  The use of
information technology for the delivery of technical cooperation and assistance was a new area.  As a
result, more information was required for a proper understanding of its use.  In addition, this was a
cross-cutting issue because different kinds of technical assistance could be delivered through the
means of information technology.  It was not simply a question of a specific area where information
was required on a sectoral basis.  The whole purpose was to better understand the use of informationtechnology as a means for delivering technical cooperation and assistance.  This was an important
question for the development, dissemination and improvement of the quality of technical assistance.
37. The Chairman emphasized that in all technical cooperation and assistance were core WTO
activities.  The Committee took note of the document.
38. The representative of Japan  briefed the Committee on a seminar in Singapore entitled: WTO
Regional Seminar on Dispute Settlement Procedures and Practices for Asia and Pacific Countries,
which had taken place from 29 to 30 October 1998.  The seminar had been made possible with
financial contributions by the Government of Japan.  The purpose of the Seminar was three-fold
namely: first, to disseminate comprehensive inform ation on the dispute settlement mechanism in the
past three and half-years;  second, to hear the assessments of academics on the performance of the
mechanism and suggestions for improvement; and third, to undertake an informal exchange of views
amongst the participants, which included representatives of 11 Member Governments, academicsfrom four Member Governments, and WTO Secretariat officials.
E. EVALUATING TECHNICAL ASSISTANCE: ISSUES FOR REFLECTION
39. The Chairman recalled that at the last meeting of the Committee, the Secretariat had been
requested to prepare a document for further reflection on the evaluation of technical assistance.  The
document had now been circulated with reference Job No. 4299.  The document referred to the
Guidelines for Technical Cooperation and Training and the Implementation Modalities; examined the
manner of assessing technical cooperation and training, made a distinction between internal and
external evaluation; and addressed the issue of evaluation criteria.  The document contained an annex
with a questionnaire used by participants for assessing technical cooperation activity, and for
discussing training activities conducted in the WTO Trade Policy Courses.WT/COMTD/M/22
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40. The representative of Switzerland welcomed the Secretariat paper, which offered many issues
for reflection.  He requested the Secretariat to undertake with the Committee an internal evaluation of
WTO technical cooperation activities, based on do cument Job No.4299, which could provide the basis
for developing a methodology for internal evaluation.  In this connection, an informal process could
be established comprising interested delegations and the Secretariat for implementing internalevaluation.
41. The representative of the European Communities (EC) noted that the Secretariat paper raised
the right questions.  Technical assistance activities were difficult to qualify and measure.  Two
reasons were central in the evaluation of any activity: one was to measure the degree of success in
achieving the objectives, and the other was to learn lessons and to increase the effectiveness of future
activities.  In this regard, it was necessary to establish criteria for success.  Preferably, it was best to
establish these criteria in the planning stage, and al so to involve the recipients in the establishment of
criteria.  The EC believed that several questions were relevant such as:  (a) at what levels of activity
should evaluation be undertaken bearing in mind different levels, for example, sectors, seminars,
countries and regions; (b) what criteria should be used; and, (c) how will be the lessons of the past and
the present be integrated into future policies and practices?  In the view of her delegation, the basic
objective and criteria of WTO technical assistance was to increase the knowledge of WTO rules andregulations, and to enhance the ability of developing countries to take advantage of the system.  These
were the basic objectives and criteria against which WTO technical cooperation and assistance had to
be evaluated.
42. The representative of the United States underscored the importance of introducing procedures
and criteria for evaluating the effectiveness of technical cooperation and assistance.  She recalled the
position by Egypt stressing the utility of targeting specific and demand-driven approaches rather than
raising issues in the abstract.  She emphasised the importance of taking advantage of available
technical assistance, whatever the means for delivery.  The United States had mentioned initiatives for
enhanced technical assistance, for example, through out-sourcing as in the WIPO/WTO initiative.  In
the light of the interest by delegations, he r delegation wondered how Members would avail
themselves of the technical assistance opportunities  present in that joint initiative.  Follow-up to
programmes, raised in the Secretariat report, was another important issue.  To this end, it was
necessary that beneficiary governments should provide on-going substantive support for those
undergoing training, and to ensure that informati on acquired was used to achieve the goals of the
training activity.
43. The representative of Norway welcomed the useful Secretariat paper.  His delegation
considered that there were core principles that should constitute guiding principles for evaluation.
First, was the establishment of relevant criteria for evaluation, which could be quantitative or
qualitative.  These should include cost efficiency and the impact of technical assistance on the
beneficiaries.  Such criteria should be simple, practical, objective and transparent.  Second, evaluation
should be continuous and an integral part of WTO technical assistance activities.  Third, external
evaluation should be conducted regularly with a view  to assessing whether technical assistance had
the anticipated impact on the beneficiaries.  Fourth, as a rule, the costs of technical assistance should
be covered by core funding.  Fifth, the use of questionnaires for participants in trade policy courses
and seminars was a useful instrument and could be further developed.  His delegation supported the
idea of regularly circulating questionnaires to beneficiary countries.  This procedure would offer a
beneficiary an opportunity to provide details of assistance received and how such assistance,including skills acquired, had been used.
44. Norway agreed with the view expressed in the Secretariat paper that it would be a challenge
to establish a system of evaluation because the results of the activities would often be difficult to
measure.  Nonetheless, donors still expected some form of evaluation in order to establish a causal
link between technical assistance and results or lack of results.  Therefore, an effort at evaluationWT/COMTD/M/22
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should be made; in its absence, it would be difficult to defend the expenses.  His delegation agreed
with the Secretariat observation that requests for technical assistance were often very general.  To this
end, his delegation joined with the Secretariat in encouraging Members to be more specific in their
formulation of requests for technical assistance, such as the specific objectives they would like to
achieve through the technical assistance.  Finally, in establishing a system of evaluation for thesystem, account must be taken of the need to evaluate joint activities with other agencies and to avoid
evaluation of overlapping programmes.  His delegation supported the position of Switzerland to hold
informal consultations on the issue of evaluation.
45. The representative of Japan welcomed the Secretariat paper and re-emphasised the
importance of technical assistance.  Due to budgetary constraints, cost effectiveness and the quality of
technical assistance were very important.  In this regard, evaluation was a necessary exercise.
Considering the three dimensions of evaluation namely, internal Secretariat evaluation, external
evaluation and beneficiary evaluation, his delegation believed that these three methodologies were
complementary and could be used simultaneously to maximise the advantage of each system.  His
delegation shared the view of the European Communities that the evaluation methodology used by
other international organizations could be useful, even though WTO technical assistance was specific
in nature.  He supported the Norwegian and Swiss proposals for informal consultations.
46. The representative of Morocco recalled that the first task to carry out was to decide on
evaluation procedures.  It was not possible to address evaluation, including the substantive aspects,
until procedures exist.  These procedures would guide the WTO in the evaluation of technical
cooperation and assistance activities.  Constant internal evaluation was necessary.  Such internal
evaluation should be structured and institutionalized in the form of an internal evaluation unit.Nonetheless, external evaluation must also take place.  To ensure complementarity between external
and internal evaluation and the independence of the evaluation exercise which should aim at
transparency and impartiality and, as a consequence, assess the impact of WTO technical assistance
activities.  A methodological framework needed to be established to serve as a basis for subsequent
evaluation.  This framework could include several elements to cover implementation and impact.Within this framework several criteria would be useful.  These criteria would relate to the general
objectives of the WTO and the more specific aims of particular technical assistance programmes.  His
delegation stated that the scope of evaluation should not only include the assessment of the impact of
technical assistance, but should also consider the implementation of technical assistance programmes.
This form of assessment should be part of both assessment and implementation of technical
cooperation programmes.  In this way, corrections can be made to technical assistance and
cooperation programmes, if necessary, as those programmes were underway.  There should also bemid-term evaluation of programmes which would make it possible to improve on implementation of
programmes.
47. He believed that the financing of technical cooperation should be considered by the
Committee in coordination with the Committee on Budget, Finance and Administration.  This
financing could be undertaken in several ways.  It should be financed from the regular budget.However, financing from extra-budgetary sources sh ould not be excluded.  He said his delegation
would codify its proposals in order to contribute to the debate of the item.  Finally, he supported the
proposals by delegations for informal consultations on the item to enable a decision on procedural
issues for further progress on the item.
48. The representative of El Salvador stated that trade policy courses, referred to in the document,
were of immense value and importance for the training of her country's trade policy officials.  Against
the background of the debate on evaluation and the improvement of technical assistance and
cooperation programmes, her delegation enquired as to the possibility of an increase in the trade
policy courses offered in Spanish.WT/COMTD/M/22
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49. The representative of Jamaica commended the Secretariat for the high quality documentation;
evidence that the concerns and interests of developing countries for integration and full participation
in the multilateral trading system were being advanced.  He emphasised several key issues.  First, in
evaluation it was important to strengthen and enhance human and institutional capacities in the public
and private sector.  Second, the key test of the  effectiveness of technical assistance was how well itassisted Jamaica to fulfill its obligations and to en force its rights, if the rights needed enforcement.
Third, technical assistance was not an adjunct to the implementation of the Agreements, but a
systemic matter.  Technical assistance was not a set of discrete and separate activities, but a systemic
and integral part of the fulfilment and implementation of WTO Agreements.  Jamaica judged
technical assistance as effective, if it enabled it to secure the balance of its benefits from its
participation in the multilateral trading system.  He believed that this position was held, not only by
Jamaica, but also by other trading partners, to the extent that it made the trading regimes of thesecountries more transparent and open, and allowed the expansion of trading opportunities in domestic
economies and in the economies of the trading partners.  Technical assistance was therefore not
simply a project or a supplement to implementati on.  Technical cooperation was also not a charitable
contribution by some Members to others.
50. Fourth, referring to the last sentence of paragraph 12, in document WT/COMTD/W/48, on the
subject of "financial considerations", he disagree d with the sentence which read as follows: "In the
absence of additional Trust Funds, current conditions would force the WTO to scale down technical
cooperation activities by about 3 million Swiss francs or by some 20 regional seminars or
150 national missions based on the average cost for 1998".  If this occurred, it would mean the
scaling-down of the opportunity for the integration of  developing countries in the multilateral trading
system.  This was the reason he had underscored the point that technical assistance was not an adjunct
or supplementary to the implementation of WTO Agreements.  In the same paragraph, he had noted
the distribution of contributions by Members to Tr ust Funds.  However, he had not seen the quantum
of funds available in the regular budget for technical cooperation activities, but felt that it would be
less than the 3 million Swiss francs projected as shortfall.  Consequently, in the evaluation oftechnical cooperation and in the review of future ac tivities, the WTO should be prepared to use the
regular budget and to ensure that a proportionate amount of resources are available to meet the
objectives of integration.  He also said that an idea suggested by his delegation, following its Trade
Policy Review the previous week, was that the range of trade policy reviews of developing countries
could be considered and assessed over time with a view to usefully identifying and indicating the
lacunae in their notifications and in the implementation of their obligations.  As a result, technical
cooperation should not be general but focus on the specifics.  It was a systemic part ofimplementation; and should, therefore, fit all the WTO Agreements together to ensure that small
economies and developing countries were integrated.
51. The representative of Senegal expressed satisfaction with the constant evolution in the
quantity and quality of WTO's technical cooperation activities.  The prospect of cooperation between
the WTO and other international organizations should be welcomed.  Complementarity should be
promoted to the benefit of recipient countries.  His delegation welcomed the Secretariat document,
which was intended to manage the present while preparing for the future.  The evaluation of technical
cooperation and training was not a simple matter.  Consequently, his delegation supported those who
had proposed the holding of informal consultations to address the issue of evaluation.
52. On the evaluation of training programmes, he noted that the Secretariat had faced a number of
difficulties.  An example, was the difficulty faced in the choice of candidates for the training courses,
which was in the hands of beneficiary countries.  Some of the difficulties turned on the fact that
sometimes beneficiary countries sent the same officials to the various training courses, and sometimes
lacked various elements for measuring the impact of the assistance programmes on recipient
countries.  In this regard, some of the problems which were rooted in the exercise of state sovereigntywere difficult to solve.  Training was important.  In the evaluation of WTO training programmes, heWT/COMTD/M/22
Page 12
considered that it would be up to the Secretariat, Member States and the trainees, to consider the
objectives that had been set and to regularly assess the content of the training courses, the quality of
the support materials used, and the educational approach.  In this regard, he felt that the number of
Trade Policy training courses, particularly those in French, were insufficient.  External evaluation of
training programmes would be difficult; evaluation would be better conducted by the Secretariat, thetrainees and the recipients.  To assist recipients and beneficiary countries undertake the evaluation,
questionnaires from the Secretariat would be helpful.  Furthermore, contacts between the WTO and
former trainees should be maintained.  To this end, the website for former trainees was useful in the
maintenance of these contacts.  Electronic training activities were to be stressed and supported.
53. He said that external expertise would be required in the evaluation of technical cooperation
programmes in the beneficiary countries, since this would relate to a judgement on concrete elements.
The example of customs services was a specific area where external evaluation would determinewhether the implementation of a technical assistance programme had improved the customs service in
a country.  The scope of evaluation should be comprehensive to cover all technical cooperation
activities whether financed through the regular budget or through Trust Funds.  A formula should be
found to satisfy donors whose main concern was that there should be an objective evaluation.  For
evaluation involving joint technical assistance between the WTO and other organizations, thereshould be a specially adapted evaluation to the original aspects of the programme in question.
54. He also said that further consideration should be accorded to the proposal that former staff
Members could be used as evaluators because of their familiarity with the WTO.  While advantages
were evident, disadvantages could also arise as evaluation by these former staff Members could be
"in-house" evaluation.  This proposal had to be further examined.
55. Criteria for evaluation should be simple, objective, transparent and practical.  In the course of
the evaluation, account should be taken of qualitative and quantitative criteria.  However, quantitative
criteria, such as the number of activities could be misleading.  For instance, some seminars had low
participation rates.  However, an indicator such as respect for notification obligations was a good
indicator that measured the degree of a country's awareness of such obligations as well as theabsorption of assistance received.
56. In conclusion, the representative of Senegal emphasised several points.  First, technical
assistance should be financed from the regular budget.  Second, stress should be placed on
disseminating information to countries because public opinion in various countries needed
information on the WTO.  Third, internal coordination and inter-Ministerial coordination should be a
key aspect of the questionnaires to be forwarded to countries.  This coordination should focus on
information-sharing amongst various ministries and sectors.
57. The Committee took note of the statements made, and agreed
 to hold informal consultations
on the item.
F. CONCERNS AND PROBLEMS OF SMALL ECONOMIES
58. The Chairman drew the attention of the Committee to the joint paper circulated by Barbados,
Jamaica, Lesotho, Mauritius, Sri Lanka, and Trinidad and Tobago; and noted that prior to the
circulation of the paper, the delegation of Mauritius had raised the issue at the second Intersessional
Meeting of the General Council.
59. The representative of Mauritius , referring to the joint paper, recalled that Trade Ministers, at
the 2nd Ministerial Conference of the WTO, had expressed deep concern on the marginalization of
small economies and had recognized the need for the issue to be urgently addressed.  To this end, andWT/COMTD/M/22
Page 13
pursuant to paragraph 9 of the Geneva Ministerial Declaration, Mauritius had raised this issue at the
second Informal Intersessional Meeting of the Genera l Council, with a view to examining this issue
and forwarding recommendations to the 3rd Ministerial Conference.  Having tabled the issue before
the General Council, the co-sponsors considered it a duty to place the issue on the agenda of the
Committee because suggestions had been made that some of the issues should be delegated tosubsidiary bodies without, however, disputing the primacy of the General Council.  His delegation
recognized that Committee Members required more time to study the paper, since it had only been
circulated just before the meeting.
60. The international system was undergoing dynamic which had entailed incessant changes.
Only a few countries could keep pace with these changes; many countries had limited capacity for
adjustment to changes.  The challenges of adjustment to these changes were more problematic for
small economies because of their smallness and limited capacity, geographical situation, vulnerabilityto external shocks and the vagaries of nature.  The vulnerability of these small economies to
exogenous factors was exacerbated by their high degree of openness which compounded their
economic fragility.
61. He underscored the concern of the paper's co-sponsors for the erosion of the competitiveness
of small economies due to the absence of Foreign Direct Investment (FDI).  Current uncertainty of thescope of market access for the small economies had made FDI elusive and uncertain.  Small
economies had undertaken obligations at Marrakesh, which were neither questioned nor reneged on.
However, in the short term, the fulfilment of WTO obligations was hampered by financial, human and
institutional resource limitations.  In signing the Marrakesh Agreement, small economies were not
aware of these resource limitations vis-à-vis  their obligations.  They had hoped that the benefits
accruing from the multilateral trading system and the provisions on special and differential treatment
in WTO Agreements would assist small economies in overcoming these constraints and limitations.
The multilateral trading system had produced overall results, but it was felt by small economies that
their marginalization was caused by their inability to secure a share in the growth of international
trade commensurate with the needs of their economic development.  Having regard to the foregoing,the Committee was confronted with a major task. Economic growth needed to be accelerated.  The
acceleration of economic growth would facilitate small economies' integration into the multilateral
trading system on a sustainable basis.
62. The representative of Mauritius emphasised additional points.  Most Members of the WTO
were also Members of the United Nations (UN); and this issue of small economies had been
addressed over a long period at the UN.  Furthe rmore, some WTO Members were also Members of
the Commonwealth; and the Commonwealth similarly was in forefront in addressing this issue.  Many
studies had been carried out on small economies, particularly on small island economies, by
organizations such as UNCTAD and others.  It was, therefore, important for the Committee to take up
this issue and the challenge that it posed in keeping with the decision by Trade Ministers at the
2
nd Ministerial Conference; and, in doing so, to enable the General Council to submit appropriate
recommendations to WTO Ministers at the 3rd Ministerial Conference, on how to address the
problems of small economies.
63. The representative of Jamaica began by according full recognition to the special position of
least-developed countries (LDCs) among the developing countries, and the priority attention to be
accorded to LDCs.  His delegation was deeply saddened by the tragic consequences and after effects
of Hurricane Mitch and the havoc it had wreaked on the region of Latin America and the Caribbean:whole crops had been wiped out which would have been harvested for exports. Recovery would take
time and would be difficult.  This situation was a familiar one for the Caribbean region.  Based on this
situation of vulnerability to external shocks, his delegation was hopeful that WTO Members would
show sympathy and understanding.  His delegation expressed full solidarity with affected countries
and hoped that the effects of the natural disasters of hurricane and flooding would be overcome in theWT/COMTD/M/22
Page 14
region, and that any special measures required would be taken.  The connection between trade and
development was evident from the situation prevalent in the Caribbean and for small economies.
Small economies had made enormous efforts in the past few years to bring their economies into
conformity with WTO obligations.  The Caribbean countries and banana exporting countries, just like
other small economies, wanted to ensure a degree of certainty for and value from their exports.However, these objectives had now been disrupted because of the consequences of the hurricane and
other natural disasters.
64. His delegation recognized the work being undertaken by the Commonwealth, the IMF and the
World Bank on the issue of small economies. The World Bank deserved special mention because the
Prime Minister of Barbados had led a special delegation to several intergovernmental organizations
including the WTO to state the concerns of small economies.  These small economies made up more
than half of the WTO.  Small economies understood that a common set of rules and disciplines wererequired at the WTO, they did not desire a "second eleven playing field".  They believed that
integration in the global economy required that their economies had a place on the same playing field.
Small economies were convinced that special attention was necessary to address their problems and
vulnerabilities considering that it had become nece ssary for systemic measures to be taken even for
large economies given the recognition in the international monetary system that large economiesrequired special attention given their structural characteristics and their failure to adjust to external
financial crisis.  Consequently, small economies should not be ignored simply because individually
they did not have the same or equivalent systemic effects.  The systemic effects of trade distortions
and external shocks across the length and breadth of small economies should not be ignored.
65. The representative of Jamaica recognized the efforts of the representatives of Bolivia,
Guatemala, El Salvador, Dominican Republic, Cuba  and others in ensuring that attention was
accorded to small economies.  For several reasons, his delegation believed that small economies at the
WTO required close and special attention.  First, the criteria for "graduation" as applied at the World
Bank were neither on efficient nor equitable.  Consequently, measures which bound small economies
to standards of obligations without recognizing their particular characteristics were deleterious to theefficiency and equity of their participation in the multilateral trading system.  The valuable papers that
had been circulated on special and differential treatment and the paper on small economies circulated
by six co-sponsors represented initial efforts to integrate the concerns and problems of small
economies as part of the Member-specific special and differential treatment provisions of the WTO
Agreements.  His delegation believed that all developing countries should seek to become mature
economies, but to do so in a way that was consistent with their possibilities.
66. The Chairman recognized the enormous damages and set-backs caused to Central American
and Caribbean economies by the hurricanes, and extended sincere sympathies to all those affected and
the wish of the Committee for their speedy recovery and re-construction.
67. The representative of Barbados said that the item on small economies was important and
crucial.  Her delegation agreed with the specific problems of small economies as highlighted by the
representative of Mauritius, and as outlined in the paper by six co-sponsors before the Committee.These problems and constraints included, but were not limited to:  (a) physical and geographical
attributes; extreme vulnerability to natural disasters; (b) heavy reliance on the sustained good
economic performance of the rest of the world, because of the open nature and fragility of small
economies; and the smallness of their domestic markets; (c) restrictions faced in the pursuit of
economic diversification; (d) high dependence on international trade and foreign investments; and(e) barriers to access of official and private capital flows.
68. Recognition of the circumstances of small economies should not be judged at the expense of
other developing countries.  The special vulnerability of some small states was a matter of enduringWT/COMTD/M/22
Page 15
financial and economic distress for these countries.  The recent damage by Hurricanes George and
Mitch had served to underline the vulnerability occasioned by geographical location.  The devastation
caused by these hurricanes and other natural disasters had wiped out, in hours, economic growth
achieved over many years.  There would be lasting effects on the countries affected, some of whom
were still re-building from the damages caused by earlier hurricanes.
69. She emphasised that interdependence of national economies was a feature of the current
international economic system.  The fact had been demonstrated most recently in the global and
systemic effects of the Asian financial and monetary crisis.  In order to ensure the strength of the
global system, the stability of the separate components should be assured.  Against this background,
therefore, the unique vulnerabilities of small economies should be addressed.  Small economies were
marginalized in the globalizing world economy becau se full account had not been taken of the full
extent of their vulnerabilities.  For instance, the use of the GDP per capita income as a benchmark fordifferentiation was a blunt instrument.  Her delegation welcomed recent indications that international
financial institutions would be reviewing this criterion.  New criteria and measures must be devised
that could be effectively used to meaningfully differentiate amongst countries in the allocation of
resources.  To this end, work should be accelerated  in different fora to develop vulnerability indices
designed to provide a broader measure of development for small states.
70. She further emphasised that the special circumstances of small states and the concepts of
smallness and vulnerability had been accepted and were pivotal to work in various fora such as at the
ACP, the EC, UNCTAD, the Commonwealth Secretariat, the FTAA, the United Nations, IMF and the
Inter-American Development Bank.  These organizati ons had incorporated into their analytical work
processes the concept that small states have sp ecial vulnerabilities.  In July 1998, a Commonwealth
Ministerial Mission on Small States led by the Prime Minister of Barbados undertook a series of visits
to major multilateral agencies in order to place the concerns of small states on the multilateral agenda.
The Mission had fruitful discussions with the U.S.  State Department, the IMF, the World Bank, the
WTO, UNCTAD, and the European Commission.  A result of the Ministerial Mission was the
establishment of a World Bank/Commonwealth Task Force which was given the mandate toundertake a detailed examination of the special circumstances facing small economies with a view to
devising a universally acceptable vulnerability index, and to designing more appropriate assistance
programmes to meet the particular concerns of small states.  The IMF, UNCTAD, the European
Commission, and the WTO had all indicated their wish to contribute to the work of the Task Force.
The Task Force would hold its first substantive meeting in London on 7 December 1998.  The Task
Force would meet in conjunction with an Adviso ry Group which would include representatives of
governments and the private sector, regional organizations and financial institutions.  It was envisagedthat this Task Force and Advisory Group would hold three substantive meetings before submitting a
report to the Development Committee meeting of the World Bank and the IMF which would be held
in Spring 1999.
71. The representative of Barbados stated that the alleviation of vulnerability was possible.  If the
international community assisted, including the WT O, it would be possible for small economies to
mitigate the constraints and the problems that confront them.  Most WTO Members had already
subscribed to the concept of the special vulnerability of small states in one forum or another.  It was
now time, therefore, for the WTO itself to become an arbiter of fairness on this matter.  The rules
governing the multilateral trading system must not be insensitive to the imperatives of equitable
international development.  A need existed for the adoption of enlightened policies which wouldprevent the further economic marginalization of small economies.
72. The representative of Dominica associated his delegation with the co-sponsors of the paper.
It was not necessary to re-state the self-evident arguments for a special consideration of small states
which was recognized by Ministers at the 2nd Ministerial Conference.  What was now required was for
the Committee to advance the process and indicate how mechanisms could be established that wouldWT/COMTD/M/22
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give effect to the decision of the 2nd Ministerial Conference.  Action was urgent because small states
were ["hurting".  This term was emotive, but ind eed small states were] "hurting" because they were
not yet in a position to take advantage of all the possibilities that they understood globalization and
liberalization offered.  If these trends continued and if small states remained unable to take advantage
of these trends, then they would add to the list of "failed states".  Members needed to be reminded thatthese states, at great sacrifice to themselves and their populations, had undertaken far-reaching reform
measures.  In spite of these measures, these states had not yet been able to participate in or benefit
from the flows of international finance, investments and trade.
73. He noted that notions of per capita income could be misleading.  Although most small states,
including Dominica, had relatively statistically high per capita incomes, there were other factors
beyond them.  First, were remittances from migrants.  These remittances were not sustainable in the
long-run.  A characteristic of small economies was that they spent a high proportion of their incomeon the provision of education, but their incomes were neither large enough nor growing at sufficiently
rapid rates to absorb the products of the educational system.  As a consequence, the products of these
educational systems travelled abroad.  However, because of reduced immigration opportunities,
"external financing" from immigrant remittances, was decreasing.  Second, were preferences, as the
key factor for a relatively statistically high per capita incomes.  Most small states, includingDominica, depended on preferences for entering into the world economy with a limited number of
agricultural exports.
74. The representative of Dominica said that if preferences were "insensitively removed", then
these small states would be condemned to poverty, destitution and hopelessness.  This was beginning
to happen in Dominica as a result of its experience in banana exports in recent months and due toyoung farmers leaving the industry.  However, these farmers were not entering into any other
productive sectors or occupation – "they were standing at street corners".  Actions being taken at the
WTO were undermining the basis for peace, security, democracy and human rights in small states.
Dominica could not compete on equal terms with other economies in the global system, which was
evident from this statement.
75. Dominica was a small country with a population of 100,000.  Half of the population were of
school age or below, senior citizens or a further quarter were not gainfully employed.  It was difficult
to conceive what a workforce of 25,000 could competitively produce and trade in vis-à-vis other
larger economies in the trading system.  Nonetheless, Dominica would not despair as it was taking
action to put in place measures prescribed by the WTO, the World Bank, the IMF, and others, with a
view to re-structuring the domestic economy so that, in time, Dominica would be able to take its place
with the rest of the world.  However, a sufficient period of adjustment and transition were required, aswell as, technical, financial and other forms of assistance were also required to put in place prescribed
measures.
76. His delegation, in conclusion, emphasised that small states and their populations should not
be sacrificed for doctrinal purity.  Preferences we re an integral part of the international trading
system.  They were contained in GSP and GSTP schemes operated by various countries andgroupings such as the EC, NAFTA, ASEAN, CARICOM, and elsewhere.  Small states, such as
Dominica required preferences, over a reasonable period, to assist adjustment and facilitate the
application of measures which would produce a strong economy.
77. The representative of the Dominican Republic expressed gratitude to the six co-sponsors for
having circulated the paper.  Her delegation acknowledged the contributions of the representative of
Bolivia for her important role in developing th e concept of small economies.  Her delegation fully
supported the concept of small economies, as her country was also a small island economy subject to
climate hazards such as Hurricane George which had, about a month ago, devastated Haiti, Cuba and
the Dominican Republic.  Conditions adding to the vulnerability of small economies included: highWT/COMTD/M/22
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dependence on a few markets and few commodities, difficulties in developing the export sector, high
cost of transport because of remoteness and heavy reliance on agricultural product commodities.
78. She noted that small economies constituted over half of the WTO membership.  Therefore,
her delegation believed that the WTO should, as decided at the 2nd Ministerial Meeting, initiate work
to ensure that the problems and concerns specific to small economies could be recognized.
79. The representative of Malta congratulated Mauritius and other co-sponsors for the paper on
the "Concerns and Problems of Small Economies" and was in favour of action which took into
consideration the specific needs and concerns of small economies.  She referred to Maltese academic
studies and the specific contributions by the University of Malta on the vulnerability indices of small
economies.  Her delegation was still awaiting specific instructions on the joint paper, and would make
a more detailed intervention at a future meeting.
80. The representative of Trinidad and Tobago recalled that her delegation was a co-sponsor to
the circulated paper.  She fully agreed with the statement made by Mauritius, Jamaica and Barbados.
Her delegation was aware of the diversity that existed amongst the small island states, which were
similarly affected by the same factors i.e., small size, small domestic markets, dependence on imports,
heavy reliance on a few commodities and a few markets,  vulnerability to natural disasters, fragility of
eco-systems, constraints on transport and communications and a high level of migration of theirskilled nationals.  It was vital to stress that per capita income was not an adequate measure of the level
of development of a country.  Furthermore, it was necessary for the WTO to take account of
handicaps faced by small economies to prevent the marginalization of these economies in the
globalizing economy.
81. She also drew attention to the fact that the joint paper listed organizations and institutions
which had undertaken studies on small economies and small island states.  In this regard, her
delegation highlighted the on-going work at UNCTAD in support of the Programme of Action
adopted at the Global Conference for the Sustainabl e Development of Small Island Developing States.
Her delegation strongly welcomed UNCTAD's cooperation with the alliance of Small Island States –
a group of about 40 small island and low-lying coastal developing countries.  Her delegationrequested that the conclusions of UNCTAD in this area should be fed into the deliberations and work
of the WTO.  Trinidad and Tobago would participate in the preparation of additional papers on this
item for submission to the Committee.  Her delegation hoped that the concerns expressed would be
taken into account in the future work of the WTO in this area.
82. The representative of Sri Lanka welcomed the placement on the Committee's agenda of the
item on "Concerns and Problems of Small Economies", as timely and praiseworthy.  Her delegation
was deeply concerned with the marginalization of small economies.  She urged Members of theCommittee to urgently address the issue.  Sri Lanka associated fully with the position expressed by
Mauritius and other co-sponsors to the paper, and supported by many other speakers.  The positions
taken by these Members fully addressed the concerns of small economies under the current
multilateral trading system.  The situation of small economies was unique.  They neither qualified for
the special programmes for LDCs nor were they fully representative and covered in the situation thatprevailed in other developing countries.  For instance, FDI in these countries were at low levels
because of the small size of their domestic markets and absence of well-developed infrastructures.
Furthermore, these countries were heavily dependent on few primary exports for their foreign
exchange earnings.  Small economies had several specific problems which impeded their meaningful
participation in the multilateral trading system.
83. Although Sri Lanka was founder Member of the GATT  since 1947, the benefits that it had
been able to derive from the trading system were questionable because of inherent problems
confronted by Sri Lanka since the inception of the GATT.  The recent financial crisis amplyWT/COMTD/M/22
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demonstrated the limited extent to which countries could deal with external shocks even if they
adopted "correct" macroeconomic policies.  Many of the small economies were liberalizing their
countries autonomously.  They were also under tremendous pressure and burden to fulfill their
obligations and commitments under various WTO Agreements.  In spite of their peculiar and inherent
weaknesses, small economies were required to proceed at the same speed as other developingcountries.  Her delegation was of the strong view that the problems of small economies needed special
attention; and their unique problems required more practical solutions in order for them to able to
reverse the current trends.
84. The representative of Lesotho referred to the paper on "Concerns and Problems of Small
Economies", of which Lesotho was a co-sponsor.  He hoped that the document would provide a basis
for constructive discussions.  The issues in the paper were of crucial importance to Lesotho, and were
directly linked to the efforts of his country to actively participate in the multilateral trading system.For instance, erratic and severe climatic conditions exerted considerable pressure on Lesotho's limited
resources.  With the limited support for small ec onomies and LDCs, his delegation took the view that
special consideration of these economies was necessary if they were to achieve full integration of their
economies into the multilateral trading system.  To conclude, his delegation welcomed earlier positive
comments, under the preceding agenda item, for the increased and focused technical assistance forLDCs.
85. The representative of El Salvador joined other delegations in commending the co-sponsors of
the paper on "Concerns and Problems of Small Economies".  The paper was interesting and contained
detailed contributions to a subject which was a source of concern to WTO Ministers at the
2nd Ministerial Conference.  Paragraph 6 of the Declaration of the 2nd Ministerial Conference testified
to the importance that the WTO Ministers attached to the subject.  Her delegation felt that amongst
developing countries there were characteristics that set apart small economies.  Some were
identifiable through their structural vulnerability to external fluctuations, and had a low share of world
trade.  There were those subject to frequent devast ating natural disasters, climatic changes, hurricanes,
such as those that had affected El Salvador.  Her delegation felt that the item should remain on theagenda of the CTD so that discussions could continue and evolve at subsequent meetings.
86. The representative of Egypt welcomed the paper circulated by six co-sponsors on "Concerns
and Problems of Small Economies".  His delegation took the view that difficulties presented by
different developing countries should be recognized by the COMMITTEE and effectively addressed.
The paper would be carefully studied.  However, as a preliminary comment, the problems identified
in the paper were similar to those faced by LDC's, also similar to general problems facing developing
countries.  However, it appeared that some of these problems were specific to small economies.  Hisdelegation was keen to further discussion of this item at a later stage.
87. The representative of Bangladesh commended the co-sponsors for the paper circulated on
"Concerns and Problems of Small Economies".  The paper had just been received.  Therefore, only
general comments could be made at this time.  First, the paper had introduced a new set of interesting
indicators of underdevelopment, distinct from the usual and universally accepted indicator of percapita income.  Second, the paper employed physical features and market characteristics in defence of
its case for "so called small economies".  The explicit attempt to re-define underdevelopment and
marginalization in terms of these new indicators and features, opened the door for new interpretations
which may shift the focus of the international co mmunity away from the effects of marginalization
that already affected the 48 recognized LDCs.  Further elaborate comments would be made after acloser examination of the paper.
88. For the record, however, the representative of Bangladesh noted that the co-sponsors justified
the rationale for the case for small economies from paragraph 6 of the 2
nd WTO Ministerial
Declaration.  However, his delegation underlined the fact that the reference in the 2nd WTOWT/COMTD/M/22
Page 19
Ministerial Declaration to small economies was exclusively in the context of the "marginalization of
least-developed countries".  In the absence of th e context of LDCs, the concern for small economies
"lost most of its validity".  Furthermore, his delegation emphasised that the 2nd WTO Ministerial
Declaration referred to "certain small economies" and not all small economies as had been presented
by the paper in circulation.  The circulated paper had severed its link to the contextual reference
because it had omitted the word "certain".  His delega tion reserved its right to return to the item at a
later stage.
89. The representative of Tanzania drew attentio n to the high importance to all Members of the
item and commended the co-sponsors of the paper on "Concerns and Problems of Small Economies".
The paper had just been received, therefore, his delegation's comments, at this time, would only be
preliminary.  Tanzania, as a Member of the Commonwealth, was participating in the Commonwealth
discussions on the same item.  The case for the small economies to be accorded special considerationwas strong.  The case had been well argued and deserved the sympathy of Members.  While it was a
fact that a number of these countries had higher GDP per capita than most of the LDCs, for instance
Jamaica's whose GDP per capita and export earnings we re twice plus that of Tanzania, yet the special
nature of these countries had to be recognized.  This  special nature included their vulnerabilities, their
remote location and smallness.
90. He said that although LDCs also had difficulties, these were structural problems, problems
related to infrastructure, under-utilisation of capacities, etc.  However, the problem of LDCs were of a
transitional nature.  It was expected that over time, LDCs would surmount their difficulties.  In
contrast, the peculiarity of the problems of small economies lay in the fact of their location and their
small size.  The problems confronting the small economies appeared to be beyond their capacities.The case for the special consideration for small economies was, therefore, strong and Tanzania would
support their case.
91. The representative of Tanzania stated that what was required was to identify practical ways in
which these concerns could be incorporated into the WTO; and assess the impact of any practical
measures of assistance on the development and the economies of these small economies.  After suchpractical measures (action package) were undertake n, it would also be useful to know what extra
impact such practical steps would have on some of the small economies that were already LDCs, such
as Lesotho.  In doing so, his delegation underscored the vital importance of taking account of the
statements made by some of the delegations of the small economies themselves, particularly those by
Jamaica and Barbados.  These delegations had said that, whatever assistance sought by small
economies should be without prejudice to the problems of or assistance to LDCs.  On this point, the
representative of Tanzania shared a common position with the representative of Bangladesh.  Thisposition was further recently affirmed by the distinguished Minister of Barbados, at the head of a
delegation that was addressing the matter of the concerns and problems of small economies, and who
had said: "We pointed out that small states did not seek recognition of their special circumstances in
ways which could prejudice assistance to the LDCs".  The representative of Tanzania said that
whatever package of practical support the WTO put together for small economies, it would benecessary to take account of the position of non-prejudice to LDCs.
92. The representative of Tanzania suggested th at either the Committee, a specialized committee
or a working group should be established to work out a set of practical measures and steps for
assisting small economies.  His delegation believed that any supportive measure or set of measures
taken to benefit any category of developing countries would in the long-run benefit all developingcountries, including LDCs. His delegation reserved the right to return to the item at a later stage.
93. The representative of Haiti associated his delegation with the joint paper by the
six co-sponsors on "Concerns and Problems of Small Economies", for three reasons.  First, Haiti
became an LDC after having been a small island developing economy, structurally weak andWT/COMTD/M/22
Page 20
vulnerable.  Second, Haiti did not want to see what happened to it, happen to other small island
developing economies.  Following the current trends of the world economy, these small island
developing economies were potential LDCs.  At the beginning of the 1980s there were only 26 LDCs,
less than 20 years later, there were now 48 LDCs.  This meant that with increasing globalization, the
number of LDCs was increasing.  If the WTO did not address the concerns of these small economies,these small economies would soon be listed as LDCs.  WTO Trade Ministers at the 2
nd Ministerial
Conference had expressed their concern over the marginalization of LDCs and certain small
economies.  They recognized that this matter should be urgently addressed more so because the
peculiar problems of these economies had been compounded by the problem of chronic debt.  As a
WTO Member and as an LDC, Haiti would like to ensure that the WTO should respond to the best of
its ability to the concerns expressed by Ministers, as set out in the Declaration by the Ministers at the
2nd WTO Ministerial Conference.  Irrespective of their scale of contributions, attention should be
accorded to the problems of LDCs and small economies at all times.
94. The representative of Bolivia acknowledged the commendation and tribute of the
representatives of Jamaica and the Dominican Republic.  In the real world of the multilateral trading
system, small economies and other Members operated in a rule-based system.  Small economies
desired full participation in drawing up the rules which would govern commercial behaviour.  Small
economies were concerned that colleagues from LDCs had expressed so many fears.  It appeared that
small economies represented a danger that could arise from the diversion of attention away from
LDCs.  Her delegation considered that there was no competition for attention.  A truly multilateral
system should be able to respond to the interests of all the components of the system, particularly if
such a system desired to be considered a credible system.  Her delegation was deeply satisfied thatthis item was being addressed in the Committee.  She requested that the item should be constantly
retained on the agenda of the Committee.  The item was not a new one.  For instance, the problem had
been very clearly referred to in the Committee on Subsidies and Countervailing Duties.  Her
delegation was convinced that a common denominator could be found to enable the Committee forge
a definition which the small economies would feel correctly identified them.  The aspirations of smalleconomies should not only be concentrated on tec hnical cooperation, which was important, but also
focused on other factors which would assist the integration of small economies in the multilateral
trading system.  There were several examples such as the safeguarding of export opportunities, early
detection of non-tariff barriers and market access for the limited exports of small economies.
95. She supported the position by several delegations that the jointly circulated paper was
valuable.  It had established a good basis for work on the item in the Committee.  In conclusion, the
wish of small economies was not to be marginalized; and to have an opportunity to allow theirexternal trade function as the motor of their economies.
96. The representative of Cuba supported the joint paper on "Concerns and Problems of Small
Economies".  His delegation was familiar with the difficulties raised in the paper.  It was necessary
that the problems of the small economies should be accorded special consideration and treatment to
enable them participate effectively in the multilateral trading system.  The paper provided a goodbasis not only for the discussions in the Committ ee but also for the recommendations that would be
evolved to meet the needs of these countries.
97. The representative of Guatemala said that he shared many of the points set out in the paper
circulated on the Concerns and Problems of Small Economies.  He felt it was justified that the
Committee should keep the item on its agenda and consider it constantly because the Committee wascharged with considering issues of trade and development in the multilateral trading system.  His
delegation recalled the concerns expressed by Trade Ministers in paragraph 6 of the 2
nd WTO
Ministerial Conference on the marginalization of certain small economies, and the urgency of
addressing these concerns at the WTO.  This was why his delegation felt it necessary to analyze the
different aspects of the problems and the concerns expressed by the Ministers.  In this connection, theWT/COMTD/M/22
Page 21
representative of Guatemala said that his delegation would circulate a paper in the future.
Nonetheless, it should be borne in mind that several organizations had already undertaken useful work
on the subject of small economies.  These organizations included Economic Commission for Latin
America, the Organization of American States and the World Bank.  In Latin America, work had also
being undertaken on small economies within the purview of regionalization.  Therefore, all the studiesthat had been carried out and which were still underway should be useful not only within the regional
context, but also at the multilateral level to enable the WTO tackle this issue.  Each small economy
represented a series of different characteristics which pointed to the urgency of taking into account the
needs of small developing economies within the WTO.
98. The representative said that small economies had certain economic and structural
characteristics which make them more vulnerable to external fluctuations in both production and
demand.  He re-iterated the point by earlier speakers that the trade of small economies depended onthe exports of certain limited number of commodities.  Their trade was non-diversified in structure,
and did not represent a significant percentage of world trade.  However, small economies were highly
dependent on international trade.  Furthermore, infrastructure was limited and the domestic markets
were small.  As widely known, many of the small economies were vulnerable to climatic disasters and
hazards, such as recently tragically demonstrated by the hurricanes George and Mitch, as well asforest fires.  Many of these small economies, therefore, had difficulties in drawing benefits from the
multilateral trading system.  As a consequence, the WTO had to be creative in evolving positive
mechanisms which would assist small economies in fu lly participating and drawing benefits from the
trading system; and also enable small economies to close the gap that separated them from other
countries.  Small economies must use their resources, their creativity and individual capacities, as wellas those of the international community to enable them realize their development aims and potential.
99. The representative of Guatemala underscored the necessity of assistance to small economies.
He highlighted possible areas of assistance to include improvements in their negotiating capacities,
implementation of treaties and agreements, human capacity-building, transfer of technology, and
support for SMEs, etc.  He affirmed that his delegation would remain committed to the item.
100. The representative of said that as a neighbour of many small economies, particularly small
island states, her delegation was interested in the item, and specifically to the issue of the vulnerability
index.  Her delegation would carefully study the pa per circulated by the six co-sponsors, and would
support further discussion of the item at the next meeting of the Committee.
101. The representative of Nepal said that his comments would be preliminary, having just
received the paper.  Some of the views already expressed, in particular those of Bangladesh and
Tanzania, also reflected the views of his delegation.  In addition, his delegation was interested in thetheme of the paper for several reasons.  First, the theme of the paper was welcome per se .  The
Agreement establishing the WTO was a major event in international economic relations.  The
increasing participation of a growing number of countries, including Nepal which was a least-
developed country or small economy, and a land-locked country in the WTO, reflected the current
geo-centric nature of international economic relations, but also a growing faith in the WTO and in itsability to ensure that even the small and the weak can  secure a share in the benefits of the system and
of the growth in international trade.  Second, the fa ctor of vulnerability was important .  Vulnerability
emanated from a number of factors, which were sufficiently important to deserve deeper study by the
Committee and the WTO.  The vulnerabilities arising either from internal structural weaknesses or
from external factors, needed to be studied in depth.  This was necessary to ensure that participants in
the multilateral trading system should not be marginalized.  For these reasons, it was necessary to
consider practical steps that would ensure reversal of marginalization.
102. The representative of Switzerland commended the co-sponsors for circulating the paper on
"Concerns and Problems of Small Economies".  Co mments would be preliminary since his delegationWT/COMTD/M/22
Page 22
had just received the paper.  He emphasised several key points.  First, Switzerland had always been
concerned with the marginalization of countries and economies irrespective of size.  His delegation
believed that every effort should be made to avoid marginalization of countries.  Addressing the
problems of marginalization was a big challenge for the WTO and for trade-related technical
cooperation.  There was a problem with the definition of the group of small vulnerable economies,which was not self-evident.  Furthermore, it was the firm belief of his delegation that the main
elements of successful development lay in stable political and legal systems, within the framework of
sound macro-and microeconomic policies.  The experience of Switzerland itself was instructive.
Switzerland was a small land-locked, net food importing country which had achieved positive results
and considerable economic progress in 150 years of liberal industrial trade regime based on legal and
political stability.
103. The representative of India welcomed and supported the underlying objectives and principles
elaborated in the joint paper.  He agreed with previous speakers that small economies faced certain
characteristic problems, and had particular concerns, all of which needed to be addressed.  In fact,
these concerns were specifically recognized in the Marrakesh Declaration which embodied the special
and differential treatment provisions, and also recognized the importance of the implementation of
these provisions for least-developed countries.  His delegation recalled that three and a half yearslater, the 2
nd WTO Ministerial Conference in paragraph 6 of its Declaration recognized the importance
of addressing the problem of marginalization of certain small economies, in the context of increasing
globalization.
104. The representative of India noted that specific suggestions and possible indicators had been
proposed in the circulated paper.  His delegation would require time to study these suggestions andindicators.  However, it was necessary to highlight the acute problem of increased vulnerability of
small economies to the vagaries of global financial and economic conditions.  This had acquired
greater seriousness in the light of problems being faced by certain economies which were not
necessarily "small".  It was, therefore, necessary to recognize the seriousness of the problem of
vulnerability, to address the problem and examine how it could be reduced or solved.  In this context,it would also be necessary to study and find solutions to how those specific problems and
characteristics that limit development could be overcome.  His delegation looked forward to further
in-depth discussions in the Committee on the issues raised in the jointly circulated paper.
105. The representative of United States said that her delegation was very sensitive to and fully
understood all the issues that had been raised by Members.  Her delegation believed that preferential
trading arrangements were essential in assisting small economies and other developing economies.
The United States was a provider of WTO-consistent preferential programmes.  Her delegation wouldreview, in depth, the paper that had just been circul ated and looked forward to a fuller discussion at a
later stage.
106. The representative of the European Communities said that her delegation would closely
review the paper; and looked forward to an in-depth debate at the next meeting.  She assured the
Committee that her delegation attached considerable importance to the subject and, to this end,desired contributing constructively to this item in the future.
107. The representative of New Zealand welcomed the joint paper.  New Zealand was a close
neighbour to many small island, developing countries and LDCs and, therefore, was both aware and
sympathetic to the concerns of these states.  His delegation had participated in discussions at various
fora and supported on-going work at the World Bank and other organizations, particularly on thespecific issue of the vulnerability index.  His delegation would closely study the paper and looked
forward to a detailed examination of the subject at the next and future meetings.WT/COMTD/M/22
Page 23
108. Replying to the discussion, the representative of Mauritius focused on five issues.  First, he
assuaged the concerns raised by several delegations that had expressed anxiety that attention to small
economies would divert attention away from and prejud ice LDCs.  In this context, he commended the
representative of Tanzania for his statement.  The representatives of Jamaica and Barbados had made
similarly useful and constructive comments.  Second, concerns had been raised about the use ofGross Domestic Product (GDP) as a measure of the development of economies.  His delegation noted
that the Commonwealth and the World Bank had agreed to examine any difficulties that may arise for
small economies in accessing funding for development, based on the use of the GDP as a measure for
development.  Third, his delegation expressed its gratitude to Members of the Committee for the
interest they had demonstrated in their interventions on this item.  Fourth, his delegation and other
co-sponsors intended to submit further ideas to rein force the jointly circulated paper.  This position
had been underscored by Jamaica and Guatemala.  His delegation was convinced that further ideaswould assist constructive discussions at the next meeting of the Committee.  Finally, the
representative of Mauritius referred to the suggestion raised by the representative of Tanzania on how
to give effect to the decision by WTO Ministers.  His delegation agreed that practical solutions were
required.  In this connection, he requested Members to consider what practical solutions and steps
could be taken to address the problems and concerns of small economies.  These practical solutionsand steps would have to be presented to the 3
rd Ministerial Conference through the General Council.
109. The Committee took note  of the statements made and agreed  to place the item on the agenda
of the 23rd Session of the Committee on Trade and Development.
G. TRADE FACILITATION: CONTRIBUTIONS BY THE COMMITTEE ON TRADE
AND DEVELOPMENT (CTD) TO THE WORK PROGRAMME OF THE COUNCIL
FOR TRADE IN GOODS (CTG)
110. The Chairman recalled that he had received a letter from the Chairman of the Council for
Trade in Goods (CTG).  In the letter, the Chairman of the CTG had requested the Committee to
contribute to the work programme on trade facilitation of the CTG, which was to be completed byMarch 1999.  The Committee had also been asked to address those aspects of trade facilitation which
it regarded as being related to the work within its mandate.  The contributions from the Committee
would be introduced into the informal discussions of the CTG on trade facilitation.
111. Following a proposal made at the informal meeting of the Committee, the Chairman said he
had invited a representative from the Trade Facilitation Section of the UNCTAD Secretariat
(Mr. Maxence Orthlieb) to make a presentation on the subject to the Committee.
112. The representative of UNCTAD stated that  UNCTAD was the United Nations organization
charged with the development of trade.  The organization had worked with the  United Nations
Economic Commission for Europe (UNECE) over a long period, in implementing the UNECE's
recommendations on trade facilitation.  In additi on, UNCTAD had a mandate to assist LDCs, land-
locked and island developing countries.  Fourt h, it extended assistance to Countries in Transition.
113. He summarized the current situation by contrasting the contraction of the world through
liberalization, globalization and increased access to technology, on the one hand, with an obsolete
commercial environment, government role, and paucity of trade data on the other.
114. The representative of UNCTAD drew attentio n to the recommendations made at the United
Nations International Symposium on Trade Efficiency (UNISTE) it organized in Columbus, Ohio,
in 1994.  These recommendations were contained in the Columbus Declaration.  The ColumbusDeclaration identified several areas in which measures could be taken to improve trade in manyWT/COMTD/M/22
Page 24
developing countries.  These areas were in:  customs; transport; banking and insurance; business
information for trade; business practices; and telecommunications.
115. Several bureaucratic problems had been identified which impeded trade efficiency.  These
were essentially:  excessive number of forms to  complete; requirement for multiple signatures;
inflexible application of regulations; lack of private/public sector synergies; use of obsoletetechnologies; and the misuse of modern technologies such as the use of containers and the
Electronic Data Interchange.
116. The representative of UNCTAD stated the Or ganization's views of how progress could be
made on trade facilitation.  First, trade facilitation required synergies between the public and the
private sectors, particularly in the fields of transport, trade and finance (customs).  Second, trade
needed to take advantage of new technologies to achieve simplification, standardization, and
harmonization of operations, documentation and practices.  Third, trade facilitation needed to supportprivate initiatives.  Conversely, the private sector needed to support trade facilitation.
117. UNCTAD had a long experience in assisting countries with trade facilitation.  In this
connection, it had developed various systems and programmes with real and positive impacts for
countries over the years.  These programmes were as follows:  (a) Facilitation Programme
(FALPRO): This was jointly developed between  UNCTAD and the UNECE.  This programme had
recommendations currently in application in seve ral countries; (b) TrainforTrade and TrainMar:
These were both training programmes.  The former focused on training for trade negotiations, and the
latter focused on the maritime transport industry; (c) Automated System for Customs Data Entry and
Management (ASYCUDA):  This was software package to assist Customs administrations in
countries.  It was a part of a wider programme on Customs Reform and Modernization, developedwithin the World Customs Organization (WCO), and was supported by a number of international
organizations such as the World Bank, the IMF, and the European Commission.  ASYCUDA had
been implemented in more than 70 countries; (d) Advance Cargo Information System (ACIS): This
was logistic and a cargo tracking system, composed of several modules on ports, railways, roads, and
a backbone that linked these modules.  ACIS had been implemented in 15 countries, and wassupported by several railway administrations, ports authorities and international donor institutions;
(e) Global Trade Point Network (GTPnet):  This system was developed within UNCTAD.  Trade
Points are focal points for practical trade transactions.  They are points within a country where traders,both importers and exporters, can find commercial information.  Trade Points are currently
operational in 44 countries, and more are in the process of joining the system.  These Trade Points had
the opportunity to connect to Electronic Trade Opportunities (ETO).  ETOs allow traders access to
global information on potential trade opportunities.  Currently, there are about 10,000 subscribers tothis system which, at present, offered approximately 1,000 ETOs every week; and, (f) Transit
Agreements: UNCTAD had concluded such Transit Agreements with several countries.
118. The representative of UNCTAD emphasised the importance of trade facilitation in one
country.  In this regard, the mechanism of a National Trade Facilitation Committee or sometimes
referred to as the National Trade Facilitation and Transport Committee (NTTFC) was of indispensablevalue.  Within this mechanism, all the key partie s and interests in international trade were brought
together.  These included the public and private sector, as well as users and providers of services.
Some of the specific interests, agencies, government departments and ministries which had tended to
participate in this forum in some countries were the ministries of trade, finance, transport, national
planning, transport operators, banks, insurance companie s, customs, etc.  At this forum, these interests
examined proposals and searched for consensu s between commercial parties and governmental
authorities on facilitation measures to improve international trade and transport.
119. UNCTAD had reached several conclusions.  First, there was a need for WTO rules on trade
facilitation.  These rules could be either through the "introduction of conditionalities" or through theWT/COMTD/M/22
Page 25
recognition that there were new players in in ternational trade who needed a new commercial
environment favourable to trade.  Second, cooperation was needed.  UNCTAD was ready and willing
to cooperate with WTO in the field of technical cooperation for the implementation of any new rule
on trade facilitation, particularly in those areas where rules had been recommended by the UNECE,
UNCTAD, and in the area of the set of rules recommended by the UNISTE – United NationsInternational Symposium on Trade Efficiency at Columbus, Ohio, in 1994.  He elaborated on some of
the recommendations, from the meeting in Columbus which, in the view of UNCTAD, could be the
basis for further discussion for rules in trade facilitation.  These were:  (a) UNISTE
Recommendation 14, dealing with facilitation at  the national level; (b) UNISTE Recommendation 15 ,
addressing administrative procedures and operations in various areas; and (c) UNISTE
Recommendation 16, emphasising the desirability for governments acting commercially, meeting user
needs, using standard commercial documents, using Electronic Data Interchange (EDI), and
employing commercial best practices.
120. UNCTAD suggested three areas of possible WTO action.  First, the WTO could recommend
that its Members apply the UNISTE recommendations in general or in particular recommendations
14 to 16.  Second, the WTO could require that its Members apply recommendations 14 to 16.  Third,the WTO could establish the application of recommendations 14 to 16 as "an entry requirement".  If
this were so, the WTO Secretariat could take initial action to prepare action by Members.  Member
countries would then decide which action to take; and in this regard, UNCTAD could offer technical
assistance to developing countries.
121. The representative of UNCTAD selected the transport sector as an example of how trade
facilitation operated and could be promoted.  In  Chapter II of the UNISTE Recommendations, there
were four sets of specific recommendations to:  (i) commercial parties; (ii) government departments;
(iii) intergovernmental organizations; and, (iv) on the implementation of suggested recommendations.
(i) Recommendations to commercial parties:  It was recommended that commercial
parties should eliminate non-productive areas; improve managerial skills through
training and career development; implement Trade Points; implement EDI-based
modern practices, switch to new commercial practices, for example, INCOTERMS,1
UCP 500 (documentary credit practices); increase capital base; and use NTTFCs;
(ii) Recommendations to government departments:  It was recommended that
government departments should modernize laws and regulations; promote National
Facilitation Committees (NFCs), implement specific operational issues such as blocktrains, updating of banking and insurance practices; stimulate training; harmonize
sub-regional regulatory policies; create sub-regional databases such as ACIS; and
hold sub-regional NTTFC meetings;
(iii) Recommendations to intergovernmental organizations: Intergovernmental
organizations should offer advice to governments and commercial parties on such
issues as measures to facilitate the introduction of multimodal transport – door to
door transportation – modifications of organizational structures, creation of NFCs,
and organization of awareness campaigns on the value of trade facilitation;
                                                     
1INCOTERMS are a set of internationally standardized contractual terms which were devised by the
International Chamber of Commerce to allow seller and buyer in a transaction to share responsibilities as
deemed appropriate.  There are approximately 13 of these di fferent terms that exist, for example, FOB, CIF, etc.
These contractual terms need to be incorporat ed in each contract by means of reference.WT/COMTD/M/22
Page 26
(iv) Implementation of suggested recommendations: To implement the recommendations,
technical assistance had to be provided and monitored, awareness had to be created
on multimodal transport issues; and cooperation had to be ensured amongst interested
parties.
122. To conclude his presentation, the representative of UNCTAD argued that due to the diversity
amongst countries, it was necessary in each country to begin by identifying the key issues in trade
facilitation.  In this connection, the NFCs were important as a fora for identifying issues, exchanging
views and searching for solutions, as well as for raising awareness on trade facilitation-related issues.
On the latter, UNCTAD was regularly organizing wo rkshops and seminars on international trade and
transport.  These seminars provided an opportunity to exchange views with representatives of the
public and private sectors.  They also served to draw attention to the value of all interested partiesmeeting at a common forum such as the NFCs and exchanging views.   Sometimes, it was difficult for
some governments to understand the rationale for the establishment of an NFC, a forum where the
government would sit around the same table with th e private sector.  In the transport sector, for
example, several key issues had arisen at NFCs.  These issues were grouped into three.  First, legal
issues under which sub-sets of other issues arose such as transport, banking and insurance.  Second,the issue of commercial practice.  Under this issue, other sub-issues arose namely INCOTERMS, the
use of documentary credits, the problems of foreign exchange, the non-recognition of EDI in some
countries as a tool of international trade, and the issue of professional associations which were not
well structured and organized and not recognized as partners in international trade.  Third, were the
operational issues.  These included the problem of how to properly operate different transport modes,terminals, preparation and training of road transpor t operators.  There were also problems in the area
of border crossing, problems with documentation, issues arising from the automatization of customs
information, and the physical problems at customs, points of entry, and transit issues which block or
impede the flow of goods.  The latter was especially problematic for land-locked countries.
123. Following the presentation by UNCTAD, the Chairman called for questions and comments
from the floor, underscoring the importance of Members ideas on how the Committee would
contribute to the informal discussions on trade facilitation in the CTG.
124. The representative of Mexico considered the presentation by UNCTAD valuable.  UNCTAD
had worked on this area of trade facilitation since 1994.  It had evolved a serious programme on trade
facilitation.  Nonetheless, acute problems were present in the area of trade facilitation.  In the view of
his delegation there were two major aspects to trade facilitation namely, the simplification of
documentation and procedures involving foreign trade particularly as regards exports.  He referred tothe UNISTE recommendation No. 16 (government as  a business), in the presentation by UNCTAD,
and wanted to know whether it was appropriate to refe r to the government as a business or rather as a
trade facilitator of international business and trade.  He also wanted to know whether the
recommendations adopted in 1994 remained relevant in  the light of rapid changes in the international
trading environment.
125. He commented on INCOTERMS which were important between buyers and sellers in
international trade.  The question, however, was the extent to which governments could become
involved in this specific aspect of INCOTERMS.   Normally, it was the International Chambers of
Commerce (ICC) or the International Trade Center (ITC) which updated INCOTERMS in order to
make them consistent with the current situation in international trade.
126. He then focused on the central issue of the ways in which the Committee could contribute to
the Work Programme of the CTG on Trade Facilitation.  In this connection, his delegation felt that
electronic commerce was important and strongly connected and complementary to trade facilitation.
Furthermore, an important aspect was the impact of  electronic trade on SMEs in developing countries,WT/COMTD/M/22
Page 27
as well as the effects of trade facilitation on the trade and economic prospects of developing countries.
These aspects had to be emphasised appropriately.
127. Finally, he asked UNCTAD how trade points func tioned, what problems they confronted, and
how their activities could be improved, particularly focusing on the developing countries?
128. The representative of Egypt agreed that the presentation by UNCTAD was valuable.  The area
of trade facilitation was complex and multi-dimensional.  The difficulty seen by his delegation in the
consideration of this subject at the WTO was the fragmentation of the subject into different
committees.  This created difficulties for the Committee in playing a coherent role on the item
although important development aspects existed on the subject of trade facilitation.  What, therefore,
was required was a Secretariat Note that would assist the Members in structuring their discussions on
the subject.  His delegation acknowledged that several delegations had presented papers such as the
European Communities, Switzerland, Korea, Hong Kong, China, as well as the Secretariat.  Theproblem, however, was one of fragmentation acro ss several WTO bodies.  The objective of his
delegation was not to duplicate the discussions taking place in other WTO bodies, but for a Secretariat
Note to assist Members in rationalizing and structuring their discussions, and hence in contributing to
the Work Programme of the CTG.
129. The representative of the European Communities expressed its conviction that the continued
and vigorous promotion of trade facilitation, in all its aspect, was an indispensable element for any
development policy.  Indeed, trade facilitation and the establishment of rational procedures would
lead to the reduction of excessive costs, rational allocation of resources and encouragement of trade
and investment.  These were tangible advantages for countries that followed the path of trade
facilitation.  Several speakers had expressed these advantages.  These speakers included the Chambersof Commerce of Peru, Zimbabwe and the Customs De partment of Chile.  The latter had shown that
through the re-organization of its services and tech niques, it had obtained spectacular results in cost
reduction and in the efficiency of its services.  On this basis and on the basis of experience in this
area, his delegation concluded that trade facilitation was a win-win situation.  Furthermore, his
delegation stressed that this win-win aspect should be reflected in the possible contributions by theCommittee to the Work Programme of the CTG in advance of the latter's March 1999 meeting.
130. The representative of the European Communities on the basis of the Report of the
March 1998 WTO Symposium on Trade Facilitation, and having regard to the presentations referred
to by his delegation, including the presentation by  the European Communities, invited the Secretariat
to prepare a summary of the elements of interest to Committee Members namely on trade facilitation
as a driving force in development policy.  This would be a useful approach.  His delegation was
uncertain as to whether this would duplicate the request by the representative of Egypt, but wascertain that this was a proposal that had the merit for further examination.
131. The representative of the UNECE said that the organization had undertaken important work in
this area in the past 30 years.  Bearing in mind the discussions underway, he noted that some
delegations had highlighted the interoperability issues between electronic commerce and trade
facilitation.  Indeed, the subject of trade facilitation was amenable to analysis from differentperspectives.  In his view, if the 21
st Century global trading system would be composed of two major
components namely, (i) the multilateral trading system, based on MFN treatment, and (ii) an
electronic trading system, based on most favoured netw ork treatment, it would then be easy to identify
a linkage between trade facilitation and electronic commerce.
132. He remarked that the work of the UNECE focused on Electronic Data Interchange which was
a backbone of most electronic commerce and trade facilitation.  This should be further considered at
the Committee.  To this end, he suggested that  a complementary view would be helpful from the
Centre for the Facilitation of Procedures and Practices in Administration and Commerce andWT/COMTD/M/22
Page 28
Transport (CEFACT).  Such a view would offer ideas as to the major issues in the linkage between
the multilateral trading system and the electronic trading system.  He said that over 40 years of
GATT/WTO work had been focused on market access and market presence issues, however, the
UNECE envisioned a new area of market communicatio n issues.  He, therefore, proposed that the
Committee should invite at its next meeting the representative of CEFACT to address the Committeeon the major issues before it and the UNECE regarding the linkages between trade facilitation and
electronic commerce within the multilateral trading system.
133. The representative of Panama welcomed the presentation by UNCTAD.  It noted that the
mechanism of Trade Points (Centres) had been created for the purpose of trade facilitation.  In a
number of countries in Central and South America, there were several projects in this regard.  His
delegation requested UNCTAD's impressions/assessments as to how these Trade Points had
contributed to trade facilitation, for instance in Central and South America?  Furthermore, what typeof follow-up had been accorded to these projects?
134. The representative of India welcomed the UNCTAD presentation.  She said that the
representative of Mexico had usefully highlighted the importance of small and medium enterprises as
the principal entities in developing countries.  Against this background, her delegation was therefore
of the view that the Committee should discuss the role of trade facilitation in furthering the tradeprospects of developing countries particularly in the conduct of trade through electronic means.  She
also referred to the statement by the repres entative of the European Communities which had
highlighted the indispensable nature of trade fa cilitation for development activities.  All these
dimensions, in the view of her delegation, should be discussed in the Committee within the
framework of the Work Programme on Trade Facilitation of the CTG.  The representative of India, inaddition, requested for clarity on the nature of the reservations by some countries on various elements
of the Kyoto Convention.  Such a discussion in the Committee would make it possible to understand
the diversity of administrative and facilitation practices across the world and in particular the
problems that were endemic to developing countries.
135. The representative of UNCTAD responded to the comments made and questions raised.  First,
the trade points were based on the rationale of assisting traders within a country to enter into
negotiations with other traders to buy and to sell goods and services.  It was geared to address the
problems faced by small and medium-sized exporters and importers.  It was intended to be a private
sector oriented system.  However, UNCTAD had noticed that some trade points were based in
ministries.  This was not an efficient use of the system.  In countries where the trade points had been
located within chambers of commerce they had usua lly turned out to be more effective.  However,
there was not a single recipe for the success of trade points.  In some places, the trade points had beenmore successful than others.
136. He noted that several comments had been made on the linkages between electronic commerce
and trade facilitation.  In this regard, he invited Committee Members to participate in the Partners for
Development Meeting in Lyon from 9 to 12 November 1998.  At this meeting, electronic commerce
would be one of the subjects to be discussed, as would be other subjects such as transport, trade
facilitation, trade points, micro-financing, bio-trade, etc.  Several pre-occupations raised at this
meeting would be discussed at the Lyon meeting which would engage the private sector and civil
society.
137. Finally, he commended the March Symposium of the WTO on Trade Facilitation.  At that
meeting, excellent documentation was circulated, and delegations made high quality interventions thatwere very useful.
138. The Committee took note of the statements made and agreed
 to initiate informal consultations
on the item.WT/COMTD/M/22
Page 29
H. REPORTING ON REGIONAL TRADE AGREEMENTS
139. The Chairman informed the Committee that he had received a letter from the Chairman of the
Committee on Regional Trade Agreements (CRTAs) requesting him to bring to the attention of the
Committee the recommendations by the CRTAs on the requirements for submission of information onthe regional trade agreements contained in paragraph 4(a) of the Enabling Clause.  The
recommendations were contained in document WT/REG/6 before the Committee.
140. The CRTAs had recommended that the Committee should adopt the suggested procedures, as
general guidelines with respect to information on regional trade agreements submitted to it.  He
invited the Committee to adopt the recommendations.
141. The Committee agreed to adopt the recommendations.
I. OTHER BUSINESS
(a) Requests for observer status to the CTD
142. The Chairman informed the Committee that he had received a request for observer status in
the Committee from the Inter Arab Investment Guarantee Corporation, in a letter dated
14 October 1998.  He recalled that WT/COMTD/W/22 and its revisions contained a list of
international intergovernmental organizations with observer status in the Committee, as well as a list
of those organizations whose requests had not yet been considered.
143. The Chairman invited Members to consider the request by the Inter Arab Investment
Guarantee Corporation, including the outstanding requests before the Committee.
144. The representative of Egypt supported the request for observer status by the Inter Arab
Investment Guarantee Corporation.145. The representative of Bangladesh supported the request for observe status by the Inter Arab
Investment Guarantee Corporation.146. The representative of Switzerland requested for documentation from the Inter Arab
Investment Guarantee Corporation before decidi ng on the request, unless there was unanimity to
support the request.
147. The representative of Jamaica agreed with the representative of Switzerland to request for
documentation from the Inter Arab Investment Guarantee Corporation.  She said that perhaps the
documentation should be provided to all Members of the Committee.
148. The representative of the United States agreed with the representatives of Jamaica and
Switzerland, and said in addition that her delegation had to consult with her authorities before joining
in any decision by the Committee.
149. The representative of the European Communities agreed with the representatives of
Switzerland and the United States.150. The Chairman noted the comments made and said that informal consultations would be
initiated on the matter.  He proposed that the Committee should revert to the issue when his informal
consultations had yielded results.  He further proposed that the Inter Arab Investment GuaranteeWT/COMTD/M/22
Page 30
Corporation should be added to the list of t hose organizations whose requests had not yet been
considered.  In this regard, the Chairman requested the Secretariat to revise document
WT/COMTD/W/22 Rev.2, and to circulate the documentation relating to the Inter Arab Investment
Guarantee Corporation.
151. It was so agreed.
(b) 1998 Annual Report of the CTD to the General Council
152. The Chairman drew attention to the fact that the Committee had to adopt an Annual Report
for 1998.  In this connection, he noted that the next meeting of the Committee was scheduled for
7 December 1998, a date which would not permit adequate time for the adoption and processing of
the Annual Report before the report was forwarded for consideration to the General Council at itsmeeting scheduled for 10 and 11 December 1998.  For the purpose of the review, the General Council
needed to consider the report no later than 27 Nove mber 1998.  The Chairman also said that the form
of the CTD Report, pursuant to the General Council's Decision on reporting procedures contained in
document WT/L/105, should be brief, factual in nature and provide an indication of the actions and
decisions taken by the Committee in the year under review.
153. In view of the fact that the 23
rd Session of the Committee had been scheduled for 7 December
1998 which came after the deadline for submitting adopted reports to the General Council, the
Chairman suggested that the Committee request th e Secretariat to prepare a draft factual Annual
Report for 1998 and circulate it to Members.  If any Member had comments on the report, that
Member would inform the Secretariat of such comments no later than Friday, 13 November 1998.Thereafter, an informal meeting of the Committee w ould be convened just before the meeting of the
Sub-Committee on Least-Developed Countries on Wednesday, 25 November 1998 to discuss the
Annual Report.  This informal meeting would be dire ctly followed by a brief formal meeting of the
Committee to adopt the report.
154. It was so agreed by the Committee.
155. The Chairman on the basis of the views expressed at the meeting, suggested a possible list of
issues to be considered at informal consultations by the Committee.  These were:  (i) evaluation of
technical cooperation; (ii) small economies; (iii) trade facilitation; (iv) and, (v) requests to the
Committee for observer status.
156. The representative of Egypt said that it w ould be best and more meaningful to informally
consult on the issue of trade facilitation after Members had received a paper from the Secretariat.
157. The Chairman in response noted that at the informal consultations no decision would be
reached.  Furthermore, there would be a need to discuss more and specify the parameters of the paper
to be produced by the Secretariat.  Also, it would be necessary to harmonize the proposals by Egypt
and the European Communities.
158. The representative of Egypt said it was willing to go along with the proposal by the
representative of the European Communities.  What his delegation required was a simple, factual,
structured paper based on the papers that had been previously submitted, and the outcome of the
March 1998 WTO Symposium on Trade Facilitation. Such a paper would allow Members to consider
the issues in a coherent way.
159. The Secretariat thanked delegations for their proposals and said that it would be useful to
have more informal consultations on the contents of the paper requested by delegations from theWT/COMTD/M/22
Page 31
Secretariat on trade facilitation.  There had been a major symposium in March 1998 on the subject
with major contributions from governments and the private sector, but more clarification was needed
to provide the Secretariat with more focus.  Furthermore, contributions from delegations on this issue
would be very welcome even on an informal basis.  He sought the understanding of Members that a
Secretariat paper should not precede the informal consultations until Members provided moreclarifications on the contents and the parameters of the paper which had been requested.
160. The Chairman in the absence of any further comments re-affirmed that the informal
consultations would then include trade facilitation.
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