WORLD TRADE
ORGANIZATIONWT/COMTD/INF/2
16 July 2001
(01-3513)
MINISTERIAL MEETING OF THE LEAST-DEVELOPED COUNTRIES (LDCs),
ZANZIBAR, TANZANIA, 24 JULY 2001
Issues Note by the WTO Secretariat
I. INTRODUCTION:
1. A key challenge facing the global community is how to integrate LDCs better into the trading
system and the world economy.  Poverty alleviation is a vital part of this task, requiring high and
sustainable growth.  Continuing improvements in market access can make a valuable contribution,linked to a coherent and integrated programme of technical assistance and capacity-building involving
bilateral and multilateral development partners.  The success of external support measures will
crucially depend on the effectiveness of LDCs in "mainstreaming" trade priority areas of action into
their plans for economic development and strategies for poverty reduction, as well as continuing with
domestic liberalization and reform.
2. In light of the decision by LDCs to convene a ministerial meeting, prior to the 4
th WTO
Ministerial Conference, the WTO Secretariat stands ready to provide every necessary support.  This
Ministerial Meeting will enable the LDCs to identify and review issues of common and individual
trade policy interest.
3. Progress has been made in integration support measures in favour of the LDCs, but much more
remains to be done.  The collective effort of multilateral agencies and donors is required to improve
the trade and economic circumstances of the LDCs.  This year, Senegal, became the 49th LDC.  The
trend towards an increasing number of LDCs needs to be reversed.  The LDCs themselves have
increased their level of participation within the WTO.  They recently established a WTO LDCs'
Consultative Group, where the LDCs identify their interests and endeavour to find common ground.
II. DEVELOPMENTS SINCE SEATTLE
4. The multilateral trading system suffered a set-back at Seattle.  However, since the Third
Ministerial Conference, significant and positive developments have occurred in the trading system,
including in particular for the Least-Developed Countries. At a the meeting of the General Council, 7-
8 February 2000, the Director-General introduced a package of confidence-building measures to the
WTO Membership.1 This package included proposed measures in favour of the Least-Developed
Countries (LDCs).
5. The Director-General initiated wide-ranging consultations with the Membership focused on
improving market access opportunities for the LDCs and strengthening the Integrated Framework for
Trade-Related Technical assistance to the LDCs.  These consultations with WTO Membership and
with the 6 core agencies, responsible for the In tegrated Framework, produced significant results.
                                                     
1 WT/GC/M/53, Minutes of Meeting, 7 and 8 February 2000.WT/COMTD/INF/2
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6. As part of the post-Seattle, confidence-building exercise, at the 22nd Session of the WTO Sub-
Committee on Least-Developed Countries2, WTO Members endorsed the proposal by the Chairman
of the Sub-Committee for concrete contributions - "deliverables - to be made by WTO Members to
LDC-III in 5 areas namely i) market access conditions for LDCs; ii) accessions; iii) "mainstreaming"
(integrating) trade priority areas of action into development plans of LDCs and strategies for poverty
reduction; iv) the Integrated Framework for Trade-Related Technical Assistance to LDCs; and v)Institutional Integration of Least-Developed Countries into the Multilateral Trading System.
Following on further consultations, WTO Members agreed to include a sixth contribution in an area
of priority for LDCs namely, Food Safety and Quality, Standards and Technical Regulations.
7. Agriculture and services trade constitute two-thir ds of global trade.  Many LDCs and developing
countries are commodity and agriculture product exporters.  On 7 February 2000, the WTO General
Council, pursuant to the provisions in Agreement on Agriculture,
3 and the General Agreement on
Trade in Services (GATS),4 agreed to initiate the negotiations mandated in the WTO agreement.
Progress has been made in both areas. In the agriculture negotiations, a Work Programme5 has been
adopted, while in the services negotiations, Negotiating Guidelines have been adopted.
Notwithstanding progress that has been made, many are of the view that more rapid progress could be
made within the framework of wider negotiations.
8. The General Council's mandate on implementation issues constitutes an important part of the
work of the WTO and Members are striving to fulfill the terms of the mandate, notwithstanding the
complexities and difficulties surrounding the issues.  The background to the debate on implementation
dates back to the Geneva Ministerial Conference where Ministers established a process, under the
direction of the General Council, to ensure full and faithful implementation of existing agreements.
The General Council was requested to make recommendations in six areas, includingimplementation.
6  During the preparatory process for the Third Ministerial Conference in Seattle,
proposals on implementation were made by developing countries.  These proposals were later
categorised as  paragraph 21 or paragraph 22 issues, depending on their level of priority. At a meeting
on 3 May 2000, the General Council decided to meet in Special Sessions to address outstanding
implementation issues and concerns with a view to completing the process no later than the FourthMinisterial Conference.  Intensive work is proceeding on implementation issues.
9. The 4
th WTO Ministerial Conference will take place in Doha, Qatar, 9-13 November 2001.
Preparatory arrangements are well under way.  Logistic arrangements by the Government of Qatar are
progressing well and several Secretariat delegations have visited Qatar to verify the arrangements.  As
in the past, contributions will be invited from some Members and international institutions to pay thecost of representatives from each of the 49 LDCs.
10. Preparations for the Doha Ministerial are proceeding.  On 20 April, the Chairman of the General
Council circulated an "Initial Checklist of Possible Issues for Discussion" for the 4
th Ministerial
Conference.7  The six points on the initial checklist are i) Ministers' Views and Statements on Current
Issues; ii) Implementation; iii) Ongoing Negotiations/Reviews; iv) Other Elements of the Work
Programme; v) Organization and Management of the Work Programme; and, Technical Cooperation
and Capacity Building.  The Chairman of the General Council and the Director-General are holdingconsultations on the basis of the checklist.
                                                     
2 WT/COMTD/LDC/M/22 Minutes of meeting.
3 Article XX of the Agreement on Agriculture.
4 Article XIX of the GATS.
5 G/AG/NG/7 (Work Programme for the 2nd Phase of the Negotiations).
6 Geneva Ministerial Declaration paragraph 9
7 (Job(01)/51.WT/COMTD/INF/2
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11. The Chairman of the General Council convened an informal General Council meeting at senior
official level on 25 to 26 June 2001.  The purpose of the meeting was to determine the level of
ambition and objectives of Members in the proponent-driven process for the 4th Ministerial and to
determine flexibility among Members to move to br idge the gaps on different issues and enter into
common positions.  The Chairman concluded that the discussions had been useful in clarifying a
number of issues, but also made clear that much remained to be done in preparing the agenda for theFourth Ministerial Conference.  By the end of July, the Chairman of the General Council intends to
convene a stock-taking meeting for a reality check to assess what could be achievable at Doha.
12. Many regional and national meetings are being held in advance of Doha.  Regions and countries
have strongly committed themselves to ensure that the 4
th Ministerial Conference at Doha will be
successful.  WTO Members agree that the multilateral trading system cannot afford another failure or
further setbacks.  WTO Members are in regular consultations aimed at ensuring a balanced agenda,
reflecting the interests of all of its Members.
13. The possible widening of the agenda for multilateral trade negotiations is at the centre of the
considerations for the Doha Ministerial.  The case has been made regarding the general and specific
benefits of wider negotiations that would arise from further trade liberalization and reform, generating
the increased incomes necessary for measures to alleviate poverty. Broader negotiations would also
aim to take account of development concerns.  Some Members are of the view that the launch ofwider  trade negotiations should be preceded by a resolution of "imbalances" and implementation
issues.
III. WTO INTEGRATION OF LEAST-DEVELOPED COUNTRIES INTO THE
MULTILATERAL TRADING SYSTEM
14. Pursuant to the mandate contained in the WTO Singapore Ministerial Declaration,
8 the High-
Level Meeting on Integrated Initiatives for Least-Developed Countries' Trade Development (HLM)
was organised by the WTO with the support of other agencies on 27-28 October 1997.  This meeting
aimed to boost efforts to further the integration of  Least-Developed Countries (LDCs) into the global
economy and included specific measures to improve market access, to support human and
institutional capacity building, and to improve participation of LDCs in the multilateral tradingsystem.
B. 
MARKET ACCESS
15. There have been significant and concrete improvements in market access opportunities for LDCs.
These improvements have been documented in the Secretariat factual survey on market access
improvements for LDCs,9 which Members endorsed in the Sub-Committee. The findings contained in
the this survey show that the average unweighted tariff applicable to LDCs' exports decreased from
10.6 percent in 1997 to 6.9 per cent at present. By value, about 75 per cent of LDC exports to the 30
major export markets, accounting for over 95 per cent of total LDC exports, are now eligible for duty-
free treatment. The trade weighted applied tariff in the 30 markets studied now stands, at under 4 per
cent.10  Recent initiatives by more than two dozen trad ing partners, including the United States and the
European Union, have contributed to improved market access conditions for the LDCs, although some
barriers clearly remain in key sectors.
                                                     
8 WTO Members adopted the Comprehensive and Integrated WTO Plan of Action for LDCs (WT/MIN(96)/14).
9 WT/LDC/SWG/IF/14/Rev.1WT/COMTD/INF/2
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C. THE RE-DESIGN OF THE INTEGRATED FRAMEWORK AS A VIABLE MODEL FOR TRADE -RELATED
TECHNICAL ASSISTANCE TO LDC S.
16. The Integrated Framework (IF) was endorsed at the High Level Meeting (HLM) in October 1997
as  the institutional mechanism to deliver  trade-related technical assistance to Least-Developed
Countries (LDCs) by the six participating Agencies - International Trade Center (ITC), International
Monetary Fund (IMF), United Nations Conference on Trade and Development (UNCTAD), UnitedNations Development Programme (UNDP), World Bank and the World Trade Organisation (WTO).
17. The IF has subsequently been re-designed.  A pilot scheme has been established as has a trust
fund for its operation and it is being implemented under the leadership of the World Bank.  The
current total contributions to the trust fund amount to US $ 6.2 million.
18. The IF will assist LDCs to mainstream trade in tegration strategy chapters into their national
development plans and poverty reduction strategy papers (PRSPs).  The reflection of trade priority
areas of action in development plans and PRSPs will not only ensure that trade is central todevelopment plans, but also that trade-related technical assistance and capacity-building are delivered
within a coherent policy framework and not on a stand-alone basis.
19. It has been agreed that a review of the pilot sc heme will be undertaken by the time of the Fourth
WTO Ministerial Conference in Doha, on which occasion Ministers will receive an update on the
performance of the pilot scheme.
D. 
IF SEMINAR ON MAINSTREAMING TRADE IN DEVELOPMENT PLANS – PERSPECTIVES OF LDC S
20. In January 2001, the six IF core Agencies organised a seminar on Mainstreaming Trade in
Development Plans – Perspectives of LDCs. The results demonstrated the rationale and techniques for
mainstreaming trade into LDCs' development plan s and PRSPs, and showed how the re-designed IF
would operate as a mechanism for poverty reduction and delivery of trade-related technical assistance.
21. Frequently, trade priorities, including the implementation of WTO obligations and
commitments, are neither integral to overall development plans, nor to strategies for poverty
reduction, as expressed in the PRSPs.  Furthermore, in many instances, core trade priorities are not
taken into account by finance and planning ministries.  Thus, although openness to trade is strongly
associated with economic growth and poverty reduction, trade as a growth strategy  is yet to be
mainstreamed  into development plans and poverty reduction strategies of many of the LDCs.  The
principal objectives of the core agency seminar, therefore, were to:
(a) review the concept, methods and process of mainstreaming trade priorities into
overall development plans and poverty reduction strategies;
(b) identify the core issues critical to main streaming, at both the domestic and global
levels;
(c) focus on some case studies with a view to  identifying good practices of policy-
relevance for mainstreaming trade into overall development plans and PRSPs;
(d) consider the contributions of the IF trade-related technical assistance to the
mainstreaming of trade priorities into development plans and PRSPs; and,
(e) enhance coordination and improve the interface between multilateral and bilateral
donors in the delivery of trade-related technical assistance to LDCs within theframework of development vehicles, in particular the Poverty Reduction Strategy
Papers (PRSPs).WT/COMTD/INF/2
Page 5
E. WTO LDCS ' ACCESSION
22. The accession process combines several challenges.  These include the development, by the
acceding LDC, of WTO trade rules capacity and expertise, drafting domestic legislation that is in
conformity with WTO rules, establishing enfor cement infrastructure, and negotiating membership
with existing WTO Members.
23. Increased focused and sustained technical assistance are required to support the efforts of the
LDCs.  It is also clear that the pace of accessions will depend on two key inter-related factors, namely
the flexibility shown in negotiations between WTO Members and acceding countries and the pace at
which acceding LDCs draft domestic laws and regulations, establish enforcement infrastructure, and
develop WTO rules expertise.
24. Progress is being made and the prospects looking promising for certain LDC accessions in the
foreseeable future. The WTO Secretariat, upon request, provides technical co-operation to all
acceding governments, within available financial and human resources.11  The nine least-developed
applicants for accession have been the subject of particular attention.12 Technical assistance provided
includes institutional and human resource development through national, regional or Geneva based
seminars and workshops; provision of information needed by the Working Party; assistance in the
drafting of legislation; tabling of offers; training courses with trade negotiation simulation exercises;
and establishment of Reference Centres. Technical assistance provided by other regional andinternational organisations including UNCTAD, the World Customs Organization and WIPO has
been complementary to these efforts.
13
MEASURES, INITIATIVES AND PROGRAMMES UNDERTAKEN BY THE WTO FORTHE INSTITUTIONAL INTEGRATION OF LDCS INTO THE WTO
25. The WTO Secretariat, with the support of its Membership, has undertaken specific measures,
initiatives and programmes to accelerate the institutional integration of LDCs into the WTO.
26. These measures include;
(a) The Non-Resident Initiative which aims to ensure that countries without physical
representation in Geneva not only follow the daily business of the WTO, but are also
able to make inputs in the building of consensus on issues before WTO bodies.  Twosessions of "Geneva Week" have been held, while a third one is scheduled to take
place before the Fourth WTO Ministerial,
(b) Improvements in the WTO Trade Policy Review Mechanism to extend beyond its
classical function as a "transparency mechanism", to include its use as a mechanism
for trade policy capacity-building, and also  as a mechanism for mainstreaming trade
priority areas of action into national development plans,
(c) The WTO training courses which are aimed at increasing the capacity of developing
countries, particularly the least developed countries, to participate in the multilateral
trading system,
                                                     
11 WT/LDC/SWG/IF/7/Rev.1 outlines the current WTO  programme for technical co-operation.
12 Bhutan, Cambodia, Cape Verde, Laos PDR, Nepal, Samoa, Sudan, Vanuatu and Yemen are currently
in the process of accession to the WTO, while Ethiopia and Sao Tome and Principe, are observers.
13 The Co-operation Agreements between the WTO and the IMF and the World Bank provide for
consultations with a view to achieving greater co herence in global economic policy-making, and are also
relevant to the provision of techni cal co-operation for acceding countries.WT/COMTD/INF/2
Page 6
(d) The installation and maintenance of WTO Reference Centers which connect LDCs'
capitals to WTO electronic sources of information, and,
(e) The new internship programme, on the basis of which interns will be funded to
operate from within their country missions in Geneva.
IV. THE BUILT-IN AGENDA AND THE MANDATED NEGOTIATIONS
A. AGRICULTURE
27. Negotiations on agriculture are taking place in special sessions of the Committee on Agriculture.
Article 20 of the Agreement on Agriculture required negotiations to begin in 2000.  It states that the
long term objective of agriculture trade reform is to establish a fair and market-oriented trading
system through progressive reductions in support and protection.  It also  requires a number of factors
to be taken into account including special and differential treatment and non-trade concerns.
28. The negotiations are now in their second phase.  The first phase began in early 2000 and ended
with a stock-taking meeting on 26-27 March 2001. It was characterised by very wide participation andintensive discussions.  Altogether, 125 Members submitted 45 proposals and three technical
documents.  Six special sessions of the Committee were held in March, June, September and
November 2000 and February and March 2001.
29. In the stock-taking exercise conducted  at the 26-27 March 2001 Special Session, participants
discussed the negotiating proposals and other submissions which had been presented and examined inthe course of the first phase of the Article 20 negotiations.  They also discussed  the organisation of
future work.  It was generally agreed that the first phase of the negotiations for continuing the reform
process had been satisfactorily completed.
30. The work programme for the second phase of the negotiations was decided at the March stock-
taking meeting, which set a timetable of six informal meetings in May, July, September andDecember 2001, and February and March 2002.  The September and December 2001 and March 2002
meetings will be followed by formal sessions.
31. Three issues were on the agenda of the May 2001 meeting; tariff quota administration, tariffs and
amber box.  The discussions were based on non papers submitted by the EC, Australia and
Switzerland on the issue of tariff quota administration; a paper by Australia, Mercosur plus Chile andBolivia, and Japan on tariffs; and a paper submitted by EC, Australia and Japan on the amber box.
32. A wide variety of countries participated in the discussions which are now more detailed and
complex, and include more technical details, which is essential in order to allow Members to develop
concrete and specific proposals.
33. In the July 2001 meeting, six issues will be on the agenda.  These are export subsidies, export
credits, state trading enterprises, export restrictions, food security and food safety.  The Committee
also agreed on a list of issues to be taken up in subsequent meetings on the understanding that this was
not an exhaustive list.  In addition to rural development that had already been agreed, other issues are
geographical indications, green box, blue box, the special agricultural safeguard, environment, trade
preferences food aid, consumer information and labeling, and, sectoral initiatives.
B. 
SERVICES
34. Negotiations on trade in services are taking place in special sessions of the Council for Trade in
Services.  The built-in agenda for services contains several elements: a series of mandated reviews,WT/COMTD/INF/2
Page 7
continuation of a rule-making agenda inherited from the Uruguay Round, work on classification and
scheduling issues, and negotiations on further liberalisation of trade in services.
35. At its Special Session on 28-30 March, the Services Council adopted the guidelines and
procedures for the negotiations.  These guidelines placed heavy emphasis on flexibility for developing
countries and due respect for national policy objectives. They  also referred to the right of Members to
specify sectors in which commitments will be undertaken.
36. A stock-taking exercise was conducted in the meeting on 28-30 March 2001.  More than 60
proposals involving more than 40 Members were  submitted to the Special Session.  Most of the
proposals deal with individual services sectors, focusing on significant trade barriers and the specific
objectives of the proponents.  There are also proposals which deal with "horizontal issues", in
particular Mode 4, the movement of natural persons.  Members agreed to have a detailed discussion of
all the proposals organised on a sectoral basis at the next Special Session.  This took place on 14-18
May 2001 and covered three agenda items.  These were modalities for the treatment of autonomousliberalisation, assessment of trade in services and negotiating proposals.  In the clusters of meetings
scheduled for July and October, Members will go more deeply into the substance of individual
sectors.  This will  ensure that all negotiating proposals are  discussed twice before the 4
th Ministerial
Conference in November.
V. IMPLEMENTATION-RELATED CONCERNS AND ISSUES
37. Implementation is a priority issue for many developing and LDC Members.  Progress on
implementation concerns is related to confidence- building in the trading system.  On 3 May 2000, the
General Council established the Implementation Review Mechanism (IRM).14  Consultations are
continuing, inlcuding within the framework of the Special Sessions of the General Council on
implementation.
38. A group of 7 (developed and developing countries)15 recently circulated16 "Proposals on
Implementation", based on an earlier WTO Secretariat compilation.17.  It was generally felt that the
proposal was a good basis for further work, and was a valuable contribution for positively addressing
implementation concerns and challenges within four overall categories.
39. Most Members consider progress on implementation as essential for a successful Doha
Ministerial Conference.  Discussions are continuing with a view to seeing what progress can be made
on issues before the end of July, what might be done before Doha or in the context of the
establishment of a broadened negotiating agenda at Doha, and what might be done in a post-Doha
negotiation.  While certain Members have expressed the view that implementation should be treated
as an issue to be settled prior to agreement on an expanded negotiating agenda, many others considerthat some implementation issues can only be addressed in wider negotiations and that prospects for
real progress on the issues would be granted inside a round.
VI. TRADE AND ENVIRONMENT
40. In the Decision on Trade and Environment adopted by Ministers in April 1994, Ministers set the
foundation for the discussion of trade-related environmental issues in WTO. The WTO Committee on
Trade and Environment (CTE) was established in 1995 in response to this Decision
                                                     
14 WT/GC/M/55 (paragraph 180 - see Annex I for decision).
15 Argentina, Morocco, New Zealand, Norw ay, Switzerland, Thailand, and Uruguay.
16 Informal Meeting of the General Council, preparatory for  the Doha Ministerial, 21 June 2001.
17 JOB(01)/14.WT/COMTD/INF/2
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41. The CTE has a two-tiered mandate,  (i) to explore the links between trade and environment and
(ii) to recommend changes that are needed to the rules of the multilateral trading system to
accommodate those links.  While not a negotiating body, the CTE reports to (and can forward its
recommendations) to the WTO General Council – the governing body of WTO.
42. The Decision of Trade and Environment set-up a work programme for the CTE consisting of 10
different items.  The most prominent amongst these include; the relationship between WTO rules andthose of multilateral environmental agreements (MEAs); environmental measures with a significant
impact on trade (such as eco-labelling and packaging requirements);  the environmental benefits of
removing trade restrictions and distortions in certain sectors; the export of domestically prohibited
goods; and the environmental concerns surrounding the Agreement on the Trade-Related Aspects of
Intellectual Property Rights (TRIPS).
43. The agenda of the CTE represents a delicate balance between, on the one hand, ensuring that
environmental measures do not act as obstacles to trade (i.e. countering "green protectionism") and,on the other hand, preventing the rules of international trade from standing in the way of legitimate
environmental protection measures.
44. With respect to the relationship between WTO rules and MEAs, the CTE has been exploring the
extent to which the trade measures contained in MEAs conflict with WTO rules, and whether scope
under WTO rules needs to be created to accommodate them.   On ecolabelling and packagingrequirements, the CTE has been deliberating on the extent to which measures, which distinguish
between products based on the way in which they ar e produced (while leaving no trace in the final
product itself) are covered by, and consistent with, WTO rules.   The CTE has also worked on
identifying those trade restrictions in different economic sectors (such as agriculture, fisheries,
forestry), whose removal would benefit trade, and al so the environment (For example, the elimination
of fisheries subsidies would limit or eliminate such negative environmental consequences as the
collapse or depletion os fish stocks.
45. The CTE has also examined the export of products, which have been banned or severely restricted
in exporting countries on health or environmental grounds, to countries not informed of their
hazardous effect. On the TRIPS item, the Committee is examining the extent to which the Agreementfacilitates the transfer of environmentally sound technology, and the extent to which patents and their
associated royalties make these technologies unaffordable and also, the extent to which the
Agreement allows for the protection of indigenous environmental knowledge, etc.
46. Discussions in the CTE on the agenda items ar e ongoing. A limited set of recommendations were
forwarded, by the CTE, to the Singapore Ministerial Conference in 1996.   None of theserecommendations involved a change in the rules.
47. Currently, a number of countries are calling for environmental issues to be taken up more
substantively at the Doha Ministerial Conference and in a possible new round of trade negotiations.
The main proponents on environment would in particular like to;  (i) clarify the relationship between
WTO rules and MEAs (the proponents consider that WTO rules should not impede legitimate
environmental protection measures taken in the context of other international agreements, in particular
MEAs); (ii) clarify the scope for product labelling under WTO rules (the proponents seek clarity onthe extent to which WTO rules apply to labelling requirements and how this would be accomplished);
and (iii) launch a discussion on the concept of "precaution" under WTO rules (a concept that would
allow countries to protect themselves against scientifically uncertain risks)
18.  The proponents want
"precaution" to be firmly recognized by the WTO, and to initiate a discussion on its non-protectionist
application.   Other proponents have suggested that emphasis in Doha should instead be placed on theremoval of environmentally harmful trade restrictions and distortions, in particular in the area of
                                                     
18 See the provisions on precaution in Article 5 of the SPS AgreementWT/COMTD/INF/2
Page 9
fisheries and agriculture.  A number of developing  countries have objected to any discussions on
environment at Doha or in a possible new trade round.
VII. NEW ISSUES: INVESTMENT AND COMPETITION POLICY, TRADE
FACILITATION AND GOVERNMENT PROCUREMENT
Trade and Investment
48. At the First WTO Ministerial Conference in Singapore, WTO Members agreed to establish a
Working Group to examine the relationship between trade and Investment.19  This Working Group
has undertaken exploratory and analytical work since 1997.
49. In July 1999, several delegations submitted detailed proposals on the launch of investment
negotiations within the WTO.  The proponents envisa ge a framework of rules that would be limited to
foreign direct investment, provide for rules on transparency and non-discrimination, adopt a positive
list approach to market access, and contain rules on investment protection, performance requirements,
and investment incentives.  Disputes would be settled under WTO dispute settlement procedures and
thus exclude investor-to-state arbitration procedures, common to existing international investment
agreements.
50. In the current consultations in preparation for the Doha Ministerial, there is evidence of  support
among Members for a multilateral framework of WTO rules on investment, although some Members
still remain opposed to such rules within the WTO.
51. In the proponent-driven process, there is stress on the need for a framework that would be based
on non-discrimination, transparency and predictability, and which would recognize the right of thehost country to regulate investors, and include flexibility for the pursuit of national development
objectives.  As with the 1999 proposal, such a framework would be restricted to FDI and be based on
a bottom-up approach.
52. Proponents for a WTO multilateral framework of rules on investment point to several advantages
such as encouraging and safeguarding foreign investment, eliminating the confusion  that exists in theplethora of bilateral and regional investment agreements, and assisting countries to benefit from FDI.
53. In the consultations underway, it has been emphasised that a basic aim of WTO rules is to reduce
policy unpredictability and, therefore, commercial risk.  Lower commercial risk means higher global
FDI flows.  This point is of specific relevance for LDCs where perceived risk exceeds actual risk.
Many countries  fail to attract FDI even though, in many cases, the regulatory environment is positive.
Many LDCs are increasingly expressing a preference for multilateral rules over bilateral agreements,
including on investment, in recognition of the fact of their enhanced negotiating leverage within
multilateral settings.
54. Some Members who disagree with negotiations for a WTO multilateral framework of rules on
investment state that a binding multilateral agreement would deny countries development policy
options, while at the same time failing to guarante e increased FDI.  Concern has been expressed that
current proposals have  not sufficiently clarified the distinction between FDI and destabilizing short
term capital flows.  Furthermore, the development dimension needed to be better clarified.  While
some of these Members have requested for continued education within the WTO Working Group on
Trade and Investment, others have taken the view that educational phase should not be endless.
                                                     
19 WT/MIN(96)/DEC - paragraph 20.WT/COMTD/INF/2
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55. Sustained, relevant, and focused technical assistance has been a central aspect of the discussions
amongst WTO Members on investment.  Post Seattle and more so in the current consultations for the
Doha Ministerial, there is a strong demand for a well-defined programme of technical assistance on
investment for capacity-building, including in nego tiations if these are to be initiated.  The forum of
the WTO Working Group on Trade and Investment has been used to spell out in detail the proposals
and elaborate the development dimension of an eventual WTO agreement.  Furthermore, sinceSeattle, the WTO Secretariat has carried out an extensive programme of technical assistance on
investment to explain what WTO rules would involve and mean.  For LDCs, this technical assistance
has included the Libreville Meeting in 2000 and regional seminars in Africa, in January 2001, and in
Asia in March 2001.  All LDCs have now partic ipated in at least one of these seminars.
Trade and Competition
56. At the First WTO Ministerial Conference in Singapore in December 1996, WTO Members agreed
to establish a Working Group to examine the relationship between trade and competition.
20  T h i s
Working Group has undertaken exploratory and analytical work since 1997.
57. Competition policy refers to laws and policies dealing with anti-competitive practices of
enterprises.  Such practices, including cartels (pri ce-fixing agreements), anti-competitive mergers and
abuses of dominant positions, are widespread and impose heavy costs on the economies of allcountries that lack effective laws to deal with them.  A recent study for the World Bank found that
international cartels have significantly raised prices of developing countries' imports and, in several
cases, have blocked entry by competing entrepreneurs from developing countries.
21
58. An Informal Group of Friends has called for the launching of negotiations on this issue at Doha.
In particular, the proponents are calling for negotiation of a multilateral framework that wouldembody three main elements:
(a) a commitment to cooperation on national legislation and in the investigation of
specific instances of anti-competitive practices;
(b) basic principles to be reflected in Members' competition policies, probably including
a commitment to take action against cartels as well as the fundamental WTOprinciples of non-discrimination and transparency; and,
(c) enhanced technical cooperation and assistance with the establishment/strengthening
of national competition institutions.
59. It should be noted that the proposals would not require harmonization of national legislation or a
"one size fits all" approach.  Furthermore, the commitment to cooperation would be voluntary innature in that, according to the current proposals, countries would have the right not to cooperate if
this went against their important interests.
60. While the launching of negotiations along the lines noted above is favoured by some, including
both developed and developing countries, it is opposed by a number of other countries.
61. For further background, detailed reports are available on two Workshops that were organized by
the WTO Secretariat on this issue in 2000 and 2001, with participation from UNCTAD and numerous
                                                     
20 WT/MIN(96)/DEC - paragraph 20.
21 Levenstein and Suslow, "Private International Cartels and Their Effect on Developing Countries",
Background Study for the World Development Report, 2001.WT/COMTD/INF/2
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developing country and other experts, for the benefit of:  (i) Asian WTO Members and observers; and
(ii) African Members and observers.22
TRADE FACILITATION
62. Among the "new" issues which have been proposed for inclusion in a possible new Round, trade
facilitation appears to be one of the least controversial. Delegations agree on the overall benefits oftrade facilitation i.e. that the simplification of trade procedures has potential for considerable savings
in time, money, as well as human and other resources, and would result in substantial benefits for any
economy. Members also agree on the importance of comprehensive technical assistance to reform and
upgrade administrative capacities in developing countries.
63. In the aftermath of Seattle, work on trade facilitation has continued under the original Singapore
Mandate, which directed the Council for Trade in Goods to "undertake exploratory and analytical
work…on the simplification of trade procedures in order to assess the scope for WTO rules in thisarea." Signficant work has been accomplished, and progress has been made at the technical level.
64. Despite the general agreement on both the importance and the benefits of trade facilitation, there
are differing views on how to proceed with WTO work on this issue. While trade facilitation has been
proposed for inclusion in the negotiating agenda for a broader  round by the proponents of the subject,
there are many developing country Members w ho, although acknowledging the importance of and
gains from trade facilitation, do not favour new legal WTO obligations at this stage. A broad range of
views was  expressed by Members in the course of two informal open-ended General Council
meetings, on 15 May and 6 June.  Delegations were given the opportunity to exchange views in the
course of a series of three informal group consultations held on 20 – 22 June. Members were asked to
outline their positions on how they would like to pr oceed, which areas they would like to see covered,
and what measures they would consider necessary. The discussion also focused on the possible
outcomes as well as on the assistance that would be required.
65. In essence, disagreement among delegations appears to focus on a) the necessity of new binding
WTO rules on trade facilitation and, b) the scope of a possible rule-making exercise. The proposal by
the proponents aims at obtaining a negotiating mandate on binding trade facilitation rules. Suchnegotiations could build upon existing WTO rules and are proposed to be based on an integrated two-
track approach, providing for the development and implementation of a technical assistance and
capacity building programme parallel to negotiations. The proposed technical assistance will provide
substantive guidance on the scope of possible rules during the negotiations, and will also enable actual
implementation of the rules, when agreement has been reached.
66. Concerns expressed by other delegations have focused on developing countries' limited
implementation capacities while also questioning the need for new multilateral binding rules. Some
delegations have expressed their preference for trade facilitation work on the national, bilateral or
regional level and/or for non-binding commitments. Members have also articulated the need for
further consultations and for more detailed information on certain issues.
TRANSPARENCY IN GOVERNMENT PROCUREMENT67. At the Singapore Ministerial Conference, in 1996, Ministers agreed to establish a Working Group
to conduct a study on Transparency in Government Procurement Practices, taking into account
                                                     
22 See Report on WTO Regional Workshop on Competition Policy, Economic Development and the
Multilateral Trading System, held in Phuket, Thailand , for the benefit of Asian WTO Members and observers,6-8 July 2000; and, the Report on WTO Regional Workshop on Competition Policy, Economic Developmentand the Multilateral Trading System, held in Cape Town, South Africa, for the benefit of African WTOMembers and observers, 22-24 February 2001.WT/COMTD/INF/2
Page 12
national policies and, based on this study to develop elements for inclusion in an appropriate
agreement.
68. Since 1997, significant work has been undertaken within the Working Group on Transparency in
Government Procurement.  There is support among many Members for negotiations in this area,
although no clear consensus has been reached.  Issues under consideration include: a) a commitment
to negotiate an agreement on transparency in government procurement; b) coverage; c) nationalreview procedures; and d) dispute settlement.
69. The necessity of programmed, focused and sustained technical assistance has also been
underlined by WTO Members, in particular the LDCs and African countries.  They have stated that
commitment to negotiations would need to be matched with a carefully developed programme integral
to the negotiations and to future implementation.
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