RESTRICTEDWORLD TRADE
ORGANIZATIONWT/COMTD/W/69
3 May 2000
(00-1795)
Committee on Trade and Development Original:  English
EC COMMUNICATION ON TRADE-RELATED  TECHNICAL ASSISTANCE
Trade-related Technical Assistance
The following communication has been received  from the European Communities, with the
request that it be distributed to WTO Members.
_______________
I. A NEW APPROACH TO TECHNICAL ASSISTANCE
In the preparations to the 3rd WTO Ministerial, the EC suggested a new approach to technical
assistance for capacity building, as part of its initiative for enhanced coherence in global economic
policy-making.  The intention of the EC proposal was to introduce a new and better approach to
technical assistance in the WTO, based on:
- Cooperation between donors (including in the Integrated Framework for
Trade-Related Technical Assistance for Least Developed Countries) for enhanced
coherence and better use of efficiencies among donors;
- full participation by recipients for demand driven assistance to better target actual
needs, and;
- a framework to support the implementation of WTO agreements in light of country
specific requirements and using existing WTO mechanisms to examine and monitor
the effectiveness of such assistance.
The EC remains committed to this approach to  technical assistance and suggests that WTO
Members pursue the programme within the existing WTO framework.
A new approach to technical assistance should focus on two types of trade-related assistance:- To promote the understanding and use of WTO rules, so that recipients are able to
exploit to a maximum the opportunities offered by the multilateral trading system.
This is the area of particular expertise of the WTO Secretariat.  It also covers
activities aimed at enhancing the capacity of developing country administrators to
participate in WTO activities and negotiations.
- To enhance the capacity of recipients to adopt and implement domestic laws and
regulations to fulfil their WTO obligations and participate actively in the system.
This form of technical assistance is closely related to the building of domestic
capacities and would often require close cooperation between the WTO and other
international organizations and donors on the basis of full partnership with theWT/COMTD/W/69
Page 2
recipient.  The EC has also suggested that technical assistance programmes in this
field be developed in relation to the negotiations of WTO rules in new areas.
In addition, a new approach should consider capacity building in a broader sense and address
the ability to trade of a country, sector or region through supply-side reforms.  This category wouldinclude a larger variety of measures and sectors, which may not be primarily trade-related.  It is thus
not, as such, the task of the WTO Secretariat, but needs to be taken into account when designing a
programme for technical assistance so as to provide a response to all elements of capacity constraints.
This type of assistance would thus call for cooperation with other international organizations to
supplement and support by capacity building measures the core technical assistance as provided by
the WTO Secretariat.  The Integrated Framework for LDCs is based on this broader approach.  A new
approach to technical assistance should build on the principles of the Integrated Framework for LDCs,while taking account of the experience and knowledge gained and the results achieved.  Consideration
should also be given on how to improve the functioning of the Integrated Framework.  The work of
the WTO in this area would contribute to enhancing coherence in global economic policy-making to
help the integration of developing countries in the global economy, as set out in the Uruguay Round
declaration on coherence and supported by the joint statement of the WTO, IMF and the World Bank,issued in Seattle on 30 November 1999.
II. A NEW APPROACH TO TECHNICAL ASSISTANCE:  PILOT PROJECT
Some developing countries have faced difficulties in implementing Uruguay Round
agreements.  For some of these countries and in relation to certain WTO agreements, capacity
constraints are a main reason for difficulties.  It is important that these countries receive adequate
assistance to build their capacity to implement these agreements.  Such assistance should be specific
in addressing the actual capacity needs to help countries carry out the steps necessary for
implementing agreements.  This requires a clear identification in the WTO of steps to take in relationto implementation and indication by developing countries themselves of needs in relation to these
steps, as suggested by the EU in its submission of 28 July 1999 on coherence and capacity building.
It also requires cooperation by relevant donors in providing assistance to ensure correctly targeted
assistance regardless of sources and to optimise the synergy between projects.  Where relevant, donor
cooperation can be carried out in existing framework s, such as the Integrated Framework for LDCs.
The EU considers that the best way to launch a process of enhanced trade-related  technical
assistance for capacity building is by a pilot project.  While addressing substantial problems in
relation to implementation, a pilot project would also allow Members to consider how best to make
use of existing mechanisms and where improvements are needed, including in the longer term.
The Agreement on Customs Valuation is an agreement that has proven particularly resource
demanding to implement.  For many countries, implementation problems are due to capacity
constraints and could be remedied by adequate and well-targeted assistance.  For this reason many
donors, including the EC and its Member States, have already given considerable attention to
technical assistance for customs valuation.  Many of these projects have carried with them a positive
result and have helped countries improve their customs valuation systems and implement theAgreement on Customs Valuation.  However, some proj ects have not had the intended effect.  Several
factors influence the outcome:  Is the project sufficient to meet the needs in relation to
implementation?  Is the project correctly targeted at the specific needs of the recipient country in
relation  to implementation?  Is the timing of the project right?  Are projects well sequenced among
them?  Does each project take account of results already achieved by other projects?  Does eachproject take account of the need for follow-up or the need for infrastructure and provide adequate
funding for this?WT/COMTD/W/69
Page 3
It is clear that a new approach is needed to address these questions and ensure better-targeted
and co-ordinated assistance.  The EU therefore suggests that, at a first stage, a new approach to
technical assistance for capacity building be directed at implementation of the Agreement on Customs
Valuation.  This would serve as a pilot project for technical assistance; experience gained in providing
assistance in the field of customs valuation should help define a future work programme on technicalassistance in relation to implementation of WTO agreements, including agreements that could be
negotiated as part of a New Round.  Targeting implementation problems with regard to the
Agreement on Customs Valuation for a pilot project would not in any way imply a prioritization of
this agreement in relation to other agreements, nor would it entail a diversion of funds from assistance
related to other agreements.  The objective would be to ( і) apply a new approach to technical
assistance in this pilot project, and (ii) review the experience gained so as to deduct principles and
measures that should apply at a general level.
The pilot project should build on four key elements:(і) An identification at the country level of the steps still required for implementation of
the agreement, i.e. an outline of all administrative, regulatory, policy or infrastructuremeasures to take for implementation of the agreement.  This would help those
developing countries that face difficulties with the implementation in identifying
specific problem areas and the assistance needs in relation thereto.
(ii) The project should be demand driven; i.e. developing countries themselves should
identify their assistance needs in relation to the outline of implementation measure
indicated above.  In connection to this, assistance already provided for
implementation of Customs Valuations Agreement should be taken account so as to
avoid repetition and overlapping and to ensure a synergy effect.
(iii) There should be transparency and cooperation among donors for enhanced efficiency
and better targeted assistance, i.e. once the needs have been identified, full
transparency would make apparent the assistance needs, thus helping donors to target
their assistance and cooperate to allow for the best placed donor to provide assistance
in each case.  It is essential that enhanced cooperation among donors on this project
does not imply the creation of costly and time-consuming administrative structures.
(iv) Assistance provided should be linked to the implementation schedule as agreed by the
Customs Valuation Committee; i.e. assistance provided to address a given measures
in the implementation schedule should ensure that this measure is actually taken and
the implementation schedule respected.  The Customs Valuations Committee would
also regularly monitor the effectiveness of technical assistance programmes.
The Commission's contribution of € 355,000 for customs valuation in the ACP countries
mentioned below, would be integrated into this pilot project.
III. TRADE-RELATED  TECHNICAL ASSISTANCE AND THE WTO LACK OF FUNDS
The need to provide an adequate financial basis for the trade-related technical assistance (TA)
activities of the WTO remains one of the questions left unanswered by the Seattle Conference.
WTO Members were unable to progress on this issue, while recognizing that this is an essential tool
to enhance developing countries ability to participate in the system.WT/COMTD/W/69
Page 4
The main challenge presently facing WTO Members is the possibility to agree on a stable,
long-term solution, which would provide an answer concerning the level of the funding and the most
appropriate mechanism to guarantee its continuity.  However, immediate concerns on how to sustain
the WTO Technical Cooperation Programme for the year 2000 should not be neglected while
searching for the optimal solution.
The EC and its Member States attach great importance to address immediately the current gap
for the financing of WTO technical assistance by a solution that ensures adequate funding,
predictability and stability for WTO technical assistance.  It is essential that the solution found allows
to meet the current gap in the funding of the WTO technical assistance.
Finding a solution that ensures adequate funding, predictability and stability for WTO
technical assistance is not, however, a panacea and any such initiative should be seen together with
other elements of a coherent approach to trade-related technical assistance.  The EC, in its
submissions and through its work at Seattle, has already raised the issue of the need for an enhanced
commitment and coordination by other international organizations – such as the World Bank and
UNCTAD, which may be better equipped for certain technical assistance needs.  We believe that it isimportant to continue to work in all these fora, to make that this process is now set in full gear and
brought to better practical results.  The Committee on Trade and Development should be at the core of
the technical work in this area, as it also is the case for the planning, oversight and evaluation of
technical assistance activities at the experts' level.
IV. THE CURRENT GAP – THE SITUATION FOR THE YEAR 2000¨
At the same time, while we are moving in the direction of greater predictability and stability
for WTO technical assistance, the EC agrees that  it remains important to continue the practice of
voluntary contributions.  The EC and its Member States have been the largest contributors for WTOrelated technical assistance in the recent past.  We intend to remain in the lead for the year 2000, via
substantial contributions to support technical cooperation on WTO related matters 2000.
Taking into account contacts between the CTD and the Budget Committee (CBFA) in
September 1999 and more recent information obtained from the Secretariat, the situation for WTO
technical cooperation for the year 2000 remains bleak and the difficulties of the previous year are
likely to be reproduced.  The WTO Secretariat based on previous years experience, estimates theneeds for the year 2000 at around 10 Mio CHF.  Against these requests, the regular budget allocates
only CHF 741,000 for technical cooperation in th e year 2000.  Voluntary contributions by
WTO Members will have to supplement this low amount.  At this time, however, they still fall rather
short of the needs.
The European Commission's contribution will be substantial, consistent with our record.  In
fact, the Commission has set aside € 10 Mio from the 7th EDF (European Development Fund) to
support the integration of ACP countries into the multilateral trading system.  In spite of some
administrative limitations linked to these funds in  the EC legal system, like in previous years the
Commission is working with the ACP Secretariat and the WTO Secretariat in order to identify theactivities which the Commission could finance in the year 2000.  The most likely candidates are a
number of regional seminars
1 and the programme of technical assistance for Customs Valuation.  For
the latter the Commission has already set aside € 355,000 (CHF 670,000).
                                                     
1 Requests are very numerous already for all geogra phical areas, including five for Middle East and 20
for Africa.  Other areas are Pacific, Latin America and Eastern Europe.WT/COMTD/W/69
Page 5
In addition, the European Commission had devoted more than € 1 Mio to the establishment
for an ACP Secretariat office in Geneva for the ACP countries who are WTO Members (currently
55, out of a total of 71 ACP), to help them to  co-ordinate in the WTO and to support those ACP
countries, a majority, which do not have permanent office in Geneva.
Concerning least-developed country accession to the WTO, the EC, like other donors, uses
parts of the funds for its bilateral programmes to provide trade-related technical assistance to these
countries.  For instance, at its request, we are financing a study to identify Bhutan's needs in relation
to its possible accession to the WTO.
In a similar way, the EC and its MS-run substantial programmes of technical assistance in the
field of intellectual property, in accordance to Article 67 TRIPs Agreement, as well as in the field oftechnical barriers to trade, to help facili tate the implementation of the TBT Agreement.
The EC Member States in their own capacity make separate voluntary contributions, now
directed to the Global Trust Fund.  For the year 2000, Denmark has committed to CHF 1,600,000 and
Finland CHF 267,000.  In addition, Germany's c ontribution of DM 1 Mio (CHF 82,000) over
four years will be entirely devoted to Trade Policy Reviews for developing countries, a need
identified as a priority by both the Secretariat and developing countries, in particular LDCs, but
separate from the technical assistance activities listed in the three-year Plan2.  Most other Member
States also envisage substantial contributions to the Global Trust Fund for this year.
It remains understood that the activities and funds reported are only a part, sometimes the
smallest part, of the total amounts that each donor commits annually for trade-related  technical
assistance projects.  it does not cover, for instance, the substantial technical assistance that the EC and
its Member States provide in support of UNCTAD activities.  The purpose of this submission,
however, is to call the attention of WTO Members to the WTO problem of lack of financial means fortechnical assistance, not to map the whole of the contributions made bilaterally or multilaterally.
Several Member States have also contributed to UNCTAD trade-related  technical assistance
programmes, to the ITC and to the establishment of the Advisory Centre on WTO Law.  Moreover,
many Member States have helped finance the participation of LDCs to the WTO Ministerial
Conference in Seattle and to the High Level Symposia on Trade and Development and Trade and
Environment, as well as organized, in cooperation with the WTO Secretariat, training programmesand seminars on WTO issues for developing countries
__________
                                                     
2 To be completed on the basis of the data provided by other Member States.