RESTRICTEDWORLD TRADE
ORGANIZATIONG/SCM/Q3/COL/9
27 March 2002
(02-1579)
Committee on Subsidies
and Countervailing MeasuresOriginal:  Spanish
SUBSIDIES
Requests Pursuant to Article 27.4 of the Agreement
on Subsidies and Countervailing Measures
Questions Posed by Peru
The following communication, dated 14 March 2002, has been received from the Permanent
Mission of Peru.
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Peru submits the following questions and comments in respect of the requests under
Article 27.4 of the Agreement on Subsidies and Countervailing Measures that are scheduled for
discussion at the meeting on 13 March 2002.
COLOMBIA - G/SCM/N/74/COL
Paragraph 10.6 of the Implementation Decision adopted by the Fourth Ministerial Conference
in Doha reads as follows:
Having regard to the particular situation of certain developing-country Members, directs the
Committee on Subsidies and Countervailing Measures to extend the transition period, under
the rubric of Article 27.4 of the Agreement on Subsidies and Countervailing Measures, for
certain export subsidies provided by such Members, pursuant to the procedures set forth in
document G/SCM/39 .  Furthermore, when considering a request for an extension of the
transition period under the rubric of Article 27.4 of the Agreement on Subsidies andCountervailing Measures, and in order to avoid that Members at similar stages of
development and having a similar order of magnitude of share in world trade  are treated
differently in terms of receiving such extensions for the same eligible programmes and the
length of such extensions, directs the Committee to extend the transition period for those
developing countries, after taking into account the relative competitiveness  in relation to
other developing-country Members who have requested extension of the transition period
following the procedures set forth in document G/SCM/39.  (emphasis added)
This means that the countries in question must satisfy certain conditions, as set forth in
paragraph 2 of document G/SCM/39:
Programmes eligible for extension pursuant to these procedures, and for which Members
shall therefore grant extensions for calendar year 2003 as referred to in 1(c), are export
subsidy programmes (i) in the form of full or partial exemptions from import duties and
internal taxes, (ii) which were in existence not later than 1 September 2001, and (iii) whichare provided by developing country Members (iv) whose  share of world merchandise exportG/SCM/Q3/COL/9
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trade was not greater than 0.10 per cent , (v) whose total Gross National Income ("GNI")
for the year 2000 as published by the World Bank was at or below US$20 billion  (…).
(emphasis added)
1. In the light of the tables below, does Colombia consider that it meets conditions similar to
those strictly fulfilled, on an individual basis, by countries that have requested the extension under
Article 27.4 of the Agreement on Subsidies and Countervailing Measures?  Has Colombia considered
other indicators or aggregate competitiveness indica tors for determining its overall position in relation
to Latin American and Caribbean countries?
Share of World Trade1
Rank Country Share
8  Antigua and Barbuda 0.00
13  St. Kitts and Nevis 0.00
15  St. Vincent and the Grenadines 0.00
18  Dominica 0.00
20  St. Lucia 0.00
27  Belize 0.00
37  Barbados 0.00
46  Suriname 0.01
67  Panama 0.01
75  Bolivia 0.02
79  Jamaica 0.02
81  Honduras 0.02
84  Mauritius 0.03
89  Kenya 0.03
90  Jordan 0.03
91  Papua New Guinea 0.03
98  Uruguay 0.04
100  Guatemala 0.04
101  El Salvador 0.05
115  Sri Lanka 0.08
116  Dominican Republic 0.09
134  COLOMBIA 0.20
162  THAILAND 1.04
                                                     
1 According to the WTO Secretariat's calculations, set forth in Appendix 3 to the Chairman's Report
(G/SCM/38).G/SCM/Q3/COL/9
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Gross National Income for 20002
Rank Country GNI
(Millions
of US$)
199  Dominica 238
196  St. Kitts and Nevis 273
194  St. Vincent and the Grenadines 309
185  Suriname 558
181  Antigua and Barbuda 625
179  St. Lucia 634
174  Belize 751
141  Barbados 2,487
127  Papua New Guinea 3,665
119  Mauritius 4,512
107  Honduras 5,517
104  Jamaica 6,382
94  Jordan 8,224
93  Bolivia 8,305
87  Panama 9,316
84  Kenya 10,715
81  El Salvador 12,507
79  Costa Rica 14,448
72  Sri Lanka 16,632
69  Dominican Republic 17,959
68  Guatemala 19,224
62  Uruguay 20,307
39  COLOMBIA 88,047
31  THAILAND 121,760
2. Article 27.4 stipulates that developing-country Members shall phase out their export subsidies,
preferably in a progressive manner.  Although some developing countries are accorded a grace period
during which they may continue to apply such subsidies, has there been any progress in the phasingout of such measures since the period began in 1995, in pursuit of one of the key objectives of the
multilateral trading system, which is to achieve freer, more competitive and undistorted trade?
3. Does your country have a plan for phasing out the prohibited subsidies for which the
extension is being requested?  Please provide details in this respect.
4. Colombia points out that, since it has no assurance of obtaining the extension for the
continuation of export subsidies, domestic and foreign investors could decide to shift investments to
countries where incentives were guaranteed.  Could Colombia specify whether it has any experience
in this regard, considering that investors knew th at the period for maintaining export subsidies would
expire at the end of 2002?
5. Why does Colombia consider that only one extension is needed for productive activity to
attain all the objectives under the country's strategic and development plans?
6. Why does Colombia consider that its incentives are not trade-distorting for countries that do
not apply trade-distorting measures?
                                                     
2 Source:  World Bank – Atlas method/2001 World Development Indicators database, World Bank.G/SCM/Q3/COL/9
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7. Articles 27.5 and 27.6 of the SCM Agreement specify that:
Any developing country Member which has reached export competitiveness in
any given product shall phase out its export subsidies for such product(s)over a period of two years. (…)  Export competitiveness in a product exists if
a developing country Member's exports of that product have reached a share
of at least 3.25 per cent in world trade of that product for two consecutive
calendar years.
Has Colombia performed any analysis of competitiveness in products subject to export
subsidies?
8. Why is the Transport Compensation Mechanism (MTC) necessary in the context of
economic, financial and development needs?  What products benefit from this mechanism?  Please
provide further details.
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