RESTRICTEDWORLD TRADE
ORGANIZATIONTN/MA/M/2
9 September 2002
(02-4722)
Negotiating Group on Market Access
MINUTES OF THE MEETING
Held in the Centre William Rappard on 2 August 2002
Chairman: Ambassador P-L. Girard (Switzerland)
Subjects discussed:             Page
1.(i) Tariffs on Non-Agricultural Products ....................................................................................1
  (ii) Non-Tariff Barriers on Non-Agricultural Products ..............................................................1
2. Other Matters................................................................................................................ ..........31
The proposed agenda as contained in document WTO/AIR/1871 was adopted by the
Negotiating Group.
_______________
1. (i)-(ii)  Tariffs and Non-Tariff Barriers on Non-Agricultural Products
1.1 The Chairman stated that the documents circulated under agenda item A were listed in the
airgram WTO/AIR/1820 which had convened this meet ing.  They covered a communication from the
European Communities entitled "Market Access for Non-Agricultural Products" circulated as
TN/MA/W/1, and two communications from the United States; one entitled  "Tariff and Trade Data
Needs Assessment" which was circulated as document TN/MA/W/2 and the second one entitled
"Negotiations on Environmental Goods" which was circulated as document TN/MA/W/3.
Additionally, there has been a recent communication from New Zealand on "The Scope of theNegotiation on Non-Tariff Barriers" circulated as TN/MA/W/4 which was also available in the room.
1.2 The representative of the European Communities stated that the paper by her delegation
provided (TN/MA/W/1) initial views on possible approaches to the negotiations.  Her delegation was
willing to discuss all approaches even one that might not appear in the EC paper.   The first part of thepaper dealt with the objectives of the negotiations, and the second part addressed the subject of
modalities. As regarded objectives, the Doha mandate was ambitious in that it included
comprehensive product coverage; no sector was excluded and the list of measures that had to be
reduced or if appropriate eliminated covered  high tariffs, tariff peaks and tariff escalation.  One of the
objectives of the negotiations which was listed was to reduce or eliminate non-tariff barriers and thepaper included a series of references to non-tariff barriers.  As regarded modalities for non-tariff
barriers, it would be important to have a modality that could profit from the experience of Members.
In other words, Members might have difficulties working with taxonomies of non tariff barriers but at
the same time Members had very good experience of non-tariff barriers so any modality that dealt
with these barriers should be anchored to the experiences of Members.  Her delegation had alsoTN/MA/M/2
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alluded to the problem of export taxes and restrictions in connection to this final element.  One aspect
her delegation had always insisted on was that the overall balance of results had to be assessed against
the interests and needs of developing countries because the mandate was very explicit on that.
Therefore the EC paper mentioned that improved market access to developed but also to developing
country Members was an extremely important objective for this Round.  Paragraph 31 (iii) of theDoha Ministerial Declaration referenced environmental goods which might require special reduction
or treatment. Why? Because there was a higher objective of environment preservation and for such
objectives her delegation was willing to go for deeper cuts.  The environmental goods issue had
already elicited some reactions from Members and she hoped that there would be a good discussion
on that item.  At the end of this section on objectives, the paper stated that her delegation would be
assessing whatever was achieved against what it deemed to be effective market access.
1.3 The second part of the paper, indicated in a very initial fashion the modalities that could be
used.  Several modalities that had been used or proposed in the past were listed because her delegation
at this stage, was not discarding any ideas.   She hoped that a  modality would be found which would
suit the current situation of a rather large Membership and which would also suit the mandate, which
was ambitious.  As regarded principles that had to underpin the choice of the modality, the principleof less than full reciprocity had to be one of the elements.  Other elements which could turn this
modality into something of interest for her delegation, would for instance be closing the gap between
bound and applied duties.  This was what she had been alluding to when she had spoken about
effective market access.  There was a further list of elements in the paper which might make a
proposed modality interesting for Members. However, it was worth noting that no matter what themodality, Members needed data.  In this connection, it was extremely important that the Integrated
Data Base (IDB) be complete.  She thanked the Secretariat for the paper G/MA/IDB/2/Rev.14
because it gave a clear picture of where the problems lay and what Members should be doing.  It was
important that a discussion took place on what the Membership could do to help some Members
submit data.  There was also a reference in the paper to some elements which concerned the  startingpoints of the negotiations but these were all initial thoughts.  She looked forward to any questions and
an exchange of views that would lead to the submission of a better and more comprehensive
document in the future from her delegation.
1.4 The representative of the United States informed  participants that the Senate had approved the
trade promotion authority by a very good margin the previous night.  This was an important step in
creating the confidence and momentum in the Round, and it was hoped that all Members could usethis momentum to their mutual advantage in advancing the work in this Negotiating Group and in
other areas.  In addition, the US statutory domestic procedures related to market access were nearly
complete.  The US Federal Register Advice had been received, and the US ITC's probable economic
effects advice was due this month.  While, her au thorities would continue to consult actively with
industry and other constituencies during the Round, they were now in a better position to advanceconcrete negotiations.  Over the course of the next month, her authorities would continue with
domestic consultations and develop a specific negotiating modality proposal.  Her delegation urged
others to do the same and to be prepared for a detailed discussion in the fall.  The proposals so far on
the table represented a very good start to stimulate Members' thinking.  She looked forward to a
thorough discussion of the US proposals.  In partic ular, her delegation welcomed efforts to help the
Negotiating Group begin the focus on the challenge of addressing non-tariff measures.  She stressed
that Members were entering negotiations at a very different stage.  This negotiation was not like the
Tokyo Round, which was viewed as primarily a developed country to developed country Round, it
was not like the Uruguay Round which was perceived as a developed country to less developed
country Round.  Real benefits could accrue in this process for developing countries vis-à-vis  their
trade with one another.  Thus active participation by  all was essential to the success.  Her delegation
recognized the capacity needs inherent in this process and was actively engaged in helping Members
to meet them.  For example, the Agency for In ternational Development was contracting with the
UNCTAD/ITC to make trade maps available to all Members on request.  This was a useful analyticalTN/MA/M/2
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tool that the US hoped all Members could use as they prepared for negotiations.  The US was working
with the World Bank to help advance its WITS program which she understood was  due out soon but
also to provide assistance to countries in need,  particularly on data.  The US was actively engaged
with WTO in the trade-related technical assistance process and hoped that the requests that countries
had tabled in the last few weeks would address some of their needs in the tariff area and the non-tariffbarriers area as well. Tariffs were also an area where the best way to learn was by doing.  Members
should not hold off progress until perfect knowledge was achieved.  As with the elusive perfect
database for negotiations it would never come.  Data was a critical issue and the US paper was
designed to outline the challenges and offer some  solutions.  But Members had  to  turn to this
problem actively as data were necessary for every aspect of this negotiation.  Whether it be the studies
Members were requesting the Secretariat to undertake, or in assessing individual interest and
vulnerabilities. This was particularly true for develo ping countries and their trade with one another.  It
was important for assessing modalities for base rates and dates, and essential for the completion of the
negotiations.  Her delegation urged Members to submit their data over the summer. Finally, the US
believed that there was much groundwork to be undertaken now.  Accordingly,  two areas for
discussion had been identified:  the data issues to which she had referred where a full set of tariffs
both bound and applied was required for all Members and a second paper identifying the issue ofenvironmental goods so that the Negotiating Group could meet its mandate in that area.
1.5 Another representative from the United States  summarized the two papers submitted by his
delegation.  The first on "Tariff and Trade Data Needs Assessment" (TN/MA/W/2) reflected the
ongoing efforts by the US and other Members to improve reporting to the IDB.  It also stemmed fromhis delegations's own analysis of the various software tools that were presented at the Market Access
Seminar held in May 2002.  Regarding software, it struck his delegation that for some Members
including his own there was confusion about the function and purposes of the numerous tools that
were presented or that would soon be made available.  So what his delegation had attempted to do was
to provide a table in its paper that summarised these tools and gave more clear guidance as to theiruse. This assessment was not definitive, and his delegation would welcome comments and
contributions from Members and the software developers in the Secretariat. His delegation's proposal
for a review by the Secretariat would allow for a comprehensive analysis, in addition to ensuring that
the WTO remained on top of the software programs and corresponding technical assistance needs.  It
also helped to avoid duplication of efforts. There were several important points that resulted from his
delegation's analysis of the software.  First, that there are only two sources of data: the WTO and the
UN COMTRADE. The UNCTAD also provided applie d rates.  Second, the software tools were
targeted for different types of audiences, the ITC's Trade Maps, for example, was designed primarily
for exporters to help them identify individual export priorities.  This tool for many countries could be
a first step towards identifying key trading partners for specific products, but it was not
comprehensive.  Third, he understood that the World Bank's WITS software database would be ready
in September 2003.  It would contain CTS data and it would be a useful tool for examining the effectof modalities proposals, but it was limited to the 6-digit tariff level.  This was why the importance of
the Secretariat role in developing its own tools and preparing an official comprehensive tariff
negotiating file, at the national tariff line level for all Members needed to be emphasized.  On the
critical issue of data which included applied rates, bound rates and imports.  He was pleased to note
the release of the CTS data containing Members' bound rates and applauded the Secretariat for itswork in developing this critical component to the negotiations.  But, without information on applied
rates and imports, it would be impossible to accurately determine the economic effect of these
negotiations on individual Member's schedules or for Members to evaluate the effects on their export
priorities.  Over the past several years, the Market Access Committee working closely with the
Secretariat had endeavoured to improve contributions to the IDB.  While reporting had increased,there were still large gaps and outdated information.  His delegation had made a number of
suggestions on how to improve the status of submi ssions to the IDB, including transfers from other
databases such as the FTAA, APEC and UNCTAD.  He noted that 11 Members had not approved the
transfer of their Trade Policy Review(TPR) data to the IDB.  However, there had been some successTN/MA/M/2
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from this effort. He understood that several Latin American countries had transferred their data from
the FTAA and APEC Members in the Market Access Group had endorsed the updating and ensuring
the update of the data to the IDB.  Nevertheless it was up to individual Members to make the legal
transfer and provide the requisite information.  His delegation continued to welcome ideas or
suggestions as to how the situation could be improved including by more pro-active measures.  ButMembers had to take some individual responsibility if they wanted to participate and benefit from the
software tools and other forms of analysis.  His delegation had proposed that Members agree to
address these data shortfalls by the end of 2002 and he would welcome thoughts and ideas of the
Chairman and Members as to a way forward.  On the second US paper regarding negotiations on
environmental goods (TN/MA/W/3), this paper sought to lay the ground work for discussion on this
important element of the Doha agenda.  As most Members were aware, the mandate for negotiations
on environmental goods would be coordinated with the Committee on Trade and Environment (CTE)in Special Session.  Therefore, his delegation recommended that all papers and proposals related to
this negotiation be submitted to both bodies, as the US paper had been.  The US paper highlighted
important work already done by APEC and the OECD to identify a list of environmental goods.  From
the US perspective, the APEC list continued to reflect key environmental goods and his delegation
therefore believed that it would be a good starting -point for WTO Members to examine this issue.  In
this regard, he noted that APEC colleagues in New Zealand had made a similar suggestion and
submitted the APEC list to the CTE under TN/TE/W/6.  As this list was developed in the WTO,
Member should also consider a tariff cutting approach in the context of the modalities discussions, in
addition to how to address non-tariff barriers.  However, his delegation did not see this as a separate
process.  At the appropriate time, the Negotiating Group might wish to focus its attention on this issuein future meetings.
1.6 The representative of New Zealand stated that the New Zealand paper (TN/MA/W/4) had
started as an exercise for his delegation's own benefit.  His delegation, when reflecting about the
shape and scope of a negotiation on non-tariff barriers, realized that it did not have a clear sense in itsown mind as to what that might cover.  Theoretically, it became clear that the scope of this exercise
could be extremely wide as noted in the paper. This point was further underlined to those who
attended the discussion on non-tariff measures during the Market Access Seminar in May 2002.  It
became apparent to his delegation that there were issues such as the relationship with other areas of
the Doha mandate or with the regular WTO work programme and his delegation had identified some
of those issues in the paper.  The heart of the paper was paragraph 10 on page 3 which provided a list.
In that list, his delegation had tried to come up with an initial breakdown of non-tariff issues into
categories and to suggest the most obvious way of dealing with each of those categories.  He intended
to provide a few examples to try and illustrate what had been idea in some of those cases.  On the first
heading " Issues that might be addressed in negotiations elsewhere under the Doha mandate" , if
delegations wished to talk about issues linked to Articles V, VIII and X of GATT 1994 in the context
of non-tariff barriers, the right place for that discussion was probably at this stage in the Council forTrade in Goods in the context of the Trade Facilitatio n exercise that was underway there.  If there was
any desire to talk about anti-dumping, Article VI of the GATT 1994, then, in his view, the discussion
belonged in the Negotiating Group on Rules and not this Negotiating Group.  On the next heading
"Issues or proposals involving substantial change to existing WTO agreements", there were only a
handful of cases where Ministers had given a specific mandate to review an existing WTOAgreement, an obvious example was that of subsid ies.  The inference from this was that other WTO
Agreements were not meant to be renegotiated.  In fact the conclusion his delegation had reached, was
that a fresh mandate would be required if Members wished to open up an existing Agreement for
renegotiation.  The third category which was suggested was " Proposals involving clarification of
existing rules".   This area was not a straight forward one, and the initial question that could be raised
was what was the difference between the renegotiation of an Agreement and clarification of specific
provision contained in that Agreement?  As indicated in the paper, his delegation was of the view that
a distinction could be made but wished to point that this was an area where it would be necessary to
move with great care and restraint. The same was true of the next heading "Issues involving disputedTN/MA/M/2
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interpretation of rules".  Here reference had been made to dispute settlement, and the point was to
flag the idea that there may be some cases where a Member with an issue it regarded as an non-tariff
barrier might have to look to dispute settlement for an answer rather than re-writing the rules.  There
might be other instances where clarifications might be an option and in the paper his delegation had
said that this would most likely be on a specific provision where there was a broad sense that theissues of interpretation had taken on systemic importance.  Finally, he wished to touch upon the
heading " Issues open to bilateral resolution ".  Part III of the Uruguay Round schedules covered non-
tariff concessions.  He believed in most cases those concessions were initially the subject of bilateral
exchanges but were finally inscribed in schedules as mfn commitments.  For example, Schedule
XLIX  listed the removal of import licensing requirement in respect of approximately fifty items.
Schedule LXIII listed the removal of import licensing in respect of twenty-nine items.  Such an option
remained available to Members in these negotiations. Finally, the paper listed four subjects that weremore horizontal in nature.  The first one was "Products of interest to developing countries" .  This
acknowledged the particular reference in the Negotiating Group's mandate to products of interest to
developing countries. Reference was also made in the paper to " Capacity issues ".  Delegations were
aware that there had been calls in the special and di fferential context, for example, for support in the
form of technical assistance for Members having difficulty in handling certain non-tariff barriers forexample, in the SPS field.  This could be relevant to some issues that might arise in this Negotiating
Group.  On " Implementation issues" , the paper recorded the fact that the Doha Declaration specified
how outstanding implementation issues were to be handled.  A reference was also made in the paper
to "Special and differential provisions", and the paper contained a reference to special and differential
provisions in paragraphs 44 and 50 of the Doha Decl aration.  In conclusion, he stated that the aim of
this paper was to put forward some initial questions and ideas rather than attempt to provide definitive
answers.
1.7 The representative of Korea stated that the outgoing Director-General Mr. Moore had
mentioned that there were only 13 months before Cancun so there was no denying that time was
limited.  As a result, Members had to be efficient and effective in going about the program of
meetings and in carrying out the objectives set forth in the Doha Declaration. To this end, his
delegation strongly believed that there should be active participation of all WTO Members in the
forthcoming meetings.  He requested that Korea's paper, circulated at this meeting as a non-paper, be
prepared as an official WTO document.  It was a preliminary paper and contained six parts which
addressed five issues:  modalities;  environmental goods;  non-tariff barriers;  special and differential
treatment;  and tariff and trade data.  He was going to focus on environmental goods and special anddifferential treatment.  On environmental goods, his delegation believed that there was a big gap to
close in environmental policy between developed and developing countries.  It was clear that
agreements to be made somewhere in the future would not be enough to deliver the so called triple-
win outcome, a term used by the EC, within any kind of an acceptable time-frame.  In order for
developing countries to reap the full benefit of th e triple-win outcome, his delegation believed that the
full participation by developing countries should be ensured through massive technical assistance.  On
special and differential treatment, his delegation sensed that the main difference between developed
and developing countries was not in the policy per se .  It had to do with the capacity of their
institutions to carry out such policies.  As a result, special and differential treatment provisions were
largely related to technical and financial assistance.  Consequently, Korea suggested that the ways andmeans of supporting capacity building for such developing countries should be clarified as soon as
possible, before Members entered into detailed tariff negotiations.  In this regard, his delegation fully
supported what was set forth in the last paragraph of the programme of the meeting that "special and
differential treatment for developing and least developed countries shall be an integral part of all
elements of the negotiations under this Work Programme."  His delegation intended to present somesuggestions on modalities for the September 2002 meeting.
1.8 The representative of Canada stated that over the course of the last eight Rounds, reduction
and/or elimination of tariffs and non-tariff barriers had delivered major economic benefits, includingTN/MA/M/2
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the reduction of poverty.  This new Round provided another opportunity for progressive trade
liberalization which could benefit all Members.  While some might claim that most of the benefits to
date had accrued to the developed countries, one had to include a wide group of middle and upper
income developing countries which had become successful players in the global trading environment.
Some other developing countries, particularly the least-developed countries had not the capacity tofully take advantage of improved market access.  In responding to the Doha mandate, Canada was of
the view that much work remained to be done to further liberalize access to non-agricultural markets
in both developed and developing countries.  Although some Members had drawn particular attention
to their interests in the agriculture negotiations, Canada believed that trade in non-agricultural goods
was of increasing importance to the overall membership.  For example, in the 1960s, manufactured
goods accounted for only one quarter of developing country exports.  By the late 1990s, thirty years
later, it had risen to about three quarters of developing country exports.  So, market access to non-agricultural goods mattered to all Members.   He also noted that the geography of trade flows had
changed over the same course of time. For exampl e, the share of exports of developing countries
going to other developing countries had increased dramatically.  This suggested that the work to
promote development had to take a wide focus.  A successful Round had to take into account tariff
reduction strategies that would reduce trade barriers for all players.  This would include the reductionof tariff and non-tariff barriers of North-North trade, North-South trade as well as South-South trade.
For all Members, the success of this negotiation would be marked by the tariff concessions that
delivered real, tangible reductions in protectionism.  Tariff concessions by both developed and
developing countries would be essential if real pr ogress had to be made on the issue of development.
In looking more specifically at the issues that needed to be addressed, it was evident that these had toinclude those tariff barriers that remained in numerous markets and in many sectors of export interest
to all Members.  There were still many high rates and, in addition, many tariff rates remain unbound.
There were also many large gaps between bound and applied rates.  These facts combined to create a
scenario in which excessive unpredictability and uncertainty discouraged trade and investment flows.
It was Canada's conviction that further trade liberalization would play a significant role in promotingeconomic expansion for all Members, at all levels of development.  Therefore, Canada's position was
that market access negotiations on non-agricultural tariffs should provide an opportunity for improved
market access on a broad front.  In this regard, Canada's main objectives included the following six
elements:  1) reducing and binding applied tariff le vels which were not yet bound;  2) reducing high
bound rates and re-binding them at lower rates;  3) expanding the scope of duty-free trade;  4)
expanding the scope of tariff bindings; 5) eliminating nuisance tariffs (for example, those less than
2%);  and 6) maximizing the use of ad valorem  rates.  As for the modalities to be used in the
negotiations, in Canada's view, tariff reductions might be best achieved through a number of
approaches, including sectoral (or zero-for-zero) agreements; formula cuts; and request/offer. With
regard  to the 13 existing sectoral tariff agreements, Canada favoured building upon the example
being set by the ITA to broaden its membership to include wider representation from both developed
and developing countries.  In some cases, Canada might also wish to expand product coverage inindividual agreements.  Membership in these sectoral agreements contributed a valuable degree of
certainty and predictability to the participants' mutu al trade regimes, and thus acted to focus private
sector attention and attract trade and investment flows.  Canada also supported the negotiation of new
"zero-for-zero" (duty-free) sectoral agreements to include sectors of interest to both developed and
developing countries.  They would include envir onmental goods, as set out by the Doha Declaration.
However, his delegation wished to express some caution with regard to the EC approach to defining
environmental goods.  He would welcome more details on how the EC would envision establishing
practical criteria for defining sustainable materials and production characteristics that were
environmentally supportive.  Canada, preferred a definition at this point that encompassed those
goods which measured, prevented, limited or corrected environmental damage. In that regard, Canadawas more comfortable with the US suggestion and its paper on how to define and approach the
environmental goods negotiations.TN/MA/M/2
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1.9 With regard to non-tariff barriers, Canadian objectives would include further efforts to reduce
or remove existing trade-distorting non-tariff barriers, and to discourage and prevent the development
of new ones.  In some cases, this could be done by improving the implementation of existing
agreements by all Members.  It might also be possible to negotiate some specific measures on a case-
by-case basis.  Canada's overriding objective would be to curtail inappropriate barriers andcomplement the trade facilitation agenda, while allowing governments to apply appropriate measures
in support of legitimate objectives i.e. regulating in the public interest and in the least trade-restrictive
manner possible.  He thanked New Zealand for its very useful paper because Canada believed it had
identified some very important issues that Memb ers needed to think about and needed to address.
1.10 With regard to special and differential treatm ent, Canada believed that this would require an
approach which took account of the various levels of development and varying capacities representedin the WTO membership.  Countries at the same level of development used tariff structures as well as
non-tariff barriers which were in some cases significantly different.  It was in the interest of all
Members to contribute to the negotiations according to their specific circumstances and abilities.
Canada stood ready to contribute to this negotiation and shared the recently expressed view of Mr.
Moore that it was "now about substance and real negotiations".  An important immediate step was todevelop Members' working tools further, in particular tariff and trade data.  In this regard, he
welcomed the US paper and also wished to high light the importance of all Members bringing up to
date their IDB submissions, as well as of Members looking at efforts to fill in existing gaps,
particularly with regard to more recent years.  It  was also clear that this Negotiating Group needed to
move on to the actual substance of its work.   In this connection, his delegation looked forward to asubstantive meeting in the fall and to contributing to the fall work programme including through the
tabling of Canadian proposal on modalities.
1.11 The representative of Colombia stated that his comments would be of a general nature,
however, he also had certain questions with respect to the submissions which had been made.  He
agreed with the assessment of the EC regarding the guidelines of the mandate concerning the broad
nature of the negotiations both for tariffs as well as non-tariff barriers which would effectively
improve access between North-South countries and South-South countries.  He welcomed the
categorical assertion made by the EC in stating that they "are ready to commit to an ambitious
programme of tariff and non-tariff reduction and eliminations, if this is matched by truly meaningful
commitments by others".  He understood this last reference as being to countries of a similar degree of
development because in the fifth paragraph of the sa me paper, the EC reiterated agreement with the
provisions of the Ministerial Declaration regarding non-reciprocity as provided for in
Article XXVIII bis of the GATT 1994 and special and more favourable treatment recognized in the
Enabling Clause. In the section entitled "modalities", it was not clear to his delegation whether the EC
had in mind a single type of formula with several options or whether the idea was to have alternative
approaches thus making it possible to choose from the various approaches depending on theconditions and the concerns of each particular economy.  Furthermore, he sought clarification as to
what the EC meant by referring to "reduce and co mpress high tariffs in an economically meaningful
way", and whether the EC had any guidelines for the rigorous analysis being proposed on tariff
escalation.  His delegation thought it would be good idea to increase the number of bindings although
it did not fully share the idea that the gap between bound and applied rates should be closed.  Thereference year to be chosen would depend on the greatest coverage and information available in the
IDB and the CTS database.  Regarding environmental goods, Colombia agreed on the need to start as
soon as possible any relevant analysis for the achievement of the reduction or elimination of tariffs
and non-tariff barriers on these type of goods, as well as on any other non-agricultural goods, in the
light of the decision taken at the CTE in Special Session to transfer the negotiations to thisNegotiating Group.  Nevertheless, his understanding on this point was as follows: this Negotiating
Group would undertake negotiations of environmental goods which were identified in the CTE in
Special Session.  At the latter forum, Members would have a chance to define the criteria which
would be used to agree on a list of good to be considered environmental goods.  At that time and inTN/MA/M/2
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that Committee, Members would analyze the various options raised by the US. On the definition of
negotiating modalities for such types of goods equal importance should be given to goods of
developing countries, mainly in the shape of grea ter technical support.  In this connection, Colombia
wished to have studies which would illustrate the comparative advantages available in production of
the ecological goods as refered to by the US.  Moreover, Colombia gave its full support to theevaluation and the recommendations made by the US regarding needs for tariff and trade data.
Colombia thought it important that action on this front be complemented by holding capacity-building
seminars in Geneva as well as in capitals.  This would improve Members' knowledge and the ability
of their technicians in using computer tools.  He drew attention to one of the EC's conclusion which
stated that "Some definitional issues will have to be decided at an early stage of the negotiations,
including the question of base rates, the scope of non-tariff barriers …". His delegation was of the
view that capitals must prepare an inventory with information supplied by exporters which would
include a study of instruments and measures which were used in regional agreements, for example,
measures in trade facilitation.  Regarding New Zealand's contribution, his delegation thought it was
very relevant and a valuable input.  New Zealand's approach to classification was very useful and at a
later stage, Colombia would make further comments on that paper.
1.12 The representative of Australia stated that his delegation hoped to submit a paper for
discussion at the Group’s next meeting.  He urged other Members to submit proposals on negotiating
modalities as soon as possible.  It would be very helpful if the proposals could cover as wide a range
of issues as possible including for example, formula cuts, elimination or reduction on a sectoral basis,
request/offer processes, base dates, base rates as well as implementation time-tables.  It was criticalthat Members did as much as possible to prepare the databases (IDB and CTS) that were essential for
the conduct of these negotiations.  In this connection, Australia shared the views expressed by
previous speakers about the need for Members to take action as soon as possible to fill in the gaps in
the IDB so that work could be facilitated.  The mandate in paragraph 16 of the Doha Declaration
required Members to address non-tariff barriers and his delegation considered this to be a verycomplex area of work which required careful consideration.  Many non-tariff barriers were to some
extent already covered by WTO disciplines or subject to mandated negotiations in the Doha
Declaration.  With this in mind, the Negotiating Group had to focus on those non-tariff barriers which
did not fall within those two broad categories.  Australia agreed with New Zealand that the
Negotiating Group should not open up Agreements which were not specifically mandated in the Doha
Declaration.  The EC had proposed that Members consider deeper cuts on items of particular
environmental significance and this was something th at his delegation could look at.  The EC had also
suggested that, on environmental goods, they supported an early discussion of including goods whose
sustainable materials or production characteristics meant that increased trade in such products would
also be environmental supportive.  He, like others, had very serious reservations about this proposal
which could be potentially divisive and pit Members against each other in relation to the general
views on environmental conditions, priorities and values .  It could also lead to difficulties with the
treatment of like products in an unlike manner.  Instead of providing for a liberalizing outcome this
approach had the potential to maintain barriers to environmental goods and technologies, particularly
from developing countries which were unable to meet standards, values and judgements which might
be imposed by developed countries.  A more favourable approach would be to work on the defining
environmental goods by focusing on end-use in the first instance and to draw on the work undertaken
in this area by APEC.  Additionally, work in th e area of non-agricultural market access would need to
be sufficiently advanced by early 2003 to permit realistic assessments across the broader negotiating
agenda in preparation for the next ministerial meeting.  Finally, the EC had referred to the concept of
"effective market access", which was a concept that his delegation could support.  Of course it might
mean different things to different Members and one dimension of the issue in his delegation’s viewrelated to non ad valorem  rates of tariffs.  Australia had noted that for those Members which applied
non ad valorem  rates of duty on agricultural products, effective levels of protection had actually
increased since the last round of negotiations ra ther than fallen in acco rdance with the commitments
that had been entered into.  This was a result of  the general downward trend in commodity prices. ItTN/MA/M/2
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was the view of many members of the CAIRNS group, that non ad valorem  rates of duty on
agricultural products should be eliminated for the ve ry reason that as prices went down, the effective
levels of protection went up.  Commodities were not just in the agricultural area and perhaps this was
a subject that this Negotiating Group might need to examine.
1.13 The representative of India welcomed the commencement of negotiations on market access
for agricultural products.  This was an area in which India had great interest and expectation of
positive contribution to its developmental efforts through greater market access for its products.  His
delegation had not had adequate time to examine all the issues relating to market access for non-
agricultural products in detail or to study all the papers at length .  He therefore would confine himself
to a few preliminary remarks on some relevant issues at this stage.  His delegation believed that these
negotiations should closely follow the mandate given by Ministers in paragraphs 16 and 50 of theDoha Ministerial Declaration as well as the overarching provision in Article XXVIII bis of GATT
1994.  Members also could not lose sight of the ultimate objective of the Doha work programme,
which was described at length in the first few paragraphs of the Ministerial Declaration, in particular
in paragraph 2 of the Doha Ministerial Declaration, which stated that: "International trade can play a
major role in the promotion of economic development and the alleviation of poverty.  We recognizethe need for all our peoples to benefit from the increased opportunities and welfare gains that the
multilateral trading system generates.  The majority of WTO Members are developing countries.  We
seek the place their needs and interests at the heart of the Work Programme adopted in this
Declaration". The intention of the Ministers was thus crystal clear.  It was Members’ role as
negotiators to carry this intention forward to a succ essful outcome without constructive or destructive
ambiguity.  A complete reading of all these provisions in GATT and in the Doha Ministerial
Declaration revealed certain guiding principles which should govern the negotiations.  First, Members
were aiming at the "reduction or elimination of tariff peaks, high tariff and tariff escalation, as well as
non-tariff barriers, in particular, on products of developing countries".  Second, product coverage was
to be comprehensive and without a priori  exclusion of sectors.  Third, the "negotiations shall take
fully into account the special needs and interests of developing and least-developed countries".
Fourth, the principle of less than full reciprocity in reduction commitments had be followed in the
negotiations and in the final outcome when dealing with developing and least-developed countries.  In
this regard, the provisions contained in Part IV of GATT, the Enabling Clause and the Decision on
Measures in Favour of Least-Developed Countries and other relevant WTO provisions had to be taken
into account.  The Enabling Clause lay down quite explicitly that "the developed countries do not
expect the developing countries, in the course of trade negotiations, to make contributions which areinconsistent with their individual development, financial and trade needs".  Article XXVIII bis further
specified that the negotiations should take into account the needs of less-developed countries for a
more flexible use of tariff protection to assist their economic development and the special needs of
these countries to maintain tariffs for revenue purposes, besides all other relevant circumstances,
including the fiscal, developmental, strategic and other needs of Members.  The question as towhether a formula-based approach or a request-and-offer approach should be followed had been
debated in several Rounds conducted in the past.  In the Uruguay Round, the US had advocated the
adoption of a request-and-offer approach, while the EC, Canada and Switzerland had favoured a
formula approach.  Ultimately, no decision could be reached in favour of a formula-based approach
and in the procedures adopted in January 1990, it was agreed that the participants would submitproposals for the reduction, elimination and binding of tariffs on a line by line basis.  It was perhaps
too early for Members to commit themselves to a decision on this matter at present.  However, a
considered decision had to be taken which gave adequate flexibility to all Members and, which above
all, factored in the special needs of developing and least-developed countries.  With regard to
elimination of tariff peaks, high tariffs and tariff escalation, it was important that a genuine attempt beundertaken on the part of developed countries to bring down tariffs substantially in consonance with
their average tariff levels.  At the end of the day, Members should not face a situation in which tariff
reductions had not taken place in sectors of particular interest to developing countries.  The same
applied to coverage.  While no a priori  exclusion might be the starting-point, the final coverage wouldTN/MA/M/2
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be determined by the developmental needs of Members.  He emphasized once again the need to
conduct negotiations in such a manner that took into account the fiscal, developmental, strategic and
other needs of developing countries.  The base year should preferably be fixed as the end point of
previous negotiations to take into account tariff reductions/bindings undertaken by Members
unilaterally or otherwise but on an mfn basis since the last negotiations.  This brought him to the issueof giving credit for autonomous liberalisation and to the question of unbound tariffs.  With regard to
autonomous liberalisation, a formula was elaborat ed during the Uruguay Round which however, was
not applied in the negotiations per se .  With regard to unbound tariffs, so far as developing countries
were concerned, these tariff lines were not bound during the Uruguay Round because of their
particular economic sensitivity.  The issue of coverage and determination of base levels, therefore,
needed to be handled with equal sensitivity.  His delegation proposed that the Secretariat prepare a
paper on all the elements relevant to modalities with particular reference to guiding principles, baseyear, staging of reductions, autonomous liberalization principles, and the manner in which the
question of factoring in the special needs of developing countries had been addressed in the past and
also the impact of trade liberalization, especially on the economies of developing and least-developed
countries.  While studying the impact of previous exercises, an objective examination would demand
assessment of overall welfare implications.  An increase in global trade or even an increase in GDPdid not necessarily and automatically need to reflect itself in increase of human welfare, particularly
in developing and least-developed countries, if it led to skewed distribution of production capacity
globally, displacement of labour intensive technologies without compensation elsewhere in terms of
increased employment and income generation at all levels and greater vulnerability to external shocks.
Since the exercise of preparing a bibliography had already been undertaken, it should not be toodifficult to prepare a compilation at this point which would be of great benefit to developing and least-
developed countries.  In this connection, he recalled the remarks of Kenya, speaking on behalf of the
African Group, and Bangladesh, speaking on behalf of LDC Group, at the meetings held on 11 April,
1 July and 19 July 2002, the minutes of which were circulated in a combined document dated
30 July 2002.  The terms of reference of such a study should take into account the particularrequirements of developing and least-developed countries and hence a process of consultation was
essential.
1.14 On non-tariff barriers, one significant element should be a complete and exhaustive study of
non-tariff barriers.  It would serve no purpose if tariffs were reduced or eliminated and quantitative
restrictions of all kinds removed if, at the same time, effective market access was denied through a
variety of other measures.  His delegation had noted the EC suggestion that non-tariff barriers whichwere not presently covered by any WTO rules or GATT provisions could be addressed by creating
disciplines.  This might be the systemic solution.  However, India’s experience showed that for
individual products of export interests, market access might be restricted or barred using specific
measures including "innovative" ones, whose WTO compatibility might never be known unless
tested.  Since developing countries usually had specific products on offer rather than a broadspectrum, Members would have to consider and negotiate removal of specific barriers on specific
products to grant meaningful market access, along with systemic solution.  Over the years, some
developed countries had been regularly and systematically compiling and publishing details of
non-tariff barriers which they perceived in other countries.  Some material had also been referred to in
the Secretariat bibliography on market access.  Developing and least-developed countries had notundertaken any such exercise for want of expertise and resources.  For the benefit of least developed
countries and developing countries, he proposed that the Secretariat prepare a compilation of non-
tariff barriers initially from existing secondary sources to be supplemented by studies later if required.
He recalled, in this connection, a similar proposal made by Malaysia at a previous meeting.
1.15 There was another issue which he wished to touch upon and which was raised by one
delegation at this meeting concerning special and differential treatment and differentiation between
developing countries.  India’s view as well as that  of many other developing countries was that this
could lead Members into very dangerous territory.  What would be the parameters used to distinguishTN/MA/M/2
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between developing countries, by capital income, or other factors?  Who determined these
parameters?  Would it find acceptance among all developing countries?  If there was a differentiation
between developing countries, why not make a similar distinction between developed countries and
differentiate mfn tariffs and other conditions of these countries?  Was the intention to carry out an
exercise of large scale fragmentation of the WTO during this work programme?  Would that serve theinterest of the global free trade?  The representative of Australia had also referred to another divisive
issue on environmental goods.  Members should try to avoid divisive issues so that within the short
time span available Members could achieve the maximum results possible.
1.16 The representative of Kenya stated that the issues at stake in these negotiations were very
crucial to the future of the industrial sector, and the future prospects of the industrialization process,
especially in African countries.  There were at least three major aspects that such countries needed toconsider in their industrial development, which had a bearing on the discussions in this session.  The
first aspect was production and employment.  Developing countries needed to produce more industrial
products to employ more people in this sector which in turn was expected to accelerate growth and
development.  The industrial output in such coun tries could be geared towards the local market, and
the export market.  There had to be a medium and long-term programme to build the capacity of suchcountries’ industrial sector to produce, and to produce more efficiently.  Without this supply capacity,
such countries would be unable to take advantage of industrialization.  At present, such countries had
relatively weak supply capacities.  Members had to recognize this weakness, the limitations it placed
on such countries, and the need to correct this weakness.  The second aspect was exports. It would be
very good if the industrial sector of such countries could increase their exports.  For this to happen,there had to be better market access, especially to developed countries.  In this regard, Kenya had an
interest in improving the terms of market access for products of export interest to Kenya.  Kenya
would be striving in these negotiations to improve market access for products for which it had an
export potential.  However, he also realised that market access was not a panacea for many
developing countries.  Any improvement in market access by itself might not have the desiredpositive effect since  supply capacity was too weak, at  least in the short term to enable a significant
increase in exports and production.  The third aspect was imports.  Further liberalisation would enable
imports to enter the markets of such countries faster and at cheaper prices.  This would reduce
consumer prices.  However, in Kenya’s experience, cheaper imports could also cause serious
disruptions in the industrial sector.  Many local firms and industries were still too weak to withstand
competition from a large inflow of cheaper imports  resulting from the lowering of import barriers.
Theoretically, economists had indicated that import liberalization could produce a good effect ininducing capital and labour to shift from inefficient industries to more efficient industries and better
still to export-oriented industries.  The extra revenues earned from these new export oriented
production should offset the revenues lost when the inefficient industries shut down under the
pressure of cheaper imports.  In reality, however , in many developing countries, especially Africa,
that had a weak and vulnerable industrial base, rapid import liberalization had led to reducedproduction or even outright closure of local firms and labour retrenchment, whilst there had been no
evidence of the shifting of displaced capital or labour  to more efficient industries.  In many of these
countries, there had been a weakening of the industrial sector and even a process of
"de-industrialization".  Moreover, the reduction in industrial tariffs had caused a significant loss of
government revenue.  What was of relatively greater importance to these countries was themaintenance and development of the industrial sector, which meant more industrial output, better
technology, and more manufacturing jobs.  This should be achieved through production for the local
and the export markets.  The progress of the industrialization process was critical to overall economic
and social development.  The development of the industrial sector in developing countries, especially
countries with weak and vulnerable industrial sector had to be the major objective of this round ofnegotiations on market access for non-agricultural products.  This objective should be uppermost in
the consideration of the Negotiating Group’s deliberations and negotiations, starting with the
discussion on modalities.  The modalities shaped the negotiations, and thus it was absolutely crucial to
have the correct set of modalities, otherwise an inappropriate working of the details of liberalization,TN/MA/M/2
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could lead to inappropriate results.  Modalities should include the principles and objectives of what
Members intended to get at the end of the negotiations. They should include the methodology or
instruments by which Members aimed to achieve the objectives and results.  He therefore at this point
wished to express his hopes and fear.  His delegation wanted this round of negotiations to strengthen,
not to weaken Kenya’s presently weak industrial sect or.  The development of the industrial sector and
process of developing countries, particularly the countries with a weak industrial base, should thus be
the major objective and the major principle of this Round and thus this should be among the first
principles of the modalities.  This development could be measured by a rapid increase in industrial
production, a higher ratio of manufacturing output to GNP, and a significant increase in
manufacturing workers and the share of these industrial workers to the total workforce.  In order for
this objective to be achieved, the negotiations on market access had to give the highest priority to
products of export interest to developing countries with a weak industrial base. At the same time,measures had to be taken inside the WTO as well as outside to assist developing countries to increase
their industrial supply capacity, otherwise whatever  improvement in market access would only be an
unrealistic potential for higher industrial output.  The need and modalities for these complementary
measures should also be an integral part of the modalities for this round of market access for non
agricultural products.  This was vital if Kenya was to convert any potential gains resulting frommarket access to become effective gains measurable by increased export earnings, increased industrial
output and jobs.  A most important point was that the modalities had to take into account the needs of
developing countries to have appropriate levels of import tariffs. Appropriateness had to first and
foremost take into account the levels of strength  or weakness of the local industries that could be
affected by too rapid or too steep a rate of import liberalization.  The modalities could not be in thenature of a one-size-fits-all approach or formula.  The modalities had to recognise that there were
different categories of Members with different levels of industrial capacity. There had to therefore be
a differential approach to fully take into account these differences.  The level and rate of liberalisation
or protection that was appropriate for one group of countries might be inappropriate or even totally
inappropriate for another group of countries.  Developing countries with a weak industrial base shouldbe allowed to choose levels of liberalization and protection that enabled their weak industrial sectors
to remain viable, and to develop in future with greater efficiency, with the assistance of
complementary measures mentioned above.  It was absolutely essential that the modalities and the
negotiations recognized the need and the right of the developing country Members with a weak
industrial base to have the flexibility and option to choose the rate of import protection which was
necessary for the survival and development of domestic industries.  This set of concepts and
principles he had alluded to was important to put forward at the outset.  He had stressed the threeinter-linked aspects of industrial production, exports and imports, and had stressed the need for the
modalities and negotiations to be designed in a way that assisted in Kenya’s process of
industrialization.  Recent studies by international agencies and academics had provided increasing
empirical evidence of many developing and least- developing countries experiencing some negative
consequences because of liberalization.  The information in a book by Edward Buffie, “Trade Policyin Developing Countries” was quite alarming. In a communication WT/GC/W/453 dated
2 November 2001, Kenya along with some other Members had expressed concerns on further
liberalization in this particular sector.  He supported the idea put forward by India that the Secretariat
produce a paper which went along the lines of Kenya's earlier proposal on impact studies of previous
liberalization.
1.17 The principle of special and differential treatment had to be fully applied during these
negotiations. It had to be adequately and fully reflected in the modalities and the suggestions Kenya
had made could be part of the special and differential treatment component.  The objective of the
negotiations on market access should be facilitated and enable the development and industrializationprocesses in developing countries.  The modalities and the actual negotiations should have this goal at
the centre and it should thus be central in all aspects of the work programme.  The liberalization of
imports should only be seen as a possible mean towa rds this goal, and for many developing countries,
further liberalization especially of products where their industries were weak would beTN/MA/M/2
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counter-productive to this overriding development goal.  On the other hand, liberalization by
developed countries of products that could be exported by developing countries could contribute to
the development of developing countries although it should also be realized that supply constraints
prevented many developing countries from being able to take advantage of any improvement of
market access.  Kenya's comments contained some initial thoughts on the subject of the session todayand his delegation hoped to come up with a formal paper for the next meeting.  In conclusion, he
pointed out that this Negotiating Group had until 1 January 2005 to complete negotiations on market
access on non-agricultural products and not the 5
th Ministerial Conference.
1.18 The representative of China stated that, at  this stage, when the Negotiating Group was
considering the modalities of the market access negotiations the following elements had to be taken
into account:  1)  developed Members should further open up their markets by eliminating tariff peaksand tariff escalation in the area of non-agricultural goods.  This was the key to ensuring the balance of
interests between the developing and developed country Members during this multilateral trade
negotiations;  2) special and differential treatment should be made available to developing countries
and least-developed countries especially in sectors of concern to them;  3) concrete measures should
be taken by the WTO to help developing Members and least-developed country Members in capacitybuilding, so that they could have greater capability in taking part in this exercise here and that the
results of negotiations could reflect the interest of all Members in a fair, balanced and a sufficient
manner;  4) during their accession negotiations to the WTO, the newly-acceded Members including
China had made enormous commitments on market access for non-agricultural products.  The
implementation period for many of those commitments would extend to 2008 or even 2010.  The levelof market access as represented by those commitments reflected and would continue to reflect for a
long period of time the actual level of development of those new Members.  He hoped that this
element could be taken into account fully by other Members.  It was unrealistic for new Members,
such as China, to make significant concessions in this round of negotiation;  5) since the negotiations
under the Doha Development Agenda were viewed as a single undertaking, it was important thatdeveloped country Members showed good faith and took concrete actions in areas of interest to
developing country Members, including on implementation issues, which his delegation believed
would facilitate the negotiations in this Negotiating Group.
1.19 The representative of Chile wished to react in a preliminary fashion  to a few issues raised in
the  contributions that had been made.  On environmental goods, the question to be asked was whether
it was necessary for the Negotiating Group to make a great effort in defining environmental goods.These were negotiations which did not exclude a priori  any non-agricultural products.  Therefore, in
his view, environmental goods, whatever their scope were included.  Perhaps, in this respect,  it would
be more logical and depending on the modalities agreed upon, to evaluate at the end of the
negotiations how market access treatment was given to so-called environmental goods and then to see
if there was any additional effort to be made on those products.  If the Negotiating Group started bydefining environmental goods, it was going to take a lot of time.  The Group would ask the Secretariat
to carry out a number of studies and at best an ambiguous result would be achieved.  He shared the
concerns raised by Australia that it was not logical or reasonable to try to define environmental goods
on the basis of production methods or material that they might be made from.  This for many reasons,
the most obvious was that this would affect in a direct manner similar products.  On modalities, hisdelegation had been studying this matter seriously and Chile might make a contribution in this regard.
However, he pointed out that modalities based exclusively on request and offer had a disadvantage for
Chile in that the negotiations then focused on potential suppliers of a product and consequently this
excluded most developing countries whose participation in a specific market was very small.
Therefore a way of integrating all Members in the negotiations so that all could benefit would have tobe through the use of a formula with a different nuance with regard to special and differential
treatment, for example.  Obviously a negotiation based on a formula could be deepened and/or
accelerated through sectoral or bilateral agreements based on a request and offer process.  But, in
principle his delegation was of the view that the basis of the negotiations should be a formula whichTN/MA/M/2
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would have to be studied more carefully.  In that  respect, he wished to refer to the time-frame for
implementing results.  The Negotiating Group could discuss modalities, which could be more or less
ambitious, however, if the Group programmed the implementation of results within a long time-frame
the objectives would be less ambitious.  It was important to include this concept into the discussion on
modalities because it could shed light on the question of ambition that had been raised.  Also, andrecalling what Kenya had said, there should be flexibility for Members to adjust themselves to high
levels of ambition in the long-term in conformity with their needs and requirement.  On the topic of
non-tariff measures, he was grateful for the contri bution made by New Zealand which provided a very
useful context for looking at this topic.  He wished to use as a basis part of the classification set out by
New Zealand.  As a first step, the Negotiating Group had to decide whether a measure was covered or
not by an existing agreement.  If the measure was covered, the Negotiating Group would have to see
whether this agreement was within the single undertaking.  If yes, then the measure should be handledwithin the relevant Negotiating Group.  If it was not covered by the Doha mandate, then there were
two possibilities.  If it was an illegal measure then it had to be dealt with under the Dispute Settlement
Understanding.  If it was a legal measure, then a request/offer process could be used to address it, i.e.
a country would take on commitments to reduce or eliminate this measure. Otherwise, there was a
danger that in the case of such measures, existing agreements would be opened which Chile did notwant to do because one ran the risk of weakening rather than strengthening the process.  The other
category under which a measure could fall was a measure which was not covered by an existing
agreement.  In such a case, a measure could be dealt with through new agreements or disciplines.
Chile was open to considering this option or the request and offer scheme of making specific
commitments.  However, he pointed out that the time-frame for the negotiations was limited.  Anumber of proposals had been made with regard to studies to be undertaken by the Secretariat.  Chile
thought that some were interesting and with regard to others his delegation had doubts. Members
would have to measure the existing capacity not just for the studies to be presented in good time since
contributions could be made from other institutions but also the capacity for Members themselves to
absorb the conclusions of these studies.  Therefore,  his delegation needed to have some time to think,
perhaps in a more informal manner, on this question of studies and their contents.
1.20 The representative of Indonesia stated that the negotiations had to be guided by their objective
which was to achieve a fair and balanced package of market liberalization comprising products of
interest to all Members.  The negotiations had to  take into account the different levels of economic
development of Members.  To this end the mandate set out in the Doha Declaration on special and
differential treatment was an important part of the negotiations.  Least-developed countries anddeveloping countries had to be given flexibility to enable them to pursue their industrialization
policies and the concessions required of them had to be commensurate with their level of economic
development.  On the subject of a balanced package, these negotiations had to provide the maximum
benefit for all Members.  The other principle that had to be taken into account was that these
negotiations had to provide an opportunity to improve developing countries' effective participation inthese negotiations, not only by taking part in these negotiations but also by reaping maximum benefits
from market liberalization.  This meant that least-developed countries and developing countries
should be given considerable technical assistance.  The Market Access Seminar of May 2002 was
helpful and his delegation thought that it would be useful if such a seminar could be organized on a
regional level so that participation from capitals would be more likely.  As mandated in the Doha
Declaration, product coverage was to be comprehensive and without a priori exclusions.  In
Indonesia's view, this mandate ensured that the package resulting from negotiations would be
balanced to cover all products of interest to all Members.  However, his delegation was also of the
view that it allowed Members to exclude selective products which were sensitive to their domestic
industries.  Reference had also been made to the mandate to reduce or as appropriate eliminate tariffpeaks, high tariffs, tariff escalation and non-tariff barriers.  However, Indonesia was of the view that
before Members entered into the process of negotiations, they should clarify what was meant by tariff
peaks, high tariff and what the scope for non-tariff barriers was.  In this regard, Indonesia welcomed
the paper from New Zealand and its effort to clarify the subject of non tariff barriers.  He noted thatTN/MA/M/2
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the EC paper had included export duties as a non-tariff barrier.  He wondered whether this was an
appropriate inclusion.  On the US submission on data collection, his delegation shared the US views
that it was important to have a complete set of data before starting negotiations.  This would allow
Members to develop a comprehensive analysis of their interests.  However, such an exercise should
not pose an additional burden to developing countries.  With regard to US paper on environmentalgoods, Indonesia saw the merit in the US suggestion to clarify a common list of environmental goods
to be the subject of negotiations.  While his delegation recognized the benefit of having favourable
access to  environmental goods through a reduction of tariffs and non-tariff barriers, his delegation
was also concerned that the main benefits would go to more advanced countries.  It was therefore, his
delegation's view, that negotiations in that sector should be accompanied by other area of activities
such as transfer of technology as part of technical assistance and capacity building.
1.21 The representative of Singapore stated that Members had agreed that the negotiations in this
body would be based on paragraph 16 of the Doha Declaration.  What was outlined in paragraph 16
was a very ambitious mandate.  It stated therein that "Product overage shall be comprehensive and
without a priori  exclusions".  The negotiations shall aim "to reduce or as appropriate eliminate tariffs,
including the reduction or elimination of tariff peaks, high tariffs and tariff escalation, as well as non-tariff barriers, in particular on products of export interest to developing countries."  As the EC paper
correctly pointed out, the mandate in this Negotiating Group for the Doha Development Agenda was
more ambitious than for previous rounds.  It would require developed and developing countries to
take an ambitious approach towards these negotiations and lower tariff and trade barriers.  Members
would need to address trade barriers in both North-South and South-South trade.
1.22 On tariffs, there were three main elements on which the Negotiating Group could structure its
work, and they were coverage, objective and modalities.  Coverage should be comprehensive, i.e. all
non-agricultural products, without a priori  exclusions, and all tariffs should be covered.  The
objective of the negotiations should aim to achiev e a fair and balanced package, comprising products
of interest to all countries, in particular products of export interest to developing countries.  In this
context, Members should aim to:  cut tariffs well above that agreed in the Uruguay Round;  eliminate
tariff peaks and nuisance tariffs, reduce substantially, if not eliminate tariff escalation and high tariffs;
and expand the scope of bindings.  On modalities, he noted that the Uruguay Round tariff negotiations
had used three methods: the "request and offer" approach, sectoral negotiations and formula cut.
Under the sectoral approach, the majority suggested a zero-for-zero approach while others proposed a
tariff harmonization model.  For this round of negotiations, Members could either consider focusingon a particular modality or consider several modalities or a combination thereof, e.g. different formula
cuts, tariff bindings, harmonization, sectoral zero- for-zero, request-offer, what he would call a
"cocktail approach".  However, the chosen modality should be one that aimed at maximising benefits
for all WTO Members, and achieving the goal of eliminating tariff peaks and nuisance tariffs,
reduction (if not elimination) of tariff escalation and high tariffs.  There had to be a start point fortariff negotiations, and Singapore's proposal was that they should be applied rates.  As to the year of
reference for the starting point, his delegation was open to suggestions, but agreed with the general
principle that a year that was closer to the start of these negotiations would perhaps be more
meaningful.  In this regard, he noted that the EC had proposed using 2001 as the base year, while the
US had proposed using 2000 data.  For the initial stages of the negotiations, Singapore agreed that itwould be useful to have basic materials/data and tools made available to all Members.  In this regard,
he welcomed the US contribution of the list of vari ous available analytical software tools.  Some of
these tools were introduced at the Market Access Seminar and such resources would greatly assist in
the negotiations.  He supported the US suggestion for the Secretariat to prepare a short background
document on the availability and application of software tools.  How effective could a tool be?  Notonly must the user know how to use the tool, the to ol must be well crafted for use.  Singapore thus
agreed that the underlying data set for a particular  software tool was critical – a tool that lacked
comprehensive and accurate data would be of limited use and would eventually fall into disuse.  To
this end, he commended the Secretariat and Members for trying to complete the IDB data set.  HeTN/MA/M/2
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understood that Members might face various difficulties in completing the data set, and noted that
there had been suggestions in the Market Access Committee for Members to make or authorise the
legal transfer of the requisite data from other databanks to the IDB so as to fill the gaps in the IDB
data set.  This was a suggestion that Members should seriously consider, since it could also save some
administrative work for Members.  There was useful raw data out there to be mined, such as the datacollected for Members' trade policy reviews.  The material for the trade policy review could be used
by delegations to ascertain both tariff and non-tariff measures.  He therefore supported the US
proposal for the Chairman, aided by the Secretariat, to compile information on trade policy data
available, with the aim of adding such data to the IDB before the end of this year.  Having said that,
data needs, while crucial, should not detract from the substance of the actual negotiations themselves,
and his delegation would thus caution against over preoccupation by Members on satisfying data
needs.  As the US delegate had pointed out in his intervention this morning, the Group was unlikely toachieve a perfect database.  Singapore would go further to say that the Chairman, aided by the
Secretariat, could also extract information on non-tariff barriers from the trade policy review reports
which could go towards a compilation of an inventory on non-tariff barriers.
1.23 On non-tariff barriers specifically, the positive effects of tariff reductions should not be
eroded or negated by non-tariff measures that re-erect market access barriers.  The protectionist effect
of non-tariff measures was even more damaging than tariff measures.  However, for non-tariff
barriers, due to their amorphous nature, and the fact that identified non-tariff barriers could prove to
be WTO-legal, there was no authoritative and comprehensive database to use.  However, Singapore's
view was that it would be counter-productive for Members to engage in and get bogged down in a
debate on the definition and scope of an non-tariff barrier – as this could basically encompass
anything that was not a tariff.  Instead Members could draw up an inventory of non-tariff barriers
based on work already done and accessible in other regional fora for example OECD, to some extent
APEC and perhaps based on the analysis by the Secretariat from trade policy reports.  Since, the
Negotiating Group was working within a tight tim eline and it had already lost much time with
procedure, his delegation agreed with New Zealand that as a pragmatic way forward, the Negotiating
Group should avoid duplicating work on non-tariff barriers that was being carried out in other
Committees or Negotiating Groups.
1.24 On environmental goods, his delegation supported fully the reduction of barriers to trade in
environmental goods as provided for in paragraph 31(iii) of the Doha Declaration.  Facilitating market
access to environmental protection would help improve the level of world-wide environmentalprotection by lowering the costs and increasing the availability of appropriate technologies required to
do so.  At the same time, the elimination of trade barriers on environmental goods provided high
growth opportunities for environmental industries in both developed and developing Member
countries.  He believed that this would constitute a positive step towards assuaging concerns that trade
liberalization would lead to increased rates of environmental degradation.  He thanked the US for itspaper "Negotiations on Environmental Goods".  As pointed out by the US and EC, the difficulty lay in
defining environmental goods.  However, to effectively identify trade barriers on environmental
goods, it was imperative that a common understanding of the concept of "environmental goods" be
developed.  He agreed with the US that the work  done by APEC and the OECD so far could serve as
useful reference tools for impending negotiations, particularly the OECD's definition ofenvironmental goods and APEC's proposed categories and coverage of environmental goods.  He
noted, from its paper, that the EC delegation was "currently studying appropriate approaches to
capture on the basis of objective and recognisable criteria environmental goods whose improved
market access will be positive not only for trade, but also for environmental objectives world-wide."
The EC paper went on to state that it was "open to suggestions for paying particular attention to goodswhose sustainable materials or production characteristics mean that increased trade in such products
would also be environmentally supportive."  His delegation was prepared to keep an open mind at
least until the EC had spelt out the results of the study.  His delegation, like others, was also
concerned by the EC's reference to wanting to pa y "particular attention to goods whose sustainableTN/MA/M/2
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materials or production characteristics mean increase trade in such products." The reference to
"production characteristics" was particularly bothersome.  As pointed out by the US delegation in its
paper on "Negotiations on Environmental Goods", production based criteria had the potential of
creating a new set of standards and/or customs classification and Members' ability to comply might
differ substantially.  He agreed with the US that there was a need for greater coordination betweenthis Negotiating Group and the CTE in Special Session.  However, Members had to be careful to
avoid duplication in work. The proposal which suggested that as appropriate, the Special Session of
the CTE and this Negotiating Group might wish to m eet jointly during key periods of the negotiations,
was worth exploring.  Finally, non-agricultural market access had been the core business of the GATT
and the WTO, and it was in this area of the negotiations that real dividends could be reaped for both
developed and developing country Members.
1.25 The representative of Malaysia stated that Malaysia aligned itself, to a large extent, to the
interventions made by India, Kenya and Indonesia.  His delegation believed that the concept of credit
for autonomous liberalization measures should be further deliberated  in the Negotiating Group and
taken on board in the modalities to be agreed, for example liberalization made by Members in the
context of the ITA.  He supported the proposal by India, which was also a proposal made by his
delegation at the previous meeting of the Negotiating Group, on the need for a list of non-tariff
barriers.  Such a list would be extremely useful for this Negotiating Group's work.  Malaysia had
always stated that the basis of the reductions should be bound rates.  The Negotiating Group in its
work needed to address both North-South trade issues as well as South-South trade issues.
1.26 On the specific submissions by the various delegations, first on the EC paper, in paragraph 8
the EC had stated that "Negotiations should also address export restrictions, including export duties."
In Malaysia's view export restrictions could be explored further, however, as far as export duties were
concerned, they were clearly outside the mandate of paragraph 16 of the Doha Ministerial
Declaration.  He urged the EC delegation to reconsider their position on this subject.  Onenvironmental goods, he wished to underline the fact that such goods should not be put on a higher
pedestal than non-environmental goods.  All goods should be treated the same and in this connection,
the same modalities should be applicable to both.  The definition of environmental goods needed to be
further discussed but at this point Malaysia agreed with what Australia and Singapore had said that
paragraph 6 of the EC paper was potentially divisive and extremely dangerous.  With the introduction
of non-product related process and production methods, one was basically questioning how a product
was made and not the treatment of a final product as was currently the case in the GATT and theWTO.  He urged the EC delegation to consider the views that had been expressed on this issue. As
indicated in the US paper, the work done by APEC in this area where the APEC product classification
process focused on end-use was a good basis for the Negotiating Group to work on.  Whether such a
discussion should be in the CTE in Special Session or whether it should be in this Negotiating Group
needed to be explored further.  The EC had stated in paragraph 13 "that in establishing the modalities,a significant increase in the number of bindings, the reduction of the gap between bound and applied
duties … would, inter alia,  be of high interest to many WTO Members".  In this connection, his
delegation wished to add that the subject of specific duties, the incidence of which was not as high as
in the agriculture sector but was nevertheless an issue in the non-agricultural sector, needed to be
addressed in this Negotiating Group along with the subject of seasonal tariffs as practiced by the EC.The Negotiating Group had to clarify whether such duties should still be applicable or available for
use of the end of the negotiations.  Paragraph 19 of the EC paper also stated "… modalities should be
decided by the forthcoming 5
th Ministerial Conference at the latest".  He urged the EC not to be
emphatic on this. While Malaysia wished to have a fruitful and productive discussion and outcome,
Members had to bear in mind that the final deadline was 1 January 2005.  The Negotiating Group hadgone through a very difficult period in getting an agreed work programme and this subject should not
to be discussed further.  The deadlines in the Work Programme were soft deadlines.  On the US paper
on "Tariff and Trade Data and Needs Assessment" his delegation supported the idea expressed therein
of the need for trade and tariff data.  He hoped that the Chairman of this Negotiating Group wouldTN/MA/M/2
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conduct more informal discussions together with the Chairman of the Committee on Market Access.
Members needed this information if they had to seriously begin the negotiations.  On the US paper on
environmental goods, Malaysia needed to reflect further on the idea of whether there should be joint
sessions of this Negotiating Group and the CTE in Special Session, and whether the work on defining
environmental goods should be undertaken in this body or the CTE in Special Session.  Additionally,he requested clarification as to what the US had meant when it said that "the Chairman of the
Negotiating Group should keep the CTE appraised of the progress in the negotiations."  His
delegation wondered whether this was a simple report from the Chairman of this Negotiating Group,
or whether it should be negotiating text which he hoped was not the case.  As to this Negotiating
Group obtaining approval of the CTE,  his delegation felt that this should not be the case as no one
body was subsidiary to the other.   The New Zealand paper was a good paper and provided a good
basis for discussion.  Malaysia agreed with what had been outlined in Korea's paper about the need toclarify at the outset the terms tariff peaks, high tariffs, tariff escalation and the need to address non ad
valorem  duties.  As far as special and differential treatment was concerned, it was stated by some
delegations that there should be no a priori  exclusions and his delegation could agree to this.
However,  the level and depth of the cuts and as to whether there should be any exclusions were
issues that had to be the  subject to discussions and that should be taken on board in the context ofspecial and differential treatment.
1.27 The representative of Switzerland welcomed the decision on the programme of meetings for
this Negotiating Group.  Now that the question of deadlines had been solved, Members had to get
down to substantive work so as to be able to draw up the modalities for the negotiations on marketaccess for non-agricultural products at the latest by 31 May 2003.  This negotiation, together with the
negotiations on agriculture and services, constituted one of the main pillars of WTO negotiations on
market access at large.  In this connection, it was of utmost importance that these three negotiations
registered similar degrees of progress if substantial results were to be achieved in all areas.  Needless
to say that this Negotiating Group had a lot to catch up on. Switzerland welcomed the comprehensivemandate agreed at Doha to negotiate on non-agricultural tariffs and non-tariff measures with a view to
reducing or eliminating barriers which, despite the numerous Rounds under GATT/WTO continued to
have important effects on international trade.
1.28 Addressing the subject of tariffs, the mandate was broad and specific at the same time.  It was
broad as no product was to be a priori  excluded.  To Switzerland, a broad coverage also meant that
the coverage of tariff bindings would have to be improved, thus enhancing transparency and legalsecurity of WTO Members' tariffs.  At the same time the mandate was  specific in that tariff peaks and
high tariffs had to be addressed as well as tariff escalation.  These kinds of tariffs often had the effect
of impeding the import of products from developing and least-developed countries.  However, this
was not only the case for  imports into developed countries, it was also the case for imports into other
developing countries.  Better market access between developing countries should thus also beachieved in these negotiations.  As to the modalities, Switzerland believed that negotiations on
improvement of market access had become very complex as more and more negotiating partners had
joined WTO, each having its specific interests and tariff structures.  Thus today, even more than in the
past negotiating rounds, there was a need to ensure that the modalities agreed upon would, on the one
hand, take into account the interests and specificity of WTO Members, while on the other hand ensurethat the negotiations would achieve an ambitious level of reductions for all Members.  Switzerland
believed that a formula approach would be the most appropriate to achieve these objectives. The
formula approach did not mean that flexibility was not possible.  For example, for least-developed
countries the formula could be adapted to the different levels of development, thus taking into account
the needs and problems faced by least-developed countries.  Furthermore, modalities would have totake into account the principle of less than full reciprocity, as was mandated in paragraph 16 of the
Doha Declaration.  Finally, the issue of reducti on of gaps between applied and bound rates needed to
be addressed.TN/MA/M/2
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1.29 Regarding non-tariff measures and how to handle them, Switzerland believed that Members
would need to be pragmatic and to make use of these negotiations to solve a number of specific
problems still remaining and identified by Members.  His delegation was thinking of drawing up an
illustrative list as a first step, but the New Zealand idea of classification was a very good one and his
delegation would have a look at it.
1.30 As to special needs and interests of developing countries, the Doha mandate required that the
modalities included appropriate studies and capacity building measures to assist developing and
least-developed countries to participate in the negotiations.  His delegation agreed that such support
would be important to assist especially smaller Members prepare for the negotiations and to assess
their specific interests.
1.31 The proposal by the EC was very comprehensive and it raised many issues of importance.  On
the definition of environmental goods, pertinent issues  were raised in both the US and EC papers, and
these issues were the subject of discussion inside the Swiss administration and with certain interested
circles of society.  The discussion on definitional issues should, in Switzerland's view, start rapidly in
this Negotiating Group since it would help fulfill the Group's mandate.  In this connection, theNegotiating Group had to draw from the know-how and the experience of the CTE in Special Session.
Close coordination between the Negotiating Group and the CTE in Special Session would be
necessary.  He agreed with the US proposal that joint meetings of the two bodies might be useful
during key periods of the negotiations.  The Negotiating Group had to also benefit from the work
done by other international organizations in this respect.  Finally Switzerland  was convinced that
improved market access would be positive also for environmental objectives which was why his
delegation was prepared to accept deeper cuts on tariffs on environmental goods.  The submission of
the US on tariff and trade data needs assessment raised many issues, which were important at the start
of these negotiations.  Indeed, Members needed to have a clear basis for the negotiations and had to
ensure that this basis was ready soon.  In Switzer land's view, the basis should contain a common data
set for the most recent period on bound rates, applied rates and import data of all Members.  A  lot of
data relating to tariffs and import statistics ha d already been submitted to the Trade Policy Review
division or to other regional organizations.  Very often this information was also published and
publicly available.  In order to enhance transparency in this organization, his delegation strongly
encouraged Members to provide rapidly the necessary data and authorization for the transmission of
the said information to the Secretariat.  In this connection, a background note by the Secretariat on the
availability and application of software tools would be useful for all Members but in some casesMembers could consider organising workshops with the other international organisations to help
Members better use existing tools.  This would be a contribution to the capacity building. As a
conclusion, he reiterated the importance of the market access negotiations in the overall framework of
the negotiations mandated by Ministers at Doha.  In terms of content his delegation supported broad
and ambitious negotiations on market access for non-agricultural products.  In terms of timing, hisdelegation wished to start substantive work as quickly as possible and in the most efficient manner.
This meant that WTO Members should come up in the very near future with proposals on modalities
in order to be able to produce a consolidated overview of all positions by the end of the year.  The
negotiations would undoubtedly require a lot of work and resources from WTO Members, and
Members most in need, especially least-developed countries should be assisted accordingly.
1.32 The representative of Norway stated that market access for non-agricultural products had
been the central element of all previous rounds of negotiations in GATT/WTO.  Through these
negotiations, tariff levels of Members, in particular developed ones, had been substantially reduced,
thereby opening up markets for exporters of all Members and improving the availability of products toconsumers.  Still, after all these rounds, tariffs were, although less than before, important impediments
to trade. The ambitious mandate from Doha, underlining that product coverage should be
comprehensive and without a priori  exclusions would hopefully provide the basis for redressing this
situation. In many markets, the protection inherent in import tariffs had been reduced significantly orTN/MA/M/2
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been eliminated, thereby removing market distortions and contributing to establishing more level
playing fields where producers competed on the basis of real factors such as price and quality.
However, this was not yet the case across-the-board.  Tariffs on raw materials, intermediate products
and other inputs had been seen as impediments to economic development of national industries,
whereas tariffs on finished products, including cons umer goods of the same industries, had often been
viewed as necessary protection of local producers.  Previous negotiations had, in many countries, left
out, or only modestly reduced, tariffs in particularly sensitive sectors.  The result was an unbalanced
tariff structure in many countries, of generally modest average tariffs, but with higher tariffs on
finished products.  Developing countries had faced this problem and Norway fully appreciated the
agreement among Members to reduce and as appropriate eliminate tariff peaks, high tariffs and tariff
escalation as spelt out in the Doha mandate, making  it more specific with respect to these important
factors than mandates for previous Rounds.  The focus in previous Rounds of market accessnegotiations had on the whole been on improving access to markets in developed country Members.
Also in this Round, this would be the major feature, in particular on products of export interest to
developing countries.  The Negotiating Group needed to discuss how to operationalize the relevant
provisions under GATT Article XXVIII bis as well as the provisions cited in paragraph 50 of the
Doha Ministerial Declaration.  They clearly implied that developing countries should take oncommitments in line with their level of development.  Norway would expect market access
commitments in the area of non-agricultural products to constitute a major contribution by developing
countries in the Doha Development Round.  While Norway would clearly not expect substantial
reduction commitments from the least-developed countries, her delegation attached importance to the
wording of the mandate, where it stated that: "the modalities to be agreed will include appropriatestudies and capacity-building measures to assist least-developed countries to participate effectively in
the negotiations".  Norway was therefore looking to  least-developed country participants to indicate
what particular studies and capacity-building measures they would find most appropriate, so that they
could participate effectively in the negotiations.  Non-tariff barriers continued to be important
impediments to market access for non agricultural products.  This was despite the majorimprovements that had been made in recent rounds through the establishment of WTO rules in areas
such as customs valuation, pre-shipment inspection, import quotas and prohibitions, import licensing
procedures, rules of origin, technical barriers to trade and sanitary and phytosanitary measures.  As
part of the present Round, Norway expected to see an agreement on rules on trade facilitation, in
particular in relation to Article V, VIII, and X of GATT 1994.  As indicated by New Zealand in its
paper, the very open mandate on non-tariff barriers did not give participants much guidance on how to
approach this important issue.  One question to be dealt with was how to treat non-tariff barriers that
might be included in the mandate for other Negotiating Groups.  Another would be issues relevant to
Agreements that were not covered by negotiations.  She thanked New Zealand for its attempts to
address this important issue and would come back with more specific comments at a later stage.  The
Doha Declaration had in paragraph 31 singled out environmental goods and services for specific
negotiations with the aim of reduction or as appropriate elimination of tariffs and non-tariff barriers.Like the EC and the US, Norway considered this an important part of the market access negotiations.
The broadest possible elimination of barriers to trade in environmental goods would constitute a win-
win-win situation benefitting trade, the environment and development.  In this regard, close
cooperation with the CTE in Special Session was necessary.  In order to address the question of
product coverage, Norway believed that objective and recognizable criteria for identifying goodswhose improved market access would contribute positively to the objectives of sustainable
development would have to be identified.  Norway agreed with the US that the Negotiating Group
should draw on the work done by inter alia  the APEC and the OECD.  However, it would be for
WTO Members to finally decide the basis on which future work in this area would be carried out.
Norway noted the concerns expressed by Australia, Chile and others concerning the EC paper whereProcess and Production Method was mentioned.  Norway, however, wondered whether it would be
possible to discuss the criteria of environmental goods without actually looking at how a product was
produced.TN/MA/M/2
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1.33 The mandate of this Negotiating Group was more ambitious than the negotiating mandates for
previous rounds, and required an equally ambitious approach to the negotiations.  The modalities to be
developed had to reflect these ambitions.  Without pre-empting the discussions that would take place
at a later stage in the process, she wished to make some preliminary remarks on how Norway saw  the
future challenges.  Many methodologies and modalities available for tariff negotiations had been triedover the history of GATT/WTO.  They all had their pros and cons.  None were necessarily ideal for a
multilateral negotiation which aimed at a balanced result for all Members, while taking into account
the special needs and interest of developing and least-developed country participants. Norway
basically favoured a formula approach that ensured that comprehensive tariff reductions took place
across the whole range of non-agricultural products.  Such a formula should reduce high tariffs more
than low ones.  In Norway's view that would be st improve market access for products of export
interest to developing countries as indicated by Switzerland and help tackle the problems of peaktariffs, high tariffs and tariff escalation.  Different Members had different trading interests and/or
tariff structures.  Therefore, Norway recognised that other approaches, including linear approaches,
request and offer, zero-for-zero, etc., also had their merits in eliminating peaks as well as low tariffs;
in levelling the playing field in particular sectors,  through major liberalising steps; in increasing the
number of bound rates; and in addressing particular bilateral problems.  While favouring the formulaapproach as the basis, Norway might see the need for some kind of a "cocktail approach" as
mentioned by Singapore.  In order to ensure that the market access negotiations resulted in
meaningful market openings across-the-board, the Negotiating Group also needed to agree on
modalities for addressing non-tariff barriers.  In this connection, Norway had noted with interest
New Zealand's classification of non-tariff barriers.  These modalities needed to allow Members toidentify and tackle specific non-tariff barriers in concrete markets.  To this end, the modalities should
inter alia include a request/offer procedure for non-tariff barriers.  Also the application of existing
rules and the development of  new ones where they did not exist would have to be addressed.
1.34 Many WTO Members, both developing countries and economies in transition, had since the
Uruguay Round taken significant steps to open up th eir economies to outside competition, including
through autonomously lowering tariffs on a wide range of products.  Mainly, this had been done to
improve the efficiency of their own economies as part of programs of broader structural changes.
However, it had the important side-effect of improving market access for outside traders. The
Negotiating Group on Market Access needed to find ways, in this Round, to acknowledge these
significant steps towards liberalising international trade.  Finally, it was Norway's ambition that these
market access negotiations for non-agricultural products, through reduction and elimination of tariffand non-tariff barriers should  lead to an overall bound level of reductions well in excess of the
reductions achieved in the Uruguay Round.
1.35 The representative of Guatemala had some preliminary comments on the submissions that had
been made.  His delegation supported the vision of the EC with regard to the scope and approach of
the negotiations, especially with regard to the objectives of creating WTO rules to generate
predictability and transparency with regard to products of export interest to developing countries.  His
delegation believed that the clarification of various concepts, as Korea had mentioned in its document,
was necessary to achieve the Negotiating Group's objectives on areas such as tariff peaks, high tariffs,
tariff escalation and tariff dispersion.  His delegation recognized the commitments made by the ECand the US with regard to special and differential treatment and the recognition of different levels of
development in negotiations.  With regard to the sp ecial interest of the EC and US on environmental
goods, his delegation believed that all sectors should be given the same treatment.  All
non-agricultural products were included in the negotiations and there should not be any a priori
exclusions.  Therefore, it was important to identify and define what was meant by environmentalgoods.  This was especially important for a developing country.  With regard to the US proposal as to
the coordination that should exist, between the CTE in Special Session and this Negotiating Group, he
sought clarification as to what the US meant when it referred to joint meetings between both bodies.
His delegation recognized the importance of the work that had been done by the APEC group and theTN/MA/M/2
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OECD joint working party on trade and environment.   His delegation thought that the Negotiating
Group should explore what other organisations and groups had done in that regard.  On modalities,
the EC had spoken about high tariffs that should be reduced and compressed in an economically
meaningful way.  He sought clarification from the EC  on this concept.  He recognised the need for the
IDB and gave his full support to completing the IDB as a principal objective. His delegation was alsoof the view that the Secretariat should be given a ro le in compiling the data.  With regard to non-tariff
barriers, it was important to identify them and establish an inventory.  Guatemala recognized the right
of Members to adopt legitimate measures in conformity with WTO agreements as mentioned by the
EC delegation in its paper.  Although, his delegation believed that such measures were valid as long
as they were not protectionist.  It was also important to give support to the Secretariat with regard to
technical assistance and capacity building.  He thanked the US on its offer of technical assistance for
developing countries in that matter.  With regard to the New Zealand paper, he would providecomments at a future date.
1.36 The representative of Japan stated that his delegation would be submitting its own paper
shortly, but wished to introduce it in preliminary fa shion at this meeting.  The following points were
made in the paper: first, improving the binding ratio was important to secure predictability and
credibility in the world trade;  second, for the modality of tariff reductions his delegation was thinking
about a formula cut in combination with a sectoral approach such as zero/zero and harmonization as
during the Uruguay Round;  third, the base rates for negotiations were very important and, in his
delegation's view, they should be the bound rate s.  However, the differences between bound and
applied rates had to be rectified in order to make meaningful improvements in market access;  fourth,on non-tariff measures, it was necessary to take up not only border measures on the importing side but
also trade distorting measures on the exporting side such as export duties and export restraints;  fifth,
his delegation's paper covered some other important issues such as environmental goods and capacity
building.  On the US paper on data, he agreed that it was very important to have a complete trade
database as the current tariff negotiations involved 144 WTO Members, and such a data set wouldexpedite negotiations. On environmental goods, the US paper suggested that the OECD had some
experience and know-how on the development of a list of environmental goods and Japan supported
the work done by the OECD in this regard.  On th e EC paper, his delegation shared views with the EC
on many points, in particular with respect to paragraph 4 where the EC had emphasized the
importance of improved market access not only between  developed and developing countries but also
among developing countries.  Paragraph 16 of the EC paper referred to trade distorting measures such
as export taxes and export restrictions, and  Japan also had a strong interest in addressing those issues.
1.37 The representative of Costa Rica stated that Ministers in Doha had given Members a  mandate
to carry out ambitious negotiations in this area.  Owing to the fact that most exports were classified in
this category, the topic of non agricultural market access was certainly of the highest importance for
Costa Rica.  As indicated by Canada, Malaysia, Singapore and other delegations, this was not ascenario where developed countries were the only ones who were exporting.  More and more
developing countries were learning to take advantage of the clear and predictable rules in this area.
Developing countries had a lot to gain from these negotiations including the improvement of
conditions of trade between developing countries.  He understood the concerns expressed by Kenya,
India and other Members in that regard, but his delegation believed that it would be possible to findconsensus on this subject.  On the papers which had been submitted he had a few preliminary
comments.  With regard to the EC paper, he drew  attention to the reference in paragraph 8 to the
elimination of export restriction.  Without prejudice to his delegation's position, he wished to have
clarification on the additional disciplines to Article 11 of the GATT which the EC was proposing in
this paragraph.  He also wished to draw attention to the way in which paragraphs 12, 14, 15, andothers of the EC paper were worded where it appeared to be suggested that negotiations would use
applied levels as a basis for tariff reductions.  He sought clarification from the EC as to whether this
was the case. His delegation believed that tariff negotiations should be carried out on the basis of final
bound tariffs, and that schedules of concessions were the legal instruments of the WTO.  To negotiateTN/MA/M/2
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on the basis of applied rates could also penalise those Members which had made efforts to liberalize
unilaterally; this would not be appropriate or desirable.  Costa Rica also endorsed the comments made
Australia, Chile and Malaysia on the possible definition of environmental goods.  It was not
appropriate to complicate the negotiations by introducing controversial topics such as definitions
based on production and processing methods or the variation of the principle for equal treatment oflike products in multilateral rules.  Chile's proposal to evaluate at a later stage in the negotiations the
need to have greater reductions on goods, considered to be environmental goods, was interesting.  His
delegation hoped to be able to discuss this topic in further detail in the future .  With regard to the US
document on "Tariff and Trade Data Needs Assessment", Costa Rica agreed fully with the US point
on the need to have complete databases.  Undoubtedly, Members who suffered the most from the lack
of data were developing countries.  However, Costa Rica believed that it was not realistic or desirable
to hope to have perfect information in that regard.  With regard to New Zealand's document, hisdelegation was of the view that it was an excellent basis to start discussions on non-tariff barriers and
he agreed with New Zealand that one should not duplicate efforts with other Committees and
Negotiating bodies.  Again Chile had made some co mments in that regard which Costa Rica found
interesting.  Particularly, the comments in which Chile had referred to the undesirability of opening up
Agreements which were not explicitly covered by the Doha mandate.
1.38 The representative of Hong Kong, China stated that Members had a mandate to negotiate "to
reduce or as appropriate eliminate tariffs as well as non-tariff barriers."  The economic theory of
comparative advantage and challenges brought about by globalisation were well known.  The vacuum
of progress on the multilateral front after the conclusion of the Uruguay Round had led to theproliferation of Regional Trading Agreements.  Now that a new round of multilateral negotiations had
been launched, it gave Members the perfect opportu nity to bring the pieces together and take the
courageous step to achieve the ultimate goal of free trade on an mfn basis for all.  Being a staunch
supporter of free trade and imposing no tariff, Hong Kong, China believed that the long term
objective of this organisation should be a commitment by all Members to eliminate tariffs on all non-agricultural products.  It was a commitment that helped Hong Kong, China fully capitalise on the
benefits of comparative advantage and weather the challenges of globalisation.  With the above
objective in mind, the goal for this Round should be to agree on a modality that would reduce tariffs
and non-tariff barriers to the maximum extent possible, leading to their eventual elimination.  In this
regard, his delegation agreed with some of the previous speakers like Singapore that the Negotiating
Group's level of ambition should be greater than the results achieved during the Uruguay Round.
Many previous speakers had also elaborated on the comprehensive scope of the mandate and the factthat product coverage should be without a priori  exclusions.  On the question of modalities, his
delegation was also in favour of "cocktail approach" based essentially on a formula to be
supplemented by a combination of other approaches, such as sectoral initiatives, request-and-offer and
non-linear cuts.  The Doha mandate also included the reduction or elimination of high tariffs, tariff
peaks and tariff escalation.  Hong Kong, China supported increasing the scope of bindings andreducing the gap between bound and applied rates.  The problem of tariff dispersion would be partly
taken care of  if deeper cuts to high tariffs and tariff peaks were introduced.  As to the phrase "as
appropriate" in the mandate.  His delegation recognized that the objective was a bold commitment,
and that individual Members did have some sensitivity, both political and economic, for selected
sectors.  His delegation was prepared to tide over such sensitivity, on an exceptional basis, by settinga reasonable timeframe for eliminating tariffs for certain products.  Members also had a mandate to
take fully into account the special needs and interests of developing and least-developed country
participants, including through less than full reciprocity in reduction commitments.  Members were
duty-bound to take into account the economic and development needs of these Members.  For
instance, as in previous market access negotiations, longer phase-out of tariffs on sensitive productsshould be provided for developing and least-developed country Members.  While addressing such
sensitivity, one should aim to achieve the deepest possible cuts for immediate implementation
followed by equal annual cuts until a zero duty rate  rather than spreading the cuts unevenly
throughout the implementation period.TN/MA/M/2
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1.39 On non-tariff barriers, he was thankful to New Zealand for the paper.  His delegation was still
pondering on how best to take forward the mandate on  this subject.  Its preliminary views were that
issues relating to existing agreements or other subjects covered by the Doha mandate (e.g. trade
facilitation) should be taken up in the respective areas unless the circumstances of a particular
measure required otherwise.  Again as a very preliminary view, a request-and-offer approach, or theEC's idea of identification, listing and impact assessment, might be the more effective way to deal
with specific measures that were identified to have caused problems and that were not covered
elsewhere.
1.40 On the question of database, his delegation agreed with many previous speakers about the
importance of having a common, consolidated source of current applied and bound tariffs and trade
statistics as the basis for negotiations.  In this connection, he encouraged Members to expeditesubmission of their data to the IDB and CTS database.  Such tools were indispensable for
non-agricultural market access negotiations.  As regarded the year of reference, as a matter of
principle, his delegation agreed that a year which was closest to the start of negotiations should be
chosen. Finally, on environmental goods. Hong Kong, China welcomed the Doha mandate as
contained in paragraph 31 of the Doha Declaration.  Further liberalisation of trade in environmentalgoods should bring benefits both to trade and the environment.  On the question of definition, his
delegation shared the concern expressed by Australia and others on introducing production-based
criteria as different Members had different environmental conditions, priorities and aspirations.  Here,
he believed that Members should make reference to relevant work already undertaken elsewhere, such
as APEC and the OECD.
1.41 The representative of Brazil stated that a number of speakers had highlighted the
comprehensive and ambitious character of the mandate given by Ministers.  Brazil fully shared those
objectives and expected that they would be faithfully translated into comprehensive and ambitious
results.  These results would, of course, have to be judged by each delegation not only in the finalpackage produced by the negotiations in this Negotiating Group, but also in the light of the broader
outcome of the Round in all areas under the single undertaking.  Brazil was presently giving detailed
consideration to the means of ensuring this compatibility between objectives and results, and hoped to
be circulating some specific ideas in the future.  At this initial stage of work, Brazil had not discarded
any of the possible modalities of negotiation from consideration.  They were all being carefully
evaluated as to the best cost-benefit relationship in achieving the ambitious mandate.  However, he
wished to outline some concepts that his delegation felt must be fully taken into account.  Firstly, asstated by Malaysia and more recently by Costa Rica, Brazil did not see any alternative to using bound
rates as the base rate for negotiations on non-agricultural market access, for both historical and
practical reasons.  Secondly, Brazil wished to highlight the importance of the concept of less than full
reciprocity in reduction commitments, in accordance with paragraph 16 of the Doha Ministerial
Declaration, which specifically recognized the special needs and interests of developing and least-developed countries.  Thirdly, in giving consideration to the modalities of negotiations to be agreed
upon in this Negotiating Group, particular attention had to be given to the negligible impact of tariff
reductions in improving market access in situations where tariff levels were already low.  This was a
critical element of the concept of effective market access, which had been mentioned at this meeting.
Fourth, the requirement of addressing tariff peaks and tariff escalation, which hampered the exports ofhigher value-added products from developing countries, had also to be effectively integrated into the
negotiating modalities.
1.42 The issue of "reduction, or as appropriate, elimination of tariff and non-tariff barriers to
environmental goods" was one that had received considerable attention, both in the submissionsbefore the Negotiating Group and in the interventions.  It was worth recalling that this was an item
that was not originally included in the Doha manda te for market access for non-agricultural products.
At a procedural level, the TNC might have a role to play in defining the border line between the areas
of competence of the CTE in Special Session and this Negotiating Group.  To the extent that thereTN/MA/M/2
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was a consensus in the CTE on the proposal to transfer to this Negotiating Group the responsibility for
dealing with paragraph 31(iii) of the Doha Ministerial Declaration, it was fair to assume that there was
a consensus to deal with the topic here.  However, it would be out of order and inappropriate for this
Negotiating Group to go into conceptual discussions on trade and environment or to spend its time
attempting to define concepts or terms such as that of environmental goods.  One had only to look atthe prolonged discussions held in the context of the Basle Convention to define the term "waste" to
see that the Negotiating Group could all too easily get bogged down.  In this respect, Brazil shared the
views expressed by Colombia, Australia, and Chile on the risks of attempting such a decision in this
Negotiating Group.  It was for this reason that his delegation favoured that a definition of
environmental goods be undertaken by the bodies that had the expertise and the competence to do so,
and that this Negotiating Group restrain itself within its area of responsibility.  The question of
non-tariff barriers was one that would merit particular focus within this Negotiating Group,particularly, in light of the fact that tariffs were no longer the main impediment to developing country
exports into the main markets.  In this connection, Brazil welcomed the paper circulated by New
Zealand, which his delegation was considering in detail.  It appeared to provide a very comprehensive
basis on which to begin work in this area.  He also supported the requests for technical assistance and
capacity building for Members that so required, in orde r to allow all participants the ability to identify
non-tariff barriers that were affecting them and thus effectively take part in the negotiations.  He
supported the request made by India for some specific and pertinent studies.  Alongside, being fully
consistent with the mandate Ministers gave, such studies could only have a beneficial impact in
empowering all delegation to plan an active role within this Negotiating Group.
1.43 On the question of data requirements and analytical tools, he thanked the US for their
submission. The underlying principles and objectives – namely that of having a comprehensive and
complete data set at the beginning of negotiations – seemed to be undisputed.  Brazil also welcomed
the constructive suggestions that had been made to achieve this.  What seemed essential was that the
Negotiating Group tried to ensure that the IDB and the CTS database, which were perfectly suited tothe requirements of the negotiations could effectively meet the needs of the Negotiating Group.
Finally, he wished to underscore a degree of concern regarding some of the interventions made.
These implied, in some manner, that there should be some special emphasis on South-South trade.  It
was not part of the culture of the GATT and WTO to direct liberalisation primarily at some particular
trade flows. The emphasis by Ministers in Doha  was on a development dimension to this Round,
which implied a focus on North-South trade, if any.
1.44 The representative of Zambia, speaking on behalf of the least-developed countries, supported,
the statement made by Kenya on behalf of the African group.  He also supported the statement made
by India particularly on the proposal of a study by the Secretariat.  He would be commenting on the
papers which had been submitted at a future date.  He wished to make a few observations regarding
the main considerations that, in his view, would have to be taken into account in laying down theground rules and modalities for negotiations on further liberalization of trade in non-agricultural
products.  First, he  appreciated the existing schemes which gave to many products of least-developed
countries quota-free and tariff-free market access.  It was, however, important that all industrial
products from least-developed countries be given tariff-free and quota-free market access in all
developed country markets.  Second, there was a need to exempt least-developed countries with weakindustrial bases from further obligations to liberalise imports of industrial products.  Third, it was
important that measures in and outside the WTO were adopted to help boost the productive capacity
of least-developed countries and other developing countries in this area to enable them to take
advantage of the improved terms of market access.  These three points should be given the highest
prominence in the modalities to be adopted by this Negotiating Group.  Fourth, least-developedcountries needed appropriate studies and capacity building measures to assist them participate
effectively in these negotiations as the Doha mandate specified.  He thanked the Norwegian
delegation which had raised this point and would be responding to the question raised regarding what
least-developed countries thought would be appropriate studies as well as capacity-building measures.TN/MA/M/2
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Paragraph 16 of the Doha Ministerial Declaration stipulated that the basic aim of negotiations in this
area should be "to reduce or as appropriate eliminate tariffs, including the reduction or elimination of
tariff peaks, high tariffs and tariff escalation as well as non-tariff barriers in particular on products of
export interest to developing countries."  It further stated that in adopting ground rules and modalities
for achieving these objectives, the negotiations s hould take into account "the special needs and
interest of developing and least-developed country participants, including through less than full
reciprocity in reduction commitments".  Since the conclusion of the Uruguay Round, a number of
countries had taken positive steps in improving the preferential access they provided to imports from
developing and least-developed countries.  The European Communities had adopted the EBA
initiative to provide duty and quota-free access to almost all products from least-developed countries.
Through its African Growth and Opportunities Act, the US had broadened the scope of its GSP to
promote the growth of imports from selected African countries in textiles and other products.  Similartypes of announcements had also been made from  Canada, New Zealand, Norway and a few other
delegations.  A number of developing countries had also adopted systems that allowed imports from
selected least-developed countries on preferential basis.  It would be for Members to suggest and
adopt ground rules that would provide that negotiations should cover reductions in tariffs as well as
improvements in preferential access of imports from least-developed countries.  For this purpose, hisdelegation had noted that negotiations should aim at: 1) improvements in GSP that would ensure that
beneficiary countries were able to derive preferential access;  2) the adoption of systems similar to the
EC's EBA by other developed countries for imports from least-developed countries;  3) the adoption
of preferential systems, by those who had not do ne so, for imports from least-developed countries;
and finally broadening the product coverage of such preferential systems for imports from least-developed countries.  In addition, it would be necessary to ensure that  trade which the preference
receiving countries had been able to develop was not  suddenly disrupted by the erosion of preferential
margins that would result from reductions or elimination of mfn duties that would be made by
preference-granting countries in the negotiations.  In order to safeguard the interest of least-developed
countries, the ground rules for negotiations should be appropriately laid down so that the staging ofreductions did not adversely affect least-developed countries.  In his view, existing rules did not
prevent special consideration being given to least-developed countries.  In their recent submission on
the steps that  would have to be taken for improvem ent in special and differential treatment, the least-
developed countries had suggested that if necessary , the provisions of the Enabling Clause, which
provided that extension of preferential treatments should not prevent reductions in tariffs on a mfn
basis, might have to be clarified.  He confirmed that this should not prevent preference-giving
countries from considering favourably requests made along the lines mentioned above.  The LDCGroup had also pointed out in previous meetings that the modalities should also take into account the
need to ensure that the Bretton Woods' institutions took into account what was agreed in the WTO in
their dealings with least-developed countries.  In particular, modalities had to include the following
treatment:  1) reiteration of the validity of the existing provisions in the GATT 1994 that permitted
least-developed countries and other developing countries to increase their tariffs beyond the boundrates without having to give compensation when their local industries were threatened;  2)
clarification of  the rules that could increase this flexibility;  and 3) if necessary amendment of the
rules so that the required flexibility could be impl emented by the countries.  On the contribution that
least-developed countries should make in the present round of negotiations.  He recalled that during
the preparatory work for the launching of the Doha Round, the least developed countries had pointedout that their experience of the liberalization measures taken by them both on an autonomous basis
and in pursuance of the commitments assumed by them in the Uruguay Round of negotiations had
been extremely unsatisfactory.  Instead of improving the competitive strength of the industries,
liberalisation measures had led to what some economists had called "de-industrialisation".  Many of
the existing industries had closed down and, as no new investment was taking place for thedevelopment of new industries, unemployment had increased.  Taking into account this dismal
experience of the liberalisation measures taken so far, the ground rules for negotiations would have to
provide that the extent to which each least-developed countries should be required to liberalize by
reducing tariffs, would have to be determined by them, taking into account their stage ofTN/MA/M/2
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development.  Further, it should be open to least-developed countries to exclude from tariff
reductions, sectors that, in their view, continued to need high level of protection. Likewise, customs
duties that aimed at mainly collecting revenue, an d did not serve any protective purpose should be
exempted from tariff reductions and the obligation to reduce tariffs should apply to duties that were
used for protective purposes.  Least-developed countries should further be permitted not to make anyreductions in duties if they considered that further liberalisation of trade would not be conducive to
their economic development.  The Doha Ministerial Declaration further recognised that economic
development did not follow automatically after liberalisation measure were taken.  Apart from
policies needed for infrastructure development it would be necessary for countries to adopt policies
aimed inter alia  at:  1) building safety nets to compensate displaced persons;  2) technological
assistance to upgrade economic units adversely affected by import competition;  and 3) establishment
of a framework for taking contingency protection measures.  Furthermore, a number ofleast-developed countries would need technical assistance for building up the institutional and
financial structure required for these purposes before they could be requested to liberalise, by taking
advantage of the assistance so provided.  Th e LDC Group had requested the Sub-Committee on LDCs
to prepare a study on market access of the LDCs, and it had been some months since that item was
included in the work programme.  He wished to know how far the study had progressed.
1.45 As a conclusion, he stated that the least-developed countries proposed that their views, as
summarized below, be reflected in the modalities:  1) Tariff peaks and escalation in developed
countries on products of interest to developing countries including least-developed countries should
be substantially reduced or eliminated. This must be acknowledged as the most important target of thenegotiations;  2) the objective of making all industrial products exported from least-developed
countries to the developed countries totally free of tariffs, quotas and other non-tariff barriers had to
be a key aspect of the modalities.  Despite efforts over the past 30 years, the degree of market access
for least-developed countries was still a distance away from full quota and duty free access.  The
negotiations had to adhere to promises made along these lines;  3) there had to be recognition andaccompanying measures undertaken to address the industrial supply capacity problem of least-
developed countries.  A key element of the modalities had to be the adoption of concrete measures by
developed countries and international agencies to assist least-developed countries and other
developing countries with a weak industrial base to improve their productive capacity in the industrial
sector.  One measure could be concrete legally binding commitments for technology transfer on
favourable and concessional terms;  4) the modalities had to reflect the principle that enshrined the
right of least-developed countries and other developing countries to special and differential treatmentin order to exercise maximum flexibility to choose the sectors and the pace for liberalization.  The
negotiations should not result in the imposition of even more onerous obligations on least-developed
countries to further liberalise industrial imports.  As a last point, these negotiations had a longer time
span than the Fifth Ministerial.
1.46 The representative of Bangladesh stated that his delegation agreed fully with the statement
made by Zambia on behalf of the least-developed countries.  He noted that the papers submitted
contained many new ideas, and it was his delegation's intention to examine these ideas and their
implications. A request for a study on market access relevant to the least-developed countries had
been included in the work programme.  In addition, further studies would be required on new issuesbeing raised.  His delegation was concerned that some new ideas being advanced would lead to a new
set of non-tariff barriers.  His delegation would be making a formal request for such studies.  To
develop Bangladesh's domestic capacity to participate in the negotiations, the WTO would need
change its trade-related technical assistance.  While his delegation appreciated efforts that countries
might make to help Bangladesh bilaterally, it was not a replacement of the assistance that should bechannelled through the WTO and UNCTAD.  For, trade-related technical assistance, these two
organisations should form the core of any programme that was based on the requests that Bangladesh
made.  He thanked the Secretariat for the compilation of selective bibliography of research on market
access.  This was a long list and these studies would require considerable amount of time to extractTN/MA/M/2
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the substance and arguments.  Nevertheless, his delegation had attempted to examine a few of the
documents listed in the WTO compilation, and he wished to comment on one of the studies by WTO
(WT/COMTD/LDC/W/11/Rev.1) on "Market Access for Exports of Goods and Services of the LDCs:
Barriers and Constraints".  For instance, the study identified, inter alia , high rate of bribery and
corruption as obstacles to trade expansion in Uganda.  This would certainly not be of assistance in the
market access negotiations.  His delegation was looking at the studies to find out factors and other
elements that would assist Bangladesh in the negotiations.  There could be innumerable studies
without relevance.  The quality and appropriateness of the studies were of paramount importance to
delegations such as Bangladesh.  Therefore, his delegation was trying to examine the merits of the
studies that were in place and would submit soon to the WTO the kind of analysis that his delegation
would require to benefit from the forthcoming negotiations.  Capacity building was another
fundamental issue.  In the Committee on Technical Cooperation, his delegation had given itsperspective on capacity building.  He sought suggestions from the Secretariat on how to maximise the
gains from capacity building.  Any effort to build capacity in countries such as Bangladesh would
have to be oriented to benefit Bangladesh and w ould need to be realistic in the context of ongoing
negotiations.
1.47 The representative of Jamaica shared many of the views expressed by other developing
country Members such as India, Kenya and Indonesia.  She wished to highlight a few key points in
respect of negotiations on market access in non-agricultural products, namely:  1) the need to achieve
meaningful benefits for all WTO Members;  2) that the negotiations and the modalities to be
formulated, materially took into account the different levels of economic development of Membersand in particular the vulnerabilities of small developing countries who had small and fledging
industrial sectors, faced significant supply-side constraints and relied heavily on tariffs for revenue
purposes;  3) that studies be completed on the impact of previous economic liberalisation on the
economies of developing countries and least-developed countries;  4) that credit be given to
autonomous liberalisation;  5) that capacity build ing and technical assistance which included and went
beyond the traditional seminar and workshop be provided;  6)the need for developed country partners
to show good faith in their manner of engagement and contribution to the discussion in other areas of
the Doha work programme of particular interest to developing countries;  and 7) the final deadline for
these negotiations was 1 January 2005.  For countries such as Jamaica, adequate time was required in
order to prepare and consider the various options that would be formulated and debated.
1.48 The representative of Chinese Taipei stated that keeping in mind that non-agricultural tariffs
and non-tariff barriers had significant impacts on international trade flows, his delegation fully
endorsed the mandate provided by the Doha Ministerial declaration that product coverage should be
comprehensive and without a priori  exclusions.  Due to time constraints, his delegation would focus
its comments only on non-tariff measures.  Non-tariff measures were diversified and sometimes less
transparent, so it might be difficult to identify and quantify their impact on trade.  Although some
non-tariff measures had been regulated under current WTO rules, other non-tariff barriers like
unreasonably high visa fees on imported goods still frustrated traders and needed to be regulated
under the multilateral trading system.  Bearing this in mind, his delegation believed that before the
modality of non-tariff measures could be determined, a database of non-tariff measures should be set
up so that Members could establish a list of non-tariff measures and identify their priority fordiscussion in this Negotiating Group.  Taking note of the efforts that some international organisations
such as UNCTAD as well as some Members had made in identifying non-tariff measures, his
delegation proposed that the Secretariat could circulate a questionnaire listing the non-tariff measures
identified by Members and other organisations.  The Secretariat could then prepare a report to this
Negotiating Group based on Members' responses to this questionnaire.  The report might also be usedas a basis for further discussion on the modality of phasing out or regulating non-tariff measures.
Finally, his delegation wished to reiterate the importance it attached to having a comprehensive and
ambitious market access negotiation that not only delivered benefits to all Members but also increased
Members' momentum to carry out the Doha agenda.TN/MA/M/2
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1.49 The representative of Thailand agreed with the US that databases were crucial instruments for
the negotiations.  Members needed to fill in the gaps on any missing data.  His delegation believed
that the market access negotiations especially in this Round were important to all Members and not
just any particular group of Members, i.e. it was not only a question of South-South or North-South
trade.  If it had been important only for a particular group, then this discussion should be taking placeelsewhere and not in the WTO.  Regarding environmental products, Thailand shared concerns about
the environment.  However when looking at the market access aspect, Thailand was of the view that
all products were equally important.  Thailand could not say that environmental products were more
important than other consumer or health products.  Moreover, Members had to keep in mind that to
define such products, and especially to get a consensus or common understanding on those products
would take time and human resources.  On modalities, Thailand believed that the same modality
should be applied to all products.  Any special and favourable treatment especially "deeper cuts"should not be given to any particular group of products.  In addition, his delegation shared the view
expressed by some speakers that the issue of specific tariffs and seasonal tariffs should be brought
into the discussions of this Negotiating Group.  In terms of non-tariff measures, his delegation
believed that all non-tariff measures which Members were facing, for example, requirements of too
high a standard, should be brought up for disc ussion in this Negotiating Group.  The proposal by
New Zealand was a constructive approach which needed to be further explored.
1.50 The representative of the European Communities clarified that her delegation was in favour of
using bound duties as the starting point.  She was not sure where delegations had read in the EC paper
that her delegation favoured the use of applied duties.  On environmental goods, she, to some extent,shared the view expressed by Chile, that the Negotiating Group should not belabour one point and
forget that there were over 70 chapters of  products that needed to be addressed.  However for the
Communities, environment was important. On the question concerning the paragraph listing initial
thoughts on environmental goods, she pointed out that the sentence began with "Furthermore" and
then went on to say that the Communities were op en to suggestions.  By including such a sentence,
her delegation was trying to offer other Members the possibility of putting forward proposals that
might concern products which were not so easily discernable as environmental goods, but which were
produced in a sustainable way.  Discussions would be difficult, but options had to be given to all
Members.  She had heard inter alia  various Members mentioning the criteria of "end-use".  It was a
principle that would require a lot of study from her delegation's side.  Coming from the customs
world, she was not very enthusiastic about this criteria because it required unwieldy management.
There was a statement from Brazil about the interaction between the CTE in Special Session and thisNegotiating Group.  It was going to be very difficult to distinguish clearly between the various
responsibilities of the two Negotiating Groups.  But Members had to avoid duplication of work.  She
liked the idea of a CTE in Special Session as the monitoring body, i.e. the body that would indicate
whether what this Negotiating Group was doing was environmentally sensible or not.  At the same
time, it was pointless to discuss products for  where there may be very little in terms of tariffs andnon-tariff barriers, even though the CTE might be of the view that those products should be discussed.
Each Negotiating Group had its own expertise to bring to this process.  It was an important point
because her delegation thought that this Round was about sustainable development as well.  So the
word "sustainable" was not a minor word. Members' results were systematically questioned by civil
society which wanted to achieve a good result but also one that was sustainable.  The subject of"studies" had been clearly included in paragraph 16 of the Doha Declaration where it stated that
appropriate studies and capacity-building measures had to be agreed within the modalities to assist
least-developed countries participate effectively in the negotiations. Her delegation would abide by
this commitment expressed in the Ministerial Declaration and her delegation supported those studies
which would help least-developed countries keep pace with the negotiations.  A question had beenraised regarding the reference to a formula in th e EC paper, and whether her delegation had intended
for this formula to apply to each and every Member.  She had thought that her delegation's paper was
explicit in so far as almost every paragraph mentioned the need to address this issue carefully, taking
into account the needs and the interest of developing countries and least-developed countries.  HerTN/MA/M/2
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delegation was not proposing a one-size-fits-all solution.  However, if Members looked at the
commitments made by recently acceded Members they would understand what her delegation would
be looking for during this Round.  She was puzzled by a reference by India to differentiation between
developed countries.  She found this to be dangerous territory to venture into.  On the subject of
reference years, historically, Rounds had dealt with reference years for the purpose of  calculatingaverages.  Her delegation did not feel that it sh ould depart from that tradition which was based on
three years.  On the question of reference year, in the case where a Member wished to make a
commitment on an unbound duty an applied duty would need to be used, and consequently a reference
year would be required.   Her delegation was of the view that 2001 was the appropriate year.  Not
only because the Doha Ministerial Conference had taken took place in 2001, but also on 1 January
2002 a revised HS nomenclature (HS2002) had been introduced.  A lot of effort had been made to
have all Members in the HS96 nomenclature, and it would be very easy to transpose the results of a
round based on HS96 to HS2002.  However,  her delegation was open to suggestions on these
elements.   A suggestion had been made about the possibility of filling in missing data from trade
policy review studies.  She would commend such a proc edure for the reason that, as often stated in the
papers of the IDB and other papers by the Secretariat concerning databases in general, these databases
had no legal status.
1.51 On the points raised by Malaysia, and on export duties, she drew attention to paragraph 16 of
the Doha Ministerial Declaration and stated that the words "import duties" had not been specified in
this paragraph.  She therefore assumed that export duties were fully within the mandate of the Market
Access Negotiations on Non-Agricultural Products.  She also failed to see the relevance of Malaysia'sreference to seasonal duties.  Seasonal duties were not a matter of non-agricultural goods, at least in
the Communities.  As regarded references made to the fact that negotiations were scheduled to finish
on 1 January 2005 and not by the Fifth Ministerial.  She had always indicated that she viewed these
negotiations as one continuous process until 1 January 2005.  Participants would have the possibility
of discussing modalities by the Fifth Ministerial, but after that they would have to submit data byDecember 2003 so that by March 2004 the modality could be applied to the data.  Between
March 2004 and the end of that year Members would be working on the results of such an exercise,
because adjustments and further discussions would most  certainly be required.  Therefore, clearly her
delegation did not foresee the completion of the negotiations by the Fifth Ministerial.  On the term
economically effective, she stated that for her delegation, what might be economically effective might
not coincide with what other Members would rega rd as economically effective.  As indicated by
Brazil whatever would emerge from these discussions would be judged by each delegation accordingto its own needs and interests.  The allusion to th e reduction of low tariffs as being a very limited way
of contributing to the achievement of effective market access was somehow a questionable statement
since it depended on the market.  A minor reduction in a big market might turn out to be a very
significant one.  On effective market access, she was thinking about the closing of the gap between a
bound duty which was high and an applied duty which was at a reasonable level. This Round was allabout achieving development goals and of course it  was important that  North-South trade be taken
into the equation but it would be a fallacy to th ink that South-South trade did not matter.  With
reference to allusions made to the issue of LDCs and the EBA initiative, it had to borne in  mind that
the EBA initiative could only go so far.  A lot of trade between developing countries encountered the
worst difficulties and barriers, be they tariffs or non-tariff barriers.
1.52 The representative of Malaysia wished to take up two issues.  A reference was made by the
EC to the differentiated capacities of developing countries.  Malaysia had already, along with many
other developing country Members, emphatically stated in many fora that it was not advisable to raise
the subject of differentiated capacities of developing countries and differentiated special anddifferential treatment.  It was politically divisive.  He urged trading partners to avoid such discussions
in this Negotiating Group and to focus more on the substance.  There was a strict special and
differential treatment provision which was mandated by Ministers in paragraph 16 and elsewhere in
the Doha Declaration.  The EC had also indicated that the recent examples of acceding countries wereTN/MA/M/2
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good examples to follow.  Malaysia did not agree with this view.  Malaysia had spoken many times in
meetings of accession working parties about the dangers of acceding countries undertaking all kinds
of commitments.  Some of them were developing countries but they were taking on greater
commitments than other developing countries.  Malaysia had alluded to the danger of having a
multilayered type of membership at the WTO, i.e. developing countries with differentiatedobligations.  Malaysia had not blocked the process in  the working parties, but at this meeting hearing
a delegation indicate that commitments made by newly acceded Members could be used as a
precedent for this Round was unacceptable to his delegation.  On export taxes, the European
Communities had  stated that in paragraph 16 there was no reference to  import duties.  However, the
Communities should not read more into the Doha Declaration than what was already stated. Nor
should one re-interpret the Doha Declaration. Additionally, the EC in their paragraph 16  referred to
export taxes in the context of non-tariff measures.  That issue needed to be addressed. He urged theEC to not bring the issue of export taxes and that of commitments made by newly acceded Members
into the WTO.  On the role of the CTE in Special Session, if he had understood the EC representative
correctly,  she had favoured the idea of the CTE as a monitoring body.  Malaysia could not subscribe
to this position; the CTE in Special Session was at the same level as this Negotiating Group.
1.53 The representative of the United States wished to clarify two points on her delegation's paper
on environmental goods.  First, her delegation had not envisaged a massive process. Her delegation
had thought that it would be useful to put some thoughts down because this was an area that Members
had to start working on.  Some of the ideas that Chile had put forward were intriguing and worth
looking at in terms of the way to accomplish this task which Members had  been given, in a simplemeaningful way.  Second, on the point concerning coordination between the CTE in Special and
Session and this Negotiating Group, her delegation had not had an elaborate process in mind.  The
CTE had agreed that the negotiations to reduce tariff and non-tariff barriers on environmental goods
should be conducted here, and it would be useful to have some cross-fertilization.  She would be
willing to defer to the Chairman on his suggestions as to the best way forward to ensure thatcoordination took place.
1.54 The representative of Kenya stated that paragraph 16 of the Declaration spoke of "studies
being conducted for LDCs".  However,  a number of countries had requested studies and in view of
what the EC had said, he wished to have some clarification as to whether the requests were still on the
table.
1.55 The Chairman suggested that this question be taken up under the next agenda item on "other
matters". which included studies and technical assistance.  A lot of comments made were directly
related to this subject and in particular the last comment.  During the first  meeting of this Negotiating
Group, a number of requests were made regarding studies. This was followed by consultations
between the Secretariat and the delegations concerned at which time some matters were clarified.  Inthe interim some work had been done by the Secretariat, and he requested the Secretariat to report on
the work  in progress.
2. Other Matters
2.1 A representative of the Secretariat (Mr. Bora) stated that on 1 May 2002, delegates from
Malaysia, Brazil and Kenya met the Director of the Development and Economic Research Division in
an informal manner to clarify their requests and lay down some parameters on which studies could
take place.  On the request by Malaysia concerning profile of tariff measures for all Members and in
consultation with the Statistics Division, the Secretariat had committed itself to having a paper done
for the 12-13 September 2002 meeting.  This was a document which would contain for all Members,for which data was available, a 2 page summary of their tariff profiles.  It would contain basic kind of
data which would allow some very general statements to be made about the structure of that regime.
The document did not make an assessment of the Members' tariff regimes but the tables wereTN/MA/M/2
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designed to let readers make their own assessments or comparisons.  A request for a study was also
made on the subject of modalities.  On modalities the paper would also be ready for the
12-13 September 2002 meeting.  It was a pedestrian paper which would illustrate the types of
modalities that had been used and their effect or impact.  So, for example, it would illustrate the effect
of the use of a certain modality on a tariff structure.  These were hypothetical tariff structures ofhypothetical Members. So it was a fairly short paper.  It did not assess modalities against any
particular objectives at all.  He had taken note of India's statement this morning concerning some
elements of a study on modalities.  Some aspects of what India had requested would be in the
Secretariat's modality paper.  The Secretariat would be making itself available to present, in short
informal sessions, its paper on negotiating modalities once it was issued.  There was a request by
some African Members concerning studies on the impact of import liberalisation, the outcome of the
informal meeting was that a useful step would be to revisit the bibliography.  He drew Members'attention to the fact that the idea of having the bibliography was precisely to try to refine Members'
requests for studies, and to avoid duplication of existing studies.  Additionally, there was a section in
the bibliography called "country specific and sector specific studies".  To do such types of studies
went well beyond the resources of the Secretariat.  It would be very difficult for a division with only
five researchers to undertake a case-study which typically took 4 to 6 months to complete with fieldwork.  The Secretariat in some instances could be involved in such types of case studies but they
would normally be done in collaboration with other international organisations.  In that connection
what would be submitted for the 12-13 September 2002 meeting would be an annotated version of the
bibliography.  The annotated version would included the abstracts of the studies that were listed in the
document TN/MA/S/1 and which were relevant to the concerns expressed at this meeting and the lastmeeting of the Negotiating Group.  In that regard, some of the aspects of the Indian request on
modalities would be covered by already existing studies.  In the context of the LDC market access
request that was mentioned by Bangladesh and Zambia, there was a separate work programme
underway specifically for least-developed countries of which market access was one component.  He
was responsible for doing that paper.  He had met informally in late June 2002 with the LDC Group toadvise them of progress and to seek their input in terms of completing that study.  His understanding
was that the deadline for that study was the 7th November 2002 formal meeting of the
Sub-Committee on LDCs.  That paper took on issues that were specific to least-developed countries
and might not necessarily fall within  the jurisdiction of this Negotiating Group.  In the context of the
US request for a Secretariat paper, the Statistics Division had indicated that for the 12-13 September
2002 meeting, there would be a paper on tariff and data assessment.
2.2 The representative of Chile asked whether the tariff profile would be on bound tariffs or
applied rates and if applied rates would take into account the rates under free trade agreements.
2.3 A representative of the Secretariat (Mr Bora) responded that the tariff profiles would be based
on bound rates and mfn applied rates.  Neither reciprocal preferential rates nor non-reciprocal
preferential rates would be used.  The IDB database was being used for doing the profiles.
2.4 The representative of Malaysia wished to have a list, if available, of non-tariff barriers in
place by different Members.  He did not know if such a list was available in the WTO Secretariat or
with the UNCTAD.
2.5 The Chairman stated that Secretariat would look  into this question.  He recalled that in the
bibliography there were a certain number of studies on non-tariff measures.
2.6 The representative of the European Communities wished to know how specific duties would
be represented in the tariff profiles paper.  Her delegation was one of the few which when it gave a
specific duty, it also offered an ad valorem  equivalent.TN/MA/M/2
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2.7 The representative of Kenya enquired as to whether this new annotated bibliography would be
a listing of the studies done before or what the Secretariat had done with regard to the request
submitted by Kenya.
2.8 A representative of the Secretariat (Mr. Bora) st ated that with respect to the question from the
EC, the profile paper would not go beyond any data that had been submitted.  So for lines that were
non ad valorem, his recollection was that the column indicated the percentage of non ad valorem
lines.  It did not make any attempt to replace those lines with any measure.  Since it was an overall
summary when averages were calculated, the paper pointed out that there were simple averages and
simple averages could only be calculated on ad valorem  lines.  With respect to the Kenyan question,
the new document would be an annotated bibliography.  New studies were not being undertaken.
This was discussed in the 1 May 2002 meeting with the Director of the Development and EconomicResearch Division.  In terms of taking on any specific new studies, more particularly case studies,
which met or went part way to meeting the issues that were raised, would require a substantial amount
of time and resources.  The Secretariat had a number of joint undertakings with other international
organisations which were better placed to undertake the kinds of studies requested by Kenya and
others with the WTO Secretariat playing a participatory role.
2.9 The representative of the European Communities stated that her understanding was that the
Secretariat would be indicating that the tariff profile could be different due to the fact that specific
duties had not been taken into account in the averages.  She wished to avoid what had happened din
the Market Access Seminar.
2.10 The Chairman stated that with respect to studies, this would be an evolving process which
would depend on the needs of the delegations.  Following the Market Access Seminar, he had
received  positive reactions from delegations.  They had indicated that it was a very useful seminar
which had helped them identify issues better.  However, a lot of the points raised at the presentmeeting, were points for which information was already available in the documentation distributed at
the Seminar.  For example, Mr Hoda's study.  There was the historical aspect as well as specific
elements regarding formula, tariff peaks, tariff escalation etc.  These documents had been distributed
at the Seminar.  However, he got the impression that Members would like the Secretariat to produce
papers which would in essence be chapters or sections of this documentation which had already been
distributed to them. One had to be careful with respect to the demand put to the Secretariat.  Mr. Bora
had mentioned that the Development and Economic Research Division had five staff membersavailable to service all the Committees and Negotiating Groups.  He requested participants to show
some understanding for the limited capacity of the Secretariat.  Members had to concentrate on the
major issues that they wished to have clarified regarding these negotiations, and had to make use of
existing studies.  The Secretariat would be constrained in undertaking big studies.  In this connection,
Mr. Bora had indicated that the Secretariat would have to contact other international organisation tosee whether they could not help or take the lead in responding to some suggestions which had been
made.  It would be good, as it would involve other international organisations in the negotiations and
make them more aware of the process.  So, he hoped that with respect to studies, Members would
focus or prioritise their requests on the issues that they wanted clarified and do this in relation to the
work being done in terms of Market Access negotiations.  In any case there would be fourcontributions by the Secretariat for the Negotiating Group for its 12-13 September 2002 meeting.  In
addition, Mr Bora had mentioned that the Secretariat would be available to present its paper on
negotiating modalities.
2.11 On technical assistance, which was another sub-item under "Other matters", at the Committee
on Trade and Development meeting of 25 April 2002, the Secretariat had invited Members and
Observers to submit their requests for technica l assistance for 2003 to the Technical Cooperation
Division by the end of July 2002.  He understood fro m that Division that there had been a number of
requests for technical assistance on trade negotiating skills, tariff negotiations and the IDB.  This hadTN/MA/M/2
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been duly noted by the Technical Assistance Division.  The Secretariat also envisaged holding a few
workshops, next year, but they would be conducted on a much more focused basis.  At this stage, the
themes of the workshops were  not clear as they would depend very much on the discussion and the
needs of participants.  Finally, he informed partic ipants that in the context of the Economic Series
Seminar organized by the Development and Economic Research Division, Mr Will Martin from theWorld Bank and Mr Joe Francois, Professor at Erasmus University at Rotterdam would be presenting
their paper on "Structured Flexibility – A Formula for Success in Market Access Negotiations".  This
seminar was scheduled to take place on 11 September 2002.
2.12 In concluding, the Chairman stated that the Negotiating Group had held a substantive
discussion, and  he thanked all delegations for their participation in particular those delegations which
had submitted papers.  Delegations had clearly indicated what their position was on the variousparameters included in paragraph 16 of the Doha Declaration, in particular the question of special and
differential treatment.  A number of elements had been introduced regarding modalities which were
most important and useful for the Negotiating Group's future work.  Regarding non-tariff measures,
there had been a good discussion thanks, in particular, to the paper from New Zealand.  He invited
delegations to reflect on this paper, in particular but not exclusively, on the last part of this paperreferred to as "classification".  It offered a very in teresting approach to address the issues of non-tariff
barriers.  The Secretariat would try and clarify what existed in terms of listing of non-tariff measures,
but he emphasized that it was mainly for delegations to indicate where non-tariff barriers were hurting
their economic operators and to find an appropriate solution.
2.13 In response to the comment by Thailand, he confirmed that all products were equally
important.  However, there was a reason why specific reference was being made to environmental
goods and that was paragraph 31(iii) of the Doha Ministerial Declaration.  This paragraph made not
only a specific reference to environmental goods, but also to the way of treating these goods in terms
of negotiations.  The suggestion which was in the Doha Declaration was what he would call a sectoral
approach.  Therefore, environmental goods did deserve to be discussed keeping this paragraph in
mind.  He intended to keep in touch with Ambassador Yoland Biké, the Chairperson of the CTE in
Special Session.  So far there had been effective cooperation between the CTE and this Negotiating
Group, and he was confident that it would continue.
2.14 On the question of data shortfalls as raised by the US in their paper, the US had suggested that
Members agree to address data short falls before the end of 2002 by a) providing a legal authorizationto other organisations to release data to the WTO where it was available and b) asking the Chair to
facilitate the extension of the IDB by working with  Members to their TPR data.  The first element was
very important. In fact, this would be one of the major steps that participants could make in terms of
market access at the beginning of the negotiations.  Therefore, he encouraged participants to raise the
question with their capitals and to clarify the matter.  There was another proposal by the US regardingthe deadline for submission of a common data set.  He hoped to revert to the aforementioned two
points at the next meeting.  On the next meeting, he hoped to have a more structured discussion, i.e. to
try and follow more closely the agenda by dealing with tariff and tariff matters in one block, and non-
tariff matters in another block.  He also looked forward to additional contributions by participants.
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