RESTRICTED
WT/TPR/OV/4WORLD TRADE
ORGANIZATION30 November 1998
(98-4807)
Trade Policy Review Body
OVERVIEW OF DEVELOPMENTS IN THE INTERNATIONAL
TRADING ENVIRONMENT
Annual Report by the Director-General
I. RECENT TRENDS IN WORLD TRADE
1. World trade achieved in 1997 its fastest growth rate in volume terms since the beginning of
the decade as a result of continued integration of national economies and robust growth in the world's
main trading entities, the United States and the European Union.  The effects of the financial crisis
that erupted in the second half of the year made themselves felt only in the first half of 1998, because
of substantial time-lags in the transmission of monetary and financial developments into the real
economy.  Trade in 1997 was therefore not yet very significantly affected by the crisis.  However,preliminary data show a contraction of exports in value terms in the first half of 1998.  The deepening
of the crisis on South East Asia, combined with Japan's largely unanticipated fall into recession in the
first half of 1998, led the WTO to revise downwards its forecast for trade.  Trade in volume terms is
now expected to grow at about 4% in 1998, some what less than half the rate recorded in 1997.
(i) 1997:  Strong expansion of global trade – but storm clouds gather
2. After slowing somewhat in 1996, world GDP and trade volumes expanded rapidly in 1997, at
a pace faster than at any time in the decade.  The volume of world merchandise trade grew 10% in
1997, compared to 5.5% in the previous year, and 6.5% on average since the beginning of the decade.
World merchandise production was up by 3.5% in real terms, stimulated by the strength of
manufacturing activity, which showed real growth of 4.5%.  Thus the excess of trade over output
growth, which narrowed in 1996, widened again in 1997, with trade volumes up at almost three times
the rate of GDP growth.  This increasing gap indicates the continued integration of national marketsinto the global economy, notwithstanding the Asian financial crisis.
3. The strong acceleration in trade volumes is not observed in trade values, which, in current
U.S. dollar terms, increased by 3% in 1997.  Among the main reasons for lower nominal growth in
1997 were low domestic inflation rates, appreciation of the U.S. dollar vis-à-vis  the currencies of
major traders in Western Europe and Asia, and weaker primary commodity prices, with fallingdemand in Asia playing a role.
4. These influences on current values notwithstanding, world merchandise exports nevertheless
amounted to US$5,300 billion in 1997.  Exports of manufactured goods, accounting for about three
quarters of total merchandise exports, grew 11.5% in volume terms, outpacing agricultural and mining
products trade, which registered export growth rates of 6.5% and 5%, respectively, in 1997.
5. Trade performance varied widely on a regional basis, with exchange rate developments,
private capital flows and changes in relative prices being reflected in nominal trade values.  The motor
of trade expansion in 1997 was the Americas.  Bo th North America and Latin America recorded a
surge in imports (in particular of manufactures) linked to strong demand growth.  The recovery in
Western Europe also led to higher import growth in  volume terms, albeit slightly under the world's
average, but the depreciation of European currencies against the U.S. dollar resulted in a stagnation ofWT/TPR/OV/4
Page 2
Europe's trade in current U.S. dollar terms.  Althoug h the outbreak of financial turmoil started to have
an impact on trade flows (both in real and nominal terms) in the second half of 1997, the repercussion
on the figures for global and regional trade for the year as a whole were limited.  While in U.S. dollar
terms, Africa's exports and imports grew at roughly the same pace as global trade, Middle Eastern
countries' trade growth was well under the world's average.
6. Compared to 1996, trade values in commercial services slowed in 1997.  Exports of
commercial services expanded by only 3%, less than half the rate in 1996 and the average for the
period 1990-97.  The three largest regions for trade in services, namely Western Europe, Asia and
North America, saw a deceleration of both exports and imports of services.  Africa and Latin
America's trade in commercial services ran above the world average, in particular with imports
expanding at more than twice the rate of exports.
(ii) 1998:  The financial crisis hits trade
7. The repercussions of the Asian financial crisis on global trade are only being felt after a fairly
considerable time-lag, although import contraction had left a first mark on intra-regional trade and on
commodity markets in the second half of 1997.  Information available for the first half of 1998 shows
more visible effects of the crisis on trade.  According to preliminary data, world merchandise exports
have declined in value terms, as a result of both a further decline in U.S. dollar prices and lower
volume growth.  The value of Asia's imports fell by about 15%, while exports decreased by 8%.Japan's merchandise exports decreased slightly less, by 7%, and its imports fell more than the Asian
average rates.  The five countries most directly affected by the financial crisis, Indonesia, the
Republic of Korea, Malaysia, Thailand and the Philippines, recorded a small contraction of their
combined exports in value terms, linked to the de cline in U.S. dollar prices hiding a strong volume
increase, due to increased competitiveness.  Whil e the strength of import volume growth in the
Americas and Western Europe moderated downward trends in global trade expansion in the first half
of 1998, the widening of the crisis to other emergi ng markets may have further depressing effects in
the second half of the year.
8. Since the outbreak of the Asian crises in mid-1997, forecasters have continued to lower their
projections for trade and output growth for 1998.  World GDP growth of about 2% is now considered
more likely, but this could fall further in light of some recent events, especially in Russia, which could
have negative effects on trade and output.  As a result, world trade volume is projected to grow by
4.1% in 1998,  compared to the 10% of 1997.  The deterioration of global trade and output growth is
the result of a much steeper than predicted slowdown in Asia, only partially offset by stronger then
predicted growth in the U.S. and continental Eur ope.  In value terms, world merchandise trade is
likely to stagnate and perhaps even decline if the U.S. dollar and oil prices remain close to their
summer 1998 levels.
II. TRENDS IN TRADE POLICIES
9. The worsening of the world's economic conditions in 1998 created more difficult conditions
for the formulation and the implementation of trade and trade-related policies.  The effects of the
financial and economic crisis affecting emerging markets and of the economic downturn in Japan
have far from fully worked themselves through.  The fall in import demand in Asia, and subsequentlyin other parts of the world, together with moderating domestic demand, have already had major
effects on trade flows and on commodity prices.  Accordingly, economic prospects for 1998 and 1999
have been revised downward in practically all countries.
10. There have, however, been no major trade policy reversals, including in those countries most
directly affected by the financial crisis, and so far, there is little evidence of market closing in the restof the world.  Not only are multilateral commitments under the Uruguay Round agreements generally
being respected, but a large majority of countries have continued to liberalize trade on a unilateralWT/TPR/OV/4
Page 3
basis.  This includes significant trade liberalization packages in Asia and continued m.f.n. tariff
reductions in other countries.
11. Nevertheless, a few countries, in particular in Latin America, have introduced "pre-emptive"
measures in the form of increased surveillance of imports, although their significance has remained
limited.  Trade frictions between major trading partners seem also to be on the rise.  While these
tensions are localized and often confined to long-standing issues, they indicate growing sensitivity
about market access as global economic activity weakens, regional cycles diverge and current accountimbalances increase.  In addition, the process of regional integration seems to show some signs of
slowdown. There are also somewhat worrying developments in the steel market, with new
anti-dumping activity in the second half of 1998 in a context of falling prices and excess capacity.
Therefore, the situation needs to be closely monitored to avoid an unwarranted proliferation of such
actions, which could contribute to a negative mood for the upcoming WTO negotiations.
12. Overall, however, the trade environment remains largely positive.  This outcome is due to the
good sense of Governments and the strength of the multilateral rules, which constrain the ability torevert to trade-restrictive measures.  The trading system contains checks and balances, including
strengthened disciplines for the use of trade defense instruments, the prohibition of "voluntary" export
restraints, and an effective dispute settlement procedure, in which both developing and developed
countries have been increasingly participating.  Moreover, few Governments in power today would
see an advantage in returning to autarkic policies.   The shock absorbing nature of the multilateral
trading system is now well recognized.
13. In addition, the WTO has provided for a continued momentum of trade liberalization, which
includes both the implementation of Uruguay Round commitments and the conclusion of new
agreements.  In the case of industrial products, some countries have immediately implemented their
concessions, while the majority of Members are phasing in their tariff reductions as scheduled.  Inagriculture, non-tariff barriers (NTBs) were tariffied and liberalization is also proceeding on schedule.
In textiles and clothing, the "integration" of products under the Agreement on Textiles and Clothing
(ATC) has continued, with the second stage underway from 1 January 1998.  The use of the ATC's
transitional safeguards has decreased considerably, from 24 occasions in 1995 to nine cases so far in
1998.  The outcome of these events is that the scope of quantitative restrictions maintained by bothindustrialized and developing countries has been reduced significantly and the level of tariffs on
manufactures is steadily declining.
14. Moreover, in the recent past, new commitments have been undertaken by 44 participants,
including two non-members of the WTO, on goods in the WTO Declaration on Trade in Information
Technology Products (the ITA), by 70 Members on services in the Agreement on Trade in FinancialServices – an agreement signed after the Asian crisis broke - and 69 in the Agreement on
Telecommunication Services.  Participants in these agreements account for around 93% of world tradein information technology products and telecommuni cation services and over 95% of world trade in
financial services.  In addition, a total of 22 Members made new "zero for zero" commitments on a
range of pharmaceutical products.  Altogether, these agreements greatly extended the package of
commitments undertaken in the Uruguay Round and will significantly increase the scope of duty-free
trade in industrial goods and of liberalized trade in two important services sectors.
15. Recent Trade Policy Reviews confirm that the momentum for trade liberalization, combining
multilateral initiatives, regional agreements in which some provisions are extended on an m.f.n. basis,
and unilateral trade reforms, has generally been maintained.  For example:
• Despite fears that the economic downturn in Asia and consequent loss of jobs and related
social problems might lead to an upsurge in protectionism, most countries have accepted,either unilaterally, as part of structural adjustment programmes, or as a result of recent sectoral
negotiations in the WTO, substantial liberalization – and commitments of further liberalization
– of their trade and investment policies.  While a few countries have increased tariffsWT/TPR/OV/4
Page 4
selectively, in general countries in South-East Asia have not used extensively the leeway
allowed by the gap between bound and applied tariffs to raise the latter.  One country has
introduced exchange controls, but no other has followed suit.  Other WTO Members in the
region, such as Hong Kong, China and Singapore have continued to pursue their traditionally
open trade policies;  and there is no evidence of major backtracking in China's trade policy,
although a few measures limiting foreign direct investment have been introduced in recentweeks.
• In South Asia, India has reduced import duties on some essential agricultural commodities,
lifted quantitative restrictions on imports of more than 2000 products from a South Asia
regional grouping, and relaxed foreign investment restrictions pertaining to several sectors.
• Japan has continued to liberalize trade on an  m.f.n. basis through Uruguay Round concessions,
participation in the ITA and other sectoral initiatives;  indeed, it made a commitment, under
APEC provisions, to accelerate the application of its Uruguay Round concessions by up to two
years.  At the same time, in their review of Japan's trade policies, participants in the Trade
Policy Review Body (TPRB) clearly stresse d the need for stimulation of the Japanese
economy through fiscal and structural reforms, and for continuing domestic deregulation and
reform, particularly in the financial sector, as essential complements to trade liberalization and
to each other.
• Liberalization in Latin America has become more complex as a unilateral process has given
way increasingly to regionally-oriented trade liberalization.  In some cases, this is coupled
with a continuation of unilateral reductions in tariffs and other measures; however, concerns
have been expressed over recent increases in some tariffs and the introduction of
administrative and technical measures against imports.
• Transition economies have generally continued their process of economic transformation,
albeit in difficult economic and social circumstances.  While no major backtracking in trade
polices has been observed to date, the situation in Russia will have to be monitored closely in
the coming months.  For countries in central and eastern Europe, the transition process is
closely linked to the objective of joining the European Union (EU).  As a result of theimplementation of (free-trade) Association Agreements, most bilateral trade is already duty
and quota-free.  The liberalization of measures such as quantitative restrictions has largely
proceeded on an m.f.n. basis.
• The integration of African countries into the multilateral system has deepened, partly as a
result of the strong emphasis of the WTO – in cooperation with sister organizations – ontechnical cooperation activities.  In this context, the monitoring, and thus transparency, of
African countries' trade policies has been enhanced as a result of the increasing number of
trade policy reviews conducted in recent months.
• By and large, industrialized countries (including the major economies) have continued their
progress towards more liberal trade policies, under the combined effects of WTO
implementation in areas such as tariff reduction or the gradual elimination of non-tariff
barriers, enlarged m.f.n. commitments through the ITA and new agreements in services, and,when it leads to greater market access for m.f.n. partners, regional integration.  However,
certain sectors continue to benefit from a high level of protection, including agriculture, and
textiles and clothing, and the continued expansion of preferential agreements is bound to cause
some concern to m.f.n. partners because of the potential for trade diversion.
16. The positive developments listed above should not  detract attention from longstanding areas
of concern in the area of market access.  Tariffs on a substantial number of industrial products, such as
steel, textiles and clothing, footwear, leather, tr avel goods and transport equipment, in particularWT/TPR/OV/4
Page 5
automobiles, remain generally higher than average levels in both developing and developed countries.
Furthermore,  the tariffication process in agriculture and agro-industrial products has – whileincreasing clarity and transparency – led to extremely high duties in many instances.  In addition,
specific duties, which tend to conceal high ad valorem  equivalents, afford increased real protection
against those imported products whose prices have declined as a consequence of currency devaluation
in South-East Asia and elsewhere.
17. Although recent anti-dumping actions in the steel market have attracted attention, the
information available does not indicate a widespread surge in anti-dumping investigations in response
to economic turmoil, particularly in investigatio ns directed at imports from some regions and
countries.  Reported initiations of anti-dumping investigations through the first half of 1998 do not
indicate any significant increase with respect to Asian and developing countries, although the overall
level of anti-dumping activity has grown since the low point recorded in 1995.  Indeed, the country
and sectoral distribution of investigations initiated remains largely the same as in the past, and does
not show any significant increases in actions directed at particular exporters or products.  The fact thatinvestigations do not appear to have increased sign ificantly as a result of currency devaluations in
South-East Asia and elsewhere is perhaps explained by the fact that, contrary to widespread notions,
currency devaluations do not in themselves give rise to or substantiate allegations of dumping.  This is
because devaluations affect both domestic and export prices in equal proportions, and thus cannot be
the source of the price differential necessary for a finding of dumping.  Moreover, as many countriesand industries, at least until quite recently, have been enjoying satisfactory growth and general
economic health, domestic industries may find it difficult to make the necessary showing of the
existence or threat of material injury for the initiation of investigations and imposition of measures.
18. National laws on anti-dumping are the subject of multilateral review in the WTO for
consistency with the strict substantive and procedural requirements of the WTO Agreement, andanti-dumping measures can be challenged through the WTO's dispute settlement procedures, but there
is little evidence of significant problems, as expressed concerns and challenges have been few.  One
notable recent development has been the increased use of anti-dumping measures by developing
countries, which has, in the past few years, equalled or overtaken that of developed countries.
However, developing countries are subject to the same WTO requirements in the investigation andimposition of measures as developed countries, and have generally shown similar patterns with respect
to country and sectoral distribution of investigations.  Overall, the use of contingent trade relief
measures by developed and developing countries alike has not negated the movement towards trade
liberalization.  While experience indicates that their use is highly cyclical, and tends to increase at
times when specific commodity markets enter downtu rns, information available through the first half
of 1998 does not indicate any immediate basis for alarm.  Nonetheless, the use of these types of
measures by all countries needs to be monitored closely in the period ahead.
19. During the past year, the march towards the strengthening of regional trade agreements has
continued on all continents.  Regional arrangements, including customs unions, free-trade agreements,
or other trade-related initiatives such as APEC, have become the norm in international trading
relations, and political impetus to increase their number and scope has anything but diminished.
Examples in 1998 include:
• In Africa, the new Economic and Monetary Union gathering Francophone countries of West
Africa plans, among objectives, to bring into effect a common external tariff; in southern
Africa, negotiations to create a free-trade area among the members of the Southern African
Development Community (SADC) are ongoing;  within this group, the Southern Africa
Customs Union (including Botswana, Lesotho, Namibia, South Africa and Swaziland) are
renegotiating their customs union's relations.  The East African Cooperation member States
are continuing their progress towards an eventual economic and monetary union.  The African
members of the Lomé Convention are currently engaged in negotiations on a new EU-ACP
Convention.WT/TPR/OV/4
Page 6
• In the Americas, an agreement has been signed between 34 countries to create the Free-Trade
Area of the Americas (FTAA) by 2005.  In addition, progress towards the completion of a
common external tariff among MERCOSUR members has continued.  Other agreements
involve individual countries in the regions or pre-existing sub-regional groupings (for
example, the recent agreements between MERCOSUR and the Andean Community, and
between Chile and Canada).
• In Asia, the process of economic integration under the ASEAN has continued apace.  As a
direct response to the crisis, ASEAN members de cided to accelerate tariff liberalization and to
further open to foreign direct investment.  The acceleration of the CEPT-AFTA tariff
reduction scheme will be implemented on a voluntary and "best efforts" basis.  In addition,
while APEC members have been working on a plan for accelerated tariff reductions on nine
fast-tracked sectors, including toys, chemicals and fish and fisheries products, it was recently
decided to send the package instead to the WTO for further negotiations.  In Central Asia,five newly independent republics (Kazakhstan, Kyrgyz Republic, Tadjikistan, Turkmenistan
and Uzbekistan) have joined with Iran, Pakistan and Turkey to develop trade links.
• In Europe, preparations for the future enlargement of the European Union are moving ahead.
The European Council has selected, in a first step, Cyprus, the Czech Republic, Estonia,
Hungary, Poland and Slovenia for negotiations for EU Membership.  Accession negotiationsare scheduled to start in 1999.  The negotiation of a new generation of free-trade agreements
with Mediterranean countries has also progressed, and the customs union with Turkey is in
place.  In addition to these moves, a number of agreements have been signed between
European Free Trade Association (EFTA) member States and countries in Central and Eastern
Europe and the Mediterranean.  Finally, the EU is involved in most inter-continental
initiatives, including plans for a free-trade agreement with MERCOSUR, Mexico, Canada and
South-Africa.  Under the new Transatlantic Economic Partnership, the EU and the United
States are working on the elimination of non-tariff barriers to trade and a better coordination
of their positions in the WTO.
20. As of mid-1998, there were more than 100 regional trade agreements in force.  The interface
between regional and multilateral activities has become one of the main issues for the trading system.
While recent Trade Policy Reviews indicate that, by and large, regional integration and multilateral
negotiations have gone ahead side by side in the re cent years, the question of the gaps between m.f.n.
and preferential tariffs, the differences between regional and international standards, the multiplication
of rules of origin and other market access issues need to be addressed.  It was generally recognized,during the review of the EU's trade policies, that  the process of economic integration under the single
market, by providing for the harmonization of national rules in areas such as customs, industrial
standards, competition policy, state aid, and services, resulted in market access improvement for non-
EU suppliers.  In some cases, however, changes in national rules in an acceding country resulting from
accession to a regional grouping may have adverse effects on outsiders, particularly if these new rules
clearly encourage domestic producers to trade within the regional grouping.  Such considerations
could be important in the context of future multilateral negotiations.  As regional initiatives progress,it is important that the multilateral trading syst em set itself an ambitious agenda, reaffirm the
pre-eminence of its rules, and ensure that the opportunities generated by trade liberalization are both
evenly spread and universally recognized.
III. WTO ACTIVITIES
21. The pace and direction of WTO activities in the first half of 1998 was strongly influenced by
preparations for the 2
nd Ministerial Conference and the commemoration of the 50th anniversary of the
multilateral trading system.  The two events were held in Geneva in May 1998.  The focus of work
during the second half of 1998 concerned the work programme outlined in the MinisterialWT/TPR/OV/4
Page 7
Declaration, and preparations for the Third Session of  the Ministerial Conference, to be held in the
United States at the end of 1999.
22. Details of WTO activities are spelled out in Chapter V of the Annual Report and
complemented by the various Council and Committee reports to the WTO's General Council.  This
section, therefore,  focuses mainly on the areas mentioned above.
23. During the first part of the year, the General Council finalized its report and prepared a draft
Ministerial Declaration and draft Declaration on Global Electronic Commerce.  The  report and draft
declarations were forwarded to and adopted by the 2nd Ministerial Conference.  Ministers noted that
the 50th anniversary came at a time when the economies of a number of WTO Members were
experiencing difficulties as a result of disturbances in financial markets.  In their Declaration,
Ministers rejected the use of any protectionist measures and agreed to work together in the WTO, and
with the IMF and World Bank, to improve the coherence of international economic policy-making,
thereby maximizing the contribution that an open, rules-based trading system can make to fosteringstable growth for economies at all levels of development.
24. Ministers stated their deep concern over the marginalization of least-developed countries and
certain small economies.  They welcomed the report of the Director-General on the follow-up of the
Plan of Action for least-developed countries agreed in Singapore in December 1996 and committed
themselves to improving market access conditions for products exported by the least-developedcountries on as broad and liberal a basis as possible.
25. Full and faithful implementation of the WTO Agreement and Ministerial Decisions was
considered by Ministers to be imperative for the credibility of the multilateral trading system and
indispensable for maintaining the momentum for e xpanding global trade, fostering job creation and
raising standards of living in all parts of the worl d.  Ministers reaffirmed their commitment to respect
the existing schedules for reviews, negotiations and other work.
26. In July 1998, the General Council initiated discussions to establish a process to ensure full
and faithful implementation of the existing agreements and to prepare for the Third Session of the
Ministerial Conference.  The General Council met in Special Session in September 1998 to begin
work on its recommendations concerning the implementation of existing agreements and decisions
and to ensure that the negotiations mandated in Marrakesh in April 1994 begin on schedule.  Theyalso considered future work on programmes initiated in Singapore and recommendations on the
follow-up to the High-Level Meeting on Least-Developed Countries.
27. Work has also begun on a comprehensive work programme to examine all trade-related issues
relating to global electronic commerce.  Members agreed at the 2
nd Ministerial Conference in May
1998 not to impose customs duties on electronic transmissions pending their work and to report to the
3rd Ministerial Conference at the end of 1999.
28. As a follow-up to the 1998 Ministerial Declaration's recognition of the importance of
enhancing public understanding of the benefits of the multilateral trading system and indicates
Members' wish to consider how to improve transparency in WTO operations, the General Council
intensified its work in this area, especially in re gard to the derestriction of WTO documents.  In July
1998, the Director-General announced enhanced cooperation between the WTO andnon-governmental organizations, including regular briefings, a special section on the WTO's website
for NGOs and a procedure allowing NGOs to submit to  the Secretariat position papers and newsletters
which would be made available to Members on demand.
29. Further work was undertaken in 1998 in the three working groups established in Singapore in
1996, mainly the working groups on trade and investment, transparency in government procurement
and the interaction between trade and competition policy.  The groups on trade and investment and onthe interaction between trade and competition policy reported to the General Council at the end ofWT/TPR/OV/4
Page 8
1998 while the group on improving transparency in government procurement continued its
examination of  transparency in government procurement practices in order to develop elements for
inclusion in an appropriate future agreement.
30. The Council for Trade in Goods started to undertake exploratory and analytical work on the
simplification of trade procedures in order to assess the scope for WTO rules on trade facilitation.  At
a symposium on trade facilitation held in March 1998, views were exchanged between representatives
from private enterprises and inter-governmental or ganizations.  The Goods Council decided in July
1998 to hold regular informal meetings to continue the work on trade facilitation, including importand export procedures and requirements, physical movement of consignments and technical
cooperation.
31. Participants agreed to extend the ITA II negotiations until 20 November 1998 after the
Chairman reported that his consultations had indicated that agreement could be achieved by that date.The Committee agreed to resume work on two other items in its programme, non-tariff barriers and
divergences in classification of IT products, after the conclusion of the IT negotiations.
32. The fourth protocol to the GATS on basic telecommunications entered into force on
5 February 1998.  The fifth protocol to the GATS on financial services was opened for acceptance as
of 27 February 1998 and will remain open for ratification and acceptance until 29 January 1999.  The
GATS Council, meanwhile, agreed to extend the negotiations on the question of emergency safeguard
measures until 30 June 1999.
33. In 1998, 39 new requests for consultations were received by the Dispute Settlement Body (up
to 1 November), bringing the total to 150 requests since the WTO's establishment.  In its report to the1998 Ministerial Conference, the Chairman of the DSB stated that the role of the DSB in managing
the settlement of disputes within the WTO had continued to be positive.  The DSB's work reflected
the fact that Members continued to show confidence in the dispute settlement mechanism.  The proper
functioning of the DSB clearly contributed to the strengthening and consolidation of the WTO and themultilateral trading system.  Also in 1998, the DSB began a full review of rules and procedures under
the Dispute Settlement Understanding.
34. Two WTO plurilateral trade agreements - the International Dairy Agreement and the
International Bovine Meat Agreement – were terminated on 1 January 1998.  The Agreement on
Government Procurement is the only remaining plurilateral agreement in the WTO.  Although theplurilateral Agreement on Trade in Civil Aircraft is part of the WTO Agreement, it remains outside
the WTO framework.  Since November 1997, attempts to adapt the provisions of the Agreement on
Trade in Civil Aircraft to the WTO framework have proven unsuccessful.
35. The relations of the WTO with the IMF and the World Bank have been developed under the
WTO's agreements with the two organizations.  In  October 1998, the Managing Director of the IMF,
the President of the World Bank, and the Director-General of the WTO issued a report on Coherence;this was in accord with the Ministerial Declaration on the Contribution of the World Trade
Organization to Achieving Greater Coherence in  Global Economic Policymaking.  During 1998,
cooperation on technical assistance with the IMF, the World Bank, UNCTAD, the ITC and UNDP has
been reinforced in regard to technical assist ance initiatives for least-developed countries.
36. Of the 32 working parties established to examine applications for WTO membership, two
completed their work in 1998.  The General Council adopted the protocols of accession and theworking party reports for the Kyrgyz Republic and Latvia at its October session.  Ratification by thesaid governments had not been notified to the Secretariat by end of October.  Several other workingparties were deemed to be close to completing their work.  In the Declaration of May 1998, Ministerswelcomed the progress made in the accession working parties and renewed their resolution to ensureWT/TPR/OV/4
Page 9
that the accession processes proceed as rapidly as possible.  They recalled that accession to the WTO
requires full respect of WTO rules and disciplines as well as meaningful market-access commitmentson the part of the acceding candidates.
37. The higher political profile of our Organizati on requires improving contact and understanding
of its work in the world we exist to serve. To this end, informal dialogue with non-governmental
organizations has been actively pursued within the guidelines set down by Members, notably through
a series of initiatives by the Director-General.  He has held a number of meetings with a wide range ofNGOs, and invited them to suggest ways of improving our dialogue.  Furthermore he announced a
package of measures in July, including the establishment of an NGO Forum on the WTO's highly
successful website,
1 aimed at making the WTO more accessible to civil society while respecting its
intergovernmental character.  These initiatives will be intensified in 1999 with the holding in March
of two high-level gatherings of government officials, NGOs and academics to discuss Trade andEnvironment and Trade and Development, respectively.
________
                                                     
1The statistics on the use of the WTO Internet Site show that a new usage record was set in October
1998, when a total of 57,823 individual computers logged onto the site, an increase of 10,000 over the previousmonth.