WT/GC/W/919/Rev.1  
 
17 January  2024 
(24-0376) Page: 1/2 
General Council  Original: English  
 
WTO SMOOTH AND SUSTAINABLE TRANSITION MEASURES IN FAVOUR OF COUNTRIES 
GRADUATED FROM THE LDC CATEGORY  
COMMUNICATION FROM  DJIBOUTI ON BEHALF OF THE LDC GROUP  
Revision* 
The following communication, dated 13 January  2024, is being circulated at the request of the 
delegation of Djibouti on behalf of the LDC Group.  
 
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1.  In response to the report by the chairperson of the Committee on Trade and Development to the 
General Council on LDC Graduation ( WT/COMTD/LDC/30 ), the LDC Group would like to share its 
reflexions on discussions so far, and propose next steps on this critical issue for the LDCs. As 
highlighted in the report, discussions in the LDC Sub -Committee have gone through an in -depth 
review of the different L DC-specific provisions listed in Annex 2 of the LDC graduation proposal 
(WT/GC/W/807/Rev.2 ). In addition to factual presentations by the Secretariat, the LDC Group has 
explained at length the reasons for extending such provisions for a reasonabl e period of time in 
favour of Members after they leave the LDC category.  
The rationale for smooth and sustainable transition measures in the WTO  
2.  LDC-specific provisions embedded in WTO Agreements and Ministerial Decisions have been 
agreed by consensus by the whole membership to respond to the unique vulnerabilities affecting 
LDCs. WTO Members have further recogni zed that they should equally apply to all LDCs. The 
question of extending those measures to graduating countries is therefore not whether these 
measures are appropriate or not, but rather if countries after graduation from the LDC category 
have achieved sufficient progress to render these support measures unnecessary. More generally, 
the question is whether graduated countries have been able to buil d sufficient productive capacity 
or reduce their vulnerabilities sufficiently to avoid a situation where the removal of those support 
measures would affect their development pathways or undermine the progress achieved so far.  
3.  Based on existing analysis by UNCTAD1 and the UN CDP2, the experience so far suggests that 
LDCs meet the graduation criteria before operating the economic structural transformation, they 
need to engage in global markets on an equal footing with other developing countries. As a result, 
their productive capacity remains largely underdeveloped and undi versified. These findings provide 
a strong rationale for extending some of the LDC specific provisions listed in Annex 2 as part of a 
smooth transition set of measures.  
4.  In recognition of the fact that Members leaving the LDC category should at least commit  to 
comply with the rules and disciplines that apply to other developing countries, the LDC Group has 
proposed that the smooth transition measures take the form of a peace clause. In other words, while 
graduated countries would make their best effort to co mply with those new obligations, they should 
 
* For editorial improvement.  
1 UNCTAD (2021): "Achieving Graduation with Momentum through the Development of Productive 
Capacities". https://unctad.org/system/files/official -document/aldc2021d4_en.pdf   
2 UN CDP (2017): "Expanding productive Capacity: Lessons Learned from Graduating LDCs". 
https://www.un.org/d evelopment/desa/dpad/wp -content/uploads/sites/45/publication/2017 -cdp-policy.pdf   WT/GC/W/919/Rev.1  
 
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  not be subject to the dispute settlement mechanism during a reasonable period of time, in case they 
face difficulties.   
 
Discussions in the LDC Sub -Committee  
5.  Discussions in the LDC Sub -Committee so far have high lighted that some of the provisions listed 
in Annex 2 of the LDC Group 's proposal ( WT/GC/W/807/Rev.2 ) may need to be consolidated. On the 
Annex  1 of the LDC submission, Members have already adopted the 23 October 2023 General Council 
Decision ( WT/L/1172 ), which encourages LDCs preference granting Members to provide a smooth 
and sustainable transition period for the withdrawal of their LDC -specific tariff or DFQF preference 
programmes. The LDC Group welcomes this Decision, which constitutes  a step in the right direction 
and recognizes that its implementation by preference granting Members will address several of the 
market access -related issues listed in Annex 2. Based on these considerations, the LDC Group is 
ready to review the list of pro visions in Annex 2 and to align it particularly with the General Council 
Decision on unilateral DFQF preferences.  
Next Steps  
6.  As we move towards MC13 and given the critical importance of this issue, instructing the Sub -
Committee to continue the examination of Annex 2 of the LDC graduation proposal and provide an 
appropriate period of time, as envisaged in the LDC sub -committee Chair's report , is not the only 
option that the LDC Group  expects . We fear that a n endless discussion on questions that have 
already been answered by the LDC Group, will only delay any action on this critical development 
matter.  
7.  We request t he General Council to agree on the principle of a transition period, which would apply 
to the provisions listed in Annex 2 for a fixed number of yea rs. Regarding the transition period, as 
mentioned in the past, the LDC Group envisages, at a minimum, a 6 -year peace clause. This is close 
to the term found in existing mechanisms, for example, 5 years available under the UN LDC 
Technology Bank, and the tw o triennial UN CDP reviews undertaken post - graduation to monitor 
progress. Based on such a decision, further discussions during the time remaining before MC13 could 
focus on which LDC specific provision might benefit from the proposed transition period.  
8.  As mentioned repeatedly, this is not about negotiating new flexibilities. Graduating LDCs have 
clearly expressed their commitment to comply with new obligations after they leave the LDC 
category, but they simply require a transitional time, in the form of a peace clause to guarantee a 
smooth transition process on a limited set of provisions. Granting such flexibilities will significantly 
contribute to facilitating a smooth and sustainable transition after graduation from the LDC category. 
The GC decision on  Annex 1 is a clear recognition that a transition period after graduation from LDC 
category is crucial. Achieving a successful outcome on Annex 2 will send a strong signal that the 
multilateral trade system is responsive to the need of its more vulnerable Members and will generate 
most needed goodwill to address other critical issues on the MC13 agenda.  
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