WORLD TRADE  
ORGANIZATION  RESTRICTED 
WT/WGTTT/M/40/Rev.1 
17 October 2012 
 (12-5640) 
Working Group on Trade and Transfer of Technology 
Fortieth Session  
 
 
 
NOTE ON THE MEETING OF 28 JUNE 2012 
 
Chairperson:  Mr. Carlos Rossi (Peru) 
 
Revision 
 
 
A.  ADOPTION OF THE AGENDA  ......................................................................................................... 1  
B.  ANALYSIS OF THE RELATIONSHIP BETWEEN TRADE AND TRANSFER OF TECHNOLOGY  .............. 2  
C.  ANY POSSIBLE RECOMMENDATIONS ON STEPS T HAT MIGHT BE TAKEN WITHIN THE 
MANDATE OF THE WTO TO INCREASE FLOWS OF TECHNOLOGY TO DEVELOPING 
COUNTRIES  .............................................................................................................................. .... 3 
D.  OTHER BUSINESS  ......................................................................................................................... 3  
 
 
A. ADOPTION OF THE AGENDA  
1. The agenda contained in Airgram WTO/ AIR/3959 of 15 June 2012 was adopted.  
2. At the outset, the Chairman briefed Members on the informal consultations he had had on his 
work plan for 2012.  He stated that he was wo rking towards:  (a) inviting UNCTAD to make a 
presentation on the relationship between bilatera l investment treaties (BITs), regional trade 
agreements (RTAs) and other sectoral plurilateral agreements with transfer of technology at the 
October 2012 meeting;  (b) encouraging Member s to share national experiences on innovation, 
technology generation, enabling envi ronment and technology transfer;  (c)  exploring the possibility 
of holding a workshop on trade and transfer of te chnology at the end of the year;  and finally 
(d) enhancing and improving availability and inform ation flow on the existing web-link under the 
development section on the WTO website to give greater  visibility and transparency to the hard work 
Members have undertaken in the Working Group during the past ten years.   
3. While Members offered preliminary comments on the Chairman's work plan, some Members 
stated that they would need to consult with thei r capitals on this matter.  Some Members pointed out 
that such an initiative should be Member-driven a nd that a formal proposal would be needed to 
consider it.  One Member raised a systemic i ssue relating to the updates of the WTO web-link on 
technology transfer and its proposed external li nkage to the websites of other international 
organizations and institutions.  Other Members wished  to have greater clarity and information on the 
Secretariat's policy on website updates.  The Secret ariat clarified that updates of the WTO website 
was a regular feature of the Secretariat's work in line with the principle of transparency and did not 
require an endorsement by WTO bodies.  In accordance with the May 2002  decision of the WT/WGTTT/M/40/Rev.1 
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  General Council
1, all official  WTO documents were deemed  to be unrestricted and could be posted 
on the WTO website.   
B. ANALYSIS OF THE RELATIONSHIP BETWEEN TRADE AND TRANSFER OF TECHNOLOGY  
4. Under the agenda item relating to  the relationship between trade and transfer of technology, 
two presentations were made on the role and im portance of Global Value Chains (GVCs) and 
technology transfer.   
5. In highlighting OECD's work in the area of  GVCs and value-added, in the presentation 
entitled "Knowledge Transfer and Global Value Chai ns", Mr. Koen De Backer, Senior Economist at 
the OECD, underscored broader conceptual issues in  the context of GVCs and technology transfer.  
The presentation identified five types of governance models in GVCs (market, modular, relational, 
captive and hierarchy) and stated that the extent of knowledge transfer varied and depended on the 
choice of model.  The relational model was found to be  the most beneficial for technology transfer as 
it envisaged face-to-face interactions and high opportunity for mutual learning as in the case of apparels in East Asia and computers in Taiwan.  Knowledge transfer was mainly taking place through 
market transactions both as intended transfer, through  among others, international trade, foreign direct 
investments, licensing and movement of staff as well as unintended transfers (including through 
demonstration effect, increased competition, verti cal linkages - upstream and downstream as well as 
through patent applications).  Over the past de cade, the production processes had been segmented and 
dispersed involving multinational companies and lo cal firms across countries.  Citing the cases of 
India and Indonesia, the presentation found out that lowering of import barriers for intermediate goods 
resulted in lowering of prices, larger sales, more variety and quality improvement through technology 
acquisition.  
6. The presentation by the WTO focused on the impacts of fragmentation of production on 
international competitiveness.  It highlighted the fact that services and manufacturing firms operated 
increasingly across regions and multiple network pr oduction chains.  Therefore, industrial upgrading 
and acquisition of advanced tec hnological capabilities to enhance competitiveness became ever more 
important.  The knowledge transfer was embodied in traded goods and services.  The presentation also 
underscored that the increase in trade volume of devel oping countries could also be attributed to the 
growing role of supply chains and an ongoing shif t to high-tech products.  Intermediate goods with 
high-technology content, subsequently embodied in  final products and exports, accounted for more 
than 50 per cent of non-fuel merchandise exports.  In addition, the enabling environment, absorptive 
capacity and the ability to adopt foreign technological knowledge in the recipient country were also 
crucial.  It went on to state that GVCs played an  important role in technology transfer and that 
national policies should be geared to facilitating ab sorbing technologies.  Participation in GVCs 
through FDI also resulted in technology transfer and increased exports.  Services were also the 
enablers of global production netw orks and took an ever increasing role in global production.   
7. Following the two presentations, Members enga ged in a productive discussion and found 
them useful and relevant to the work of the Work ing Group.  They raised a number of issues including 
on:  (a) how GVCs impacted on the economic deve lopment and trade prospects of developing 
countries;  (b) the role of governments in promo ting participation of local firms in GVCs and 
promoting technology transfer;  (c) how lowering of  trade barriers in intermediate goods benefited 
developing countries;  and (d) what policy steps c ould be appropriate to enhance trade flows and 
technology transfer.   
                                                      
1 Document WT/GC/W/464/Rev.1.  WT/WGTTT/M/40/Rev.1 
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  C. ANY POSSIBLE RECOMMENDATIONS ON  STEPS THAT MIGHT BE TAKEN WITHIN THE MANDATE 
OF THE WTO TO INCREASE FLOWS OF TECHNOLOGY TO DEVELOPING COUNTRIES  
8. Under the agenda item on possible recommendations  that the Working Group could make in 
the future, Members continued their discussion of  an earlier submission entitled ''Facilitating Access 
to Information on Appropriate Technology Sourcing – Steps to Increase Flows of Technology to 
Developing Countries''.  The proponents informed th at they were currently engaged in internal 
consultations aimed at revising the room document for its formal submission at an appropriate time.   
D. OTHER BUSINESS  
9. No issue was raised under "Other Business".   
10. The meeting was adjourned.   
 
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