RESTRICTED  WORLD TRADE  
ORGANIZATION  G/C/M/81 
1 August 2005 
 
 (05-3465) 
Council for Trade in Goods Original:   English 
  
 
MINUTES OF THE MEETING OF THE COUNCIL FOR TRADE IN GOODS 
15 JULY 2005 
 
Chairperson: H.E. Ambassador Himanen (Finland
) 
 
 
 The meeting of the Council for Trade in goods was convened by airgram WTO/AIR/2616 and 
the proposed agenda for the meeting was containe d in document G/C/W/525.  The meeting proceeded 
on the basis of the proposed agenda.  
 
I.
 REVIEW OF THE OPERATION OF THE AGREEMENT ON TRADE-
RELATED INVESTMENT MEASURES (TRIMS) UNDER ARTICLE 9 ........................2  
II. REGIONAL TRADE AGREEMENTS ..................................................................................3  
A. FREE TRADE AGREEMENT BETWEEN THE FORM ER YUGOSLAV REPUBLIC OF 
MACEDONIA AND BOSNIA AND HERZEGOVINA ............................................................................3  
B. FREE TRADE AGREEMENT BETWEEN THE EFTA STATES AND TUNISIA .......................................3  
III. SANITARY AND PHYTOSANITARY MEASURES...........................................................4  
A. REPORT ON PROPOSALS FOR SPECIAL AND DIFFERENTIAL TREATMENT ...................................4  
B. SECOND REVIEW OF THE OPERATION AND IMPLEMENTATION OF THE SANITARY AND 
PHYTO SANITARY AGREEMENT ...................................................................................................4  
IV. UNITED STATES – REQUEST FOR WAIVERS FOR AFRICAN GROWTH 
AND OPPORTUNITY ACT, CARIBBEAN BASIN ECONOMIC RECOVERY ACT, AS AMENDED, AND ANDEAN TRADE PREFERENCE ACT, AS AMENDED........................................................................................................................ ........4
 
V. CUSTOMS VALUATION AGREEMENT:   REQUEST FOR AN EXTENSION 
OF  WAIVER GRANTED UNDER  ARTICLE IX OF THE WTO 
AGREEMENT - SENEGAL....................................................................................................7  
VI. ISSUES RELATED TO TRADE IN TEXTILES – SUBMISSION OF TURKEY..............7  
VII. NIGERIA TRADE RESTRICTIVE MEASURES ..............................................................18  
VII. ELECTION OF CHAIRPERSON FOR THE COMMITTEE ON TRADE-
RELATED INVESTMENT MEASURES ............................................................................19  
IX. OTHER BUSINESS................................................................................................................1 9 
A. REQUEST BY PAKISTAN FOR EXTENSION OF THE TRANSITION PERIOD UNDER THE 
TRIM S AGREEMENT .................................................................................................................19  
B. DATE OF THE NEXT MEETING ....................................................................................................20  
 
_______________ G/C/M/81 
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 I. REVIEW OF THE OPERATION OF THE AGREEMENT ON TRADE-RELATED 
INVESTMENT MEASURES (TRIMS) UNDER ARTICLE 9 
1.1 The Chairman
 recalled that at the July meeting the Council had received a joint proposal by 
Brazil and India concerning a study on the impact of  TRIMs and of their elimination.  The terms of 
reference for this study were contained in documen t Job(04)/93.  His predecessor, Ambassador Choi, 
had carried out informal consultations on the matter  and reported that he had been unable to reach a 
consensus on the desirability of conducting the prop osed study.  As far as he understood, there had 
been no new developments in Members' positions since the last CTG meeting.   He, therefore, was in Members' hands as to how to address this matter in the future. 
1.2 The representative of Brazil
 noted that the proposed terms of  reference for a study were the 
elements to go under the Review.  He recalled that the CTG had already examined a previous study in 
2001 and a joint proposal by Brazil and India suggesting amendments to the TRIMs Agreement in October 2002.  The latest proposal referred to terms of reference fo r another study to which he had 
nothing more to add, except if other Members ha d changed their positions on the matter.  He wished 
to raise the matter of the flexibility left in the TRIMs Agreement.  Suggestions to amend the TRIMs 
Agreement had been put forward  over the years through several tracks in the WTO.  The LDC Group 
had presented a suggestion to amend the TRIMs Ag reement which was being considered in the 
Special Session of the Committee on Trade and Development. The African Group had presented 
suggestions to amend the TRIMs Agreement which we re currently under consideration in the TRIMS 
Committee.  The proposals classified as Categor y II proposals coming from the Committee on Trade 
and Development had been sent to the respective subsidiary bodies as mandated by the August 2004 
Decision (WT/L/579). These bodies would, in turn, report back to the General Council in July.  The 
third track  - apart from the Article 9 Review under which the TRIMs Agreement was being submitted 
for consideration and for amendment, was the tr ack under Article 12(b) of the Doha Ministerial 
Declaration dealing with the outstanding implem entation issues, under which India and Brazil had 
also presented some suggestions to amend the Agreem ent.  He wished to share with the Council for 
the records and to provide his colleagues with th e state of play regarding the discussions on the 
TRIMs Agreement.    1.3 Under the latter track, his delegation had unde rtaken consultations to discuss what Brazil 
considered to be the absence of flexibilities for developing countries to adopt development-oriented 
policies.  Two days ago, in the context of co nsultations held by the Chairman of the TRIMs 
Committee (Mauritius), acting as a Friend of the Dir ector-General, Brazil and India had presented a 
analysis of Articles 4, 5 and 9 of the TRIMs Agreement to assess whethe r flexibilities were still 
available.  Article 4 allowed some possibilities fo r developing countries to deviate temporarily from 
the provisions of Article 2 of the Agreement.  Most of them were related to balance-of-payments:  the 
Understanding on the Balance-of- Payments Provisi ons of GATT 1994, and the Declaration on Trade 
Measures Taken for Balance-o f-Payments Purposes adopted on 28 November 1979.  Although 
important, these balance-of-payment related flexibilities did not address the longer term 
developmental objectives listed in the proposal presen ted by India and Brazil to the CTG in October 
2002.  He summarized those development objectives, as, inter alia ,:  to promote domestic 
manufacturing capabilities; to stimulate the transf er or indigenous develo pment technology; to 
promote purchases from disadvantaged regions; to stimulate environment-friendly methods; to 
increase export capacity in cases where a structural  current account deficit would cause a major 
reduction in imports;  and to prom ote small- and medium-sized enterprises as they contribute to 
employment generation.  There was also a possibility for deviation from the provisions of Article 2, which was related to Article XVIII of GATT 1994.   However his delegation had come to the 
conclusion that the provisions established in paragra phs 14-18 of Article XVIII were so onerous that 
recourse to that Article was impossible.   
  G/C/M/81 
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 1.4 Article 5 which was also analysed for flex ibilities provided for notification and transitional 
arrangements.  All WTO Members had been give n 90 days to notify requirements that did not 
conform to the TRIMs Agreement.  After the TR IMs Agreement entered into force, developed 
countries had 2 years, i.e., until December 1997, developing countries had 5 years and LDCs had 7 years to phase out the measures that had been notif ied.  The Agreement provided an opportunity for 
individual countries to request an extended transiti onal period in the event that special difficulties 
arose in the implementation of the Agreement.  Many developing countries had difficulties in 
notifying existing measures within 90 days, i.e. from January to March 1995.  All in all, 24 developing countries, of which only one was an LD C,  notified that they had relevant measures. 
Certain Members considered that they quite simply  had not had the capacity to identify any measures 
that were in conflict with the Agreement.  This ha d created problems since the stipulated periods of  
transition only referred to notified measures. Some  Members had therefore been unable to take 
advantage of the transitional period.  His delegation concluded that this flexibility was not available 
anymore.    
1.5 Finally, under Article 9 which provided for the Review of the Agreement, the CTG had a 
joint study prepared by UNCTAD and WTO in 2001; a proposal by India and Brazil in 2002, and the 
latest proposal related to the te rms of reference for a study subm itted in July 2004, which currently 
faced an impasse in the CTG.  Rega rdless of the efforts of the proponents for further flexibility in the 
TRIMs Agreement to assess the developmental imp lications of the current prohibitions, opponents 
had not engaged so far in substantive discussions und er the Article 9 Review.  He asked Members to 
seek further flexibility in their capita ls so as to provide the necessary fresh air to the discussions and 
concrete assessment that would help the CTG in defining what should be the outcome in relation to 
the TRIMs Agreement at the end of this round  and at the end of the Article 9 review. 
 1.6 The representative of India
 supported the Brazilian statement.   Her delegation also urged 
Members to reengage constructively to further di scuss the proposals which had been made by India 
and Brazil in 2002 in order to find a way out of the current impasse.   1.7 The Chairman
 proposed that the Council take note of the statement made and revert to this 
matter at a future meeting.  
1.8 It was so agreed
. 
 
II. REGIONAL TRADE AGREEMENTS 
A. F REE TRADE AGREEMENT BETWEEN THE FORMER YUGOSLAV REPUBLIC OF MACEDONIA AND 
BOSNIA AND HERZEGOVINA  
B. F REE TRADE AGREEMENT BETWEEN THE EFTA STATES AND TUNISIA  
2.1 The Chairman  drew Members' attention to the two Agreements listed under this item 
that had been notified under GATT Article XXIV.1  The texts of the Agreements and their 
notifications had been circulat ed in the documents listed.  In the absence of comments, he 
proposed that the Committee on Regional Trade Agreem ents carry out the examination of the above-
mentioned Agreements in accordance w ith the following terms of reference:  "to examine, in light of 
the relevant provisions of the GATT 1994, the trade agreements just referred to and to submit a report 
to the Council for Trade in Goods.  It is understood that the understanding read out by the Chairman 
of the Council for Trade in Goods under item 7 of th e agenda of the meeting of the Council for Trade 
                                                      
1 The texts of the Agreements and their notifications had been circul ated, respectively, in documents 
WT/REG200/N/1, WT/REG200/1; WT/REG201/N/1, WT/REG201/1;  
 G/C/M/81 
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 in Goods on 20 February 1995, as contai ned in document WT/REG3/1, will apply mutatis mutandis  to 
the examination of the agreements.  It is also  understood that, during the examination, due account 
will be taken of the intrinsic differences between customs unions and free trade areas". 
2.2 The Council so agreed
. 
 III. SANITARY AND PHYTOSANITARY MEASURES 
A. R EPORT ON PROPOSALS FOR SPECIAL AND DIFFERENTIAL TREATMENT  
B. S ECOND REVIEW OF THE OPERATION AND IMPLEMENTATION OF THE SANITARY AND 
PHYTO SANITARY AGREEMENT  
3.1 The Chairman noted that the Committee on Sanitary and Phytosanitary Measures had 
forwarded two reports to the Council for Trade in Goods.  Both of these reports responded to specific 
requests from the General Council.  He gave the floor to the Chairman of the SPS Committee to 
present these reports to the Council  3.2 The Chairman of the SPS Committee
 reported the results of the efforts of the SPS Committee 
to respond to the General Council's request by forwarding through the CTG the two reports listed 
above.  Specifically, the first document, in G/SPS/35,  reported on the five proposals submitted to the 
SPS Committee by the General Council that were th at were reviewed in informal and formal 
meetings.  He considered that there was an incr easing engagement in the substantive discussions of 
these proposals, and in particular the concerns unde rlying the five proposals.  The report concluded 
that there were no specific recommendations that th e SPS Committee make at this stage.  However the 
Committee welcomed an indication by some Members th at they expected to review the five proposals 
with the intention of trying to submit revisions for the consideration of the Committee. In addition, the 
Committee also committed itself to expeditiously di scuss a rather long list of specific items which 
may make the operation of Articles 9 and 10 of the SPS Agreement more precise, effective and operational. The Committee was not able, due to time c onstraints, to engage substantively on this list 
but will begin doing so at its October meeting.  The second document, in G/SPS/36, was the product 
of at least 12 months of the Committee's work  putting together a schedule and Members actively 
submitting elements to undertake.  He referred inte rested Members to the su mmary of the document 
on page 24 where there was a total of 40 differe nt recommendations that the Committee will examine 
in its Review.  He considered it a healthy list of  issues that would keep the Committee occupied for 
sometime.  There was wisdom in the Committee not trying to prioritize the list, and Members who 
were interested would be bringing forth their own contributions.  There would, therefore, be a self-
selection type of work that would be done on the review.   3.3 The Chairman proposed that  the Council take note of the statement made and of the two 
documents and agree to forward them to the General Council for appropriate action. 
3.4 It was so agreed
. 
IV. UNITED STATES – REQUEST FOR WAIVERS FOR AFRICAN GROWTH AND 
OPPORTUNITY ACT, CARIBBEAN BASIN ECONOMIC RECOVERY ACT, AS AMENDED, AND ANDEAN TRADE PREFERENCE ACT, AS AMENDED 
4.1 The Chairman
 recalled that the United States circulated, in advance of the CTG meeting of 
11 March 2005, three requests for waivers in docu ments G/C/W/508, G/C/W/509, and G/C/W/510.  The 
first document consisted of a request for a waiver  for the Caribbean Basin Economic Recovery Act 
(CBERA), the second  document consisted of a request for a waiver for the African Growth and 
Opportunity Act (AGOA), and the third document cons isted of a request for a waiver for the Andean 
Trade Promotion Act (ATPA).  The United States also circulated supplemental information to each of  G/C/M/81 
 Page 5 
 
 
 these requests in G/C/W/508/Add.1, 509/Add.1 and 510/Add.1.  At the C ouncil's meeting of 
11 March  2005, the United States presented these waiver requests as well as provided an in depth 
description of these programmes.  He had subseque ntly convened two inform al consultations on 
5 April and 27  May 2005 on this matter.  At the first cons ultation, questions were posed by China, 
India and Pakistan.   These were circulated in document G/C/W/516.  The United States res ponses to 
these questions were circulated in G/C/W/518.  At  the second consultation, follow-up questions were 
raised by China and Pakistan.  These were ci rculated in documents G/C/W/519 and G/C/W/520 
respectively.  Responses from the United States to these questions were received yesterday and 
circulated in G/C/W/526.  4.2 The representative of the United States
 noted his understanding that Members would not 
likely be in a position to comment on the responses ci rculated by his delegation only yesterday.  He 
had also recently received additional questions fro m Brazil to which his delegation would strive to 
respond quickly.  He urged other Members which ha d questions to submit them as soon as possible so 
as not to delay inordinately the examination process.  His delegation was available to consult with any 
Member on any or all of the programmes for which the waivers were sought.   4.3 The representative of India
 stated that her delegation would also be raising some follow-up 
questions to its first set of questions.  She w ould transmit the recently received responses to her 
capital and appreciated the US offer to consult on these questions.  4.4 The representative of Brazil
 shared most of the views expressed  by China and Pakistan in the 
two series of questions they had presented to the US .  His delegation had expressed such concerns in 
the informal meetings that were convened and took note of the rep lies provided by the US.  These had 
been further assessed in his capital.  His delegation wished to express its own concerns with regard to 
the US waiver requests and had therefore decide d to present some comments and questions. They 
would be circulated shortly.  Instead of reading them  out, he briefly referred to the main points.  They 
related mostly to the distorting effects of preferential rules of origin to not only to third part suppliers 
but also to the beneficiaries of the waivers themse lves who would not be able to supply from the most 
competitive sources.  A second issue was the criteri a used in one of the programmes for which a 
waiver was sought to select the beneficiary countri es.  Brazil was fully aware of the interests and 
concerns of beneficiary countries in the preference schemes provided by the US, but Brazil was also a 
developing country and had legitimate interest in tho se issues.  Some clarificat ions were still pending 
before his delegation could agree to these waivers.  At that phase Brazil would certainly engage in a 
constructive manner and expected that the same spirit of flexibility would also be accorded by 
developed countries for developing country initiatives  that would require a derogation from the most 
favoured nation clause.  4.5 The representative of Mauritius
 appreciated the transparent nature of this examination 
process.  He appealed to Members to move the process along as quickly as possible so those Members 
which benefited from the programmes, i.e. the poorest  Members of the WTO, could continue to do so. 
 4.6 The representative of China
 thanked the US for its responses to his delegation's follow-up 
questions.  Since they were only just received his delegation needed time to study them.  His delegation appreciated the US intentions and willi ngness to engage in consu ltations.  His delegation 
looked forward to exchanging views with the US if a further need arose.  Finally, his delegation 
reiterated that its main purpose was to better unders tand the specifics of the schemes so as to make 
sure that the benefits of the schemes toward devel oping country beneficiaries were really materialised. 
 4.7 The representative of Uganda
 referred to the statement made  at the 11 March 2005 meeting of 
the CTG in which the African Union made an import ant statement in support of the African Growth G/C/M/81 
Page 6  
 
 and Opportunity Act.  She also called for a quick resolution of the examination process and 
favourable outcome to the requests.  4.8 The representative of Nigeria
, also asked for a speedy process of examination of the waiver 
requests and that nothing be done in the WTO to jeopardize the programmes which were so necessary 
to his country as well as to the other beneficiary countries. 
 4.9 The representative of Pakistan
 also thanked the US for provid ing the answers to its questions 
which it sent to its capital for further reflection.  He also appreciated the US offer to consult 
informally on these waivers, which his delegati on viewed as means for a dditional transparency 
regarding the legislation and related concerns.  He could not emphasize more the importance of the 
textile and clothing sector for Pakistan, and his delega tion wanted to ensure that such legislation were 
not enacted to the detriment of other developing c ountries' and LDCs interests.  In addition, his 
delegation wanted to ensure that these programmes we re in conformity with the rules based system of 
the multilateral trading system.  He considered th e Brazilian questions in line with his delegation's 
concerns and looked forward to receiving the US rep lies to these questions as well.  His delegation 
might have further comments or questions once it reviewed all the responses.   4.10 The representative of Kenya
 stressed that these programmes were designed to benefit the 
most vulnerable Members of the WTO and urged a speedy process.  He suggested that one way to expedite the process could be to have a numbe r of informal meetings on the matter.   
 
4.11 The representative of Senegal
 called for a rapid resolution to the examination process in 
favour of the beneficiary countries like his.    4.12 The representative of Colombia
 recalled that her delegation had spoken previously of the 
importance of the ATPA programme, which was a temporary preference system, to helping countries, 
particularly Colombia, in fighting illegal drug produc tion and trade.  Her delegation joined the US and 
others in encouraging countries that wished to enter into a constructive dialogue to improve this 
scheme to complete the process as soon as possible so  that a positive response to the US requests for 
waivers could be given.  
4.13 The representative of Korea
 shared the concerns raised by China, Pakistan, Brazil and India. 
These programmes had implications for world textile  and clothing trade.  There could be some 
detrimental effects for other developed countri es, as well the beneficiary countries.  Further 
clarification and discussion on these issues was need ed.  His delegation might submit questions at a 
later stage. 
 
4.14 The representative of Ecuador  stated that the problem of drugs and narcotics trafficking was 
far-reaching.  International respons ibility was necessary to combat it.  International trade was an 
important component of this responsibility and n ecessary to overcome proverty and social instability.  
He asked that Members support the US requests which his delegation hoped would be accepted as 
soon as possible. 
 
4.15 The representative of Rwanda  asked Members to be understanding towards these requests as 
they provided important market access for Rwa nda.  His delegation hoped that a positive decision 
would be forthcoming quickly.  
4.16 The representative of Peru
 noted his delegation's earlier statements on the importance of the 
ATPA programme for combating the drug problem in her country.  Her delegation considered this a 
problem shared by the international community.  Therefore it looked for a positive result to these 
requests.   G/C/M/81 
 Page 7 
 
 
 4.17 The Chairman  recalled that the CTG had agreed at its previous meeting that, in order to 
satisfy the requirement in Article IX.3(b) of the WTO Agreement, he would make a brief, factual 
report on behalf of the CTG to the General Council at  its next meeting on 27 and 29 July 2005.  He 
would explain that the CTG had been examining th e three requests made by the United States since 
11 March 2005.  In addition to the three formal me etings in which these requests were examined, he 
would inform the General Council that he had also  convened two informal consultations in which 
questions were posed and answers were provided.  He would explain, however, that the CTG had 
been unable to complete its examination of the th ree requests for waivers and would request that the 
General Council agree to allow it to continue its wo rk and to report back to  the General Council once 
it had completed its examination.  He also belie ved that it would be useful to convene another 
informal consultation on the matter and he would inform  delegations of this da te in due course.  He 
proposed that the Council take note of the statements  made and revert to this matter at its next 
meeting.  4.18 It was so agreed
. 
 
V. CUSTOMS VALUATION AGREEMENT:  REQUEST FOR AN EXTENSION OF 
 WAIVER GRANTED UNDER ARTICLE IX OF THE WTO AGREEMENT - SENEGAL 
5.1 The Chairman
 noted that, in document G/C/W/524, Senegal circulated a request for an 
extension of its waiver under Article IX of the WTO Agreement for the use of a system of officially 
established minimum values for a limited number of products.  He recalled that the General Council 
on 17 May 2004 approved Senegal's request for a waiv er from its obligations under the Agreement on 
Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 (Customs 
Valuation Agreement).  This Decision, contained in document WT/L/571, expired on 30 June 2005.  
He also noted that Senegal, in accordance with its obligations under this Decision, had presented a 
report on the status of its implementation of th e officially established minimum values for the 
products concerned.  This was circulated as doc ument G/C/W/523 as well as to the Committee on 
Customs Valuation as document G/VAL/N/4/SEN/2.  He noted his understanding that Senegal was 
consulting with Members on this request.  In the absence of statements, he proposed that the Council 
agree to revert to this matter at its next meeting.  
5.2 It was so agreed
. 
 
VI. ISSUES RELATED TO TRADE IN TEXTILES – SUBMISSION OF TURKEY 
6.1 The Chairman  recalled that at the last meeting of the Council, during the discussion of this 
agenda item, Turkey had stated that it would submit a paper for consideration by the Council.  It was 
agreed that the Council would revert to his ag enda item once that paper was received.  In a 
communication dated 28 June 2005, Turkey submitted its paper for circulation to the Council and 
requested the inclusion of the item "Issues Related to Trade in Textiles" on the agenda of this meeting 
of the Council.  Turkey's submission was circulated in document G/C/W/522.  6.2 The representative of Turkey
 stated that the aim of his delegation's paper was to contribute to 
the debate on the issues related to trade in textil es and clothing after 1 January 2005.  The textile and 
clothing sector played an essential role in the economic and social development of many countries, including Turkey.  For many, this sector was the ma in source of export revenues, accounting in some 
instances for as much as 90 per cent of manufactures.  In fact, the developing countries had had great expectations from the 1 January 2005 quota phase-out .  It was believed that while the MFA phase-out 
would increase global welfare, the trade in textile and clothing and developing countries as a whole 
would further gain market share in world total e xports.  Moreover, it was expected that at least 20 
million new jobs would be created in developing c ountries.  However, the outcome was the opposite G/C/M/81 
Page 8  
 
 and getting even more complicated.  The dramatic  transformation of global production and sourcing 
patterns in this sector was a great reason of co ncern for the developing countries.  The sharp 
consolidation of production into a few suppliers and lack of new market opportunities exacerbated the 
vulnerability of the situation.  In fact, the disr uptive effects of the removal of textile quotas were 
beginning to be felt by textile industries around th e world.  Information on recent developments of 
major export markets confirmed that a great many textiles and apparel exporting countries were losing 
their traditional export markets.  Therefore, his delegation's objective was to stimulate discussion on 
the issues related to trade in textile and clothi ng with a view to finding an urgent and collective 
solution to the problems of a good number of count ries, which were economically and socially 
heavily dependent on this sector. 
 
6.3 He cited some statistics concerning recent developments in major markets that confirmed the above-mentioned arguments.  Actually, only China' s textile and apparel export sales to the EU 
increased 73 per cent year-on-year and, more than 500 per cent in some categories such as sweaters 
and sweatshirts as well as linen fabric.  This in crease was more than ten times for women's panty 
hoses and tights since 1 January 2005.  In the US ma rket, China's export sales to the US surged 65 per 
cent year-on-year.  In some categories the increas e of Chinese products soared as high as 15 times in 
the first quarter of 2005 over 2004 levels.  Unfortunate ly, those increases were at the expense of other 
developing countries and not an outcome of market e xpansion.  In this respect, he stressed the fact 
that combined with sudden surge in imports, sharp declines in prices had been experienced in the first 
quarter of 2005 too.  For instance, the volume of T-shirt imports originating from China had risen by 
185 per cent and the prices had decreased by 36 pe r cent in the EU market.  According to UN 
statistics, prices for major Chinese clothing products  were 58 per cent below average world prices.  
As pointed out in papers from various Members, the impact of the dismantling of the textile and 
clothing quotas could be seen in the toughening competition among the developing and the least-
developed countries.  Most countries had engaged in an aggressive comp etition strategy to be able to 
maintain their market shares.  As a result of this , declines in prices of textile and clothing had been 
accelerated.  Should significant drops of averag e unit prices continue, it would cause a further 
deterioration in developing countries' terms of trade that posed great challenges for sustainable 
development and for fair competition.  6.4 His delegation believed that there were seri ous problems relating to trade in textiles and 
clothing which would not be resolved if Members avoided dealing with them.  He believed that 
Members would support his delegation's idea to work on the issue in this regard.  In fact, the measures 
that were already taken by some countries so far and initiatives of some others made his delegation's 
arguments valid and stronger.  In this respect, he underlined two points.  Firstly, the elimination of 
quantitative restrictions had already brought majo r adjustment challenges for many developing and 
the least-developed countries.  The implementati on period of the ATC, unfortunately, had not 
provided a preparatory trading environment for developing countries for the post-ATC era.  Secondly, the complexity of the challenges that many deve loping countries were facing today called for a wide 
range of policies and policy coherence at the globa l level.  Consequently, it would become more 
difficult to resolve these problems unless a co mprehensive work programme was developed 
collectively.  It was clear that the WTO was the main responsible body to solve the problems of the 
textile and clothing sector arising from the conduct of trade relations among its Members in matters 
related to the WTO Agreements and other associated  legal instruments.  Moreover, Part IV of GATT 
1994 brought precise and specific obligations to a ll WTO Members in order to achieve the objective 
of sustainable development.  As a complementary to this process, technical and financial assistance 
were vital for improving competitiveness and crea ting alternative employment opportunities in 
developing countries.  Hence, the responsibility of  other international institutions could not be 
neglected.  Turkey strongly believed that th e establishment of a WTO work programme was 
indispensable to handle the challenges and initiate an action to ensure undisr upted markets and create 
new market opportunities.   G/C/M/81 
 Page 9 
 
 
 6.5 In this respect, his delegation proposed that  the Council for Trade in Goods should establish a 
“work programme” for a full and periodic review of  global textile and appa rel production, export and 
market circumstances so as to develop appropriat e remedies within the multilateral trade system.  
With a view to avoiding any deterioration in the trading conditions of the world textile and clothing 
sector, it was also important to closely monitor developments.  Considering the various aspects of the 
sector, the CTG Chair should periodically consult with the Chairpersons of the Special Sessions 
Agriculture Committee and the Negotiating Groups on Market Access and Rules to address the issues 
relating to trade in textile and clothing products to  ensure comprehensive and exhaustive study of the 
sector.  Furthermore, taking into account the fact th at trade policy measures in textile and clothing 
sectors had a major impact on production and investment, as well as trade flows, the WTO Secretariat 
should examine the adjustment-related issues and make recommendations on measures in order to 
assist developing and least developed countries experi encing challenges in the short and medium term 
as a result of the expiration of the ATC.  In this c ontext, the identification of possible ways to stabilize 
prices merited special attention.  Moreover, th e Committee on Trade and Development should also 
work on the problems created by declines in the prices of these products in the short run in 
cooperation with other relevant inte rnational organizations and report on the results of its works to the 
CTG.  Finally, the WTO should examine ways to develop collaborative efforts with the relevant 
international organizations, including the World Ba nk and the IMF in order to effectively direct 
resources under existing programmes toward divers ification of economies relying heavily on the 
textile sector.  In conclusion, his delegation recalle d its commitments to the objective of sustainable 
development as stated in the Preamble to the Ma rrakesh Agreement.  In this respect, he looked 
forward to the constructive discussions among Members on subjects of common interest to 
developing and the least-developed countries.  6.6 The representative of China
 said that his delegation took the Turkish submission “Issues 
Related to Trade in Textiles and Clothing” very ser iously, because the paper had made quite a number 
of references to China. His delegation valued th is opportunity to make some comments and set the 
records straight.  It was taking the floor, not only for the sake of its national interest and dignity, but also for the sake of a strong and robust multilatera l trade system based on sound economic principles.  
He added that he, personally, was not entirely critical of the paper despite its fundamental flaws.  For 
instance, he subscribed to the point  that the textile and clothing sector played an essential role in the 
economic and social development of many count ries, provided that the “many countries” included 
China. He also liked the expression that today a lot of Members faced new challenges, though he 
disagreed with the author on the causes of such ch allenges.  The Turkish perspective as presented in 
the paper could be divided into two parts. Part one was its diagnosis of the problems, and part two was 
its prescription for solutions. With regard to part on e, the paper represented another attempt of the sort 
to turn China into the scapegoat fo r the so-called problems. It tried to do so by citing dubious figures, 
by exaggerating estimates, by selective use of information, and by hasty generalizations.  
 6.7 He added that economics textbooks told that ma ny factors worked together to determine the 
prices of textiles and clothing in the world market, such as supply, demand, consumer preference, elasticity, substitute products, quantitative rest rictions, rules of origin, natural endowment, 
technological innovation, features of workforce, ge ographic location, cultural elements, competition, 
technical barriers, marketing strategies, multilateral trade rules, bilateral arrangements, and so on and 
so forth. Together, these factors worked to produce competitive advantages or comparative 
advantages in some places, and together they de termined the trend of development as well as the 
pattern of sourcing for the sector. With the expiry of ATC, market forces had been given opportunities 
to play a bigger role to the benefit of consumers all over the world.  It w as a pity that the Turkish 
paper chose not to refer to these many factors, ex cept for highlighting competition from China. This 
was ridiculous and unfair. As a full Member of th e WTO, China was entitled to the benefits of trade 
liberalization. China should have a fair share in  the sector after the dismantling of the very 
discriminatory quota regime. China deserved credit for its unremitting efforts to uplift the competitiveness of its industry. Today, China was pr oud to say that it had not  squandered the precious G/C/M/81 
Page 10  
 
 transition period of the past 10 years and its painful e fforts of structural adjustments were paying off. 
Its open trade and investment policies had resulte d in a sector of dynamic growth, which was 
contributing increasingly more to both domestic and world economies. China was now the third largest textiles importer in the world. It had alr eady offered duty free market access for imports of 
most textile products from 25 least developed countries  in Africa. China was a responsible member of 
the international community. 
 6.8 On the other hand, China was pleased to see that exports of textiles and clothing by many 
Members also experienced positive growth since 1 Ja nuary 2005.  Here, he reminded colleagues that a 
striking feature of the Turkish paper was the absence of figures about Turkey. As a matter of fact, 
Turkey had been faring pretty well. For instance, its exports of textiles a nd clothing had expanded by 
12 per cent and 9.6 per cent respectively during the firs t four months of this year. Turkey was already 
the second largest supplier to the European Union, w ith a market share of 14 per cent. According to 
its own estimates, Turkish exports of textiles and cl othing to certain markets this year would expand 
by 30 per cent and for some categories and products , the growth rates could be even higher. So 
Turkey was already reaping the benefits of the new era.  The reason why Turkey was withholding 
these key data from the paper was a simple one: it wa nted to make the current campaign against China 
more effective. Once people knew that the party th at claimed facing the risk of “being swept away 
from their traditional markets” was experiencing double-digit export growth, and the party that claimed “vulnerability to the sharp consolidation of production into a few s uppliers” happened to be 
the second largest supplier to the EU and enjoye d the second biggest market share there, the 
credibility of this party dropped to zero. The fear monger would lose his audience right away. The 
reason was as simple as that. The intention was to  mislead people into believing that China was worth 
being singled out for criticism and China alone was r esponsible for every problem.  In his view, this 
act of deliberate withholding of crucial facts was intended to produce the strong effect of discrediting 
China to the advantage of its comp etitors like Turkey.  However, in the age of information society, 
tactics of this type can be counterproductive or backfire. 
 6.9 Regarding the prescription part of the paper hi s delegation considered the proposals listed in 
the paper by and large inappropriate, in the sense that most of them seemed to be products of 
ideological confusion. For instance, it called for th e CTG “to develop appropriate remedies within the 
multilateral trade system”. Did not the WTO already ha ve the rules and structur e for remedies?  Then, 
it called for the CTG Chair “to ensure comprehens ive and exhaustive study of the sector”. Until a 
clear definition was given of what was meant by “exhaustive study” and until this job was properly 
added to the Chair’s portfolio, this would be a miss ion impossible. Further, it suggested that the WTO 
Secretariat should identify “ways to stabilize prices ”. What a great idea, but where was the mandate? 
And finally, it required the Committee on Trade and Development to “report on the results of its 
works to the CTG”. Thus, the CTD was downgraded to  a subsidiary body of CTG.  He asked for 
consideration of the feelings of those working for the CTD.  To conclude, he thanked Turkey for its 
interesting submission. But to put it candidly, th e Turkish perspective was one-sided, narrow-minded, 
harmful and therefore unacceptable to his delegation.   Obviously, the paper was not free of political 
bias and economic misconceptions. A fundamentally flawed paper like G/C/W/522 shouldn’t and wouldn’t serve as a basis on which Members could build consensus. After all, the WTO was an 
important multilateral institution devoted primarily to  trade liberalization.  All should make efforts 
towards that direction.  He expressed his delegati on's thanks to all the orga nizations and individuals 
who had provided valuable support and help in his delegation's preparation for this important 
moment, and he was deeply grateful to colleagues and friends for their wisdom and sense of justice. 
 
6.10 The representative of Mongolia
 thanked the delegation of Turkey for bringing this issue, 
which was important not only for Turkey but also  for many other developing countries who had 
suffered from the post ATC situation, to the attenti on of this Council.  The situation was chaotic.  
Many developing countries had lost employment, reve nue and market share so it was natural for those 
countries, including his, to bring this issue to the a ttention of this Council.  They were in a situation  G/C/M/81 
 Page 11 
 
 
 that they could not manage.  He echoed the proposals made by Turkey, and that the WTO, in 
particular this Council, should keep this issu e on its agenda for the period necessary to allow 
Members to bring management to the situation.  Indu strialisation had been useful, but the side effect 
of climate change had become a problem.  Similarl y, the expiry of the ATC had been correct, but 
there was a side-effect and it was na tural that Members should deal with it.  This was why his country 
supported that this Council develop a work progr am to help those developing countries who had 
suffered, unintentionally, from the expansion of othe r large textile exporting counties.  In order to 
survive this trade situation, Members should c onsider this issue continuously until some common 
ground would be found on how to solve it.  His co untry was not against market forces, but one was 
now talking about how to survive in the situation.   Large developed and developing countries should 
think about how to help small exporters to su rvive.  Advice from developed countries and large 
developing countries like China and India was need ed as to how to deal with people who were 
employed in the textile industry.  Mongolia had lo st a lot of in terms of the size of its economy and 
employment.  It had had to close a number of factories and the Government had to develop 
emergency measures in order to keep some factories in operation. It had issued a decree to give these 
factories holidays from personal income tax or cor porate income tax.  This constituted a loss in 
government revenue.  At the same time Mongolia was facing further factory closures.  Many women 
who were employed and who were the only income ea rners for their families were having difficulties.  
They could not be left at the mercy of market for ces.  Trade should have a hu mane face, not just be 
mechanical, as if there was no human being involv ed.  He expressed his full support to the proposals 
made by Turkey in document C/G/W/522. 
6.11 The representative of El Salvador  thanked Turkey for submitting the proposal contained in 
document G/C/W/522 on issues related to trade in te xtiles and clothing.  Her comments were of a 
preliminary nature given that this proposal was curr ently being analysed in detail by her authorities.  
She welcomed the Turkey's initiative and considered  it an excellent contribution to the discussions 
which were taking place.  This issue was of great  importance for her delegation just as for other 
developing Members, given the fundamental role played by the textile and clothing sector in the 
economic and social development of many countr ies such as El Salvador. Therefore she hoped to 
continue to be able  to work with the delegation of Turkey and other Members on this issue within the 
framework of the present Council. 
6.12 The representative of Jordan  reiterated the importance that his delegation attached to the issue 
of textile and clothing for the economy of his country  that it had submitted to CTG in October 2004.   
Textiles and clothing formed more than one third of  exports of his country and this explained the 
concern.  His delegation was thankful to the Turk ish delegation for developi ng such an interesting 
proposal with practical mechanisms.  His country sh ared some of the views expressed in the proposal, 
including some of those in the descriptive part.  Jordan supported the establishment of a work 
program as it appeared under paragraph 15 of the submission, as well as the proposal for a 
comprehensive study.  Jordan looked forward to th e role of the WTO, in addition to the efforts of 
many other relevant internati onal organizations including the Wo rld Bank and the International 
Monetary Fund, in order to address this issue and to  ensure that there would be fair and appropriate 
market mechanisms taking into consideration the in terests of all Members, including their technical 
and financial assistance needs.  Such a work program did not put any burden on any of the Members or the Secretariat and was within the rules governing this organization. 
6.13 The representative of Tunisia
 thanked Turkey for its submission which continued the review 
of the effects of the dismantling of textiles and clothing quotas on certain developing countries and 
LDCs.  This was of particular interest to his co untry, as in Tunisia the textiles and clothing sector 
represented 46% of employment and 46.7% of exports  in the manufacturing industry.  He recalled his 
delegation's submission at the last CTG meeting.  His country would spare no efforts to ensure 
satisfactory results for the countries concerned, on th e basis of consensus and in a spirit of dialogue 
and co-operation between all concerned parties.  It  was essential that the CTG deal with this matter G/C/M/81 
Page 12  
 
 and examine in-depth all issues pertaining to it so as to ensure results which should confirm the 
humanitarian and fair nature of the WTO.  The pr oposals for action followed an approach similar to 
the one in his delegation's submission, picking up on the different points contained therein, such as the 
reference to Part IV of GATT to define actions, ex amining the question of price stabilisation, as well 
as joint action by international organisations to help countries affected by the dismantling of ATC 
quotas.  His  delegation also stressed its interest a nd support for the CTG to set up an exhaustive work 
program so as to be able to look into the different  aspects relating to development in trade in textile 
and clothing.  Tunisia also expressed support for the intervention of different bodies such as the 
Special Session of the Committee on Agriculture, th e Negotiating Group on Market Access and the 
Negotiating Group on WTO Rules.  This would reinfor ce the global and comprehensive review of this 
question within the CTG.   To conclude, his delegation supported all proposals, whether from 
developed or developing countries, wh ich would enable Members to have  an in-depth review of this 
issue to satisfy all Members concerned, which w ould confirm the global dimension of the WTO, and 
which would highlight the fact that the WTO took on board the interests of all of its Members so as to achieve the multilateral trading system spelled out in  the Preamble of the Marrakesh Agreement.   
6.14 The representative of Morocco
 thanked Turkey for its contribution to finding a solution to this 
crisis, and to other delegations fo r keeping the debate within the C ouncil.  Morocco was one of those 
countries severely suffering from this crisis and which,  therefore, considered th at it was essential that 
this issue be kept on the agenda of the CTG.  It was also important to bring in other WTO bodies so as 
to find a solution to this problem.  She recalled th at the issues mentioned by Turkey in Paragraph 15 
of its document should be looked into in detail,  notably the suggestion for establishing a full and 
collective work programme and the promotion of a system of technical and financial assistance which 
her delegation felt was also essential.  Her dele gation also wished that other international 
organizations be involved more concretely so as to  seek a solution to the problem.  Therefore, it was 
imperative that this issue be kept on the agenda of  the Council and that, with the contribution of all, 
Members come up with effective and tangible solutions. 
6.15 The representative of Kenya  thanked the Chairman for bringing this important issue to the 
attention of the Council.  Having listened to the in troductory remarks made by Turkey, his delegation 
agreed that the textiles and clothing sector played an essential role for both developing and developed countries and, therefore, that this issue should no t be seen as an issue for Turkey but for many 
Members.  The history of industrialisation showed  that this sector had been a stepping stone to 
industrialisation in many countries.  This was why Kenya attached importance to this sector.  He also 
agreed with Turkey that many Members had looked forward with a lot of hopes and expectations to 
the phase out of the quotas on textiles and clothing.  But the reality was that many Members had lost out while a few had disproportionately gained.  Turk ey had eloquently pointed this out with statistics 
and, therefore, his delegation agreed that the WTO had an important role to ensure that the gains 
arising from liberalization would be equitably dist ributed among the Members.  The Council should, 
therefore, take this issue with seriousness.  As  had been expressed by Mongolia, his delegation was 
not opposed to market forces but the Council also ha d to ensure that the smaller economies would be 
integrated in the multilateral trading system and that they would also receive benefits from liberalization.  His delegation had looked carefu lly at the proposals made in paragraph 15 of the 
Turkish submission and was of the view that ther e was merit in examining them. Therefore, his 
delegation believed that this issu e should be kept on the agenda of the Council in the future. 
6.16 The representative of Israel
 also thanked Turkey for its subm ission.  It was evident at this 
stage that this was a sensitive i ssue of great importance for sever al Members. This was why her 
delegation considered that it shoul d be debated and analysed.  In that sense she supported others in 
requesting that this issue be kept on the agenda of this Council. 
6.17 The representative of Japan  wished to state its views on the proposals made in the Paragraph 
15 of the Turkish submission.  As for the first pa rt of the proposal, her delegation could not associate  G/C/M/81 
 Page 13 
 
 
 itself with the idea of establishing a work progr amme if appropriate remedies implied the 
establishment of new trade restrictive measures, wh ich her delegation believed to be inappropriate.  
As for the third proposal, she pointed out that a detailed and comprehensive paper concerning the 
options for LDCs to improve their competitiveness in the textiles and clothing business in light of the 
termination of the ATC had been prepared by the Secretariat within the context of the Sub-Committee 
for LDCs, and that it might be possible to conduct a similar exercise concerning developing countries, 
excluding LDCs.  Having said that, she wanted to ma ke it clear that Japan could accept the idea of 
price regulation as mentioned in the last sentence of this proposal only when it did not include any new trade restrictive measures.  As for the last pr oposal, her delegation shared the idea that ensuring 
policy coherence with other releva nt international organizations w as important.  It should be noted 
that the work conducted by the IMF and the Wo rld Bank had been introduced to WTO Members 
through reports by the Secretariat such as documen t WT/TF/COH/F/9.  Also, at the General Council 
meeting of May 2004 the Trade Integration Mechan ism had been introduced by the IMF.  This 
mechanism aimed at supporting the necessary adjustme nts faced by developing countries in dealing 
which the negative influences caused  by trade liberalization of other countries such as the expiration 
of the ATC and the decrease of preferential marg ins.  According to information from the IMF 
website, only two countries had applied for this me chanism.  In light of these circumstances, her 
delegation believed that it was necessary to clarif y what was being asked of other international 
organizations to do when seeking cooperation with them. 
6.18 The representative of Sri Lanka
 thanked the Turkish delegati on for its paper as well as its 
statement.  As the paper had been received recently , his comment at this stage were of a preliminary 
nature.  He had also listened very carefully to th e statements made by China, Mongolia, El Salvador, 
Jordan and others on the subject.  Sri Lanka attached  a very high importance to export of textiles and 
clothing, which amounted to almost 50% of Sri Lank a’s total exports.  As a country highly dependant 
on exports of textiles and clothing, Sri Lanka shared mo st of the views expressed in the Turkish paper.  
It contained some constructive proposals and he believ ed that some of these needed to be addressed 
expeditiously as they covered the concerns of a large number of developing countries, not only Sri 
Lanka and Turkey.  His delegation had been a dvocating a work programme within the CTG for 
sometime.  It believed that such a work progra mme and subsequent deliber ations would help to 
develop appropriate measures within  the multilateral trading system to address the concerns of the 
developing countries who had been finding it is difficult to compete in the market due to various reasons.   With regard to the second proposal for a study, like the Japanese delegation he believed that 
the Secretariat could undertake such a study, some what similar to but more comprehensive than the 
study the Secretariat had already undertaken fo r the least-developed countries.  Having listened 
carefully to the Chinese delegation, particularly its  comments on the Turkish paper, he was more than 
ever convinced of the need for a study by the Secretariat.  Otherwise the Council would be deliberating on this issue based on studies and subm issions made by various delegations, which did 
not provide a comprehensive picture of the cha llenges faced by countries in this sector.  He 
recognised that there was a need to strengthen the collaborative efforts with other organisations as 
suggested in the last proposal of the Turkish submission.  With regard to the second and fourth proposals, his delegation believed that they should be  carried out within the appropriate procedures of 
the WTO.  Finally, as said by Tunisia, the WTO should take care of all its Members and ensure that    
the concerns of small and more vulnerable countries not be brushed under the carpet. 
6.19 The representative of Mauritius
 informed the Council that he had learned that this morning, 
like everyday in his country, a factory had closed with 150 jobs lost.  150 me n would not be important 
for many countries, but for Mauritius it was a very  large lay off.  The issue was not about bashing 
those who were more successful, as those who had the competitive and comparative edge were bound 
to be successful, but it was about taking a different slant to the discussions.  There was a problem and 
the WTO had accepted that there was a problem by in stituting the work programme or the study on 
the LDCs.  The Council could probably, with some extra efforts and probabl y no additional financial 
or human resources, extend the scope of the work  already done for the study and see how countries G/C/M/81 
Page 14  
 
 were faring.  He believed it was important to do some thing to gage exactly the extent of the problem.  
China and a number of other countries were successf ul which was consistent with the objectives of 
the WTO.  But it was also fair to try to understa nd the problems of other countries who were not able 
to cope with the evolving adjustment of this phasing out period. He hoped that the Council could 
bring this matter to a fruitful conclusion b ecause it had been dragging on for some time. 
6.20 The representative of the European Communities
 thanked Turkey for its paper and its 
presentation, and China for its forceful interventio n.  He understood the concerns that had been 
expressed by Turkey and echoed by other vulnerable developing countries, on the particular matter of 
textiles and clothing, some of them fearing that th ey were losing out in this liberalization process.  
The Communities’ starting point, notwithstanding that some transitional measures were needed in this 
process and that the European Communities had rece ntly concluded an MOU with China, was that 
there was no way of turning the clock back on liberalization.  The fundamental question was how could Members be sympathetic in Geneva to the concerns that had been expressed, without finger 
pointing and going in the directions of restrictions.  He stated that he was ready to continue to 
examine the Turkish proposals in the Council for Trad e in Goods and had four basic points to make in 
this regard.  One was to focus on trade devel opments.  A second was the question of what trade 
measures could be used to improve the relative po sition of the most vulnerable countries in their 
exports to the markets of industrialized countries, i. e. a “pro-trade” approach.  A third point was how 
could the most competitive countries in textiles and clothing themselves facilitate access to their 
markets, thus encouraging and fostering liberalization in South-South trade.  That could be one of the 
ways of perhaps developing market opportunities for developing countries.  A fourth point was that 
his delegation would also be ready to look at how to facilitate adjust ment to the new environment and 
strengthen co-operation, for example with the I BRD and IMF, which had been doing good work, to 
see how they could assist in the inevitable transformation process that was taking place. 
6.21 The representative of Korea
 thanked Turkey for its proposal.  Korea also wanted this issue to 
be discussed in this CTG.  His delegation had not examined the Turkish proposals in paragraph 15 but 
as Japan, Sri Lanka and Mauritius ha d mentioned, the recent WTO Secretariat study mandated by the 
Sub-Committee on LDCs was useful and already contai ned practical suggestions.  It might be a basis 
for discussion in the CTG.  His delegation remained  open and would keep the Tunisian and Turkish 
proposals in parallel but could also discuss the rece nt study prepared by the WTO Secretariat.  His 
delegation did not intend to revert to the trade r estrictive regime, but preferred to maintain a “pro-
trade” direction.  Nevertheless, he believed that the WTO had to accommodate and be sympathetic to 
the concerns raised by many developing countries.  
6.22 The representative of India  thanked Turkey for its subm ission which his delegation had 
perused carefully.  The issues and concerns expressed therein had been debated in the CTG for almost 
a year, and her delegation had made its positi on in this regard known on earlier occasions.  
Liberalization entailed adjustments which were not  always painless and India itself had undergone 
such adjustments and was still doing so.  Therefore,  she could empathise with the concerns which had 
been raised, but nonetheless reiterated her delegation’ s position regarding the systemic implications of 
embarking on sector specific work programmes or studies particularly at a time when Members were engaged in a new round of trade liberalization.  Sh e recalled that the Ministers in Doha had envisaged, 
while launching this round of negotiations, that gr eater market access opportunities would accrue to 
all Members, particularly developing country Member s, and Members had been directed to carry out 
work in accordance with the mandates which had been set forth.  All were engaged in this process and 
had an opportunity of factoring in experiences and concerns into the ongoing negotiations.  Further, 
there were already a set of well defined rules in th e WTO, as mentioned in the Turkish paper itself, 
and all Members of the WTO had equal recourse to them.  Finally it would be remiss if she did not respond to the intervention by the Mongolian delega te who had asked if India could advise on the 
process that it had undertaken.  His delegation woul d definitely look forward to an opportunity to 
exchange its experience in this regard on a bilateral basis.  G/C/M/81 
 Page 15 
 
 
 6.23 The representative of Brazil  supported the statement by the I ndian delegate and restated the 
position that his delegation had been taking in this  discussion from the beginning.  His delegation had 
a systemic concern with a particular sector bei ng the object of any work programme within this 
organization.  All liberalization processes, and Brazil had undertaken autonomous liberalization, 
entailed adjustment in different sectors.  The Tu rkish submission, as noted by India and China, 
mentioned some tools that were already available.   The first bullet in paragraph 15 of the Turkish 
submission mentioned remedies, but remedies were already available in the WTO.  As to the last bullet on diversification and coherence programmes, these programmes were already available.  The data which had been mentioned by the delegation of Japan which was also the object of an assessment 
in the LDC study showed that those programmes ha d been under-utilised.  In fact many developing 
countries could have used those programmes of the IMF and the World Bank or other organizations 
more to promote diversification.  Any Member  which was undergoing adjustment and needed to 
diversify should use these programmes as they were not necessarily linked to the textiles sector.  His 
delegation was of the opinion that it was not c onstructive to link this discussion and the ongoing 
negotiations as proposed in the Turkish paper.  Th at only reinforced his delegation’s reluctance to 
have this debate in the CTG.  It showed clearly that it was not a constructive stance and indeed might 
have a negative impact on the Doha Round discussions .  Textiles had already benefited from a 10 year 
period of adjustment and implementation.  Now WT O rules and mechanisms were available to deal 
with any specific problem arising in a specific country in this sector.  The textiles sector should not be treated differently. 
6.24 The representative of Hong Kong, China
 also stressed that his delegation continued to have 
systemic concerns on singling out the textile and cl othing sector, after the phasing out of the ATC.  
The suggestion for any new and separate institutional arrangement to oversee trade in this sector 
would be inconsistent with the sp irit of integration.  This would have implications not only on the 
textiles and clothing sector but potentially on  any other sector under in WTO.  The Japanese 
delegation had made an important point, and Ho ng Kong, China shared the concern about the 
establishment of a separate work programme to come up with appropriate remedies, if such 
appropriate remedies implied the establishment of new trade restrictive measures.  There were existing WTO-consistent tools for exporters to purs ue their concerns which were not sector-specific 
and used to regulate trade in any sector.  Th ere were also programs by other international 
organisations to help developing countries with th eir adjustment programs, including in the textiles 
and clothing sector.  In any future discussion a ttention should focus on those programs which were 
consistent with basic WTO principles and with WTO and GATT rules. 
6.25 The representative of Colombia
 said that Colombia had traditionally been an exporter of 
textiles and apparel, not in the same magnitude as  other trading partners possibly, but it was an 
important sector of the economy.  Colombia was al so facing adjustment difficulties once this sector 
had been liberalized on 1 January 2005.  Her dele gation did have some difficulties in supporting the 
proposal introduced by Turkey.  Her country was trying to overcome its own domestic difficulties and 
was vigilant in monitoring the situation which certain sectors of production were facing.  But 
Colombia was also concerned at the systemic con sequences which might stem from some of the ideas 
suggested by Turkey and complemented by Tunisia at earlier meetings.  Her delegation also welcomed the proposals by Tunisia in past meetings but believed that they we re too general in scope; 
the exact scope or thrust of some of these proposal s and how they would be applied in practice was 
not quite clear.  Likewise it seemed that the proposal from Turkey suffered from the same weak 
points.  She was concerned with dealing separately with one sector when all Members were, in fact, 
working hard to open-up markets and achieve ne w market access opportunities, particularly for 
developing countries.  Like Brazil, India, H ong Kong, China and China had pointed out, her 
delegation was also concerned by the fact that now  the Negotiating Groups would have to deal with 
this sector in particular.  There were specific ma ndates with difficult work and throwing in additional 
ingredients would overburden the work of th ese Negotiating Groups.  Her delegation was also 
concerned with the idea of recommendations, particular ly on the part of the WTO Secretariat, on how G/C/M/81 
Page 16  
 
 to stabilize prices.  This would go beyond Members' mandate and would be risk y.  Colombia, though, 
would look at these proposals in greater detail, particularly given the difficulties encountered in 
certain sectors of production.  But her delegation wanted to proceed very cautiously before any 
decisions would be taken.  She was inclined to suggest that some of Tunisia's proposals could be 
looked at in the CTD, complemented by considering some of the Turkish proposals, but without 
implying that this would lead to a link with the CTG.  Her delegation had always said that efforts 
towards coherence which could involve other rele vant international bodies were always welcomed, 
and she believed that in this area there was good ground to build upon. 
6.26 The representative of Chile
 said that his delegation also shared the systemic concerns which 
had been noted by India, Brazil, Hong Kong, China,  and Colombia.  It was also concerned with the 
suggestion of starting work programme s or consultations specific to some sectors in this organization.  
He understood that the direction to go in the WTO was precisely the opposite, that was to close the exceptions that had existed for decades so as to br ing sectors which historically had been anomalies 
such as textiles and agriculture into standards of gene ral application.  He was also concerned with the 
suggestion by Turkey to link a possible work prog ramme in this Council with the work of other 
Negotiating Groups.  And thirdly, he was worried by th e suggestion to ask or to give the responsibility 
to the Secretariat of suggesting certain courses of ac tion or possible solutions to  this problem.  Indeed, 
his delegation did not necessarily share the belief that there was a problem.  In a nutshell his delegation had serious systemic reservations on Turkey's proposal. 
6.27 The representative of Turkey
 thanked all the delegations and appreciated the high level of the 
discussion.  He reminded the membership that te xtiles and clothing as a sector had been treated 
separately for the last 40 years.  All Members were glad, and he wished to underline this, that it was 
now in the WTO system.  But since October 2004  when Mauritius had submitted a paper regarding 
the coming problems, his delegation had been trying to draw everyone's attention to the restructuring 
difficulties to be faced, and that some were now faci ng, and to the distorting effects of the 10 years of 
the Agreement on Textiles and Clothing.  Since Ja nuary, Members were in this new era and in the 
recent paper his delegation had tried to draw the attention of Members to the fact that in global trade 
there were some problematic issues in terms of ma rket conditions, in particular for the developing 
countries whose revenues were highly dependent on the export revenues of this sector.  Developing 
countries had economic problems and the investments wh ich had been mad in this sector were crucial 
to all of them. 
6.28 His delegation’s paper did not seek to downgr ade any country in any way.  The example of 
China was very properly taken in his view b ecause China was an economic power which his 
delegation was very glad to have in this organiza tion since 2001.  The price levels and the competition 
from China were a good example to show what th e conditions of the market were.  Regarding 
statistics, his country also benefited from Internet  and the information technology.  Statistics for 
example indicated that Turkey’s ex ports to its Customs Union partner, the European Union, showed a 
10 per cent increase.  This should not be that  surprising because Turkey was exporting under 
preferential treatment.  One could see the same resu lts for the other countries when they exported to 
their preferential partners.  Turkey had been the second supplier of the European Union for years,  
since the Customs Union had started, and had achie ved that level under fair market conditions.  Of 
course Turkey wanted this to continue, but under fa ir market conditions.  This was the basic reason 
why his delegation was asking for a study or work pr ogramme so as to be able to discuss problems.  
One could then see whether these problems were only orig inating in Turkey’s structural adjustment or 
if there were some other issues that might be brought  out by the Secretariat in the same manner it had 
done for the LDC study.  The latter had done a goo d job in summarizing and identifying the issues 
and making important recommendations.  As regards st atistics, he was ready to share Turkey’s other 
data with China and other Members.  He was pleased  that Turkish exporters had survived despite all 
the challenges of unfair conditions which had been noted in his delegation’s submission and previous 
interventions.  This did not change the reality.  Mo re importantly, this was not an issue between two  G/C/M/81 
 Page 17 
 
 
 Members.  Whatever his delegation and others ha d been saying was for all the developing countries, 
with a view to develop their trade.  The problem w as not only Turkey but what all exporters had been 
doing since January and how they saw their future.   
6.29 As to the systemic implications perceived by  some, the representative of Turkey stated that 
the systemic implications were valid and he unde rstood what was being said.  He did not want to 
repeat that this was a 40 year problem, but there w as a problem and the systemic issue had not arisen 
when the LDC study had been agreed.  Now the LD C study was there and would be tackled in the 
Committee on Trade and Development, and there was nothing wrong with that.  He did not think that 
Members would introduce or generate restrictions or other measures in this sector through a study.  
He did not see any problem to carry out a study fo r developing countries under a work programme.  
The interventions made by other developing and developed Members confirmed that the 
establishment of a work programme was needed.  Th is programme would be an excellent instrument 
to clarify what had been discussed at the present mee ting, including all the hesitations that were heard 
from some Members, while at the same time fulfilli ng his delegation’s expectations.  He had no doubt 
that the Secretariat would do this well, on the basis of which one could possibly arrive at some 
recommendations for all countries.  This was in ma ny ways going to be a challenge, including for 
Turkey.  He had no doubt that the study would be objective and, like in the LDC study, probably suggest more South-South trade.  One would also see how the Secretariat would compile the necessary data, from which conclusions could be drawn by the Members, not by the Secretariat.   
6.30 Going back to his delegation’s proposals, if there would be implications to the Doha Round, 
then so be it.  The point was not just to exchange  views but to see if something could be done.  The 
matter was already in the NAMA negotiations.  There were discussions even in the Sub-Committee of 
Cotton where there had been some interventions to th e effect that cotton issues were general issues.  
So the exchange of views between Committees shoul d not be surprising to anybody.  The WTO could 
tackle this issue after the compilation of data and th e study by the Secretariat would have been made.  
Japan and some other countries had dwelled on the pr ice stabilization issue.  Price  stabilization did 
not mean in any way new restrictions on exports.  Price stabilization meant, if it would come out of 
the study, how less variations in prices could benefi t developing countries.  The very high variations 
were to the disadvantage of the other countries but th is was something that this study could identify in 
this context.  But he agreed with Japan and others  that this was totally dependent on market forces.  
The idea was to point out what had been happening  since January in order to show direction to 
Members.  He did not believe that price stabili zation should be a problem for Members because all 
knew, for example, that there were export taxes by China and that the European Union agreement 
with China also included price stabilisation efforts.  So there was no other reason to look for why his 
delegation was talking about price stabilisation issues.  But he again wanted be very clear that the idea 
was only to look at the reality in the market now.  He suggested that all that he had said could very well be analyzed in a work programme, in a study pr epared by the Secretariat.  His country was ready 
to take this challenge, to have a picture of the market in this sector, to see how the transitional 
measures by all countries were effective, and to see  the compilation of the data in terms of production 
and exports.  He was of the view that this could be used in Members’ economic domestic 
programmes, for future reference, and in terms of Members’ economic needs. 
6.31 The Chairman
 said that it seemed clear from the numerous  interventions that there was, at this 
point, no common understanding among the Members, par ticularly on the proposals contained in the 
Turkish communication.  He also noted that a num ber of delegations had expressed the strong wish 
that this issue be kept on the agenda of this Counc il.  He believed, however, that there was a need for 
consultations, individually, bilatera lly and multilaterally, in advance of that meeting.  He was in the 
hands of Members if they wished to hold consultatio ns on this issue, and belie ved it would not be very 
productive if the Council were to revert to this issu e before doing so.  He, therefore, proposed that the 
Council take note of the statements made and agreed to revert to this issue at its next meeting. G/C/M/81 
Page 18  
 
 6.32 It was so agreed
. 
VII. NIGERIA TRADE RESTRICTIVE MEASURES  
7.1 The Chairman  informed Members that this item had been placed on the agenda following a 
request from the European Communities, dated 26 June 2005.   
 
7.2 The representative of the European Communities  noted that this item had been on the agenda of 
the 30 March 2005 meeting of the Market Access Committee.  The minutes of that meeting, in 
document G/MA/M/39, under "other business" cont ained a good summary of the matter as well as of 
what motivated the EC to request this item on th e agenda.  At the EC's request, the summary is 
reproduced in the following paragraph.   
 
7.3 The Communities wanted to raise the point on the new tariff regime and trade restrictive measures in Nigeria.  The Communities had noticed that various restrictive measures were introduced 
between 2002 and 2004 and that th ese had had a negative impact on the normal trade flows between 
the Communities and Nigeria.  Her delegation had ta ken up these issues on a bilateral basis including 
at Ministerial level and while there had been some indication that there would be a new tariff regime 
introduced and also some indications concerning both import and export bans, her delegation had 
thought that it could be helpful to raise the issue here in order to encourage Nigeria to commit to an 
early removal of these non-compatible import and e xport bans and also to encourage reduction of 
other trade restrictive measures.  This could help to avoid the escalation of any dispute and could also 
help in the regional harmonization that was ongoing.  So as she had mentioned there had been some 
indications that there would be reform and so she welcomed that commitment to reform the tariffs and 
to bring them into line with other ECOWAS memb er states.  Her delegation also welcomed the 
statements concerning removal of import and expo rt bans including bringing the tariffs for these 
banned products in line with the new tariff struct ures.  The Communities strongly encouraged the 
early removal of the import and export bans this ye ar if possible.  This would send a very positive 
signal about Nigeria's commitment to meeting its responsibilities under WTO Agreements.  The 
Communities also encouraged Nigeria to review ot her trade restrictive measures which would include 
the high registration fees applied to imports by th e national agency for food and drugs administration 
and control and in connection with some planne d visits for the purpose of certification of good 
manufacturing practice.  At the same time, the Communities recognized the concerns of Nigerian 
industry and the need to phase in reform but the n eed for early action had to be stressed due to 
complaints from the Communities' own exporters and the possibility of therefore having to raise this 
at dispute settlement.  Depending on how her delega tion progressed in its discussions with Nigeria, 
there might be need to revert to this subject at a later stage.    7.4 His delegation considered that they were now at the later stage referred to at the end of the 
statement above.  His delegation had, as Nigeria re quested, provided a written version of its concerns 
about the import and export bans and their timetable  for removal and the high levels of registration 
fees for regulated imported products by the national agency for food and drugs administration control, NAFDAC, to Nigeria on 30 May.  His delegation ra ised the matter at this meeting because it was 
frustrated with a situation that it ha d facing since 2002.  The matter ha d been raised at the Ministerial 
level and in respective capitals but no progress had been made.   
 7.5 The representative of Nigeria
 stated that his Government was equally frustrated.  He recalled  
that Nigeria was confronted with the same issue during the recent review of its trade policy in May 
2005.  He was under the impression that there was sa tisfaction with his delegation's explanation at 
that time.  He also understood that Members would allow the matter to rest.  However, in light of the 
EC statement, he explained that the import prohib ition measures were essentially transitory and were 
not intended for indefinite application.  Nigeria was presently assessing the impact of the import bans on its economy and the trade of other countries, although it was already engaging bilaterally with  G/C/M/81 
 Page 19 
 
 
 some of its partners to fully and amicably resolv e all issues.  Nigeria wished to assure all those 
affected by the measures that they were being review ed with a view to phasing them out no later than 
2007 and a process for their eventual elimination ha d already commenced.  Ho wever, these concerns 
would be conveyed to the capital.  Finally, he reite rated Nigeria's deep commitment to the multilateral 
system and reassured Members that his Government  would not deliberately seek to undermine it. 
 
7.6 The representative of Canada  shared the concerns expressed by the delegation of the 
European Communities and was grateful to the de legation of Nigeria for the information just 
provided.  His delegation hoped that in the futu re, Nigeria could provide Members with more 
information concerning the quantitative restrictions th at had been imposed for the past three years or 
so, especially in terms of the tariff lines that we re covered by these measures.  He asked what the 
justification was for applying these measures when Members were previously told that they were 
temporary.  At this meeting Members were told that  they may be lifted by 2007.  In the meantime, his 
delegation would appreciate that they be duly notified to the WTO according to the rules. 
 
7.7 The representative of the United States  also supported the EU on this issue.  His delegation 
faced the same problems in doing business in Nigeria.   It had raised these issues with the Nigerian 
authorities bilaterally.  There seemed to be a process going on designed to address these issues.  To the extent that there were consultations or in formation exchanged on these issues, his delegation 
wished to be part of that process.  
7.8 The Chairman
 proposed that the Council take note of the statements made. 
 7.9 It was so agreed
. 
 
VII. ELECTION OF CHAIRPERSON FOR THE COMMITTEE ON TRADE-RELATED 
INVESTMENT MEASURES 
8.1 The Chairman  recalled that at the previous meeting of the Council, it had been agreed that, in 
accordance with the The Guidelines for the Appointment of Officers to WTO bodies contained in document WT/L/510, adopted by the General C ouncil on 10 December 2002, he would carry out 
consultations on a new candidate for Chairmanship of the TRIMS Committee.  He had carried out 
consultations and was pleased to be in a position to nominate Mr. Suren Ba dral of Mongolia for the 
Chairmanship of the TRIMS Committee.  He proposed  that the Council agree to elect Mr. Badral as 
Chairman of the TRIMS Committee by acclamation.  8.2 The Council so agreed
. 
  IX. OTHER BUSINESS 
A. R EQUEST BY PAKISTAN FOR EXTENSION OF THE TRANSITION PERIOD UNDER THE TRIM S 
AGREEMENT  
9.1 The Chairman  informed Members on the status of the request for the extension of the 
transition period submitted by Pakistan at the end of 2003 and circulated in document G/C/W/478.   
Questions by the United States concerning this requ est and the replies provided by Pakistan were 
contained in documents G/C/W/480 and G/C/W/487, resp ectively.  Informal consultations were held 
by his predecessor Ambassador Choi from which he re ported that further time was needed to find an 
appropriate solution.  He reported that this issu e was on-going and opened the floor to any Member to 
update the Council on any developments.    
9.2 The representative of Pakistan
 informed the Council that he had not received any new 
information from his capital on the matter.   G/C/M/81 
Page 20  
 
  
9.3 The Chairman
 proposed that the Council take note of the information and the statement. 
 9.4 It was so agreed
. 
  
B. D ATE OF THE NEXT MEETING  
9.5 The Chairman  informed the Council that the next form al meeting was scheduled to take place 
on Thursday, 10 November 2005.  The agenda for this meeting would close on Monday, 
31 October 2005.  
 
__________