WORLD TRADE  
ORGANIZATION  TN/MA/W/109/Rev.1 
6 May 2011 
 (11-2364) 
Negotiating Group on Market Access Original:   Spanish 
 
 
 
MARKET ACCESS FOR NON-AGRICULTURAL PRODUCTS 
 
Communication from Argentina  
 
Revision  
 
  The following communication, dated 5 May 2011, is being circulated at the request of the 
delegation of Argentina. 
 
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 1. Argentina is fully committed to the Doha R ound negotiations.  It endorses the objective that 
the final agreement should be c onsistent with the development mandate and should remedy the 
imbalances in the multilateral trading system  resulting from asymmetry in the treatment of 
agricultural products vis-à-vis  non-agricultural products. 
2. Specifically, and in order to prevent a further d eepening of the disparity of treatment between 
Agriculture and NAMA, Argentina considers it essen tial that the outcome of the Round, whatever it 
may be, should be in keeping with the provisions  of paragraph 24 of the Hong Kong Ministerial 
Declaration in ensuring a comparably high level of ambition in market access for Agriculture and 
NAMA. 
3. In this respect, the NAMA modalities text of D ecember 2008 is inconsistent with the principle 
of less-than-full reciprocity in reduction commitme nts, as are the undue demands to limit flexibilities, 
impose "anti-concentration" rules, and/or require  mandatory participation by certain developing 
countries in sectoral agreements.  All of this runs counter to the principle of special and differential 
treatment in favour of the developing countries and considerably alters the balance provided for in 
paragraph 24 of the Hong Kong Ministerial Declaration. 
THE CURRENT STATE OF ARGENTINE INDUSTRY 
 
4. The production of non-agricultural goods accounted, on average, (in the period 2002-2010) 
for 19 per cent of GDP and was one of the main engines of Argentina's economic recovery following 
the crisis suffered by the country in 2001 and 2002.   However, job creation in these sectors was not as 
dynamic.  As a result of this economic recove ry, the value of non-agricultural goods imports 
underwent a continuous increase from 8,192 milli on dollars in 2002 to 53,806 million in 2010.
1  The 
international crisis that began in the third quarter of 2008 led to a 32.3 per cent reduction in imports of 
non-agricultural goods in 2009, bringing their total value to 36,431 million dollars. 
                                                      
1 Data based on the International Standard Industrial Classification of All Economic Activities (ISIC). TN/MA/W/109/Rev.1 
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  5. The non-agricultural goods trade balance went fro m a surplus of 5,304 million dollars in 2002 
to a deficit of 21,603 million dollars in 2010, a figur e that cannot continue to rise at the same pace 
without jeopardizing the country's further growth and social stability. 
6. As stated earlier, the key element which explai ns Argentina's positive contribution to global 
demand is economic growth.  The excessive reduction of Argentina's tariffs would not contribute to 
sustaining this global demand.  Argentina currently has moderate industrial tariffs, which fosters the 
major increase in trade flows mentioned above. 
7. Reducing tariffs would intensify the negative im pact that increased imports have on industrial 
activity and employment, as was seen between 2002 and 2010.  During that period, imports of 
non-agricultural goods increased more than sixfold, ri sing steadily by an annual average of 56.1 per 
cent in 2003 and 69.6 per cent in 2010 in relation to 2002.  The growth rate of industrial activity, 
however, slowed down, and was considerably lower than that of imports, falling from 26.6 per cent in 
2003 to 10.8 per cent in 2009.  This slowdown had a negative impact on the level of employment, 
which, after rising by 8 per cent in 2003, fell by 4 per cent in 2009. 
8. If the tariff reductions proposed in the Chairman 's text are implemented, this slowdown in 
growth will intensify, causing a downturn in industrial activity and employment and 
generating thousands of job losses, thereby unde rmining the economic achievements made since 
2002.  In the 2002-2009 period alone, the reduction in the employment growth rate meant that 
589,000 less jobs were created in the industrial sector. 
9. The reductions proposed in the Chairman's text  would destroy more jobs than they would 
generate.  Moreover, the history of industrial policy in Argentina has shown that the effects of 
economic liberalization combined with labour reform have contributed to the disappearance of small 
and medium-sized enterprises (SME), which has increased employment instability.  Argentina's SME 
sector continues to play a vital role in employment generation, not only directly, but also through the 
related services generated by the sector.  A compe titive SME sector cannot be achieved in the context 
of major tariff reductions, particularly when ther e is high elasticity between  tariff reduction and the 
level of employment, as is the case in Argentina. 
ARGENTINA'S PROPOSAL 
 
10. In view of the above, and assuming that suffi cient progress is made in the agriculture 
negotiations, Argentina confirms that it will be ab le to move ahead on a set of modalities involving a 
Swiss formula coefficient of 35 and flexibilities fo r 16 per cent of NAMA lines, with a 50 per cent cut 
and no trade value limitation.  This is a significant contribution and Argentina's best effort in the 
present international circumstances an d the current negotiating context. 
11. Alternatively, in the case of a coefficient of less than 35 but greater than 25, the flexibilities 
required by Argentina would be the following: 
 - 16 per cent of lines subject to a 50 per cent cut;  and 
 
 - 8 per cent of lines not subject to cuts.  
12. In short, current circumstances demand that th e outcome of the negotiations, whatever it may 
be, should contribute to trade liberalization whils t allowing the developing countries to maintain 
moderate tariff levels and preserve the space they n eed to implement their policies aimed at expanding 
and diversifying the production base, increasing em ployment, and guaranteeing social stability and 
progress.  This is the only way for developing country markets to continue making a dynamic  TN/MA/W/109/Rev.1 
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  contribution to the rise in global demand, in a context where the effects of the 2008-2009 financial 
crisis are still being felt and where there continue to be clear symptoms of recession and uncertainty 
over the future of the international economy. 
CONCLUSION 
 
13. The relative importance of tariffs as an industria l policy instrument is linked to acceptance of 
multilateral disciplines restricting the use of other tools such as subsidies, quantitative restrictions, 
regulations governing foreign investment, direct ed lending schemes, and ot her various non-tariff 
barriers that are more recent and of growing comple xity.  Many of these tools are used in agricultural 
production and trade in the developed countries, th us limiting Argentina's ability to benefit from the 
high competitiveness it enjoys in this area. 
14. Indeed, the major economic powers will maintain  a high level of protection for products of 
commercial significance to Argentina, even after implementing the undertakings negotiated in the 
Doha Round.  This situation will not be reflected  in the negotiations on industrial goods, where the 
developing countries are required to make commitmen ts that restrict their potential for growth. TN/MA/W/109/Rev.1 
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  ANNEX I 
  
P24:  Balance between Agriculture and NAMA? 
 
Tariff reductions under the 2008 model 
(as a percentage) 
 
 
A. W
ITH NAMA  FLEXIBILITIES  
 
 Developed countries1 Developing countries2 
Agriculture3 54% 36% 
NAMA4 39.9% 56.8% to 57.3% 
 1 US, Japan and EU. 
 2 Argentina, Brazil and India. 
 3 Minimum cut for developed countries (including sensitive products, tropical products and tariff 
escalation) and maximum cut for developing countries. 
 4 Minimum and maximum cuts in accordance with the various combinations of coefficients and 
flexibilities proposed. 
 
Source : Centre for International Economics (CEI) on the basis of WTO data. 
 
 B. W
ITHOUT NAMA  FLEXIBILITIES  
 
 Developed countries1 Developing countries2 
Agriculture3 54% 36% 
NAMA4 39.9% 56.9% to 60.9% 
 1 US, Japan and EU. 
 2 Argentina, Brazil and India. 
 3 Minimum cut for developed countries (including sensitive products, tropical products and tariff 
escalation) and maximum cut for developing countries. 
 4 Minimum and maximum cuts in accordance with the various coefficients proposed. 
 
Source : Centre for International Economics (CEI) on the basis of WTO data. 
  TN/MA/W/109/Rev.1 
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ANNEX II 
 
Argentina:  Trade in non-agricultural goods 
(US$ million) 
 
 Exports Imports Balance 
2002 13,496 8,192 5,304 
2003 14,798 12,790 2,008 
2004 17,426 21,006 -3,580 
2005 20,855 27,107 -6,253 
2006 24,676 32,441 -7,766 
2007 26,592 42,030 -15,438 
2008 31,421 53,795 -22,374 
2009 26,628 36,431 -9,803 
2010 32,203 53,806 -21,603 
 
Source : Own compilation based on Argentine Institute of Statistics and Censuses (INDEC) data. 
 TN/MA/W/109/Rev.1 
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  ANNEX III 
 
CHART
 
 
 
Imports 
GDP 
Emplo yment
Year Average annual growth rate - Imports, industrial GDP and 
employment - 2003-2009 Percentage 
 
 
Source : Ministry of Industry, based on date from the Ministry of Labour and INDEC. 
 
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