WORLD TRADE  
ORGANIZATION  WT/WGTDF/W/32 
29 June 2005 
 (05-2788) 
Working Group on Trade, Debt and Finance Original:   English 
  
 
COMMUNICATION FROM THE ACP GROUP 
 
 
 The following communication, dated 27 June 2005, from the Delegation of Benin, on behalf 
of the ACP Group, is being circulated to Member s in advance of the Working Group's meeting of 4-
5 July.   
 
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ACP SUBMISSION TO THE WORKING GROUP 
ON TRADE, DEBT AND FINANCE 
 
Specific Actions to Address Key Issues of Concern for Developing Countries
 
  
I. BACKGROUND AND OVERVIEW OF KEY ISSUES 
1. The economies of developing countries are burde ned with large and unsustainable debt as a 
result of international economic policies that do not address development needs.  Developing 
countries, in particular ACP countries, are in a de bt trap where they cannot sustain debt servicing 
without diverting an enormous part of their me agre resources away from social and development 
programmes.  Imbalances in the multilateral trading regime as manifested by rapid trade liberalization 
in developing countries and higher tariffs and non-ta riff barriers in developed countries have led to 
deindustrialization and hen ce debt unsustainability in developing countries. 
2. The problem of debt cannot be effectivel y addressed without adopting a comprehensive 
approach that embraces trade policy issues.  For the international trading regime to effectively 
contribute to development in developing countries there is an urgent need to break out of the debt trap 
and to ensure that developing countries move th eir meagre export earnings from paying debt to 
investment for future growth. 
3. In this regard, the multilateral trading system should contribute towards breaking the debt trap 
by primarily addressing, inter alia , problems of declining and vola tile export earnings;  resolving 
problems of policy space erosion; contributing to  the broader agenda of policy coherence in 
international economic relations in a manner supporti ve for development;  and effectively addressing 
supply-side constraints that developing countries face. 
II. PROPOSALS 
4. Taking note of the G-8 Finance Ministers' conc lusions on development made on 11 June 2005 
in London, in which they proposed the completio n of the process of debt relief for the Heavily 
Indebted Poor Countries (HIPC) leading to the 100 per cent debt cancellation of outstanding 
obligations of HIPCs to the IMF, the World Bank and the African Development Bank, we call on the 
G-8 Heads of State and Government meeting at the G-8 Summit in the United Kingdom on 6-8 July WT/WGTDF/W/32 
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 2005 to approve and implement this pr oposal without delay.  In addition, we urge that the scope of the 
initiative and its beneficiaries be extended so as to provide debt relief to ot her developing countries 
that need it in support of their development objectives. 
5. The WTO's Work Programme on Trade, Debt  and Finance shall be institutionally 
strengthened in accordance with the proposal in document WT/WGTDF/W/30 calling for the 
establishment of a regular Committee on Trade, Debt and Finance by the 6
th Session of the Ministerial 
Conference. 
6. Pending the establishment of the Committee and in  accordance with the Doha mandate of the 
Working Group on Trade, Debt and Finance (WGT DF), the following specific actions should be 
agreed upon by the WGTDF for recommendation to and adoption by the General Council: 
(a) That the WTO shall recommend to relevant organizations or governments immediate 
debt cancellation, reduction, and relief fo r developing countries experiencing adverse 
terms of trade. 
(b) That developed-country Members shall agre e to cancel bilateral debts, including 
export credits that are added to the total st ock of bilateral debt, for the benefit of 
developing-country Members whose declines in  their share of international trade was 
the result of, inter alia , developed countries' subsidies and decline in price of 
commodities. 
(c) That the WTO shall address the decline and volatility of export earnings through 
comprehensive measures that boost expor t earnings in developing countries by, inter 
alia, enhancing market access opportunities, th rough measures for effectively dealing 
with the issue of declining commodity pr ices (including commodity price supports), 
and binding commitments for increased a nd sustainable technical and financial 
assistance to address supply-side constraints. 
(d) That developing-country Members shall, in the Doha negotiations, neither be 
expected nor required to undertake further liberalization in sectors that are sensitive 
or important to their development needs.  Instead, existing WTO rules in all of the 
Doha negotiating areas should be reviewed with the view to increase the scope and number of policy flexibilities to developing  countries in order to safeguard their 
economies from adverse external competition. 
(e) That a trade-related debt review mechanism  shall be established for the conduct by 
the WGTDF or, upon its establishment, th e Committee on Trade, Debt and Finance, 
of periodic reviews on the extent of debt  servicing by developing-country Members 
as a percentage of these countries' government revenues;  the extent of implementation of developed- country Members' commitmen ts to provide bilateral 
official development assistance;  and the extent of availment by developing-country 
Members of grants and loans from the Br etton Woods institutions and the regional 
development banks.  The WGTDF or the Co mmittee, as the case may be, shall submit 
reports to the General Council on the matt ers within the purview of the review 
mechanism described above with specific r ecommendations for action to be taken by 
the General Council.  Such action shall seek to  break the debt trap in order to achieve 
debt sustainability by developing countries, taking into account the need for channelling government revenue away from debt servicing towards investment in 
building supply-side produc tive capacity.  Such recomme ndations shall include the 
provision of temporary and non-reciprocal market access concessions by developed-country Members in favour of developing-country Members.  A procedure to  WT/WGTDF/W/32 
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 determine eligibility for and the duration of  such concessions shall be developed.  
These concessions should aim at: 
(i) Generating export surplus; 
(ii) Diversifying export sector;  and 
(iii) Increasing the competitiveness of domest ic industries in accordance with 
Article IV of the GATS. 
(f) That fast-track procedure shall be agreed in order to enable developing countries to 
take trade-related preventive and/or remedial  measures against financial crises and in 
order to deal with financial crises in a timely manner.  The procedures should aim at 
implementing flexibilities and enabling developing countries to export more. 
7. Upon the establishment of the Committee on Trad e, Debt and Finance, as proposed by the 
ACP in WT/WGTDF/W/30, the specific actions identifie d in Paragraph 6 of this submission that have 
not yet been done or concluded shall automatically  form part of the terms of reference of the 
Committee. 
 
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