RESTRICTED  
  
WT/COMTD/LDC/M/ 97 
 
8 November  2023 
(23-7550) Page: 1/6 
Sub-Committee on Least Developed Countries  
Ninety -seventh  Session    
 
NOTE ON THE MEETING OF 5 OCTOBER  2023  
Chairperson: Ambassador José R. Sánchez -Fung (Dominican Republic )1 
A. ADOPTION OF THE AGENDA  ................................ ................................ ....................  1 
B. REPORT ON THE INFORMAL SESSION OF THE SUB -COMMITTEE ON LDCS HELD ON 
20 SEPTEMBER 2023  ................................ ................................ ................................ ........  1 
C. INTEGRATION OF LDCS INTO GLOBAL TRADE: PREFERENTIAL RULES  OF ORIGIN  .. 2 
I. UPDATE BY TANZANIA, THE CHAIRPERSON OF THE WTO COMMITTEE ON  
RULES  OF ORIGIN  ................................ ................................ ................................ .............  2 
II. PRESENTATION BY THE UNITED STATES  ................................ ................................ ..... 3 
III. PRESENTATIONS BY THE WTO SECRETARIAT AND UNCTAD  ................................ ............  3 
D. OTHER BUSINESS  ................................ ................................ ................................ .... 6 
 
A. ADOPTION OF THE AGENDA  
1. The Chairperson  welcomed Members to the 97th Session of the Sub -Committee on 
Least  Developed Countries (hereinafter the Sub -Committee) which took place in a hybrid format. He 
also acknowledged the participants from the Introductory Trade Policy Course for  francophone  LDCs 
for the year 2023 . He said  that the agenda of the meeting was contained in document 
WTO/AIR/COMTD/LDC/24.  He noted that a n informal experience -sharing session on preferential 
rules of origin would take place immediately after the formal session.2  
2. The a genda was adopted .  
B. REPORT ON THE INFORMAL SESSION OF THE SUB -COMMITTEE ON LDCS HELD ON 
20 SEPTEMBER 2023  
3. The Chairperson  provided  a report on the informal session of the Sub -Committee held on 
20 September 2023. He recalled that, at the July General Council meeting, Members had instructed 
the Sub -Committee to examine Annex 2 of the LDC graduation proposal contained in document 
WT/GC/W/807/Rev.2 , and report  back to the General Council by 30 November 2023 with any 
recommendations.  
4. He said that an informal session of the Sub -Committee was held on 20 September 2023. The 
meeting had offered an opportunity for the LDC Coordina tor (Djibouti ) and the Focal Point on 
LDC graduation ( Bangladesh ), to introduce the LDC graduation proposal. He further noted that the 
LDC Group had suggested to organize four informal sessions to examine the 17 special and 
differential treatment provisions identified in Annex 2 of the proposal.  
 
1 Ambassador José R. Sánchez -Fung (Dominican Republic), Chairperson of the Committee on Trade and 
Development , chaired the meeting  pending the election of a new Chairperson.  
2 The summary of the discussions i n the informal experience -sharing session on preferential rules of 
origin is available here: 
https://www.wto.org/english/tratop_e/devel_e/devel_0510202315_ e/devel_0510202315_e.htm  WT/COMTD/LDC/M /97 
 
- 2 - 
5. He went on to highlight that Members had encouraged LDCs to prioritize the provisions 
contained in Annex 2, with several Members underlining that an evidence -based discussion would 
assist in identifying the  needs of graduating LDCs. Members had also pointed out that certain 
provisions contained in Annex 2, including on Duty-Free Quota -Free (DFQF) market access, cotton, 
and waiver decision regarding preferential market access by developing countries, were rel ated to  
Annex 1. He therefore noted that there was a willingness to start the discussion on this topic in view 
of the advanced stage of discussions on the market access component of the LDC graduation 
proposal .  
6. He continued by stating that a small group c onsultation had taken place  on 2 October 2023 , 
with a first review of the work plan which had been submitted by the LDC Group. The work plan 
proposed four thematic informal sessions of the Sub -Committee focusing on provisions related to 
intellectual proper ty rights, subsidies, market access and development. He pointed out that Members 
had requested the LDCs to indicate the sequencing of the proposed topics, with a number of 
delegations requesting for the discussions on market access to be examined by the br oader 
membership. Delegations had also requested clarifications on different aspects of the LDC graduation 
proposal. He noted that the LDC Group had indicated that the discussion on market access had been 
taking place in bilateral settings, and that the LD C Group had suggested providing ambassadors  with 
additional time to finalize the discussions on Annex 1.  He indicated  that the next informal session of 
the Sub -Committee had been scheduled for 16 October 2023 . Deliberations would continue in the 
informal s essions, and delegations were encouraged to reach out to each other to make progress on 
the topic.  
7. The representative of Djibouti , the coordinator  of the LDC Group , indicated  that the LDC Group 
had taken note of Members' interventions  during  the informal session of the Sub -Committee held on 
20 September  2023, including on Annex 2 of the LDC graduation proposal. She urged Members to 
engage constructively with a view to make recommendations on Annex 2  to the General Council by 
30 November 2023 .  
C. INTEGRATION OF LDCS INTO GLOBAL TRADE: PREFERENTIAL RULES  OF ORIGIN  
8. The Chairperson  noted that the discussions under this agenda item would include  an update 
on the work of the WTO Committee on Rules of Origin, perspectives of LDCs' trade and developm ent 
partners, and an update by the WTO Secretariat and UNCTAD on their efforts in supporting LDCs' to 
fully realize the benefits of market access opportunities offered to them.  
I. UPDATE BY TANZANIA, THE CHAIRPERSON OF THE WTO COMMITTEE ON 
RULES  OF ORIGIN  
9. The Chairperson  invited the Minister Counsellor of the Permanent Mission of Tanzania and 
Chairperson of the WTO Committee on Rules of Origin (CRO) (Mr Elia Nelson Mtweve), to provide an 
update on the discussions on preferential rules of origin taking place  in the CRO.  
10. The representative of Tanzania  noted that the work of the CRO had been inspired by the  
Hong Kong Ministerial Decision on Measures in Favour of LDCs , indicating that the Decision  
encouraged preferential rules of origin applicable to imports f rom LDCs to be simple and transparent. 
He underlined the need for preferential rules of origin to be aligned  with contemporary practices. He 
went on to cite the example of rules of origin regimes requiring beneficiaries to ship consignments 
directly, which  posed difficulties to certain countries, in particular landlocked LDCs. He highlighted 
the role of collaboration amongst preference granting countries and LDCs in ensuring smooth trade.  
11.  He noted that since the adoption of the Nairobi Ministerial Decision  on Preferential Rules of 
Origin for LDCs, work had been undertaken b y the CRO with the engagement of the LDC Group. 
While some progress  had taken place, he underlined that th ose were not sufficient to achieve the 
goal of the Decision. He went on to highli ght that the Decision had been overall beneficial, with a 
positive impact on LDCs' exports. He further highlighted improvements in notifications in the CRO , 
particularly  the engagement of preference granting countries and LDCs on an agreed template. The 
information contained in the notifications  of Members  had assisted institutions such as UNCTAD and 
the International Trade Centre ( ITC) in providing S mall and Medium Enterprises (S MEs) with 
information on how to meet rules of origin requirements . WT/COMTD/LDC/M /97 
 
- 3 - 
12. He indicated that, in 2022 the CRO had decided to work on a report on the implementation of 
the Nairobi Ministerial Decision. The work of the CRO could include the identification of best practi ces 
on rules of origin and related administrative requirements. In its May meeting, the CRO decided that 
a report should be prepared by the WTO Secretariat after receiving Members' inputs. He  noted that 
a consultation meeting had taken place to discuss Mem bers' views on the report. Members would 
have an opportunity to engage in the CRO meeting scheduled for 12 October 2023. He further noted 
that the re port had the potential to serve as a reference for future work in the CRO. 
II. PRESENTATION BY THE UNITED STATES  
13. The Chairperson  invited the Director for Multilateral Non -Tariff Barriers of the Office of the 
United States Trade Representative (Mr Kent Shigetomi) to make his presentation . 
14. The representative of the United States  noted that it had five  preference  programmes, one of 
which was  its Generalized System of Preferences (GSP) , and the other four  cover ing specific 
geographic areas. He highlighted  that beneficiary countries could therefore benefit under more than 
one programme. He indicated that each programme had different product coverage, and highlighted  
the number of tariff lines covered  under these  programme s. He further noted that the rules of origin 
applied under the preference progra mmes were based on whether the good was a product of the 
beneficiary country  and the regional value content  requirement . These programmes were not based 
on a tariff shift method.  
15. Providing  the example of the African Growth and Opportunity Act (AGOA) progra mme, he 
highlighted that the rules of origin allowed the use of third country fabric in the manufacturing of 
textile products in AGOA beneficiary countries. The programme also allowed for cumulation with 
other AGOA beneficiary countries. He went on to highlight examples of success stories under 
individual programmes. Underscoring  the example of Haiti's apparel production, he noted  that Haiti 
was the largest beneficiary under the United States Caribbean Basin Economic Recovery Act (CBERA) 
in terms of trade v olume shipped to the United States.  
16. He underlined  the factors affecting the utilization of preferences which , inter alia , includ ed: 
(i) cost of compliance exceeding the preferential duty rate; (ii) difficulties in meeting the rules of 
origin ; (iii) lack of awareness of available benefits ; (iv) countries' eligibility for the preference ; 
(v) amount of foreign direct investment in a given sector ; (vi) consumer demand for the product in 
the United  States ; (vii) cost of production ; and (viii) extent of foreign -domestic partnerships in 
certain industries. He further  noted that beneficiaries who had developed a national strategy to take 
advantage of the preferences programmes generally benefitted from higher utilization rates . He went 
on to point out  that the base tariff rate might  also influence the utilization of preferences. Providing 
the example of vanadium oxide, for which the United States's tariff was 5.5% , he noted that the 
utilization rate was 90% while it was expected that it would be closer to 99 -100% as the product 
was wholly originating within the beneficiary country.  
17. Discussing the extent to which preferences affected exports, he noted that countries receiving  
trade preferences still accoun ted for a small percentage of total exports for many goods. He pointed 
out that, for Subheading 6107.99  of the Harmonized System (HS) , exports from beneficiary 
countries in Africa accounted for less than 1% of total imports to the United States. In the cas e of 
HS Subheading 6109.10, he noted that while the top 15 exporters accounted for 83 % of exports, 
the first unilateral trade preference beneficiary was in the 14th position. He further noted that 
unilateral trade preference beneficiaries only accounted for around  4% of total imports to the United 
States . 
III. PRESENTATIONS  BY THE WTO  SECRETARIAT  AND UNCTAD  
18. The Chairperson  invited the  representative from the WTO Secretari at (Mr Darlan Marti, 
Market  Access Division)  to make his presentation.  
19. In his presentation, t he representative of the WTO Secretariat  and Secretary of the CRO noted 
that LDCs ha d benefitted from a number of trade preferences over the years to help them  better  
integrate into the multilateral trading system. All trade preferences  require d the application of rules 
of origin to ensure that the tariff benefit ted only the products originating in partner countries. To 
utilize trade preferences and receive tari ff preferences, he emphasized that LDCs must be able to WT/COMTD/LDC/M /97 
 
- 4 - 
comply with preferential origin requirements. The key instruments adopted by Members to ensure 
that rules of origin were simple and transparent included: (i) Annex F of the Hong Kong Ministerial 
Decis ion (2005) ; (ii) Bali Ministerial Decision (2013) ; and (iii) Nairobi Ministerial Decision  (2015). In 
2022, WTO Members in the CRO reached a decision underscoring  the importance of identifying and 
addressing the specific challenges that LDCs face d in effect ively using trade preferences. In the 
context of this decision, he noted that t he work of the CRO could include  identif ying best practices .  
20. As a result of these legal instruments, he  highlighted  that there were three pillars of the work 
of the CRO which i ncluded: (i) transparency ; (ii) analysis of substantive provisions ; and 
(iii) preference utilization  rates. He noted limitations of comprehensive data in calculating preference 
utilization. In addition to utilization of preferences, he highlighted that the Secretariat analy sed 
underutilization or non -utilization of preferences.  From the data analy sed, it was observed that 
underutilization was increasing und er a number of schemes indicating that , not all LDCs were equally 
equipped to utilize trade preferences. For instance, in the analysis of underutilization or non -
utilization of preferences for fruits, vegetables and plants , it was observed that despite hav ing 
identical applicable rules of origin, almost half of imports of th ose products by the Democratic 
Republic of the Congo, Lesotho, Lao People 's Democratic Republic and Uganda were not receiving  
any preference , while Senegal, Cambodia, Haiti, and Rwanda h ad only 5% or less of their imports 
that did not receiving any preferences . 
21. He also noted that there were other factors affecting the  utilization of preferences. For 
example, it was observed that non -utilization of preferences by landlocked developing countries 
(LLDCs) was double t o that of other LDCs which might be due  to transport -related requirements. On 
certification of rules of origin,  it was noted that  Members which  required third party certification had 
a higher average of non -utilization of preferences compared to those that allowed self-certification. 
He underlined  that full or high utilization rates were a good indication that rules o f origin were 
facilitating imports, but did not necessarily indicate that the preference was deploying its full benefits 
to the LDCs. It was therefore importa nt to study other factors that affect ed the utilization of 
preferences besides the origin criteria . He concluded by reiterating  the need for  collaboration 
between LDCs and p reference granting Members to facilitate comprehensive data collection to 
analy se trends  on utilization of preferences.   
22. The Chairperson  invited the  Chief of Technical Assis tance, Trade and Customs  at UNCTAD's 
Division for Africa, LDCs and Special Programmes  (Mr Stefano Inama ) to make his presentation .  
23. The representative of UNCTAD  noted that a two -day workshop for LDC  delegates was held at 
the European University Institute i n Florence , where the 2022 Report of the CRO to the General 
Council on preferential rules of origin for LDCs was discussed.  The workshop  was part of a research 
and capacity building program me that UNCTAD ha d been implementing since 2014. He noted that 
the program me aimed at preparing LDC delegates to better participate in WTO  meeting s, in 
particular  meetings of the  CRO. He noted that  some 13 decisions had been take n in favour of LDCs 
in the multilateral tradi ng system, and that UNCTAD's programme had contributed to three  of them 
which included the Bali Ministerial Decision (2013), Nairobi Ministerial Decision (2015) and the 
decision of the CRO in 2022.  
24. He pointed out that UNCTAD had been providing  tailored ass istance to the LDCs. He 
highlighted the example of Cambodia where UNCTAD  had assisted in  a request for extended  
cumulation to the European Union. This request had been  accepted and extended cumulation had 
been granted . In addition, he noted that UNCTAD made preference  utilization rates publicly available 
in their website. This process was aimed at improving accessibility, creating awareness, and 
providing policy makers with a n understanding on how other countries were performing in utilizing 
trade preferences. Also, he highlighted UNCTAD 's support for LDCs participation in negotiations of 
mega -regional trade areas  such as the African Continental Free Trade Area (AfCFTA) and the 
Regional Comprehensive Economic Partnershi p (RCEP) , including implementation of rules of origin 
according to their trade interests.  
25. Further, he noted that in preparation for MC13, UNCTAD had extended its support to  LDCs 
and the CRO in relation to  the 2022 report to the General Council, a step which would mark an 
important milestone in strengthening the work of the CRO. He highlighted that there had been 
success stories with some Members  such as the United Kingdom undertaking  reforms on their rules 
of origin , and he encouraged LDCs to h old constructive dialogue s on reform s within the CRO. He also WT/COMTD/LDC/M /97 
 
- 5 - 
noted that there had been positive spillovers from the work cond ucted by the LDCs since 2017, with  
18 submissions and 14 presentations  made  by the LDCs .  
26. The Chairperson  thanked all the speakers for their presentations. He invited the delegations 
to make their statements.  
27. The representative of Djibouti , the coordinator of the LDC Group , thanked the Chair person  of 
the CRO for his presentation. She pointed out that rules of origin had been  a driver for LDCs  
integration  into global trade. Given  the existing non -tariff barriers facing LDCs exports, she 
reiterated the importance of simple and predictable rules of origin. She encouraged Members  to 
constructively enga ge and deliver on the mandate entrusted to them by Ministers at MC12. She 
commended  Members w ho took steps to implement the Nairobi Ministerial Decision on Preferential 
Rules of Origin for LDCs . She noted that the United States was one of the main trading partners for 
many LDCs , and acknowledged the efforts made by the U nited States in implement ing simple and 
more predictable rules of origin. She a lso appreciated  the representatives from UNCTAD and the 
WTO Secretariat for their presentations and acknowledged the continued support from the two 
institutions  in building capacities for LDCs to take advantage of preferential rules of origin.  
28. The representative of Nepal  expressed  appreciation to the U nited States for their support in 
granting duty -free entry of 77 tariff lines of products under the Nepal Trade Preference program me. 
He noted that it was important to identify policy instruments that work ed in favo ur of LDCs. He 
concluded by reite rating continued engagement with the U nited States with a view to better  utilize 
the preference s granted to them.  
29. The representative of Japan  noted that consignment requirements was one of the issues  that 
affected utilization of rules of origin. He highli ghted that overlapping membership in several regional 
agreements , commonly referred to as "spaghetti bowl ", brought complexities in the implementation 
of rules of origin. He noted the need for harmonization and simplification of rules of origin to resolve 
the problems faced  by LDCs and other Members.   
30. The representative of  the European Union  commended the use of detailed statistics by the 
United States  to show case the impact of its preference programmes , especially on exports from  
Haiti. He noted wi th satisfaction that extended cumulation between Cambodia and Viet Nam relating 
to the production of bicycles had been granted by the European Union . He noted  the complexities 
involved in analysing the  preference utilization rates.  
31. The Chairperson  invited the speakers to respond to the questions posed  by delegations.  
32. The representative of Tanzania  encouraged Members to continue engaging in the CRO and 
find collective solutions to utilize rules of origin preferences and boost LDCs ' expor ts. 
33. The representative of  the United States  noted that there were a number of factors affecting 
the utilization of preferences, such as access to sea transportation and detailed knowledge of the 
preferences within the beneficiary countr ies. 
34. The representat ive of the WTO Secretariat  emphasized LDCs' continued engagement in the 
CRO to identify problems faced in utilizing trade preferences granted to them. From the engagements 
in the CRO, Members would be able to identify specific causes for underutilization a s well as share 
success stories that could be replicated.  
35. The representative of UNCTAD  reiterated th at the  direct consignment s was a technical issue 
that needed to be addressed. He noted that the difficulty for LDCs was in getting the documentary 
evidence  or proof for direct consignments , since the majority were transported through intermediary 
ports located in  Singapore ; Hong Kong,  China; and the Netherlands.  He noted that a bill of lading  
was required to facilitate the movement of goods.  
36. The Chairperson  noted that the discussions  had provided a useful  update on preferential rules 
of origin in the WTO and the support provided to LDCs by development partners.  He suggested that 
the Sub -Commit tee take note of the presentation s and the statements made.  
37. It was so agreed . WT/COMTD/LDC/M /97 
 
- 6 - 
D. OTHER BUSINESS  
38. The Chairperson  inform ed the Members  that the next  formal  meeting of the Sub -Committee 
would take place in early  2024. The exact date would be communicated in due course.  
39. The meeting was adjourned . 
__________