WORLD TRADE  
ORGANIZATION  WT/COMTD/LDC/W/46 
23 October 2009  
 (09-5277) 
Sub-Committee on Least-Developed Countries  
  
 
MARKET ACCESS FOR PRODUCTS AND SERVICES OF EXPORT INTEREST TO 
LEAST-DEVELOPED COUNTRIES 
 
Note by the Secretariat
1 
 
 
Table of Contents 
 
I. INTRODUCTION ................................................................................................................... .3 
II. TRENDS IN LDC TRADE ......................................................................................................4  
A. MAJOR PRODUCTS AND MAJOR MARKETS FOR LDC EXPORTS ......................................................5  
B. HAVE THE LDC S GAINED MARKET SHARE ? ................................................................................11  
III. MARKET ACCESS CONDITIONS FOR LDC EXPORTS ..............................................15  
A. INTRODUCTION ..........................................................................................................................15  
B. TRENDS IN MARKET ACCESS FOR PRODUC TS OF EXPORT INTEREST TO LDC S............................15  
C. TARIFF TREATMENT OF LDC EX PORTS IN SELECTED MARKETS .................................................16  
IV. RECENT INITIATIVES TO IM PROVE MARKET ACCESS .........................................24  
A. IMPLEMENTATION OF THE HONG KONG MINISTERIAL DECISION ON DFQF MARKET 
ACCESS TO LDC S........................................................................................................................25  
B. OTHER INITIATIVES ...................................................................................................................26  
V. THE LDC S AND THE GLOBAL FINANCIAL CRISIS ....................................................26  
A. GLOBAL TRENDS IN LDC TRADE DURING THE CRISIS .................................................................29  
B. THE CHALLENGE OF FINANCING TRADE AND TRADE DEFICITS ..................................................34  
VI. CONCLUSION ..................................................................................................................... ..35 
ANNEX .......................................................................................................................... .......................38  
 
 
                                                      
1 This document has been prepared under the Secret ariat's own responsibility and without prejudice to 
the positions of Members and to their rights and obligations under the WTO. WT/COMTD/LDC/W/46 
Page 2  
 
  List of Tables  
 
Table 1: Export prices of primary commodities, 2000-2008..................................................  9 Table 2: Commercial services exports by  LDCs, 2000-2008. ......................... .......................   9 
Table 3: Trends in tariff treatment on me rchandises imported by developed countries, 
  1996-2007................................................................................................................ 16 
Table 4: Preferential duty-free access for LDC exports to developed countries ................... 17 
Table 5: Tariff treatment of LDC exports in  selected developed markets, 2007.................. 19 
Table 6: Market access for LDC exports to  developing countries, 2006.............................. 21 
Table 7: Tariff treatment of LDC exports in selected developing markets, 2006................. 22 
Table 8: Average monthly variation of merchandise exports of the World and the LDCs, 
  January 2006-June 2009.................. ......................................................................... 33 
 
Annex Tables 
 
Annex Table 1: Merchandise exports  and imports of LDCs by selected country grouping, 2008.... 38 
Annex Table 2: Export prices of primary commodities, 2000-2008................................................. 39 
Annex Table 3: Measures in favour of export s originating from LDCs .............................. .............. 40 
 
List of Charts  
Chart 1(a): Share of top three LDC products in their total merchandise exports, 2007..............  6 
Chart 1(b): Share of commercial services in LD C total exports, 2007.. ...................... ...............   6 
Chart 2:  Composition of LDC exports by major products, 2007...........................................   7 
Chart 3:  Top 15 markets for LDC exports of goods, 2000-2007........................................... 11 Chart 4:  Comparative evolution of LDCs' product specialization, 2000-2007...................... 12 
Chart 5:  Comparative evolution of ma in LDC markets, 2000-2007...................................... 13 
Chart 6:  Monthly evolution of World and LDC exports, January 200 6-June 2009............... 27 
Chart 7:  Monthly evolution of LD C exports by main product groups,  
  January 2006-June 2009.................. ......................................................................... 32 
 
List of Boxes  
 
Box 1:  The dynamics of LDC exports betw een 2000 and 2007 using the SSA.................. 14 
Box 2:  Recent trends affecting external  trade in goods and services................................... 28 
Box 3:  Tourism in the face of the gl obal crisis................ ...................... ...................... ........ 33 
Box 4:  International initiative to restore trade finance........................................................ 35 
 WT/COMTD/LDC/W/46 
Page 3 
 
 
   
I. INTRODUCTION 
1. World economic growth - measured by gross domestic product (GDP) - slowed abruptly in 
2008 against the backdrop of the worst financial crisis  since the 1930s.  The crisis began as a financial 
turmoil in the US with the collapse of the sub-pr ime market and the rise in financial tensions in 
July 2007 before spreading quickly to the rest of  the banking system with the bankruptcy of major 
financial institutions in September 2008;  it has now become a global recession affecting economic 
activity in virtually all countries, developed as well as developing.   
2. Least-developed countries (LDCs), known to be pa rticularly vulnerable to external shocks, 
were not spared by the global crisis.  They depe nd heavily on a few products for most of their export 
revenues, and these trade revenues weigh a lot in th eir national income.  The collapse of commodity 
prices during the initial phase of the crisis (Septe mber 2008-March 2009) severely affected the value 
of their exports, and the partial recovery that has been perceptible sin ce then remains largely 
dependent on the evolution of the inte rnational prices of oil and minerals. 
3. The initial impact of the financial crisis was fe lt most particularly on developed economies, at 
least from an economic perspective, and its intensity was largely unexpected.2  Industrialized 
countries only managed a meagre 0.8 per cent growth  in 2008, leading to a decrease in per capita 
income.3  Developing economies, on the other hand, expanded their output in 2008 by 5.4 per cent, 
down from 7.7 per cent in 2007, but slightly below their average rate of 5.6 per cent for the 2000-2008 period.  Against this adverse general contex t, LDCs (as a group) were able to grow at 
6.3 per cent in 2008, in line with their average 2000-2008 growth of 6.2 per cent. 
4. International trade has been specially affected.  World merchandise trade growth in real terms 
(i.e., adjusted for price changes) slowed significantly  in 2008 to 2 per cent, compared to 6 per cent in 
2007, and the WTO forecasts for 2009 decrease the number to minus 10 per cent.  By most indicators, the present crisis stands out for its magnitude and dur ation.  Although it is possible to find episodes of 
trade collapsing with a similar intensity in the hi story of nations, it is the first time that such a 
synchronized decline across the world is observed.  Globalization served as transmitter of growth in 
the 1990s and early 2000s between increasingly intertwined national economies; the same 
transmission channels – most particularly, interna tional trade and finance – have acted as magnifiers 
during the current crisis. 
5. In the second half of 2009, there are signs that the crisis is reaching the bottom.  The banking 
crisis created by the accumulation of "toxic assets" appears to be under control, and the main 
international financial markets are regaining some of the lost grounds.  Domestic activity in large 
emerging countries are stabilizing or even regainin g strength, buoyed by government packages or 
improving business and consumer confidence.  Si milar symptoms, albeit much weaker, are also 
apparent in some developed economies.
4 
6. Among the factors expected to boost demand for im ports, at least in the short term, are the 
rebuilding of business inventories after the rapid pace at  which they were disposed of in the first half 
of this year.  In June 2009, world trade was up by more than 2 per cent over the previous month, the strongest month-to-month rise since mid-2008.  De spite these positive short-term signals, world trade 
                                                     
 
2 Due to better social security provisions, the social implications of the economic downturn may be less 
severe in those countries, even when the relative magnitude of the economic shock is much higher. 
3 Weighting GDP in national currencies at th eir market exchange rates to US dollars.  
4 According to OECD, aggregate gross domestic product is expected to decline by 3.7 per cent this year 
against a forecast of 4.1 per cent made just three m onths ago (PPP-based).  Source: OECD, "What is the 
economic outlook for OECD countries?  An interim assessment", 3 September 2009. WT/COMTD/LDC/W/46 
Page 4  
 
  in June 2009 was still about 20 per cent below its peak of April 2008.
5  Although the international 
economy is still far from its previous level of activity, some key commodity prices such as fuels, are on the rise again, constraining the purchasing power of net-oil importing countries.  What is more worrying is that credit has slowed down dramatically and is not likely to bottom-out yet, while unemployment rates are reaching peak levels.  Thes e adverse developments are laying the ground for 
another negative demand-driven shock based on an in creased risk aversion that may negatively affect 
both household consumption and productive investment of firms. 
7. Against this background, this Note first looks at trends in LDCs trade, in particular how their 
share of world trade has changed in the period 2000 to 2007/2008, depending on the period up to 
which statistics are available.  It then analyses the impact of the crisis on LDCs.  The basic mandate of 
the Note stems from the WTO Work Programme  for LDCs (WT/COMTD/LDC/11) which provides 
for an 
annual review of market access for products orig inating from LDCs.  In the context of the 
discussions on the previous market  access review study, a request was made for the study to reflect the 
ongoing financial crisis and its impact on the LDCs.  The Note focuses on short-term dynamics observed 
during the most recent months, while the analysis of  the structural trends affecting LDC exports is 
principally used as a background to identify the stre ngths and vulnerabilities.  Despite its specificity, 
this document should not be viewed as a stand-alone study.  It should be read in conjunction with the 
previous versions prepared by the Secretariat, in order to gauge the different factors that influence 
international trade and market access conditions for LDC exports.6 
8. The statistical coverage of LD Cs is known for its incompleteness and untimeliness.  These 
usual limitations are even more acute when it co mes to recompiling and analysing quarterly or 
monthly statistics.  In many cases, the Secretaria t had to rely on mirror statistics, using imports 
reported by LDC partners, while remaining data gaps had to be  imputed, when reasonably robust 
information was available for such an inference.  In particular, mirror statistics were compiled from 
databases such as the UN COMTRADE or Global Trade Atlas, which contain comprehensive coverage of the developed countries'  trade, and substantial coverage  for trade of major developing 
countries and economies in transition.  This allows  estimating the share of the LDCs' trade with not 
just developed countries but also with developing economies.  The disadvantage of using mirror data, 
however, is that data unavailability of LDCs and other developing economies does not allow to take 
into consideration intra-trade among the LDCs, as well as trade with non-reporting developing 
countries.  In addition, the total figures based on mirror data may differ from total exports as reported 
by the LDCs.  Whenever possible, the Note uses national reported figures for total trade. 
II. TRENDS IN LDC
 TRADE  
9. It is well known that LDCs are particularly vuln erable to external shocks.  They are not only 
dependent on a few products for most of their expor t revenues, but these trade revenues weigh a lot in 
their national income.7  In order to understand how this structural vulnerability affects the LDCs 
during crisis, the paper analyses the trends in LDC exports, including in the context of risk factors 
conditioned by:  (i) the changes affecting global trade since the beginning of the crisis;  (ii) the shocks 
affecting the specific products exported by the LDCs;  and (iii) the economic situation of their main 
markets of destination.8 
                                                      
5 Preliminary estimate based on CPB Netherlands Bureau for Economic Policy Analysis. 
6 The previous note by the Secretariat is contained in WT/COMTD/LDC/W/42/Rev.1.  
7 LDC exports accounted for 33 per cent of their aggr egate GDP in 2007.  The shares were especially 
high in the case of oil-exporting LDCs such as Angola (72 per cent), Chad (52 per cent) or Equatorial Guinea 
(49 per cent). 
8 This diagnostic follows the methodology suggested by Shift-Share Analysis ( SSA).  According to it, 
the evolution of national exports can be attributed to:  (i) the global trends affecting international trade;  (ii) the 
world demand for specific products and product groups;  (iii) the dynamism of their respective markets of WT/COMTD/LDC/W/46 
Page 5 
 
 
  10. The main structural components which are of interest are product specialization and market 
diversification.  Some products will be more affected than others during the crisis, either in their price 
(e.g., oil) or in the volume of the demand (e.g., inv estment goods), or in both aspects.  Some markets 
are also more affected than others.  This is particularly the case during the present crisis, where 
developed countries are the most affected and the hypothesis of decoupling of rest of the world from 
industrialized economies is put to test.  The two e ffects (products and markets) are not independent;  
as for some products, the LDC exports are very specialized.  For example, the bulk of clothing exports goes to developed markets, while some specific agricultural exports belong almost entirely to 
South-South trade. 
11. Following the path of the so-called SSA, the present document revises the recent trends 
affecting product and market specialization of LDCs , identifying the underlying factors of growth.  
On the basis of these results, th e document evaluates which are the most vulnerable "export niches" in 
terms of the combined "product x market" mix and the most probable crisis scenarios.  
12. A word of caution is required on the limitations of  this exercise.  The SSA is a "bottom-up" 
tool commonly used by analysts to identify main fact ors behind past trends in large data sets.  It is 
more a growth-accounting method than a fully-fledged statistical procedure.
9  Since it does not rely 
explicitly on economic or statistical hypothesis, it is to  be used as an exploratory device rather than as 
a modelling one.  For these reasons, the analysis of the possible impacts of the crisis derived from SSA does not pretend to forecast what will happen,  but only identifies and evaluates the possible 
outcome based on the main structural characteristics that affected past trends. 
A. 
MAJOR PRODUCTS AND MAJOR MARKETS FOR LDC EXPORTS  
13. Trends in LDCs exports and external balan ces are influenced by export specialization of 
individual economies.  Due to the lower degree of development of their productive sectors, LDCs are 
traditionally heavily dependent on a few products where they enjoy some natural comparative 
advantage (primary commodities as far as trade in  goods is concerned, and tourism for service 
exporters).  Even when LDCs were able to divers ify into manufacture, the range of exported products 
is usually limited to a few labour-intensive i ndustries, mostly in textile and clothing. 
                                                                                                                                                                     
destination;  and (iv) the influence of national and re sidual factors that may have  affected the supply and 
competitiveness of export activity.  See WT/COMTD/L DC/W/42/Rev.1 for an introduction to SSA and its 
application to LDCs' trad e structure and trends. 
9 In particular, the method in its traditional form doe s not provide for the possib ility of formally testing 
the robustness of the results. WT/COMTD/LDC/W/46 
Page 6  
 
  Chart 1(a):  Share of top three LDC products in their total merchandise exports, 2007
 
0102030405060708090100United Rep. of Tanzania
EritreaSenegal
Nepal
Uganda
Afghanistan
Togo
Tuvalu
Cape Verde
Ethiopia
Gambia
Somalia
Benin
Dem. Rep. of the Congo
Mozambique
Bhutan
Malaw i
Myanmar
Kiribati
Lao People's Dem. Rep.
Madagascar
Sao Tome and Principe
Burundi
MaliBurkina Faso
Sierra LeoneCentral African Rep.ZambiaDjiboutiSamoaGuineaTimor-LesteBangladeshHaitiCambodiaRwandaNigerSolomon IsdsMaldivesVanuatuComorosSudanMauritaniaLesothoYemenLiberiaGuinea-BissauEquatorial GuineaChadAngolaLDC Average
(74 per cent)
 
Chart 1(b):  Share of commercial services in LDC total exports, 2007  
0102030405060708090100 Equ. Guinea 
 Angola  Chad 
 Guinea 
 Sudan 
 Bangladesh 
 Myanmar 
 Zambia 
 Mauritania 
 Yemen 
 Lesotho 
 Burkina Faso 
 Bhutan 
 Niger 
 Burundi 
 Guinea-B. 
 C. Af rican R.
 Congo, DR. 
 Sierra Leone 
 Mozambique 
 Malaw i  Mali  Lao PDR  Uganda  Benin  Haiti  Togo  Nepal  Cambodia  Solomon Isl. Sao Tome & P  Senegal  Rw anda  Madagascar  Tanzania  Ethiopia  Gambia  Djibouti  Eritrea  Maldives  Comoros  Vanuatu  Samoa 
 
Source :  WTO. WT/COMTD/LDC/W/46 
Page 7 
 
 
  14. Export concentration has been a structural characteristic of LDC economies.10  The recent 
trends in commodity prices reinforce this tende ncy, not only by increasing the weight of those 
commodities, but also for discouraging diversification efforts.11  On average, almost three quarters of 
total merchandise exports depended upon only three main products (which change from LDC to 
LDC).  For eight countries, the top three products account for more than 95 per cent of their export 
receipts, illustrating the vulnerability of these economi es to fluctuations in international trade.  
15. Some LDCs also depend on service exports for a sizeable share of their total export receipts.  
Travel, a close proxy of tourism receipts, is the dominant sector, especially for small islands where it 
represents the main source of export revenues (Kir ibati and Solomon Islands are also exporters of 
business services, as well as telecommunications services).  Transportation – an activity closely 
related to trade in goods is especially important fo r Djibouti, Ethiopia and Myanmar.  The dependence 
on a few products and services matter most when the global economy goes through a period of structural changes, as was the case in  the recent years.  It even beco mes a critical aspect when a crisis 
strikes.  Before analysing the vulnerability of each  product group during the present crisis, their past 
contribution to the growth of LDC exports is outlined below. 
16. Chart 2 indicates a rapid rise in the value of fuels and mineral exports  between 2000 and 2007 
(more than 27 per cent on average, year on yea r).  Fuels and minerals, already the major export 
products in 2000 (43 per cent of total expor ts) have now assumed a clear dominant position 
(67 per cent).   
Chart 2:  Composition of LDC exports by major products, 2007
 
 
11.6
11.0
10.8 7.217.5 10.2 11.227.5
0.010.020.030.040.050.060.070.0
   Textiles    Machinery
and transport Others    Process
manufactures   Agr. raw
materials   Food    Clothing    Fuels and
minerals2000
2007
 
Note: Number over 2007 bar indicates average annual growth rate (2000-2007). 
 
17. This increased concentration on commodities re duced the weight of clothing, the second 
product in importance, to below 13 per cent.  All other product groups are now contributing less than 
10 per cent to the total export value.  Process manufactures (iron and steel, chemicals, pharmaceuticals and other semi-manufactures) are the so le items that registered a single digit average 
                                                     
 
10 In international economics, export concentration is  usually associated with the small size of the 
country, but this relation does not hold within the LDC gr oup, where export concentration is highest for the ten 
largest economies, ranked either by GDP or trade (see WT/COMTD/LDC/W/42/Rev.1). 
11 The non-traditional activities appear less lucrative to domestic investors due to their lower relative 
prices.  In addition, exchange rate appreciation linked to commodity booms – the so-called Dutch Disease –  
reduces the international competitiveness of labour intensive activities, such as light manufacture. WT/COMTD/LDC/W/46 
Page 8  
 
  annual growth;  their share in the export structure of the group dropped therefore from 8 to 4 per cent 
during the period.  
18. The increase in the value of fuels and mineral exports is the result of an increase in both 
international prices and volume exported.  As indicated  in Table 1, prices alone explain slightly more 
than half of the changes from 2000 to 2008.  The increase in production capacities reflects, inter alia , 
the large share of foreign direct investments (FDI) that was directed towards the extractive 
industries.
12  The process of other commodities increased at a much slower pace since the year 2000, 
even though food products registered a surge in 200 8.  Among the products of interest to LDCs, it 
should be noted that the price of rice, bananas and coffee increased substantially over the period.  In 
relation, the average unit value of manufacture trad e grew much more slowly, at an annual average 
rate of 4 per cent for the period. 
 
                                                      
12 As mentioned by UNCTAD, in recent years, there has been a significant increase in FDI flows to the 
primary sector, mainly the extractive in dustries, and a consequent increase in the share of that sector in global 
FDI flows.  (Source:  UNCTAD, World Investment Report 2008.) WT/COMTD/LDC/W/46 
Page 9 
 
 
  Table 1:  Export prices of primary commodities, 2000-2008  
(Annual and quarterly percentage changes) 
 
  2000 2001 2002 2003 2004 2005 2006 2007 2008 2008 Q-o-Q 
                    Q1 Q2 Q3 Q4 Annual 
average 
2000-08 
Food and beverages -0.4 0.4 2.7 5.1 13.2 1.5 10.3 15.1 23.3 18.1 6.6 -4.5 -24.7 8.7 
Agricultural raw materials 4.7 -5.0 1.8 3.8 5.4 1.6 8.6 5.0 -0.8 2.0 2.2 0.3 -15.4 2.5 
Minerals and non-
ferrous metals  
(excluding crude petroleum) 12.1 -9.7 -2.7 12.3 36.2 26.5 55.9 17.5 -7.9 10.6 1.1 -8.5 -33.4 14.1 
Total of above 4.5 -4.0 0.8 6.9 18.6 10.3 23.1 14.1 7.5 12.8 4.0 -5.1 -26.0 9.3 
Energy 56.1 -11.6 -0.4 16.7 31.1 38.7 19.2 10.5 40.1 11.0 25.8 -2.2 -46.4 16.7 
All primary 
commodities 32.6 -8.9 0.1 13.0 26.6 29.1 20.6 11.8 27.6 11.6 18.3 -3.1 -40.4 14.2 
Memo item: 
Manufacture Unit Value -2.9 -3.2 1.4 9.6 8.4 2.3 2.7 7.3 ... .... ... ... ... 4.0 
 
Note : The indices are period averages based on dollar prices.  The data for manufacture correspond to unit values.  The 
quarterly figures are not seasonally adjusted. 
Source : WTO. 
 
19. Commercial service exports are of particular importance to many LDCs, such as Tanzania, 
Cambodia, Ethiopia, Senegal and Bangladesh.  Trav el, a close proxy of tourism receipts, is the 
dominant sector of LDC services exports, representi ng 52 per cent of the balance-of-payment receipts 
of commercial services in 2008 (see Table 2).  This activity grew steadily since the beginning of 2000, 
at an average annual rate of 15 per cent, and was particularly dynamic during the last three years.  
This promising sector is vulnerable in the present economic cycle, because a large part of these 
revenues originate from tourists arriving from devel oped countries, where the economic impact of the 
crisis has been primarily felt.  
Table 2:  Commercial servi ces exports by LDCs, 2000-2008
 
(US$ million and percentages) 
 
Value 2000 2001 2002 2003 2004 2005 2006 2007 2008a 
Commercial services 6125 6278 6711 7275 8853 9749 11334 14270 16942 
Transport 1222 1267 1367 1505 1739 2187 2535 2945 3620 
Travel 2874 3179 3477 3766 4654 5156 5901 7622 8770 
Other commercial services 2029 1831 1867 2003 2460 2407 2898 3702 4550 
Composition 2000 2001 2002 2003 2004 2005 2006 2007 2008a 
Commercial services 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 
Transport 20.0 20.2 20.4 20.7 19.6 22.4 22.4 21 21.4 
Travel 46.9 50.6 51.8 51.8 52.6 52.9 52.1 53.4 51.8 
Other commercial services 33.1 29.2 27.8 27.5 27.8 24.7 25.6 25.9 26.9 
 aPreliminary estimate. 
Source : WTO. 
 
20. After travel, the category of "other commercial services" accounted for 27 per cent of services 
exports in 2008.13  This sector has registered a renewed dyna mism in the last year, however, it is still 
growing at a rate below that of the LDC commerc ial services exports.  In 2007, among the LDCs, the 
five largest exporters of "other commercial services" were Bangladesh (14 per cent), Senegal 
                                                      
13 This category includes, inter alia , incomes for licenses and royalties, as well as transactions such as 
construction, computer and information, and other business services (legal, accounting, management and public relation services). These services are sometimes traded involvin g the presence of natural persons in the recipient 
countries (mode 4).  WT/COMTD/LDC/W/46 
Page 10  
 
  (11 per cent), Madagascar (8 per cent), Tanzania (8 per cent), and Ethiopia (7 per cent).  The sector is 
also important for some smaller LDCs such as the Solomon Islands.  
 
21. Transportation services are the smallest co mponent of LDC services exports representing 
21 per cent in 2008.  This sector is closely linked to  trade in goods, and registered an average annual 
growth of nearly 15 per cent since 2000.  As a resu lt of high correlation of transportation services with 
trade in goods, this sector is particularly exposed to  the crisis.  Transportation services are especially 
important for LDCs such as Djibouti and Ethiopia, where they account for more than half of services exports.  
22. In 2007, the EU overtook the US as the main importer of LDC products, purchasing 
28 per cent of their exports (against 26 per cent for the US).  Chart 3 reveals that the market for LDC 
exports have increasingly become diversified, with  developing economies, such as China, India and 
Thailand having a greater weight in LDC exports th an one would expect from their share in world 
total imports.
14  As a result of this geographical redistribution of trade flows, LDC exports in 2007 to 
other developing economies represented 48 per cent of  their total exports, s howing lower dependence 
on developed markets.   
23. Throughout recent years, developing economies have become the major destination for LDC 
exports of mineral fuels (56 per cent in 2006), co pper (83 per cent), wood products (87 per cent), 
cotton (89 per cent) or some food products lik e vegetables and oil seeds (84 and 73 per cent).  
Interestingly, these products where South-South trad e has been particularly important for LDCs are 
also those where international prices have been increasing.  On the contrary, developed economies 
remain largely a dominant export destination for ma nufactured articles such as clothing (95 per cent 
for products under HS 61and 62 chapters), where cha nges in prices have been much more moderate.  
Developed country markets are also the main de stination of exports for some high value-added 
agricultural and food products such as fish and crustaceans, beverages or tobacco, with 67, 73 and 
57 per cent, respectively.  
 
                                                      
14 While China purchases 24 per cent of all LDC exports, its weight as a world import market 
(excluding intra-EU trade) is only 8.5 per cent. These respective numbers are 6.2 and 1.9 per cent for India and 
5.1 and 1.4 per cent for Thailand.  As indicated in a previous report (WT/COMTD/LDC/W/42/Rev.1), this may 
be due to geographical proximity and specific Prefer ential Trade Agreements (P TAs) or Regional Trade 
Agreements (RTAs), as well as a closer match betw een LDCs' domestic production capabilities and developing 
economies' demand. WT/COMTD/LDC/W/46 
Page 11 
 
 
  Chart 3:  Top 15 markets for LDC e xports of goods, 2000-2007 (US$ billion)  
 
0.05.010.015.020.025.030.0
Ethi opi a Nor w ay Si ngapor e Hong
Ko ng,Chi naViet Nam Saudi
ArabiaRepublic
of  K or eaCanada Chi nese
TaipeiTha ila nd J a pa n India C hina Unite d
StatesEuropean
Union (27)2000
2007
 
Source : WTO. 
 
B. HAVE THE LDC S GAINED MARKET SHARE ? 
24. The objective of this section is to determin e whether the performance of LDC merchandise 
exports was merely due to the overall dynamism of wo rld trade (riding the global tide) or if it was due 
to their specialization in products or market divers ity.  The aim is to further understand the dynamics 
of main markets and products that are relevant to  LDCs in order to identify possible scenarios for the 
crisis.  Using 45° graphs, it is possible to see whet her LDCs gained (or lost) market share in dynamic 
niches (products or importers that have been growi ng at a rapid pace) or if they gained (or lost) 
relevance in mature or declining niches (products or  importers that have been growing at, or below, 
world average).  The analysis covers the period from 2000 to 2007.  Points above/below the 45° line 
are those for which LDCs have gained/lost market share;  the size of the point indicates the importance of the corresponding market for LDCs (either as an exported  product or a market of 
destination) during 2000-2007. 
25. Chart 4 indicates that, with the exception of "fuels" and "other minerals" (two dynamic 
products at world level), the LDCs have gained mark et share in mature products (food) and stagnating 
ones (textiles, clothing, and agricultural raw materials).  This pattern is to be expected in developing 
countries.
15  The LDCs have been losing ground in the relative dynamic niche of "process 
manufactures", i.e., capital intensive industries such as iron and steel, pharmac y, chemicals and other 
semi-finished products. 
 
                                                      
15 According to the traditional "product cycle" theory, innovative products are usually produced in 
industrialized countries, and the production moves progre ssively to developing countries when the product is 
entering maturity and goes for mass production.  This tr aditional pattern has been radically transformed in the 
recent years with the internationalization of global supply chains  that are out-sourcing the production of 
relatively innovative products . WT/COMTD/LDC/W/46 
Page 12  
 
  Chart 4:  Comparative evolution of LDCs' product specialization, 2000-2007
 
(annual average growth, per cent) 
 
Scatter plots:
   TextilesOthers
  Machinery 
   Agr. raw materials   Process 
manufactures   Food   Clothing   Fuels and minerals
  Total merchandise 
exports
51015202530
5 1 01 52 02 53 0World trade LDC exports
 
Source :  WTO. 
 
26. Applying the same analytical device to their main markets of destination (Chart 5), it is 
interesting to see that LDCs are gaining market sh ares in the two most dynamic markets (China and 
India).  They also tend to increase their presence in  mature markets such as Canada, Chinese Taipei, 
Japan and the US.16  Their sales to the EU, another mature market, are also growing slightly above 
world average.  While LDCs have  reinforced their presence in Thailand, an emerging economy, they 
are losing market shares in Norway, Korea and Singapore. 
                                                      
16 It should be noted that the LDCs bene fit from preferential access to these countries. WT/COMTD/LDC/W/46 
Page 13 
 
 
  Chart 5:  Comparative evolution of main LDC markets, 2000-2007  
(annual average growth, per cent) 
 
Vie t Na m
Hong Kong, 
Chi na 
NorwayCanada
Saudi  Arabi a
Si ngaporeC hin. Ta ipe iIn d ia
Japan
Tha ila nd
Rep.  of K oreaChi na
US AEU (27)
-0.100.10.20.30.4
-0.1 0 0.1 0.2 0.3
Average change in imports from worldAverage change in imports from LDCs
 
 
Source : WTO 
27. The above-mentioned results on th e relative dynamics of LDCs' market shares in the space of 
products and markets of destination are confirmed when  applying the shift-share analysis (see Box 1).  
Most LDC exporters did better than just "riding th e tide", either because they were able:  (i) to 
amplify an initial favourable specialization in dynamic products (exporters of fuels and other 
minerals) and markets (large emerging economies like  China and India);  or (ii) because they were 
able to increase their market share in mature mark ets (typically, light manufacture sold to developed 
countries).  The only category of LDC exporters th at could not increase its export performance, but 
followed the global trend, was the agricultural exporters.   WT/COMTD/LDC/W/46 
Page 14  
 
   
Box 1:  The dynamics of  LDC exports between 2000 and 2007 using the SSA 
 
According to the SSA, 76 per cent of th e growth of LDC exports was based on the strength of their sale of fuels and 
minerals.  If LDCs benefited from the global tide, this explains less than half (46 per cent) of their export performance.  Their initial product mix in the year 2000 , with an already high composition of fuels and minerals, 
helped somewhat (9 per cent) in explaining their grow th, while their geographical diversification was, on the 
contrary, a negative aspect (-2 per cent).  
The LDCs' capacity to adapt th eir exports to changing environment is, according to the SSA method, imputable for 
46 per cent of their performance between 2000 and 2007.  They increase their market share in dynamic products 
such as fuels and minerals (thanks to higher investment and production) and redirected their exports to the most dynamic markets (China and India).  They were also ab le to increase their presence in developed economies (see 
Charts 5 and 7).  
Ranking high in the performance index was easier for oil exporters and producers of other minerals, because 
(i) they benefited from most of the FDI inflow which entered the LDCs;  and (ii)  commodities are standard 
products that are easily redirected from one market to another.  
The performance of LDCs specializing in  manufacture or agriculture is very similar in terms of overall results 
(about 15 per cent annual growth);  but it is very heterogene ous in its sources.  The "agricultural exporters" in fact 
diversified (agriculture explained just half of the export  performance, the rest being equally distributed between 
extractive activities and manufactures).  Their limited natural resources in fuels and other minerals helped them in 
seizing some of the momentum benefiting these commodities, but in general their export structure did not adapt to 
the changes in global trade.  
The manufacture exporters, on the contrary, suffered from a bad positioning in both products and markets 
(international prices have been growing only slowly, and are mainly exported to developed markets, which are 
growing less than world average).  But these countries were able, through increased competitiveness, to gain 
market share in their traditional markets. As a result, 44 per cent of their export performance is due to the 
"residual", the SSA proxy for global competitiveness. 
Table:  SSA decomposition of changes in LDC exports, 2000-2007
 (percentages) 
 
 Annual 
growth Total Global effect Co mposition Geographical 
distribution Residual 
LDC Group 23.5 100 46 9 -2 46 
Fuels and mining  76 20 16 -1 42 
Manufacture  14 16 -4 -1 3 
Agriculture  9 9 -2 0 1 
Oil exporters 30.4 100 30 19 -1 52 
Fuels and mining  98 26 20 -2 53 
Manufacture  1 1 0 0 -1 
Agriculture  1 2 0 0 -1 
Other Minerals 29.3 100 32 13 -2 56 
Fuels and mining  84 15 16 -3 57 
Agriculture  13 5 -1 1 8 
Manufacture  2 11 -1 1 -10 
Agricultural exporters 15.2 100 87 0 6 7 
Agriculture  50 49 -9 2 9 
Manufacture  24 25 -3 5 -3 
Fuels and mining  24 12 12 -1 1 
Manufacture exporters 14.8 100 91 -27 -8 44 
Manufacture  69 71 -24 -9 30 
Fuels and mining  19 2 2 0 15 
Agriculture  12 17 -4 0 -1 
Note : See WT/COMTD/LDC/W/42/Rev.1 for a description of the methodology.  
Source : WTO.   WT/COMTD/LDC/W/46 
Page 15 
 
 
  III. MARKET ACCESS CONDITIONS FOR LDC EXPORTS 
A. INTRODUCTION  
28. This chapter presents a series of descriptive and analytical indicators on the evolution in 
market access conditions, includi ng duty-free access to LDC products, and the average tariffs on 
products of specific interest to LDCs.  The most recent situation concerning the tariff treatment of 
LDC exports in developed and developing markets has also been examined.  
29. Traditionally, LDCs have benefited from non-r eciprocal preferences for their merchandise 
exports in developed country mark ets.  More recently, a number of  developing countries have granted 
preferences to LDCs, under a series of multilateral,  bilateral and regional preferential market-access 
schemes.  South-South trade has grown rapidly si nce 1990 and its value now represents 16 per cent of 
world trade (43 per cent of total developing countries' exports).   
B. TRENDS IN MARKET ACCESS FOR PRODUC TS OF EXPORT INTEREST TO LDCS  
30. Table 3 shows trends in the tariff treatment th at LDC exports received in developed country 
markets between 1996 and 2007.  The indicator shows that there is virtually no progress in duty-free 
access for the LDCs as a group since 2004, whereas duty-free access for the developing countries as a 
whole has continued to increase.  Nevertheless, a clo ser analysis of this indicator shows that most of 
the improvements recorded for developing countries in  general is due to the elimination of tariffs 
under the most favoured nation (MFN) treatment, rath er than an extension of true preferential 
treatment.  
31. The margin of true preferential duty-free treat ment for the group of developing countries has 
been fluctuating around 20 per cent for the last ten years. The LDCs however have been increasingly 
benefiting from a true preferential access, from only 35 per cent of their exports in the late 1990s to 
more than 50 per cent today.  The margin of true  preference is particularly high for clothing and 
textiles (62 and 59 per cent, respectively), while it is  only 33 per cent for agriculture.  Average results 
for the LDC group may hide quite large heterogeneiti es at individual level.  Most LDCs benefit from 
duty-free access under the various preferential agreemen ts in developed markets.  The remaining gap 
is concentrated in a few LDCs, especially from As ia, as they face MFN tariffs on exports of their 
textile and clothing products in the US market.   
32. Table 4 also shows that the average tariffs charged by developed countries on agricultural 
goods, textiles and clothing, fell over the period 1996- 2007.  Compared to the treatment received by 
all developing countries, the margin of preferen ce is especially significant in case of agricultural 
products.  The difference between average tariffs paid  by LDC agricultural exports in relation to the 
group of developing countries is higher than 6 pe rcentage points.  The margin of preference on 
products such as textiles and clothing is less si gnificant (around two percentage points above the 
average tariffs faced by developing countries).  Here again, the situation differs from country to country.  The African and small island LDCs bene fited from very low tariff rates on most of their 
exports (virtually zero for all products in the case of Haiti;  from 3 per cent on agricultural products to 
zero on clothing for African LDCs;  and one per cent and five per cent, respectively for the LDCs in 
Pacific islands).  
33. It is important to mention that these indi cators are based on the assumption that existing 
preferences are fully utilized by LDCs.  Some pref erential regimes have conditions that impede their WT/COMTD/LDC/W/46 
Page 16  
 
  full utilization, for example rules of origins, and the actual rate of utilization may be as low as 
40 per cent for products such as textiles and clothing.
17  
Table 3:  Trends in tariff treatment on merchandises imported by developed countries,  
1996-2007  (percentages) 
 
 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 
a. Duty-free treatment of exports (excluding arms and oil)   
Developing Countriesa 54 55 54 63 65 64 69 71 76 76 77 79 
  of which true preferenceb 19 20 20 18 16 17 19 19 21 21 20 20 
Least-developed Countries 78 77 78 72 70 71 74 78 80 80 79 80 
 of which true preferenceb 33 35 40 33 35 40 43 48 51 49 53 52 
Agricultural goods             
Developing Countriesa 65 67 65 63 63 64 62 63 66 66 66 67 
Least-developed Countries 93 92 96 86 88 98 96 94 92 92 93 93 
Textiles              
Developing Countriesa 17 17 18 24 24 22 26 26 38 34 34 36 
Least-developed Countries 68 66 62 55 50 47 47 57 66 67 71 74 
Clothing              
Developing Countriesa 8 8 9 14 14 14 22 22 34 31 29 28 
Least-developed Countries 57 53 51 47 45 46 52 60 66 63 63 62 
 
b. Average tariffs on exports (trade weighted)c 
Agricultural goods 
Developing Countriesa 10.4 9.9 9.9 9.5 9.2 9.2 9.4 9.4 9.1 8.8 8.5 8.4 
Least-developed Countries 3.9 3.9 3.7 3.8 3.7 2.7 2.8 2. 8 3.2 3.1 2.8 2.1 
Textiles   
Developing Countriesa 7.3 7.2 7.0 6.6 6.5 6.6 6.0 5.8 5.2 5.3 5.2 5.0 
Least-developed Countries 4.6 4.5 4.4 4.3 4.1 3.8 3.8 3. 5 3.2 3.2 3.2 3.1 
Clothing 
Developing Countriesa 11.4 11.3 11.2 10.9 10.8 11.3 10.0 9.6 8.6 8.3 8.2 8.2 
Least-developed Countries 8.1 8.1 8.0 7.9 7.8 7.7 7.4 7. 0 6.4 6.4 6.4 6.4 
 
 a All developing countri es, including LDCs. 
b The true preference margin is calculated by subtrac ting from the total duty-free access all products receiving 
duty-free treatment under MFN regime. 
 c The average tariffs are weighted by trade flows and based on best applicable tariffs (MFN and preferential 
treatments granted to developing countri es). Average tariffs were weighted us ing a standard export structure based on 
2000-2001 data, to limit the impact of the ye ar to year changes in export composition and relative prices on the indicators. 
Source :  Based on CAMAD compiled by ITC, UNCTAD and WTO.  
 
C. TARIFF TREATMENT OF LDC EX PORTS IN SELECTED MARKETS  
34. The next sections analyse in more detail the coverage of duty-free access and the average 
duties faced by LDC exports in their main export markets in developed and developing countries.  
The statistical analysis of the preferential treatme nts presented in the following tables differentiates 
between theoretical coverage for agriculture and non- agricultural products (all tariff lines) and the part 
of the tariff schedule most relevant to LDCs (tariff lines with actual imports from LDCs).  The tables 
also indicate the resulting average tariffs, weighted by the value of the resp ective trade flows.  These 
indicators are again based on the best tariff availa ble, under the assumption that existing preferences 
are fully utilized by exporters. 
                                                      
17 WT/COMTD/LDC/W/37. WT/COMTD/LDC/W/46 
Page 17 
 
 
  (a) Market access conditions facing LDC exports in selected developed countries 
35. Table 5 presents detailed information on mark et access conditions in selected developed 
markets for the year 2007.  The table is organized in  three sets of indicators.  The first set of four 
columns compares the number of duty-free tariff li nes granted to LDCs with regard to the MFN 
regime.  Given supply-side limitations, not all these opportunities are utilized;  the next four columns 
show the same information, but based on those ta riff lines where trade was reported for the reference 
year.  Finally, the third indicator complements the information at tariff-line level by presenting the corresponding imports and trade weighted duty averages. 
36. In 2007, many developed countries provided tota l or nearly total duty-free status to LDC 
exports, both in terms of tariff lines and import valu e.  This was in particular the case for Australia, 
Canada, EC, Japan, New Zealand and Norway.  Switzerland provided duty-free access for over 
96 per cent of the value of its imports from LDCs, while the percentage of preferential duty-free tariff 
lines was only 85 per cent, due principally  to lower coverage in agriculture.
18  An opposite situation is 
observed in the US, where almost 100 per cent of the value of imported agricultural goods entered 
duty free, while the coverage was low (22 per cent)for non-agricultural products.  
37. Overall, the review of selected, importing deve loped country markets reveal that on average 
(weighted), LDCs benefit from preferential duty-fr ee treatment on 91 per cent of the dutiable MFN 
tariff lines (see Table 4).  The coverage of preferential duty-free access is 100 per cent or close to it for non-agricultural raw materials (principally minera ls and fuels).  Over 91 per cent of manufactured 
products actually exported (tariff line with impor ts) benefit from duty-free treatment, while this 
percentage rises to 93 per cent in the case of agriculture.  
38. Interestingly, the actual duty-free treatment for agricultural exports (tariff lines with imports) 
is much higher than the total coverage considering all agricultural tariff lines, with or without imports 
from LDCs (93 and 80 per cent, respectively).  This difference originates principally from two 
preference granting countries, Switzerland and the US, a nd may be explained by two effects.  The first 
one is related to the fact that LD C exporters would avoid trading in those lines where they do not have 
preferential treatment over other competitors;  the s econd rationale is that the protected tariff lines 
cover principally products of temperate agricultu re where the importing countries have their own 
production;  these are normally not produced by LDCs that are mainly located in tropical areas.   
Table 4:  Preferential duty-free access for LDC exports to developed countries
 
 
Sector Number of  
tariff linesa Tariff lines with 
imports Preferential duty free 
importsb 
 in per cent of total tariff lines in per cent of total imports 
Total 91.1 91.3 87.4 
Agriculture 80.4 92.9 92.3 
Non-agriculture 94.2 91.1 72.7 
Ores 100.0 100.0 100.0 
Petroleum 100.0 100.0 100.0 
 
 a Percentage of tariff lines exempted of duty under prefer ential LDC schemes in relation to dutiable tariff lines 
under MFN regime (excluding all MFN duty-free treatment).  
 b Percentage of imports exempted of duty under preferen tial LDC schemes.  The data refer to the LDCs as a 
Group. 
Source :  WTO.  
 
                                                      
18 As of September 2009, Switzerland grants DFQF market access to all products from all LDCs (See 
Section IV). WT/COMTD/LDC/W/46 
Page 18  
 
  39. The opposite effect can be observed in the case of manufacture, where an actual duty-free 
tariff line coverage of 91 per cent translates in only a 73 per cent of the trade value, indicating that, 
contrary to agriculture, a large share of the trade is  not covered by preferences.  This result is almost 
entirely due to the tariffs faced by Asian LDC exporters of clothing in the US market.
19 
 
                                                      
19As mentioned in WT/COMTD/LDC/W/42/Rev.1, despite the MFN treatment imposed on their textile 
and clothing exports, Bangladesh and Cambodia consolidated their positions in the US market when quotas 
were lifted, with total exports of textiles and clothing  growing at an annual average of 15 and 19 per cent, 
respectively, from 2004 to 2007.  
   WT/COMTD/LDC/W/46
 Page 19 
 
Table 5:  Tariff treatment of LDC expor ts in selected developed markets, 2007  
 
    NUMBER OF TARIFF LINES a IMPORTS (million US$ and percentage) b 
Member  Sector TARIFF REGIME WITH IMPORTS LDC 
   MFN LDC LDC Beneficiaries 
   
TOTAL Dutiable Dutiable % duty 
free All 
partners Number Dutiable 
MFN Dutiable 
LDC 
scheme All partners TOTAL Dutiable 
imp. % duty 
free Weighted 
applied dutyc 
Total 6 002 3 229 0 100.0 5 540 953 569 0 156 863.9 210.3 0.0 100.0 0.0 
Agriculture 748 215 0 100.0 634 113 33 0 7 163.5 25.1 0.0 100.0 0.0 
Non-agriculture 5 219 3 014 0 100.0 4 880 838 536 0 136 915.6 185.2 0.0 100.0 0.0 
Ores 33 0 0 100.0 25 2 0 0 463.8 0.0 0.0 100.0 0.0 Australia 
Petroleum 2 0 0 100.0 1 0 0 0 12 321.0 0.0 -  - - 
Total 8 424 4 096 95 98.9 8 233 1 932 1 127 2 372 022.1 2 358.6 2.2 99.9 0.4 
Agriculture 1 365 834 95 93.0 1 271 298 134 2 22 956.7 27.6 0.5 98.1 0.3 
Non-agriculture 7 025 3 262 0 100.0 6 930 1 626 993 0 323 720.6 952.8 1.7 99.8 0.4 
Ores 33 0 0 100.0 31 7 0 0 2 926.9 49.0 0.0 100.0 0.0 Canada 
Petroleum 1 0 0 100.0 1 1 0 0 22 417.9 1 329.3 0.0 100.0 0.0 
Total 9 720 7 341 63 99.4 9 426 3 549 2 733 28 1 755 072.6 25 365.3 459.5 98.2 0.2 
Agriculture 2 032 1 663 41 98.0 1 805 563 406 24 101 520.0 2 624.7 224.7 91.4 0.0 
Non-agriculture 7 645 5 678 22 99.7 7 580 2 967 2 327 4 1 353 755.9 14 603.9 234.8 98.4 0.3 
Ores 41 0 0 100.0 39 17 0 0 26 750.4 1 164.1 0.0 100.0 0.0 European 
Communities 
Petroleum 2 0 0 100.0 2 2 0 0 273 046.3 6 972.7 0.0 100.0 0.0 
Total 9 035 5 340 164 98.2 7 973 853 540 13 610 891.9 5 289.8 6.1 99.9 0.1 
Agriculture 1 858 1 386 69 96.3 1 436 119 63 1 45 788.3 243.3 0.0 100.0 0.0 
Non-agriculture 7 138 3 954 95 98.7 6 505 729 477 12 436 287.5 1 176.2 6.1 99.5 0.1 
Ores 37 0 0 100.0 30 4 0 0 25 178.3 37.3 0.0 100.0 0.0 Japan 
Petroleum 2 0 0 100.0 2 1 0 0 103 637.9 3 833.0 0.0 100.0 0.0 
Total 7 270 3 081 0 100.0 6 466 766 470 0 30 369.9 18.0 0.0 100.0 0.0 
Agriculture 1 000 364 0 100.0 798 76 24 0 2 596.3 4.8 0.0 100.0 0.0 
Non-agriculture 6 236 2 717 0 100.0 5 655 690 446 0 25 687.1 13.2 0.0 100.0 0.0 
Ores 33 0 0 100.0 12 0 0 0 1.4 0.0 - - - New Zealand 
Petroleum 1 0 0 100.0 1 0 0 0 2 085.2 0.0 - - - 
Total 7 031 1 156 1 100.0 6 471 673 264 1 79 584.1 287.9 21.9 92.4 1.6 
Agriculture 1 345 851 1 99.9 1 098 91 41 1 4 756.0 25.0 12.4 50.4 5.9 
Non-agriculture 5 651 305 0 100.0 5 360 580 223 0 73 459.3 156.3 9.5 94.0 0.9 
Ores 33 0 0 100.0 12 1 0 0 595.6 9.2 0.0 100.0 0.0 
Petroleum 2 0 0 100.0 1 1 0 0 773.2 97.4 0.0 100.0 0.0 Norway 
               
  WT/COMTD/LDC/W/46 
Page 20     NUMBER OF TARIFF LINES a IMPORTS (million US$ and percentage) b 
Member  Sector TARIFF REGIME WITH IMPORTS LDC 
   MFN LDC LDC Beneficiaries 
   
TOTAL Dutiable Dutiable % duty 
free All 
partners Number Dutiable 
MFN Dutiable 
LDC 
scheme All partners TOTAL Dutiable 
imp. % duty 
free Weighted 
applied dutyc 
Total 8 371 6 981 1 238 85.2 7 739 807 672 33 160 488.1 396.5 14.7 96.3 0.0 
Agriculture 2 282 1 972 1 226 46.3 1 843 156 112 33 9 183.9 55.7 14.7 73.6 0.0 
Non-agriculture 6 054 5 009 12 99.8 5 875 650 560 0 148 823.4 136.4 0.0 100.0 0.0 
Ores 33 0 0 100.0 20 0 0 0 2.7 0.0 - - - Switzerland 
Petroleum 2 0 0 100.0 1 1 0 0 2 478.1 204.4 0.0 100.0 0.0 
Total 10 451 6 700 1 831 82.5 10 065 1 693 1 119 572 1 870 091.4 24 467.9 6 837.4 72.1 5.7 
Agriculture 1 792 1 418 274 84.7 1 538 219 134 6 74 960.9 281.4 0.5 99.8 0.5 
Non-agriculture 8 614 5 273 1 557 81.9 8 490 1 466 982 566 1 616 003.9 8 740.4 6 836.9 21.8 6.4 
Ores 43 7 0 100.0 35 6 1 0 2 915.2 109.6 0.0 100.0 0.0 United States 
Petroleum 2 2 0 100.0 2 2 2 0 176 211.5 15 336.4 0.0 100.0 0.0 
 a Based on HS 2007 classification. The Table uses the WT O Agreement on Agriculture definition of Agriculture.  
 b Imports are based on IDB and CAMAD data, and may differ with thos e reported in Annex Tables due to differences in coverage, in particular for the definition of agricultural products.   
 c Excludes non ad valorem  duties if no AVEs have been provided. 
Source: WTO, UNCTAD, ITC. 
 
 
 WT/COMTD/LDC/W/46 
Page 21 
 
 
  (b) Market access conditions facing LDC exports in selected developing countries 
40. The information available for developing c ountries on existing preference schemes for LDCs 
is limited.  The analysis of ma rket access conditions in developing countries is therefore reduced to 
studying the treatment actually received by the LDC exports to these markets, mostly on an MFN-basis, as indicated by the share of duty-free imports and average tariffs, weighted by the import 
values. 
41. Table 7 shows a significant degree of heterogeneity  in tariff structure of different developing 
country markets.  Some countries grant extensive,  and even full duty-free ac cess on agricultural and 
non-agricultural products, under the MFN regime.  It is , in particular, the case of Hong Kong, China; 
and Singapore.  China and Malaysia are granting dut y-free treatment to 90 per cent or more of their 
tariff lines, even if the residual average tariff may remain relatively high for some categories of 
products.  Chile, however, does not provide full duty-free access, but the average tariff is low (6 per cent) for both agricultural and non-agricultural products. 
42. The (weighted) average tariff faced by LDCs in  developing countries was nearly 12 per cent 
in 2006, with much higher rates for agriculture  than non agricultural products (Table 6).  
Seventy-three per cent of the total value of LDC exports was granted duty-free status, which resulted 
principally from the favourable treatment of their e xports of fuel and non-fuel minerals.  On the other 
hand, only 30 per cent of their agricultural exports  was accepted free of duty, while the remaining 
agricultural exports faced an average tariff of 26  per cent.  This situation illustrates the wide 
dispersion of tariffs facing South-South trade, and the potential for improving LDCs' market access in developing countries. 
 
Table 6:  Market access for LDC exports to developing countries, 2006
 
 
Number of MFN 
duty-free tariff lines Tariff lines  
with imports MFN duty-free imports Weighted  
import duties Sector 
in per cent of total tariff lines  in per cent of total imports  
Total 66.8 12.2 73.2 11.9 
Agriculture 69.6 15.3 29.7 26.1 
Non-agriculture 66.5 11.8 40.1 13.4 
Ores 42.4 22.2 88.6 3.1 
Petroleum 57.1 66.7 87.3 4.8 
 
Source : WTO.  
 
  
  WT/COMTD/LDC/W/46 
Page 22 Table 7:  Tariff treatment of LDC expor ts in selected developing markets, 2006  
    NUMBER OF TARIFF LINES a IMPORTS (million US$ and percentage) 
 Member Sector TARIFF REGIME WITH IMPORTS LDC 
   MFN LDC LDC Beneficiaries 
    TOTAL Dutiable Dutiable % duty 
free All 
partners Number Dutiable 
MFN Dutiable 
LDC 
scheme All 
partners TOTAL Dutiable 
imp. % duty 
free Weighted 
applied duty b 
Brazil Total 9 711 8 987 - - 8 021 22 15 - 83 120.1 1 357.3 18.6 98.6 7.2 
  Agriculture 944 866 - - 656 5 5 - 4 913.9 17.4 17.4 0.0 10.0 
  Non-agriculture 8 720 8 076 - - 7 340 15 9 - 67 578.7 115.3 1.0 99.2 7.7 
  Ores 45 45 - - 24 1 1 - 1 492.7 0.3 0.3 0.0 2.0 
  Petroleum 2 0 - - 1 1 0 - 9 134.8 1 224.3 0.0 100.0 0.0 
Chile Total 7 705 7 670 - - 6 494 193 193 - 42 569.5 951.3 951.3 0.0 6.0 
  Agriculture 1 048 1 048 - - 791 12 12 - 3 135.8 0.4 0.4 0.0 6.0 
  Non-agriculture 6 614 6 579 - - 5 683 178 178 - 33 251.3 36.7 36.7 0.0 6.0 
  Ores 41 41 - - 18 2 2 - 1 186.8 0.2 0.2 0.0 6.0 
  Petroleum 2 2 - - 2 1 1 - 4 995.6 913.9 913.9 0.0 6.0 
China Total 7 646 7 006 - - 7 026 807 690 - 862 298.4 21 992.0 1 382.5 93.7 9.2 
  Agriculture 1 075 1 001 - - 826 101 97 - 36 568.7 546.8 545.8 0.2 15.4 
  Non-agriculture 6 531 5 994 - - 6 168 684 593 - 696 695.0 1 557.3 836.7 46.3 8.8 
  Ores 39 11 - - 31 21 0 - 53 247.4 864.9 0.0 100.0 0.0 
  Petroleum 1 0 - - 1 1 0 - 75 787.2 19 023.1 0.0 100.0 0.0 
Hong Kong, China Total 6 908 0 - - 5 904 714 0 - 369 983.2 601.2 0.0 100.0 0.0 
  Agriculture 937 0 - - 782 67 0 - 10 412.6 42.3 0.0 100.0 0.0 
  Non-agriculture 5 936 0 - - 5 105 643 0 - 359 536.1 545.2 0.0 100.0 0.0 
  Ores 34 0 - - 17 4 0 - 34.5 13.7 0.0 100.0 0.0 
  Petroleum 1 0 - - 0 0 0 - 0.0 0.0  - - - 
India Total 11 268 10 884 - - 8 038 1 175 1 101 - 146 780.6 4 384.7 4 142.9 5.5 14.7 
  Agriculture 1 430 1 389 - - 810 219 202 - 6 775.4 1 065.1 870.7 18.2 30.4 
  Non-agriculture 9 777 9 434 - - 7 189 945 888 - 90 093.1 1 402.3 1 354.8 3.4 10.9 
  Ores 60 60 - - 38 10 10 - 4 406.9 115.3 115.3 0.0 3.1 
  Petroleum 1 1 - - 1 1 1 - 45 505.3 1 802.0 1 802.0 0.0 5.0 
Kenya Total 5 429 3 454 - - 1 022 442 294 - 557.6 250.7 167.1 33.3 14.4 
  Agriculture 729 604 - - 176 124 111 - 274.4 136.3 128.6 5.7 18.9 
  Non-agriculture 4 666 2 850 - - 846 318 183 - 283.2 114.4 38.5 66.3 12.4 
  Ores 33 0 - - 0 0 0 - 0.0 0.0 - - - 
  Petroleum 1 0 - - 0 0 0 - 0.0 0.0 - - - 
Korea, Republic of Total 11 703 9 844 9 666 17.4 10 464 786 690 649 353 249.1 2 071.0 1 136.0 45.1 9.5 
  Agriculture 1 556 1 494 1 445 7.1 1 244 90 89    81 14 563.9 43.2 10.0 76.8 25.9 
  Non-agriculture 10 089 8 330 8 201 18.7 9 168 688 595 562 269 128.3 989.3 123.7 87.5 7.9 
  Ores 48 10 10 79.2 42 2 0      0 9 233.3 36.2 0.0 100.0 0.0 
  Petroleum 10 10 10 0.0 10 6 6      6 60 323.5 1 002.3 1 002.3 0.0 3.0 
Malaysia Total 12 585 6 435 - - 11 868 1 259 650 - 117 053.3 342.0 34.5 89.9 8.4 
  Agriculture 1 564 609 - - 1 425 223 101 - 6 950.0 71.8 5.5 92.3 5.9 
  Non-agriculture 10 979 5 824 - - 10 413 1 034 549 - 107 353.5 217.1 29.0 86.6 8.9 
  Ores 39 0 - - 27 1 0 - 121.7 11.8 0.0 100.0 0.0 
  Petroleum 3 2 - - 3 1 0 - 2 628.0 41.3 0.0 100.0 0.0 
Pakistan Total 6 910 6 510 - - 3 899 351 272 - 14 341.0 430.4 75.7 82.4 10.5 
 Agriculture 803 682 - - 437 130 87 - 2 693.3 248.7 63.0 74.7 7.2 
 Non-agriculture 6 073 5 798 - - 3 456 220 185 - 7 970.0 181.7 12.7 93.0 13.2 
 Ores 33 30 - - 5 1 0 - 79.2 0.0 0.0 100.0 0.0 
 Petroleum 1 0 - - 1 0 0 - 3 598.5 0.0 - - - 
                
   WT/COMTD/LDC/W/46
 Page 23    NUMBER OF TARIFF LINES a IMPORTS (million US$ and percentage) 
 Member Sector TARIFF REGIME WITH IMPORTS LDC 
   MFN LDC LDC Beneficiaries 
    TOTAL Dutiable Dutiable % duty 
free All 
partners Number Dutiable 
MFN Dutiable 
LDC 
scheme All 
partners TOTAL Dutiable 
imp. % duty 
free Weighted 
applied duty b 
Singapore c Total 10 688 6 - - 9 449 1 947 2 - 233 750.7 386.8 1.7 99.6 0.0 
  Agriculture 1 216 6 - - 1 000 251 2 - 5 926.5 81.6 1.7 97.9 0.0 
  Non-agriculture 9 434 0 - - 8 427 1 693 0 - 207 390.1 295.1 0.0 100.0 0.0 
  Ores 36 0 - - 20 1 0 - 41.0 0.0 0.0 100.0 0.0 
  Petroleum 2 0 - - 2 2 0 - 20 393.1 10.1 0.0 100.0 0.0 
South Africa c Total 6 664 3 140 - - 5 865 1 744 856 - 57 899.1 1 055.9 156.0 85.2 11.4 
  Agriculture 880 507 - - 786 202 110 - 3 128.0 114.8 104.1 9.3 8.0 
  Non-agriculture 5 750 2 633 - - 5 051 1 527 746 - 45 156.7 305.0 51.9 83.0 11.8 
  Ores 33 0 - - 27 14 0 - 374.7 51.6 0.0 100.0 0.0 
  Petroleum 1 0 - - 1 1 0 - 9 239.7 584.5 0.0 100.0 0.0 
Chinese Taipei Total 8 848 6 048 5 929 33.0 8 030 626 470 416 217 152.8 3 725.6 44.6 98.8 7.4 
  Agriculture 1 423 1 075 1 067 25.0 1 127 76 52 48 8 246.3 62.0 18.0 71.0 7.5 
  Non-agriculture 7 383 4 972 4 861 34.2 6 875 547 418 368 182 870.3 367.6 26.6 92.8 7.4 
  Ores 40 0 0 100.0 27 2 0 0 1 511.3 0.1 0.0 100.0 0.0 
  Petroleum 2 1 1 50.0 1 1 0 0 24 524.9 3 295.9 0.0 100.0 0.0 
Thailand Total 5 505 4 489 - - 5 208 1 113 1 016 - 125 225.7 4 877.8 3 243.8 33.5 14.6 
  Agriculture 768 726 - - 659 145 138 - 4 411.7 154.5 51.3 66.8 17.6 
  Non-agriculture 4 703 3 742 - - 4 522 959 871 - 100 700.1 3 376.9 3 182.8 5.7 14.4 
  Ores 33 21 - - 26 8 7 - 273.7 9.8 9.7 0.8 0.8 
  Petroleum 1 0 - - 1 1 0 - 19 840.2 1 336.6 0.0 100.0 0.0 
a Based on HS07 for Brazil;  Chile;  China;  Hong-Kong, China;  In dia;  Pakistan;  and Korea; al l other reporters are in HS02. T he Table uses the WTO Agreement on Agriculture 
definition of Agriculture.  
 b Excludes non- ad valorem  duties 
 c  2006 data. 
Note : '-' Data on preferential treatment of LDC exports if not available/not relevant.  
Source : WTO, UNCTAD, ITC  
 
 WT/COMTD/LDC/W/46 
Page 24   
 
  IV. RECENT INITIATIVES TO IMPROVE MARKET ACCESS  
43. This section focuses on recent mark et access initiatives in favour of LDCs which have been  
taken by Members since the last report issued by the Secretariat in February 2009.  Annex Table 3 
provides an updated, non-exhaustive list of mark et access initiatives taken by Members since 2000, 
based on notifications by Members and other in formation made available to the Secretariat.
20  It may 
be noted that s ince the last report by the Secretariat, no new market access initiatives in favour of LDCs 
have been notified by WTO Members.  However, a number of decisions have been taken which would, 
inter alia , provide opportunities for improved market access for LDCs.   
44. In May 2009, the General Council adopted the extension of the waiver concerning 
preferential tariff treatment for LDCs, originally  granted in June 1999 (WT/L/304), for a further 
ten years i.e. until 30 June 2019.21  This waiver extension, contained in WT/L/759, continues to allow 
the developing country Members to provide preferen tial tariff treatment to products of LDCs without 
being required to extend the same tariff ra tes to like products of any other Members.22  To date, two 
developing countries have notified their mark et-access schemes of LDCs under this legal 
mechanism.23  The extension of the Waiver is hoped to  encourage developing countries to establish 
preferential schemes for LDCs, and to further st rengthen South-South cooperation in trade.  
45. The General Council meeting of May 2009 al so adopted three waivers for US trade 
preference programmes, namely the African Growth  and Opportunity Act (AGOA) and the Caribbean 
Basin Economic Recovery Act (CBE RA), together with the Andean  Trade Preferences Act.  The 
Waiver Decision concerning AGOA (WT/L/754), wh ich will remain valid until 30 September 2015, 
allows the US to provide duty-free treatment to  eligible products originating in beneficiary 
sub-Saharan countries which incl ude a large number of LDCs.24  The Waiver concerning the CBERA 
(WT/L/753) was renewed until 31 December 2014, allo wing the US to provide preferential tariff 
treatment to eligible products originating in d esignated beneficiary countries, including an LDC 
namely Haiti.   
46. While no new market access initiatives in favour  of LDCs have been notified by WTO 
Members since the last report, it should be noted th at the full implementation of the EC's Everything 
But Arms (EBA) initiative comes into effect from 1 October 2009, as on this date the transitional 
provisions for imports of rice and sugar have been fully liberalized.25  Therefore, from 
1 October 2009, the EBA has been granting duty -free and quota-free (DFQF) market access for all 
products from all LDCs (ex cept arms and ammunitions).26  It may also be noted that Switzerland 
recently notified its revised GSP scheme (WT/COMTD/N/ 7/Add.3), which is expected to be formally 
considered at the December 2009 meeting of the CTD.  The DFQF market access for all products 
originating from all LDCs has been implemente d by Switzerland as of September 2009, as per the 
revised preferential tariffs ordinance adopt ed by the Federal Council on 16 March 2007. 
                                                      
20 A non-exhaustive list of market access initiatives in favour of LDCs taken prior to 200 0 is contained 
in a previous note by the Secretariat in document WT/COMTD/LDC/W/38. 
21 The request for the extension of the waiver was ma de by Brazil, China, India and the Republic of 
Korea (G/C/W/620). 
22 The Decision on Extension of the Waiver is contained in document WT/L/759. 
23 (i) Notification by Korea on its preferential tariff treatment for LDCs (WT/COMTD/N/12/Rev.1, 
28 April 2000);  (ii) Notification by Morocco on its preferential tariff  treatment for African LDCs (G/C/6, 
9 May 2001). 
24 The request for the AGOA and CBERA waivers (G/C/W/509 and G/C/W/508) was pending in the 
CTG for more than four years. 
25 It may be noted that the revised GSP scheme of EC (WT/COMTD/N/4/Add.4), which does not affect 
the EBA initiative, entered into force on 1 January 2009.   
26 For the period 1 October 2009 to 30 September 2012,  importers of sugar will be required to purchase 
at a price not lower than 90 per cent of the EC reference price.    WT/COMTD/LDC/W/46 
 Page 25 
 
 
  47. Members have kept informed the WTO Committees  of developments in the area of market 
access for LDCs.  India, which had announced its Duty Free Tariff Preference (DFTP) scheme for 
LDCs in April 2008, informed Members at the CTD meeting of 11 May 2009 that 16 LDCs had 
submitted letters of intent in order to  avail of the benefits of the DFTP.27  Brazil informed the General 
Council in May 2009 that its authorities were examin ing the legal and administrative steps to provide 
preferential treatment to the LDCs.  At the same meeting, Korea also indicated that it had been 
offering the LDCs duty-free market access for 80 per cent of all national tariff lines and was considering the expansion of its duty-free product coverage.
28  At the July 2009 meeting of the CTD, 
the US expressed its commitments to transparency in its preference programmes including its GSP 
scheme. 
A. IMPLEMENTATION OF THE HONG KONG MINISTERIA L DECISION ON DFQF MARKET ACCESS TO 
LDCS  
48. As per the Hong Kong Ministerial Declarati on of December 2005, Members are required to 
notify the implementation of the schemes adopted unde r the DFQF Decision every year to the CTD.  
The CTD is required to undertake annual reviews of  the steps taken by Members to provide DFQF 
market access to the LDCs.  Since Hong Kong, th ere have been three such annual reviews – 2006, 
2007 and 2008 in the CTD.   
49. The LDCs continue to call for the full implem entation of the DFQF Decision, in accordance 
with their proposals made in 2006 and the Dar es Salaam Declaration adopted by LDC Trade Ministers' in October 2009.
29  Since the Hong Kong Ministerial Conference, in parallel to the regular 
monitoring at the CTD, the negotiations on the implementation of the DFQF Decision have largely 
taken place in the Negotiating Group on Market Access (NGMA).30  Four revisions of draft NAMA 
modalities text were issued by the Chairmen of  the NGMA in 2008 – February, May, July and 
December.31  No modalities text has so far been issu ed in 2009.  There was convergence on the 
specific modalities language on market access for LDCs  during the informal Ministerial meeting held 
between 21 to 29 July 2008.  That convergen ce on the modalities language was preserved in the 
December 2008 NAMA modalities text, which is so far the latest NAMA modalities text.32  However, 
Members have not yet reached agreement on the modalities on NAMA nor on Agriculture.   
50. To operationalize the DFQF Decision, the LD C Group has been seeking information from 
developed country Members on the 97 per cent coverage under DFQF ac cess.  The time-frame within 
which this information should be provided has been u nder negotiation.  In the view of the LDCs, such 
information should be provided by  the time Members submit their draft schedule of concessions.  In 
this regard, the December 2008 NAMA modalities text s tipulates that "the agreement on the date by 
which this information shall be provi ded shall be concluded prior to the date of the Special Session of 
the Ministerial Conference to be held to take d ecisions regarding the adoption and implementation of 
the results of the negotiations in all areas of the DDA (the "Single Undertaking")".33  Furthermore, 
building on the Hong Kong Ministerial Declara tion, the December 2008 NAMA modalities text asks 
Members to provide meaningfully enhanced market access for all LDCs.   
                                                      
27 WT/COMTD/M/74.  The LDCs that submitted letters  of intent are Benin, Burkina Faso, Cambodia, 
Eritrea, Ethiopia, The Gambia, Lao PDR, Madagascar , Malawi, Mozambique, Myanmar, Rwanda, Samoa, 
Sudan, Tanzania and Uganda.  
28 WT/GC/M/120. 
29 The proposals on the implementation of the DFQF Decision and on Rules of Origin are contained in 
documents TN/MA/W/78 (also TN/AG/GEN/23 and TN/CTD/W/31) and TN/MA/W/74 (also TN/AG/GEN/20 and TN/CTD/W/30), respectively.  The Dar es Salaam  Declaration is contained in document WT/L/772.  
30 In 2009, work on NAMA concentrated on NTBs and scheduling. 
31 These four revisions are contained in documents TN/MA/W/103, Rev.1, Rev.2 and Rev.3.  
32 Paragraphs 15 to 17 of document TN/MA/W/103/Rev.3. 
33 TN/MA/W/103/Rev.3. WT/COMTD/LDC/W/46 
Page 26   
 
  51. The December 2008 NAMA modalities text envisages a monitoring procedure which would, 
inter alia , require Members to annually notify the CTD of their implementation of DFQF 
programmes, including the steps taken and possibl e time-frames established to progressively achieve 
full compliance with the Decision.  In this rega rd, the LDCs have called upon the developed-country 
Members to phase-in the remaining 3 per cent of ta riff lines under the DFQF coverage by the end of 
the implementation period.  As regards progress in work concerning the preferential rules of origin, 
the December modalities text largely echoes th e LDC Group's demand that Members use their 
proposal (TN/MA/W/74) as the model for designing th e preferential rules of origin applicable to 
imports from LDCs.  Under the proposed monitoring procedure, Members are also asked to annually 
notify to the CTD their rules of origin  associated with DFQF programmes.   
52. It may be noted that under the negotiations re lating to non-reciprocal preferences in NAMA, 
as a result of the proposal to grant a longer implementation period of MFN tariff cuts to two major preference granting Members – the EC and the US – for some identified tariff lines, three LDCs – 
Bangladesh, Cambodia and Nepal – have claime d themselves as "disproportionately affected 
countries".  As per the December 2008 NAMA modalities text, these three LDCs along with two 
developing countries (Pakistan and Sri Lanka) would have access to the normal implementation 
period of MFN tariff cuts on identified tariff lines.
34  However, this issue is still under negotiation.  
B. OTHER INITIATIVES  
53. Since the last report by the Secretariat, some progress was registered in the conclusion of full 
and interim Economic Partnership Agreements (EPAs) between the EC and six ACP regions, which 
include as many as 40 LDCs. 35  Since the last report, interim EPAs were signed with four countries of 
the Southern African Development Community (S ADC) in June 2009, two of which were LDCs – 
Lesotho and Mozambique.  As of June 2009, the EC initialled a full EPA with 14 countries in the 
Caribbean Forum of ACP states (CARIFORUM)36;  interim EPAs were signed with the East African 
Community (EAC) which includes four LDCs (Bur undi, Rwanda, Tanzania and Uganda);  with 
Comoros, Madagascar and Zambia in the Eastern and Southern Africa (ESA).37  Negotiations are 
proceeding in the Central and West African region.  The LDCs in the Pacific Region (Kiribati, Samoa, 
Solomon Islands, Tuvalu and Vanuatu) are yet to join  the interim EPAs signed so far by two countries 
in their region – Fiji and Papua New Guinea.  It  may be noted that the original deadline of 
December 2007 envisaged for conclusion of EPA nego tiations in all the ACP regions could not be 
met.  Some regions are expected to conclude full EPAs by the end of  2009.  Till the signing of interim 
or full EPAs, the other LDCs in the ACP Group are eligible to trade under the EBA scheme adopted 
by the EC in 2001.  
V. THE LDC S AND THE GLOBAL FINANCIAL CRISIS 
54. This section builds upon the previous review to  analyze the impact of the global crisis on 
LDC trade.  The analysis covers the evoluti on of main exports of goods and services since 
September 2008, encompassing also some of the fina ncial implications of the crisis for the LDCs. 
55. After having passed through a period of rapid gr owth, which accelerated in 2003, the value of 
world exports plunged sharply as soon as the first si gns of the crisis were perceived (September 
                                                      
34 The identified tariff lines are contained in Annex 4 of the document TN/MA/W/103/Rev.3. 
35 For up-to-date information, please see EC we bsite at http://ec.europa.eu/trade/index_en.htm 
36 Antigua and Barbuda, Bahamas, Barbados, Beli ze, Dominica, the Domini can Republic, Grenada, 
Guyana, Jamaica, Saint Lucia, Saint Vincent and the Gr enadines, Saint Christopher and Nevis, Suriname and 
Trinidad and Tobago. 
37 Zambia initialled the Interim EPA in November 2007, but did not conclude negotiations on market 
access until September 2008.   WT/COMTD/LDC/W/46 
 Page 27 
 
 
  2008).  Since the start of the crisis, and up to June 2009, the average monthly decline of world exports 
has been 3 per cent.  Chart 6 provides a graphical comparison of LDC exports in relation to global 
trade, and shows the overall implication of the crisis on these indicators. It is clear that the evolution 
of LDC exports mimics the world total, but with more accentuated features.  While the growth of 
LDC exports was higher in the pre-crisis period,  as will be shown in the following sections, the 
impact of the crisis was also stronger (the averag e monthly decline in world trade between September 
2008 and June 2009 was 4 per cent).  Similarly, while both trends started to bottom-out after 
March 2009, the LDCs recovery surpassed global tr ade figures (15 per cent versus 5 per cent, 
respectively), due, in particular, to a rise in th e international price of fuels and minerals.  
 
Chart 6:  Monthly evolution of World and LDC exports, January 2006-June 2009  
020004000600080001000012000140001600018000
2006
3
69
2007
3
6
9
2008
3
6
9
2009
3
605000001000000150000020000002500000
Total merchandise
World 
(right scale)
LDCs Exports
 
Note : World exports (right hand scale):  partial coverage based on 70 major traders. LDC exports (left hand scale): 
Secretariat estimates, based on mirror data from major trading partners. 
Source : WTO Short-term merchandise trade statistics data base. 
56. The crisis hurt the LDCs during a phase of particularly rapid growth of their exports of goods 
and services (see Box 1).  Total exports of goods  and commercial services (on balance-of-payments 
terms) had been growing at a high average rate  of around 20 per cent over the 2000-2008 period;  
thanks to a succession of double-digit annual grow th rates since 2003.  As a result, the LDCs 
over-performed the global trends in world trade (12 per cent), albeit their share in total trade (goods 
and services) is still marginal (0.9 per cent in 2008).  While the LDC oil exporters have been able to 
generate substantial trade surpluses,  the vast majority of LDCs still suffer from large external deficits, 
which are increasing their vulnerability in times of crisis.  WT/COMTD/LDC/W/46 
Page 28   
 
  Box 2: Recent trends affecting ext ernal trade in goods and services  
 
The sustained increase in export values was principally the re sult of the surge in commodity prices, in particular fuels 
and other minerals, on international markets.  Exports of fuels and mining benefited from this international trend, growing at an annual av erage of 28 per cent sin ce the beginning of the decade.  Av erage annual growth  in other goods 
was less impressive (11 per cent since 2000) despite good results in 2008, due to a stronger increase in food exports.  
Despite year-to-year fluctuations, exports of commercial services were also able to sustain a two-digit growth since 
2004, averaging 14 per cent average annual increase over the period. 
 
Table:  Trends in LDC exports of goods and services, (2000-2008) 
(US$ billion and percentages) 
Values Annual rate of growth  
 
2000  
2008a  
2001  
2002  
2003  
2004  
2005  
2006  
2007  
2008a 2000-
2008a 
Total goods and commercial services 42.1 176.3 3.9 7.6 15.2 29.7 30.7 23.7 22.8 26.4 19.6 
Total goods 35.9 159.4 4.2 7.7 16.3 31.0 33.6 24.6 22.5 27.3 20.5 
Commercial services 6.1 16.9 2.5 6.9 8.4 21.7 10.1 16.3 25.9 18.7 13.6 
Other goods 20.4 46.0 6.8 4.1 10.4 14.3 13.4 12.2 14.3 10.7 10.7 
Fuels and Mining 15.6 113.4 0.7 12.8 23.8 50.0 51.2 32.6 27.0 35.6 28.2 
 aPreliminary estimates. 
Source: WTO estimates based on Bala nce of Payments data. 
 
For trade in merchandise, the LDCs' participation in world exports passed the 1 per cent mark in 2008 (customs-based).  
This is more than twice their participation ten years ago (1.1 per cent of total trade in goods in 2008, vs. 0.5 in 1998).*  
In addition, thanks to the high rate of export growth wi th a more moderate trend in imports, the group registered a 
positive trade balance for the third consecutive year (see Char t below). In 2008, the trade surplus reached US$15 billion, 
representing a coverage ratio of imports by exports of 109.5 per cent.  
 
Nevertheless, this globally positive outcome registered fo r the LDC as a group hides a strong heterogeneity when 
analysing the situation of indivi dual countries.  In order to have a clearer pi cture of the trends affecting each one of the 
LDCs, Annex Table 1 presents merchandise export and import data according to four categories of economies, based on 
their export specialization:  oil, manufactures, agriculture and non-fuel minerals.** 
 Chart: Indices of LDCs' merchandise trade, 1990-2008 (1990=100)
 
 
* By surpassing 1 per cent market share, the LDCs have r ecovered the ground they had been losing since 1980, due inter alia , to the 
 emergence of more dyna mic developing countries. 
** There is some degree of arb itrariness in this classification. This is par ticularly the case for the exporters of agricultura l products which 
 include countries that are not activel y specializing in agricultural production per se , but generate their balance-of-payments income from a 
 mix of natural-resources goods where agriculture predominates, or from services.  -200 0 200 400 600 800 1000 1200 
LDC Trade Balance  
LDC Exports
LDC Imports
World Exports  
1990   1991   1992   1993  1994  1995   1996   1997    1998   1999   2000  2001   2002   2003   2004  2005   2006   2007  2008   WT/COMTD/LDC/W/46 
 Page 29 
 
 
  57. As expected, it is within the groups of exporters of oil and other minerals that the LDCs have 
recorded the fastest growth since 2000 (28 and 24 per cent average annual growth, respectively).  The LDCs exporting mainly agricultural products benefited from a good year 2008 (exports grew 
21 per cent), but the performance over the longer 20 00-2008 period was lower, averaging 14 per cent 
annual growth rate.  Exporters of manufacture (m ainly clothing), evidence lower average growth 
(13 per cent) in a period dominated by increases in the prices of commodities, while increased 
international competition pressured the prices of labour-intensive manufactures.  
58. In such a context, oil exporter s have been able to accumulate over the period a sizeable trade 
surplus.  Their import coverage ratio by expor ts, already close to 200 per cent in 2000, reached 
240 per cent in 2008.  All other categories of LDC exporters show a trade deficit (import coverage 
ratio less than 100 per cent), althou gh the exporters of other minerals  came close to balancing their 
merchandise trade (the import coverage ratio wa s 90, an improvement of 17 percentage points 
compared to 2000).  The two other categories of LDC exporters registered a higher overall trade 
deficit.  It was especially the case for exporters of agricultural products, which displayed the largest 
imbalances with an impor t coverage ratio of only 39 per cent, 8 percentage point deterioration since 
2000.  In other words, 61 per cent of their 20 08 import bill had to be  financed from other 
sources - export of services, private and official transf ers, foreign investment or debts.  This financing 
gap is of special importance in a period of cris is, when – as we should see later – foreign capital 
becomes scarce.
38 
59. The subsequent section reviews the changes affecting global demand for imports and the 
specific macroeconomic situation of the main mark ets of destination, and analyses the particular 
shocks affecting the demand and the price of th e specific goods and services exported by the LDCs.39 
A. GLOBAL TRENDS IN LDC TRADE DURING THE CRISIS  
60. The sharp contraction of the global economy that began in the second half of 2008 and 
accentuated into the first quarter of 2009 was concentr ated in developed countries.  Its effects have 
been felt most severely in the developed countries,  but the subsequent collapse of aggregate demand 
in those countries is still working its way through th e global economy.  Global trade is expected to 
decrease by 10 per cent during 2009, and exports of  developed economies are forecast to fall by 
roughly 14 per cent. The decline for developing ec onomies is expected to be about 7 per cent.   
61. The EU (27), the main destination for LDC e xports, reported a 4.4 per cent decline in output 
for the first quarter of 2009 compared to the same quarter of 2008;  the US and Japan registered declines of 2.6 per cent and 9.1 per cent, respectivel y, reflecting in the case of Japan, the high export-
intensity of its economy.  Data for developing co untries show a more positive situation, as output 
growth in both China and India was above 6 per cent in  the first quarter of 2009.  Although, this is a 
sign of resilience, it does not mean that these economies decoupled themselves from the developed 
markets.  Indeed, the reported growth rates are well below the rates that these countries recorded in 
recent years, i.e., close to 10 per cent fo r India and as high as 13 per cent for China. 
                                                     
 
38 UNCTAD, using different data – balance of payments and national accounts – indicates also that the 
resource gap – or the reliance on foreign resources – has fallen quite significantly since 2000 when considering 
all LDCs.  Similarly, it shows that only oil exporters as  a group have achieved positive external balances while 
all other LDC exporters have been in chronic deficit on both current and trade accounts.  Resource gaps still 
exceeded 10 per cent of GDP in 33  LDCs in 2006 and in 17 of th ese it exceeded 20 per cent of GDP 
(Source:  UNCTAD:  The Least Developed Countries Report,  2008 and 2009 editions). 
39 Albeit this sequence differs from what is suggested by the usual SSA, it makes more sense when 
adopting a forecasting approach , because the specific demand for main pr oduct groups will depend, ultimately, 
from the respective demands emanating from developing and developed economies. WT/COMTD/LDC/W/46 
Page 30   
 
  62. Data for the second quarter of 2009 is incomplete  and mixed, but there are signs that the 
global economy may be stabilizing.  Output and empl oyment are still declining in many countries, but 
the rate of decline appears to be decreasing.  US GDP declined by an annualized rate of 1 per cent in 
the second quarter of 2009 after plunging by 6.4 per cent during the first three months of the year.  There have been upturns in composite leading indi cators in China, France, Italy and the UK.  Some 
economies started to report a slight increase of their quarterly GDP figures.  France and Germany's 
second quarter GDP grew at 0.3 per cent while that of Japan increased by 0.6 per cent, 
quarter-over-quarter (q-o-q).  For the full year 2009 , the IMF's current forecast is that global output 
will fall by 1.3 per cent, with developed countries bei ng hit the hardest by a decline of 3.8 per cent.  
The World Bank expects global GDP to contract by 2.9 per cent in 2009.  Developing countries are 
expected to grow by only 1.2 per cent this year, af ter growing by 8.1 per cent in 2007 and 5.9 per cent 
in 2008.
40  The developing Asia region is expected to record the strongest output growth among 
developing and emerging economies 
63. The shock to LDC exports was perceptible sin ce September 2008.  The LDCs have a different 
exposure to global trade, due to their specializati on in primary commodities or in light manufactures.  
Price and quantity effects differed across product groups.  The sectors most affected in the recent 
financial crisis were fuels and minerals, because of  their weight in the LDC exports and the strong 
price correction effect that was perceptible at the ear ly stage of the crisis.  Oil prices fell sharply and 
remained in the neighbourhood of US$40/barrel early in 2009.  
64. The biggest declines in the demand for intermedia te goods and primary products have been in 
iron and steel, fuels, and mineral ores.  While de veloped economies have been hit hardest, especially 
the major exporters of automotive products and othe r machinery, developing countries were also hit 
by the lower demand for related inputs, and in July  2009 (year-on-year), the value of China's exports 
of iron and steel dropped 67 per cent and its expor ts of mineral ores and non-ferrous metals fell 
59 per cent. 
65. The market for primary commodities was among the first to rebound;  prices rose in the 
second and third quarters of 2009 due to a mix of favourable demands from large emerging countries 
as well as from speculative investments.  Oil pri ces rebounded above US$70/barrel while the price of 
some minerals like copper doubled.  The prices of food and agriculture products decreased during the 
crisis, for reasons similar to other primary commod ities, and because of increases in production after a 
series of bad harvests in 2007.41  Since then, prices of main food products have remained depressed, 
with some exceptions, like sugar, which has risen notably in 2009. 
66. Consumer durable and capital goods ha ve been particularly affected by the financial situation, 
as their demand relies on credit.  LDCs are not particul arly vulnerable to this pa rticular segment of the 
market, which impacted countries like Germany.  As far as LDC exports of cl othing is concerned, the 
specialization of LDCs in the lower range of produc ts should be a favourable aspect, as elasticity of 
demand for these products should be lower.  Nevert heless, in times of uncertainty, exports are 
depressed by the inventory effects:  retailers and middlemen run down their stocks before placing new 
orders.42  The industry has been particularly sensitive to  this effect.  Partial information from main 
LDC exporters provide a mixed picture.  Cambodian industries indicate that exports of clothing dropped by 35 per cent in the first semester of 2009,  when compared to similar period in 2008.  The 
US, the main market of destination, imported 23 pe r cent less during the period.  On the other hand, 
                                                     
 
40 When China and India are excluded, GDP in the remaining developing countries is projected to fall 
by 1.6 per cent in 2009 (World Bank Press release No. 2009/414, 22 June 2009). 
41 See WT/COMTD/LDC/W/43. 
42 Rapidly falling inventories in all activity sectors knocked 1.39 percentage points from the US GDP 
as companies shed a huge US$159.2 billion in stock in the second quarter, following a decline of 
US$113.9 billion in the first quarter (Financial Times, 27 August 2009).  WT/COMTD/LDC/W/46 
 Page 31 
 
 
  both woven and knitwear exports of Bangladesh registered positive growth (14 and 16 per cent, 
respectively) in the 2008-2009 fiscal year (July-June) over the fiscal year of 2007-2008. 
67. As shown in Chart 7, the LDC exports were  below their trend lines for all major product 
groups in June 2009.  Nevertheless, the vulnerability from the crisis a ppeared very different for food 
exports, which deviated only slightly from their pre- crisis tendency, and oil and other minerals which 
experienced a large swing, registered a fall up to February 2009.  The preliminary data presented in 
Table 8 confirm that LDC exports have been rec uperating strongly during the second quarter of 2009, 
and food products have rec uperated the ground lost during the early m onths of the crisis, even if they 
are still below their long-term trend.  The rebound is also significant in fuels and minerals, but 
insufficient yet to compensate for th e huge losses registered in the early months of the crisis.  As for 
manufacture, the drop was much lower, but it continued during the second quarter of 2009, through at 
a reduced pace.  
68. On average, trade in commercia l services has been more res ilient than merchandise trade, 
even though transportation and – to a lesser extent – travel are significantly affected.  Based on the limited data available, mainly from OECD countr ies, it has been observed that trade in other 
commercial services is for the time being less affected  by the crisis.  While monthly US imports and 
exports of goods declined by about one-third in value terms from July 2008 to February 2009, the 
corresponding decline in other commercial services (e xcluding financial services) imports and exports 
was only by about one-tenth in value terms.
43  In all other OECD countries, rates of both exports and 
imports of services were negative up to first quart er of 2009 – except for Japan  – for which the 
growth in the other commercial services was positive.  Imports of goods were c ontracting faster for all 
countries except Australia and Poland.  
69. One of the reasons for demand in services to have contracted less than demand for goods 
during the crisis is that services are not storable .  While retailers and firms run down their stocks 
during the initial phase of the downturn, the reduction in demand for services, especially 
business-related ones, was much smoother.  Some services sectors have however been more affected 
than others.  Services related to trade in goods (transpo rtation) have shown the same trends like that of 
merchandise trade, while financial services have been hurt particularly hard.  Tourism is also 
suffering from the lower purchasing power of househol ds while other commercial services were less 
affected.  For example, the US reported that ex ports of business, professional and technical services 
were more resilient (the World Bank reported signa ls that these services were still reporting positive – 
albeit reduced – rates of growth in the earlier mont hs of 2009).  Nevertheless, preliminary information 
of the US for the second quarter of 2009 shows a progressive decline of these services (-6 per cent 
compared to the same quarter of  2008).  
 
                                                      
43 Ingo Borchert and Aaditya Mattoo, "The Cris is-Resilience of Services Trade", World Bank, 
April 2009. WT/COMTD/LDC/W/46 
Page 32   
 
  Chart 7:  Monthly evolution of LDC exports by main product groups, January 2006-June 2009
 
 
  
  
 
Note : Dotted line corresponds to the "crisis period", after Sept ember 2008. Trend line shows the extrapolated trend, 
based on pre-crisis observations.  Data are based on mirror statistics obtained from a selection of 11 developed and 
developing countries and the EU27. 
Source :  WTO (on the basis of official data and Secretariat estimates). 0100200300400500600700800
369 2007369 2008 3 6 9 200936Food products 
0 200 400 600 800 1000 1200 
3 6 9 2007 3 6 9 2008 3 6 9 200936Agricultural goods  
0 2000 4000 6000 8000 10000 12000 14000 16000 
3 6 9 2007 3 6 9 2008 3 6 9 200936Fuels and mining products 
05001000150020002500
369 200736 9 2008 3 6 9 200936Manufactures  WT/COMTD/LDC/W/46 
 Page 33 
 
 
  Table 8:  Average monthly variation of me rchandise exports of the World and the LDCs,  
January 2006-June 2009  (percentage, month-on-month) 
 
 Jan 2006-Aug 2008 Sept 2008-March 2009 April-June 2009
World: 
Total merchandises 1.2  -5.6 5.2 
LDCs: Total merchandises 2.9
 -9.1 15.2 
  Agricultural products 0.8  -3.1 0.8 
  Food products 1.0  -1.1 -1.2 
  Fuels and mining 3.7  -12.3  22.3 
  Manufactures 0.8  -2.5 3.5 
 
Note : World data cover the 70 most important traders; data fo r LDCs are based on mirror sta tistics of a selection of 
developed and developing importing c ountries, and Secret ariat estimates. 
Source :  WTO. 
 
70. The resilience of trade in services, when compar ed to trade in goods, is subject to the depth 
and duration of the crisis.  While the decrease in  trade in goods has been slowing down in the second 
quarter of 2009 – in part because run-down inventor ies had to be rebuilt – trade in services might 
suffer from the secondary wave shocks.  If the dura tion of the crisis is long, and consumption and 
investment patterns are st ructurally affected in the major economies, then demand for commercial 
services such as tourism and other services will also be affected (see Box 3). 
Box 3:  Tourism in the face of the global crisis 
 
Tourism, the most important component of commercial services exports for LDCs (53 per cent in 2007), is of 
critical importance to many small islands.  In 2007, the revenue from the sector represented 56 per cent of GDP 
in the Maldives, and more than 20 per cent for Vanuatu an d Samoa.  In many other countries, the sector is also 
of strategic importance because it is labour-intensive and generates many indirect linkages with the rest of the formal and informal economy.  Its contribution as provider of employment is usually much bigger than its 
contribution in export revenues.   After transport, touris m is the sector most severe ly affected by the global 
crisis.  The UNWTO forecasts a decline in international tour ist arrivals by 4 to 6 per cent in 2009 at the world 
level; the negative trend started in the second half of 20 08 and will continue and intensify in 2009.  Preliminary 
data confirm that the LDCs are not spared by this downturn, and this negative trend might be exacerbated by the risk of pandemic flu.  
Cambodia is the largest travel exporter of the LDCs, representing more than 15 per cent of the group's total 
exports.  In 2007, travel exports accounted for 76 per cent of the country's total commercial services exports and 
13 per cent of its GDP.  Although travel exports have increased by 8 per cent in 2008, in the last quarter of the 
year they have stagnated (-0.2 per cent).  According to UNWTO data, the number of international tourist 
arrivals has declined progressively since the third quarter of 2008, recording -6 per cent in the first quarter of 2009.  The forecast for the year 2 009 is a decline of 4 per cent.  
For some LDCs, whose economy is particularly dependen t on tourism revenues, the impact of the crisis might 
take catastrophic dimensions.  For the Maldives, in whic h tourism exports account for more than 90 per cent of 
total commercial services exports, travel receipts are fo recast to decrease by more th an 20 per cent in 2009. 
Cape Verde, which graduated from the LDC group at the end of 2007, is also suffering the repercussions of the 
recession.  Its previously buoyant travel exports, which represented 21 per cent of GDP in 2007, plummeted by 43 per cent in the first half of 2009.  
The origin of foreign visitors is a factor explaining the differences in forecasts between Cambodia and the two 
small islands.  While over 60 per cent of foreign visitors in Cambodia are from Asia and the Pacific, the large majority of Maldives or Cape Verde tourists originate principally from Euro pe, and also from the US.  Because 
these two economies are particularly affected by the crisis, the households are adjusting their consumption 
pattern and limit their "superfluous" expenses, by shortening their holidays and staying closer to home. 
 
Source : WTO, IMF;, UNWTO, Maldives Monetary Authority, Bank of Cape Verde, Cambodia Ministry of Tourism.  WT/COMTD/LDC/W/46 
Page 34   
 
  71. As a synthesis, the crisis did not find all LDCs in the same stage of preparedness, and it is not 
affecting all of them equally.  Basic commodities, for which prices tended to overreact at the beginning of the crisis, are benefiting from the si gns of recovery observed in the large emerging 
countries.  On the basis of partial information ava ilable, monthly LDC exports of fuels and minerals 
have bottomed-out in March 2009, after a drop of mo re than 50 per cent since September 2008;  and, 
since March 2009, it has been growing more than 40 pe r cent.  Exporters of agricultural products are 
less affected as demand for food is less elastic.  For exporters of manufactures, the situation is more 
complex due to slow recuperation of the develope d economies.  Available information indicates that 
from September 2008 to February 2009, exports of LDC manufactures dropped more than 
25 per cent;  thereafter manufacturing exports from LDCs  started to recover more slowly by 8 per cent 
up to June 2009. 
72. The short-term indicators may suggest that the worst of the crisis is over, but its effects may 
last long.  The LDCs have been able to benefit re latively from the strength of international trade in 
recent years.  However, cautious economic and fi nancial environment will weigh negatively on the 
capacity to finance trade.  Credit standards are still being tightened.  Bank credit growth is meagre.  
More generally, the difficult fiscal and financia l situation of many large economies may put a 
restriction on the financing of much needed assistance in developing the necessary production 
capacities, as well as financing trade facilitation pr ojects, such as communication infrastructure and 
ports.
44 
B. THE CHALLENGE OF FINANCING TRADE AND TRADE DEFICITS  
73. Most researchers identify the following as the main channels through which LDCs may be 
affected in the medium term by the crisis:  (i) a reduced demand for exports;  (ii) a fall in commodity 
prices;  (iii) a contraction of both short- and l onger-term private capital flows to LDCs across all 
financial instruments (i.e., FDI, portfolio and debt flows);  (iv) a reduction in remittance flows;  and 
(v) downward pressure on, or freezing of overseas aid mainly official development assistance (ODA) flows from advanced countries.
45 
74. It is not the objective of the present section to an alyse the financial implications of the current 
crisis for the LDCs.46 Trade finance is critical for facilitating trade, which has gone down 
considerably in recent times.  No new credits were being delivered by the financial markets in several 
Eastern Europe countries as a result of the default.  Interest spreads even in the US on opening new letters of credit were up 100 to 200 basis points depending on the quality of risk.  Trade or domestic 
bills are a main activity for shallow domestic fina ncial markets such as the LDCs.  In the current 
                                                     
 
44 These initiatives are needed to overcome a series of  structural constraints which limit the capacity of 
LDCs of availing themselves of the opportunities offered by international trade.  These structural constraints are 
compounded by additional transaction costs that greatly reduce the competitiveness of LDC exports.  As indicated in a previous report, (WT/COMTD/LDC/W/41/ Rev.1) the higher unit costs that LDCs face when 
exporting goods (almost 80 per cent more than in the OECD and East Asia and Pacific) greatly impair their 
capacity to benefit from the preference ma rgins that LDCs enjoy for their exports. 
45 Remittances are an important source of external fi nance for LDCs, with inflows larger than official 
development assistance, FDI, and portfolio flows in some countries.  According to the World Bank, remittances 
are expected to fall by 7-10 per cent in 2009.  Europe and Central Asia ar e expected to experience the largest 
decline (15 per cent) among all developing regions in 2009.  Remittance flows to Latin America and the 
Caribbean are expected to decline by 7 per cent, those to the Middle-East and North Africa by 6 per cent, and to 
Sub-Saharan Africa by 8 per cent.  Remittance flows to South Asia are expected to decline more modestly by 4 per cent (Source:  World Bank, Development Prospects Group, Migration and Development Brief No. 10, 
13 July 2009). 
46 See, for example, Thomas Barnebeck Andersen, Sa m Jones & Finn Tarp, The current financial crisis: 
"Implications and issues for Less Developed Countries" Development Economics Research Group University of 
Copenhagen, 31 October 2008.  WT/COMTD/LDC/W/46 
 Page 35 
 
 
  uncertain environment, central banks of developed countries, such as the UK and Japan, are 
re-opening discount windows for commercial papers  presented by local, small and medium-sized 
enterprises. 
75. Data on the LDCs' financial system is only partia l.  Various anecdotal evidences show that the 
market situation remains tense, with increased paymen t defaults and high cost of credit, which are not 
falling significantly from the peak periods.  The African Development Bank estimates that trade 
finance transactions have collapsed by over 50 per cent since the beginning of 2009 (out of a total 
annual turnover of US$100 billion at peak times) .  In Asia, some countries that are key in 
international supply-chains rely on the Asian Development Bank and the IFC to facilitate their trade 
transactions.  However, making funds available fr om multilateral institutions is only part of the 
solution, because the establishment of the related government -supported schemes will need time and 
resources to be in place.  The full package is expect ed to be implemented over the next two years (see 
Box 4).   
Box 4:  International initia tive to restore trade finance 
 
The drying up of trade finance resulting from shortages in global liquidity and increased risk aversion by major 
international banks, led G-20 leaders in London to adopt a significant trade finance "package";  under the 
heading "Resisting protectionism and promoting global trade and investment".  The last bullet of paragraph 22 
of the G-20 communiqué says:  "we will ensure availability of at least US$250 billion over the next two years to 
support trade finance through our export credit and in vestment agencies and thro ugh multilateral development 
banks. We also ask our regulators to make use of available flexibility in capital requirements for trade finance". 
The trade finance "package" responds largely to the criteria developed by the WTO, and includes in particular 
strengthened public-private sector partnerships in th e context of existing trade fi nance facilitation programmes, 
which are further enhanced in particular by the provision of increased liquidity, not just re-insurance.  The 
World Bank's International Financial Corporation (IFC) is showing the way by creating a Global Trade Finance 
Liquidity Fund, allowing for co-lending agreements with commercial banks on a 40-60 per cent risk sharing 
formula.  The first deal was made under this scheme by Standards Chartered Bank for its operations in Africa 
mainly.  Another pillar in the package is the strengthening of existing capacities of export credit agencies 
(ECAs) in OECD and non-OECD countries.  Finally, it is  intended that several institutions, either multilaterals, 
ECAs and other government agencies will try to revive the secondary market by intervening directly into it. 
An expert meeting of G-20 countries and multilateral agencies in early June 2009 did a "reality check" of 
financial commitments to ensure that US$250 billion in support of trade could be in effect mobilized by the time 
of the G-20 Meeting held in Pittsburgh in September 2009.  However, no measure of the utilization of such 
package was available yet, in particular because it takes time for some of the progra mmes to be fully in place.  
For example, while trade finance facilitation programmes were already up and running and could "absorb" more 
demand, the establishment of government-supported schemes by export credit agencies needed more time and 
resources to be in place, bearing in mind that the full package is expected to be implemented over two years. 
Source : WTO "Report to the TPRB from the Director-Gener al on the financial and economic crisis and trade-
 related developments" JOB(09)/62, 1 July 2009 
 
VI. CONCLUSION 
76. One of the main conclusions that can be draw n from this Note about trends of LDCs trade 
from 2000 to 2007 is that, in addition to "fuels" and "other minerals" (two dynamic products at world 
level), the LDCs have actually gained market share in mature products (food) and stagnating ones 
(textiles, clothing, and agricultural raw materials).  In fact, the participation of LDCs in world 
merchandise trade crossed the one per cent mark, reaching 1.1 per cent in 2008.47   
                                                      
47 This share has declined to 0.85 per cent in the first half of 2009, but there are signs that commodity 
exporters are gaining ground in the second half of 2009. WT/COMTD/LDC/W/46 
Page 36   
 
  77. The second important conclusion that emerges is that even though the EU and the US remain 
the most important markets for LDC exports, purch asing 28 per cent and 26 per cent of their exports 
respectively, LDC exports are increasingly becoming  more diversified, with developing economies, 
such as China, India and Thailand having a greater weight in LDC exports than one would expect 
from their share in world total imports.  In fact, LDC exports to other deve loping economies in 2007 
represented 48 per cent of their total exports, s howing lower dependence on developed markets.   
78. LDC exports to developing and developed markets are also becoming increasingly 
differentiated. Developing economies have become the major destination for LDC exports of mineral 
fuels, copper, wood products, cotton and some  food products like vegetables and oil seeds.  
Interestingly, these products where South-South trade has become particularly important for LDCs are 
also those where international prices have been in creasing.  On the other hand, developed economies 
remain largely a dominant export destination fo r manufactured articles such as clothing, where 
changes in prices have been much more moderate .  Developed country markets are also the main 
destination of exports for some high value-added agricultural and food products such as fish and 
crustaceans, beverages or tobacco.  
 
79. At the same time it is clear that the aver age tariffs charged by developed countries on 
agricultural goods, textiles and clothing, fell ove r the period 1996-2007.  Duty-free access for the 
developing countries as a whole has continued to incr ease, due principally to the elimination of tariffs 
under the MFN treatment, rather than an extension of true preferential treatment.  On the contrary, the 
duty-free treatment granted to LDCs corresponds to  a true preferential treatment for more than 
50 per cent today.  Compared to the treatment recei ved by all developing countries, the margin of 
preference received by LDCs is especially significant in the case of agricultural products.  
80. Since the last report, no new market access initiatives were undertaken in favour of LDCs.  
However, a number of decisions have been taken by both developed and developing countries and 
which would, inter alia , provide opportunities for improved market access for LDCs.   
81. The continued extension of the preferential treat ments granted to the LDCs –in particular the 
implementation of the Hong Kong Ministerial De cision on DFQF market access – could further 
contribute to the deepening and diversification of th eir international trade.  A rapid conclusion of the 
Doha Round, together with adequate aid for trade a nd trade finance, would provide them with a much 
needed platform to recover from the present crisis  and pick up the trade dynamics where they left it 
off before the crisis.  
82. The latter part of the report focuses on the impact  of the crisis on LDCs.  It concentrates on 
the developments and trends in LDC trade obser ved after September 2008, when the world economy 
slowed abruptly.  The short-term developments  affecting LDC trade are analysed against the 
background of their previous trends, in order to id entify the strengths and vulnerabilities of LDCs.   
83. The initial impact of the crisis was felt most particularly in developed economies, at least 
from an economic perspective, and its  intensity was largely unexpected.  The crisis also showed that 
the hypothesis of a decoupling between the developed and developing world does not hold.  Globalization served as a transmitter of growth in  the 1990s and early 2000s between increasingly 
inter-connected national economies – and the same tran smission channels, in pa rticular, international 
trade
48 and finance – acted as the transmitters of the crisis.  As a result the developing countries, 
including the LDCs, have not been isolated from the global crisis.   
                                                      
48 International trade has been specially affected, and the WTO forecasts for 2009 estimate a decrease 
of  up to10 per cent in real terms.   WT/COMTD/LDC/W/46 
 Page 37 
 
 
  84. However, the impact of the crisis has not been evenly spread and it has not affected all LDCs 
in the same way.  The impact on LDC exports wa s particularly perceptible from September 2008, 
mainly due to the collapse of oil and commodity  prices which dropped by more than 40 per cent 
during the last quarter of 2008, and remained  depressed during the first quarter of 2009.49  The exports 
of LDCs, as a group, were particularly affected by th is strong price correction effect due to the fact 
that fuel and minerals weigh heavily in their tota l exports.  The prices of food and agriculture products 
also decreased during the same period, for reasons similar to other primary commodities, and because 
of increase in global production after a series of bad harvests in 2007.   
85. As far as trade volumes are concerned the picture is not as black and white, as the decline in 
the value of LDC exports.  Some of the LDCs export sectors may have actually experienced volume 
growth in the first half of 2009, as compared to the first half of 2008 – for instance analysts report that 
textiles and knit apparels experienced a 3.7 per cent increase in volume, despite a very slight decline 
in value during this period.50   
86. At the same time some LDC exports were affe cted by demand factors.  The international 
demand for manufactured consumer and capital goods we re particularly affected by the financial 
situation, as their demand relies on credit.  Services exports, in particular tr ansportation and tourism, 
have also suffered from the lower internati onal demand and falling hous ehold consumption in 
developed countries.   
87. In the second half of 2009, there are signs that th e crisis may have reached its bottom.  It may 
be noted that overall LDC exports has been recoveri ng since the second quarter of 2009.  In fact LDC 
exports have grown by 15 per cent as compared to th e world average of 5 per cent during this period.  
Among the factors expected to boost demand for imports , at least in the short term, is the expected 
rebuilding of business inventories.  Nevertheless, for the recovery to be sustainable, business and 
consumer confidences must be restored, and credit – including trade finance – be no longer constrained. 
88. Despite the signal that the LDCs are recupe rating from the initial shock since the second 
quarter of 2009, there are still a host of factors th at may lead to a slower recovery in 2010 than 
indicated by the most recent statistics.  The indi rect economic impacts, induced by secondary shocks 
related to the rise in unemployment and lower produ ctive investment in many industrial economies, 
may depress world demand for investment and durab le consumer goods, impeding a full return to the 
pre-crisis trends.  The risk is also present for service-oriented LDCs, as tourism would be particularly affected by a drop in household consumption.  Th erefore, initiatives to further improve the market 
access conditions for LDC exports, along with efforts to build their trade-related infrastructure and 
supply-side capacity, remain key in sustaining growth and economic development in the LDCs. 
 
                                                     
 
 49  For instance the decline in the to tal aggregate value of LDC exports during the first half of 2009 as 
compared to the first half of 2008 was over 40 per cent .   However, if oil exports are excluded the decline in 
LDC exports for the same period is only 13.5 per cent, as  compared to a global figure of nearly 30 per cent 
(Source-ITC Trade Map Fact-sheet). 
 50 (Source-ITC Trade Map Fact-sheet). WT/COMTD/LDC/W/46 
Page 38   
 
  ANNEX 
 
Annex Table 1:  Merchandise exports and imports of LDCs by selected country grouping, 2008  
(Million dollars and percentage) 
  Exports  Imports  
  Value  Annual percentage change  Value  Annual percentage change  
  2008 2000-08 2006 2007 2008 2008 2000-08 2006 2007 2008 
LDCs          173,514  21.6 24.7 23.8 34.8        158,392 17.4 15.2 23.4 27.4 
Oil Exporters         109,077  28.1 24.1 31.4 47.0          45,310 24.8 15.6 33.9 28.7 
Angola           67,100  30.6 32.2 39.3 51.1          21,100 27.4 5.1 55.6 54.5 
Equatorial Guinea           16,300  40.1 16.2 24.4 59.6            3,270 28.1 54.2 36.6 18.5 
Sudan           12,050  26.8 17.3 57.0 35.7            9,150 24.8 19.5 8.7 4.3 
Yemen             8,977  10.4 14.1 -3.6 27.3            9,960 20.0 12.9 40.2 17.0 
Chad             4,650  49.8 10.6 7.5 27.0            1,830 24.5 42.1 11.1 22.0 
Exporters of manufactures           31,470  12.9 21.5 14.4 15.5          47,856 12.8 15.9 17.8 27.5 
Bangladesh           15,357  11.6 26.9 5.5 23.3          23,838 13.1 15.4 16.0 28.2 
Myanmar             6,937  19.7 20.3 38.1 9.5            4,288 7.5 33.1 29.2 29.5 
Cambodia             4,300  15.2 13.7 16.3 5.2            6,600 16.5 20.9 14.2 21.7 
Madagascar             1,340  6.3 15.3 25.6 8.3            4,040 17.7 5.7 46.1 53.3 
Nepal             1,050  3.4 -2.9 5.9 18.3            3,600 10.9 9.1 16.6 24.0 
Lao People's Dem. Rep.             1,095  16.2 59.5 4.6 18.7            1,302 11.8 20.1 0.5 22.3 
Lesotho                900  19.3 6.8 15.8 11.8            2,040 12.3 6.4 15.9 17.4 
Haiti                490  5.6 8.2 2.6 -6.1            2,148 9.5 12.9 12.8 16.0 
Exporters of agriculture and 
 othersa           19,525  14.0 16.6 16.4 21.2          50,467 16.7 14.6 21.5 27.0 
Tanzania             3,037  19.4 14.2 16.1 36.4            7,081 21.2 29.2 25.7 32.7 
Senegal             2,350  12.4 1.0 4.8 40.7            6,528 20.0 5.0 32.7 34.0 
Uganda             2,180  21.5 16.8 42.0 29.3            4,526 14.5 24.5 36.6 29.6 
Mali             1,650  14.9 40.8 -1.7 8.3            2,550 15.5 17.9 20.1 16.7 
Ethiopia             1,602  16.1 15.2 23.5 24.7            7,700 25.4 16.4 19.7 33.9 
Guinea             1,360  9.3 26.0 6.6 18.8            1,600 12.8 15.9 26.3 33.3 
Benin             1,050  13.1 27.1 19.0 20.0            1,990 15.9 20.6 30.3 24.4 
Niger                880  15.2 7.0 35.8 23.9            1,400 17.1 0.6 11.7 32.1 
Malawi                770  9.3 6.6 30.9 8.5            1,650 15.2 3.6 14.2 19.8 
Togo                900  12.0 -1.5 7.7 28.6            1,540 13.4 4.2 12.0 10.0 
Afghanistan                610  20.5 6.2 21.8 22.7            3,350 14.0 4.5 9.2 18.8 
Burkina Faso                550  12.9 25.6 6.0 -11.7            1,800 14.5 4.7 22.8 11.1 
Bhutan                521  22.5 60.5 62.6 -22.6               543 15.2 8.6 25.5 3.2 
Maldives                331  14.9 39.4 1.2 45.0            1,388 17.2 24.4 18.3 26.6 
Somalia                290  5.2 -3.3 0.0 0.0               790 11.0 8.2 3.0 16.2 
Liberia                242  -3.7 20.2 26.9 21.1               813 2.5 50.6 7.0 62.9 
Rwanda                250  21.7 18.2 20.0 41.4            1,139 23.5 27.3 34.5 54.5 
Sierra Leone                220  42.4 45.8 6.1 -10.3               560 18.0 12.9 14.3 25.9 
Solomon Islands                190  13.5 17.5 38.3 13.1               295 15.7 17.2 32.0 3.1 
Central African Republic                195  2.4 16.6 13.1 9.6               310 13.0 19.7 23.1 24.5 
Guinea-Bissau                  98  5.9 -17.3 14.9 15.3               160 13.3 20.1 7.1 17.6 
Djibouti                  69  10.2 39.7 5.3 18.4               580 13.8 21.1 41.0 22.6 
Burundi                  57  1.7 0.5 -9.1 8.4               403 13.3 60.0 -25.9 26.2 
Vanuatu                  42  6.2 -2.8 -18.5 40.7               287 16.1 7.3 26.1 42.0 
Eritrea                  17  -9.3 -4.5 42.9 13.3               530 1.5 1.0 3.0 3.9 
Comoros                  13  -0.9 -17.4 31.0 0.0               180 19.6 16.8 21.5 28.6 
Kiribati                  15  19.6 46.3 55.0 53.4                 55 4.1 -14.4 10.6 -21.6 
Gambia                  14  -0.9 43.3 9.2 11.2               329 7.3 -0.1 23.8 2.6 
Samoa                  11  -2.7 -10.5 45.0 -27.5               249 11.3 16.9 3.8 9.6 
Sao Tome and Principe                  11  17.1 13.2 -11.7 56.4               114 18.2 42.5 11.6 44.2 
Tuvalu                    0  40.3 -19.0 80.4 63.0                 26 23.1 -0.8 22.0 68.9 
Timor-Leste  ...  ... ... ... ...  ... ... ... ... ... 
Exporters of non-fuel  minerals           13,442  23.8 53.5 12.9 21.0          14,759 20.6 13.7 20.2 24.6 
Zambia             5,089  24.3 108.3 22.5 10.2            5,106 22.7 20.2 29.2 28.6 
Congo, Dem. Rep. of             3,950  21.6 5.9 14.2 49.1            4,100 24.8 20.7 20.4 24.2 
Mozambique             2,653  28.2 33.5 1.3 10.0            3,804 16.0 19.1 6.3 24.7 
Mauritania             1,750  22.1 118.6 4.6 22.4            1,750 18.4 -18.3 30.2 15.1 
Memorandum item:                     
World  b     16,070,000  12 15 15 15   16,422,000 12 14 15 15.1 
 aIncludes exports without a clear specialization in a specific category of goods, or specialized services. 
 bIncludes significant re-exports of imports for re-export. 
Note : Groups and countries ranked by value, data for 2008 are largely estimates. 
Source : WTO.  WT/COMTD/LDC/W/46 
 Page 39 
 
 
  Annex Table 2:  Export prices of primary commodities, 2000-2008  
(Annual and quarterly percentage changes) 
2008 Q-o-Q 
  
  2000 
  2001 
  2002 
  2003 
  2004 
  2005 
  2006 
  2007 
  2008 
  Q1 Q2 Q3 Q4 Annual 
average 
2000-
2008 
Food and beverages -0.4 0.4 2.7 5.1 13.2 1.5 10.3 15.1 23.3 18.1 6.6 -4.5 -24.7 8.7 
Food 1.7 2.3 1.3 5.1 14.3 -0.4 10.5 15.2 23.3 18.0 6.8 -5.2 -25.2 8.7 
Cereals -3.6 4.5 14.3 1.1 8.2 -2.4 21.5 31.2 39.3 24.1 7.6 -10.3 -29.2 13.9 
Wheat 1.7 11.2 17.1 -1.5 7.4 -2.9 25.8 33.1 27.7 20.3 -15.8 -8.3 -28.2 14.0 
Maize -2.3 1.6 10.9 5.8 6.2 -11.9 23.6 34.2 36.8 28.1 17.7 -5.3 -31.3 12.3 
Rice -18.2 -15.2 11.1 4.0 23.2 17.1 5.5 9.5 110.6 44.6 84.8 -21.0 -23.0 16.7 
Barley 1.7 21.6 16.0 -3.9 -5.5 -4.0 22.7 47.8 16.3 11.5 10.1 -9.3 -40.3 12.7 
Vegetable oils and protein meals -3.3 -3.7 17.1 17.6 16.1 -10.3 3.4 38.7 34.2 22.4 5.1 -8.2 -32.3 13.0 
Meat 8.6 8.0 -5.2 2.5 22.0 -0.4 -4.5 4.2 4.0 1.0 10.5 7.7 -14.7 3.5 
Beef 5.6 10.0 -1.2 -6.0 27.0 4.3 -2.6 2.1 2.6 0.8 0.5 11.3 -14.0 4.1 
Lamb -2.6 15.4 12.2 9.4 3.8 -2.9 -4.5 5.2 5.6 1.8 8.3 -4.3 -15.8 5.3 
Swine Meat 33.5 3.6 -23.0 12.9 33.1 -4.7 -5.6 -0.3 1.5 0.5 32.6 8.8 -26.7 1.1 
Poultry -0.9 7.0 -0.9 4.9 14.4 -2.4 -6.3 12.9 8.2 1.4 5.7 5.6 -1.4 4.5 
Seafood 3.1 -12.1 -13.7 -1.1 4.4 13.7 20.5 -6.4 0.5 3.1 3.7 0.3 -19.6 0.1 
Fish 2.1 -20.7 1.6 2.0 11.6 21.6 24.6 -10.2 6.6 10.1 5.5 2.3 -25.5 3.6 
Shrimp 4.5 0.6 -31.4 -5.9 -9.7 -5.0 4.9 11.0 -22.3 -21.5 -5.2 -10.8 18.5 -8.2 
Sugar 14.8 0.6 -14.8 9.5 8.5 20.4 32.5 -23.2 14.7 20.0 -4.8 10.2 -15.0 4.6 
Bananas 12.9 38.5 -9.8 -28.9 39.9 9.9 18.4 -0.8 24.6 27.3 9.6 -14.8 9.6 9.0 
Oranges -17.1 64.0 -5.2 21.0 25.1 -1.4 -2.1 16.2 15.6 12.3 19.8 -12.0 -27.6 15.0 
Beverages -15.1 -16.1 16.6 4.9 3.0 21.0 8.4 13.7 23.3 18.5 4.3 2.9 -19.5 8.7 
Coffee -21.7 -28.8 -0.2 10.2 18.2 43.0 11.5 15.8 16.0 15.7 -3.7 1.4 -18.8 8.9 
Cocoa beans -20.4 20.4 63.5 -1.4 -11.5 -0.5 3.0 23.1 31.4 23.0 13.0 0.9 -20.2 14.0 
Tea 6.8 -20.2 -9.5 8.4 1.9 9.2 11.7 -12.4 27.3 15.7 9.5 14.8 -19.2 1.0 
Agricultural raw 
materials 4.7 -5.0 1.8 3.8 5.4 1.6 8.6 5.0 -0.8 2.0 2.2 0.3 -15.4 2.5 
Timber -1.6 -8.4 -1.0 5.3 11.6 4.2 8.1 -1.1 1.8 4.0 2.2 1.8 1.2 2.4 
Cotton 11.1 -18.7 -3.5 36.9 -2.2 -11.1 5.2 9.0 12.8 -0.4 -0.9 1.0 -24.5 2.4 
Wool 13.1 -5.5 28.3 12.7 -7.6 -4.6 3.6 38.9 -4.2 3.8 -5.8 -9.9 -31.5 6.5 
Rubber 8.8 -13.1 27.3 41.5 20.4 15.2 40.3 8.7 14.1 12.4 10.8 -1.3 -46.0 18.1 
Hides and skins 11.2 5.5 -4.6 -15.4 -1.7 -2.2 5.0 4.7 -11.1 -3.3 2.7 1.7 -19.6 -2.8 
Minerals and non-ferrous  
metals  (excluding 
crude petroleum)  12.1 -9.7 -2.7 12.3 36.2 26.5 55.9 17.5 -7.9 10.6 1.1 -8.5 -33.4 14.1 
Copper 15.4 -12.9 -1.3 14.1 61.0 28.4 83.1 6.0 -2.4 8.2 8.1 -9.3 -49.1 18.3 
Aluminum 14.1 -6.7 -6.7 6.1 19.9 10.6 35.4 2.6 -2.4 12.6 7.1 -5.5 -34.3 6.6 
Iron ore 4.4 3.9 -2.0 9.0 18.6 71.5 19.0 9.5 66.0 66.0 0.0 0.0 0.0 21.9 
Tin 0.8 -17.4 -9.6 20.5 73.4 -12.9 18.5 65.7 27.4 9.0 26.7 -9.5 -35.6 16.5 
Nickel 43.8 -30.8 13.7 41.9 43.6 6.9 63.3 53.9 -43.1 -0.9 -11.4 -26.0 -42.5 11.9 
Zinc 4.8 -21.4 -12.2 6.4 26.5 31.8 136.6 -0.5 -42.0 -7.3 -13.3 -16.1 -32.8 6.6 
Lead -9.5 4.9 -5.0 13.6 71.5 10.5 32.2 100.2 -18.9 -9.7 -20.8 -17.0 -34.7 21.0 
Uranium -17.3 4.0 14.1 14.2 60.6 54.8 70.7 108.1 -35.3 -9.2 -19.9 -0.4 -19.0 29.2 
Total of above 4.5 -4.0 0.8 6.9 18.6 10.3 23.1 14.1 7.5 12.8 4.0 -5.1 -26.0 9.3 
Energy 56.1 -11.6 -0.4 16.7 31.1 38.7 19.2 10.5 40.1 11.0 25.8 -2.2 -46.4 16.7 
Natural Gas 77.0 -1.3 -19.3 31.5 11.1 42.0 15.3 1.4 48.6 19.5 18.8 9.3 -4.6 14.1 
Crude petroleum 57.0 -14.0 2.7 15.8 30.7 41.3 20.5 10.6 36.5 9.0 26.9 -4.7 -51.4 16.7 
Coal 3.1 24.1 -17.8 5.3 99.2 -11.3 4.4 31.8 93.2 34.5 20.1 19.2 -42.6 22.4 
All primary 
commodities 32.6 -8.9 0.1 13.0 26.6 29.1 20.6 11.8 27.6 11.6 18.3 -3.1 -40.4 14.2 
Memo item: 
Manufacture Unit 
Value -2.9 -3.2 1.4 9.6 8.4 2.3 2.7 7.3 ... .... ... ... ... 4.0 
Note : The indices are period averages based on dollar prices.  The data for manufacture corresponds to unit values.  The 
quarterly figures are not seasonally adjusted. 
Source : WTO. 
 
  
  WT/COMTD/LDC/W/46 
Page 40  
Annex Table 3:  Measures in favour of exports originating from LDCsa 
 
Preference 
granting country Description Beneficiary(ies) Coverage/margin  of preference  References 
 
Australia 
 Duty- and quota-free entry   
Entry into force:  1 July 2003 LDCs  All products  WT/COMTD/N/18  
 
Belarus Harmonized System of preference by the 
Eurasian Economic Community (EAEC) 
Entry into force:  May 2001  47 LDCs Duty-free access for all products WT/TPR/S/170   
Canada GSP – Least-developed Countries' Tariff 
Programme (LDCT) 
Entry into force: 1 January 2003, extended 
until 30 June 2014  LDCs  With the exception of over-quota tariff items for dairy, poultry 
and egg products, Canada provides duty-free access under all 
tariff items for imports from LDCs 
 WT/COMTD/N/15/Add.1  and 
Add.2 
WT/COMTD/W/159 
 
China  Asia-Pacific Trade Agreement (APTA)b– 
amendment to the Bangkok Agreement  
Entry into force: 1 September 2006 Bangladesh  
Lao PDR In addition to 1,697 products (with average margin of preference 
of 26.7%) available to all APTA  members, tariff concessions 
granted exclusively to LDC members on 161 products with 
average margin of preference of 77.9% WT/COMTD/N/22  
 
 
  Bangladesh On top of Asia-Pacific Trade Agreement (APTA), unilateral 
special preferential tariffs (zero rated) are offered on additional 87 
tariff lines  Information received from the 
Government of China 
 Framework Agreement on Comprehensive 
Economic Co-operation between ASEAN 
and China 
Entry into force: 1 January 2006 
 Cambodia  Duty-free treatment on 418 tari ff lines Information received from the 
Government of China 
  Cambodia On top of Framework Agreement on Comprehensive Economic 
Co-operation between ASEAN a nd China, unilateral special 
preferential tariffs (zero rated) are offered on additional 420 tariff 
lines  Information received from the 
Government of China 
 Framework Agreement on Comprehensive 
Economic Co-operation between ASEAN 
and China Entry into force: 1 January 2006 Lao PDR Duty-free treatment on 330 tariff  lines Information received from the 
Government of China 
  Lao PDR On top of Framework Agreement on Comprehensive Economic 
Co-operation between ASEAN a nd China, unilateral special 
preferential tariffs (zero rated) are offered on additional 399 tariff 
lines Information received from the 
Government of China 
 Framework Agreement on Comprehensive 
Economic Co-operation between ASEAN 
and China 
Entry into force: 1 January 2006  Myanmar  Duty-free treatment on 220 tari ff lines Information received from the 
Government of China  
   WT/COMTD/LDC/W/46
 Page 41Preference 
granting country Description Beneficiary(ies) Coverage/margin  of preference  References 
 
China (cont'd)  Myanmar On top of Fram ework Agreement on Comprehensive Economic 
Co-operation between ASEAN a nd China, unilateral special 
preferential tariffs (zero rated) are offered on additional 226 tariff 
lines Information received from the 
Government of China 
 Forum on China-Africa Co-operation, 
November 2006 30 LDCs Duty-free and quota-fre e market access WT/COMTD/W/164 
 Special preference tariff  Afghanistan, Maldives, 
Samoa, Vanuatu and Yemen Unilateral special preferential tariffs (zero rated) are offered on 
286 categories of products Information received from the 
Government of China 
European Communities GSP - Everything But Arms (EBA) 
initiative 
Entry into force:  5 March 2001   LDCs  The transitional provisions fo r imports of rice and sugar have 
been fully liberalized by Octobe r 2009.  As of 1 October 2009, the 
EBA has been granting DFQF access for all products from all 
LDCs (except arms and ammunitions).  WT/COMTD/N/4/Add.2 and 
Add.4 
WT/TPR/S/177/Rev.1 
 Cotonou Agreement  
Entry into force:  1 April 2003 
Expired: 31 December 2007 (The EPAs 
being negotiated with the ACP countries 
will replace the unilateral preferences 
granted under the Cotonou Agreement) 79 African, Caribbean and 
Pacific (ACP) countries, 40 of 
which are LDCs Duty-free treatment on industrial, certain agricultural, and fishery 
products, subject to a safeguard cl ause  Certain products (bananas, 
beef and veal, and sugar) gover ned by commodity protocols. 
 
 WT/TPR/S/177/Rev.1 
WT/TPR/S/214/Rev.1  
Iceland GSP – Tariff Preferences in Regard to the 
Importation of Products Originating in the World's Poorest Developing Countries  
Entry into force:  29 January 2002 
  LDCs  Essentially all products with some exceptions in agricultural 
products (HS chapters: 04, 15, 18, 19, 21 and 22) and non-agricultural products (HS sub- headings:  3502 and 3823, and all 
of HS 16 with the exception of sub-headings 1603 to 1605)    WT/COMTD/N/17 and Corr.1  
WT/TPR/S/164 
India   
 Asia-Pacific Trade Agreement (APTA) – 
amendment to the Bangkok Agreement  
Entry into force: 1 September 2006 Bangladesh  
Lao PDR In addition to 570 products (with average margin of preference of 
23.9%) available to all APTA members, tariff concessions granted 
exclusively to LDC members on 48 products with average margin 
of preference of 39.7% WT/COMTD/N/22 
 
 Duty-Free Tariff Preference Scheme 
(DFTP) all LDCs  Duty-free access on 85 per cent tariff lines at HS 6-digit level 
within a five-year time frame. WT/COMTD/M/69 
 South Asian Free Trade Agreement 
(SAFTA)c 
Entry into force:  1 January 2006  Bangladesh 
Bhutan 
Maldives 
Nepal 
 
 
 In addition to tariff concessions on 2,940 line at the HS 6-digit 
level to all SAFTA members, special concessions exclusively 
granted to LDC members.  In 2006/2007, preferential rates were 
granted on 84.4% of all tariff lines at average rate of 10.6% (while 
15% for non-LDC members)     WT/COMTD/10  
WT/TPR/S/182.Rev.1 and 
WT/COMTD/N/26 
 Bilateral agreement 
Entry into force: 13 May 2003 Afghanistan 
 Tariff reductions on 38 HS 6-digit lines, with margins of 
preferences of 50% or 100% of MFN tariff  
 WT/TPR/S/182.Rev.1 
 Bilateral agreement 
Entry into force: extended on 29 July 2006 
for 10 years  Bhutan All products 
 WT/TPR/S/182.Rev.1 and 
WT/COMTD/N/28 
 Bilateral agreement Nepal 
 Tariff exemptions for all goods subj ect to rules of origin.  Imports 
of certain goods (vanaspati, copper  products, acrylic yarn and zinc 
oxide) are subject to annual quota.     WT/TPR/S/182.Rev.1 
  
  WT/COMTD/LDC/W/46 
Page 42 Preference 
granting country Description Beneficiary(ies) Coverage/margin  of preference  References 
 
Japan GSP – Enhanced duty- and quota-free 
market access 
Entry into force:  1 April 2007 LDCs Duty-free on 8,859 tariff lines (or 98% of the tariff line level), 
covering over 99% in terms of  the import value from LDCs. WT/COMTD/N/2/Add.14  
Kazakhstan Harmonized System of preference by the 
Eurasian Economic Community (EAEC) 
Entry into force:  May 2001  47 LDCs Duty free for all products WT/TPR/S/170 
Korea, Rep. of 
 Presidential Decree on Preferential Tarriff 
for LDCs 
Entry into force:  1 January 2000 LDCs Duty-free access is granted on 87 tariff items  
(HS 6-digit).  WT/COMTD/N/12/Rev.1  
WT/TPR/S/137 
 Asia-Pacific Trade Agreement (APTA) – 
amendment to the Bangkok Agreement  
Entry into force: 1 September 2006 Bangladesh  
Lao PDR In addition to 1,367 products (with average margin of preference 
of 35.4%) available to all APTA  members, tariff concessions 
granted exclusively to LDC members on 306 products with 
average margin of preference of 64.6% WT/COMTD/N/22  
 
 
Kyrgyz Republic Harmonized system of preference by the 
Eurasian Economic Community (EAEC) 
Entry into force:  May 2001  47 LDCs Duty free for all products WT/TPR/S/170 
Moldova GSP  LDCs Duty free for all products WT/ACC/MOL/37  
Morocco Preferential tariff treatment for LDCs 
Entry into force:  1 January 2001 33 African LDCs  Duty-free access on 61 products (at the HS 4 to  
10-digit level)  WT/LDC/SWG/IF/18 and 
G/C/6  
 
New Zealand GSP- Tariff  Treatment for LDCs Entry 
into force:  1 July 2001 LDCs All products WT/COMTD/27 
WT/TPR/S/115 
Norway  GSP – Duty-  and quota-free market access 
Entry into force:  1 July 2002 LDCs All products  WT/TPR/S/138 
WT/COMTD/N/6/Add.4 
Pakistan 
 South Asian Free Trade Area (SAFTA)  
Entry into force:  1 January 2006 
 Bangladesh 
Bhutan 
Maldives 
Nepal Special concessions available for least-developed contracting 
states.  Tariffs are to be reduced to a 5% ceiling on imports from 
LDC members by 2009. SAARC Secretariat website 
(www.saarc-sec.org) 
WT/TPR/S/193 
Sri Lanka   
 South Asian Free Trade Area (SAFTA) 
Entry into force:  1 January 2006 
 Bangladesh 
Bhutan 
Maldives 
Nepal Special concessions available for least-developed contracting 
states SAARC Secretariat website 
(www.saarc-sec.org) 
 Asia-Pacific Trade Agreement (APTA) – 
amendment to the Bangkok Agreement  
Entry into force: 1 September 2006 Bangladesh  
Lao PDR In addition to 427 products (with average margin of preference of 
14%) available to all APTA members, tariff concessions granted 
exclusively to LDC members on 72 products with average margin 
of preference of 12% WT/COMTD/N/22  
 
 
Switzerland GSP – Revised Preferential Tariffs 
Ordinance  
Entry into force:  1 April 2007  LDCs Duty-free access for all products  originating from all LDCs as of 
September 2009.  Phase-in period s for broken rice, animal feed, 
cane and beet sugar and chemically pure sucrose in solid form 
were completed by September 2009 TN/CTD/M/28  
WT/COMTD/N/7/Add.2  and 
Add.3  
  
   WT/COMTD/LDC/W/46
 Page 43Preference 
granting country Description Beneficiary(ies) Coverage/margin  of preference  References 
 
Tajikistan Harmonized System of preference by the 
Eurasian Economic Community (ECEA) 
Entry into force:  May 2001 47 LDCs Duty free for all products WT/TPR/S/170 
Turkey 
 GSP 
Entry into force:  31 December 2005 All LDCs Duties are eliminated for LDCs on the basis of EC's Everything 
But Arms (EBA) Initiative  
WT/TPR/S/192 
Russia  Harmonized System of preference by the 
Eurasian Economic Community (ECEA) 
 47 LDCs Duty free for all products WT/TPR/S/170 
United States GSP for least-developed beneficiary 
developing countries (LDBDC) 
Entry into force: 1 January 1976, extended 
until 31 December 2009  44 designated LDCsd In addition to the standard GSP coverage of  nearly 5,000 
products, 1,450 articles excl usively available for LDC 
beneficiaries for duty-free treatment  WT/COMTD/N/1/Add.4 & 
Add.5 
WT/TPR/S/160 
www.ustr.gov 
 GSP - African Growth and Opportunities 
Act (AGOA)  
Entry into force:  May 2000, extended until 
30 September 2015e 40 designated sub-Saharan 
African Countries (including 
26 LDCsf), as of April 2009 In addition to the standard GSP coverage of 4,600 products, 1,800 
products, including tex tiles and apparelg, available for duty-free 
treatment   WT/COMTD/N/1/Add.3 
WT/TPR/S/160 
WT/TPR/S/200, WT/L/754 
 Caribbean Basin Trade Partnership Act 
(CBTPA) 
Entry into force:  1 October 2000, extended 
until 31 December 2014 19 designated beneficiaries 
(including one LDC, i.e. Haiti) 
in Central America and the 
Caribbean  Duty free for most products, including te xtiles and apparels.  WT/TPR/S/160 
WT/TPR/S/200 
WT/L/753  
Uzbekistan  
 
 Harmonized System of preference by the 
Eurasian Economic Community (ECEA) 
 47 LDCs Duty free for all products WT/TPR/S/170 
 
 a This table updates the inform ation contained in the previous report by the S ecretariat, as contained in document WT/COMTD/LDC/W /42/Rev.1.  For those measures taken in favour of 
exports originating from LDCs prior to 2001, please see document WT /COMTD/LDC/W/38.   
 b  Members of the APTA are:  Ba ngladesh, China, India, Lao PDR,  Republic of Korea and Sri Lanka 
 c  Members of SAFTA which superseded the South Asian Preferential  Trade Agreement (SAPTA) in 2006 are:  Bangladesh, Bhutan, Indi a, Maldives, Nepal, Pakistan and Sri Lanka. 
 d Afghanistan, Angola, Bangladesh, Benin, B hutan, Burkina Faso, Burundi, Cambodia, Cape  Verde, Central African Republic, Chad, Co moros, Democratic Republic of Congo, Djibouti, 
Timor Leste, Equatorial Guinea, Ethiopia, The Gambia, Guinea, Guin ea-Bissau, Haiti, Kiribati, Lesotho, Liberia, Madagascar, Mal awi, Mali, Mauritania, Mozambi que, Nepal, Niger, Rwanda, 
Samoa, São Tomé and Principe, Sierra Le one, Solomon Islands, Somalia, Tanzania, Togo , Tuvalu, Uganda, Vanuatu, Yemen and Zambia . 
 e The Africa Investment Incentive Act of 2006 or AGOA IV has ex tended the third-country fabric  provision from September 2007 unt il September 2012;  adds  an abundant supply 
provision;  designates certain de nim articles as being in abundant supply;  and allows lesser developed beneficiary Sub-Saharan  African countries export certain textile articles under AGOA.  See 
more information on the offici al AGOA website at www.agoa.gov 
 f Angola, Benin, Burkina Faso, Burundi, Chad, Comoros, Democratic  Republic of Congo, Djibouti, Et hiopia, The Gambia, Guinea, Gui nea-Bissau, Lesotho, Libe ria, Madagascar, Malawi, 
Mali, Mozambique, Niger, Rwanda, São Tomé and Principe, Senegal, Sierra Leone, Tanzania, Uganda and Zambia. 
 g Twenty-seven sub-Saharan African countries, including 17 LDCs (B enin, Burkina Faso, Chad, Ethiopia, The Gambia, Lesotho, Madag ascar, Malawi, Mali, Mozambique, Niger, Rwanda, 
Senegal, Sierra Leone, Tanzania, Uganda, Zambia), are elig ible for AGOA apparel benefits.   
 
 
__________