WTO accessions
African Perspectives on Trade and the WTO
Twenty-first century Africa is in a process of economic transformation but challenges remain in areas such as structural reform governance commodity pricing and geopolitics. This book looks into key questions facing the continent such as how Africa can achieve deeper integration into the rules-based multilateral trading system and the global economy. It provides a range of perspectives on the future of the multilateral trading system and Africa's participation in global trade and underlines the supportive roles that can be played by multilateral and regional institutions during such a rapid and uncertain transition. This volume is based on contributions to the Fourth China Round Table on WTO Accessions and the Multilateral Trading System which took place just before the WTO's Tenth Ministerial Conference in Nairobi in December 2015.
WTO Accessions and Trade Multilateralism
What have WTO accessions contributed to the rules-based multilateral trading system? What demands have been made by original WTO members on acceding governments? How have the acceding governments fared? This volume of essays offers critical readings on how WTO accession negotiations have expanded the reach of the multilateral trading system not only geographically but also conceptually clarifying disciplines and pointing the way to their further strengthening in future negotiations. Members who have acceded since the WTO was established now account for twenty per wto_cent of total WTO membership. In the age of globalization there is an increased need for a universal system of trade rules. Accession negotiations have been used by governments as an instrument for domestic reforms and one lesson from the accession process is that there are contexts which lead multilateral trade negotiations to successful outcomes even in the complex and multi-polar twenty-first-century economic environment. The contributions in this volume illuminate the pressing question regarding why some trade negotiations fail some stall and others succeed.
Energy-related rules in Accession Protocols: Where are they?
Energy issues have not been systematically discussed by WTO members in the multilateral trading system. This is owing to the fact that there is no rule on energy per se in WTO agreements. Yet all tradable energy goods and services are covered by the General Agreement on Tariffs and Trade 1994 and the General Agreement on Trade in Services respectively. With energy security and climate change high on the global agenda there is increasing interest in how to deal with energy-related issues during WTO accession negotiations particularly given that several energy-producing countries energy-transit countries and energy-consuming countries are currently in accession negotiations. Following the examples of earlier accessions the ongoing negotiation dossiers would need to negotiate energy-related specific obligations in their terms of accession. This chapter identifies five key themes relating to energy in the WTO Accession Protocols of the Article XII members and explains the rationale of how these topics relate to trade in energy based on the existing WTO rules. Further it categorizes similar energy patterns and trends for Article XII members. Finally the chapter draws lessons for future WTO rule-making by arguing that these ‘updated’ rules on energy found in Article XII members’ Accession Protocols will have the potential to guide the envisaged regular work of the WTO on future rule-making on trade in energy thereby contributing to international energy cooperation in the context of the rules-based multilateral trading system.
The WTO and the global economy: Contemporary challenges and possible responses
The high economic growth rates that have been achieved by many countries in Asia have led to a contemporary world economy that is multipolar. This has had repercussions for the WTO as well as for other multilateral organisations. The deadlock in the WTO’s Doha Round has led the United States and the European Union increasingly to turn their attention towards the negotiation of preferential trade agreements including so-called ‘mega-regional’ partnerships. This chapter discusses some of the implications for – and possible responses by – the economies that have the greatest stake in a well-functioning multilateral trading system. These economies may find themselves caught in the midst of disagreements between the major trading nations with few prospects of participating in the mega-regionals. The chapter argues that these economies – including those that have acceded to the WTO since its creation – need to take a more proactive leadership role in the WTO to enhance the transparency of what is done in the ‘megaregionals’ and to facilitate the pursuit of rule-making initiatives in the WTO on a plurilateral basis.
A podium perspective: Experiences and challenges of chairing a working party
What is the perspective from the podium? what are the challenges that face the chairperson of an accession working party? The role of a chairperson of an accession working party is tough and challenging and the functions of a chairperson can only be successfully exercised if he or she has the trust and confidence of parties involved. This role is best understood as that of a referee assisted by the Secretariat. The accession of the Russian Federation demonstrated that ‘the real work in WTO accession negotiations is done “beyond the gavel”. If the chair could only work with the gavel the accession process would get nowhere.’ Critical to any progress in the complexity of accession negotiations is political will and the ability to compromise as geopolitics may add a thick layer of complexity to the process. The reality of accession negotiations is that all participants have to be accommodated.
Services market opening: Salience, results and meaning
This chapter is structured around three questions. What advances have been made on services market opening? what have been the specific market access commitments of least-developed countries (LDCs)? And what is the progress made with domestic regulation disciplines? This chapter examines the extent to which the services-specific commitments and domestic regulatory disciplines of Article XII members differ from those undertaken by original WTO members at similar levels of development. Although no single indicator exists that can be used to make this comparison given the textual nature of specific commitments as opposed to the numerical properties of tariffs several other possible parameters exist which could be used alone or in combination to assess such departures. The evidence and patterns in Article XII members’ services market access commitments and regulatory state-of-play and advances are examined. The trends and patterns in the depth and sectoral coverage of commitments are identified. The results from accession negotiations on the rules are reviewed with particular focus on how they compare to the envisaged disciplines on domestic regulation under the General Agreement on Trade in Services Article VI:4. Finally the performance of Article XII LDC members in their WTO accession services negotiations is reviewed. Overall the evidence indicates that Article XII members’ services bindings go further than those of original WTO members.
The 2013 WTO accession of Tajikistan: Experience of a landlocked economy in a changing regional economic configuration
Tajikistan was part of the Great Silk Road a system of caravan routes connecting Eurasian countries between the second century BC and the fifteenth century AD. The development of trade throughout Central Asia encouraged the people of this region to adapt to the demands and requirements of consumers thousands of kilometres away both in western Europe and in China. Tajikistan’s principal rationale for seeking WTO membership was to gain access to new markets and secure the General Agreement on Tariffs and Trade/WTO right of freedom of transit reinserting Tajikistan into trading routes comparable to its location in the historic Great Silk Road system. By becoming a member of the WTO in 2013 Tajikistan is opening up new markets for its goods just as it did several centuries ago. Tajikistan sought WTO membership to sustain domestic reforms. Domestic reforms entailed enactment repeal and/or amendment of approximately one hundred laws and regulations. In the experience of Tajikistan successful negotiating factors included inter alia a technically competent negotiation team support from WTO members strategically defined negotiating objectives accompanied by a strategy for cooperation. Post-accession considerations should be part of an accession strategy. This chapter outlines Tajikistan’s road to the WTO.
Original Members - WTO accessions from a member’s perspective: Safeguarding the rules-based system
Forms of collective action and balanced commitment through negotiations were the foundation of the General Agreement on Tariffs and Trade (GATT) and the structure for its daily work. These remain at the centrepiece of work in the WTO in a system structured on the balance of rights and obligations. GATT contracting parties established the principles of balance and reciprocity trade liberalisation and a system of mediation and dispute settlement for mutual resolution of GATT provisions. From this base expansion of membership pursuant to accession negotiations has required a commitment to accepting GATT/WTO rules resulting from previous negotiations. WTO accession supports applicants’ efforts for economic reform and integration into world markets. This is one of the most important benefits of membership. Although challenging accession negotiations and the implementation of WTO provisions support important economic goals such as sustainable growth the promotion of high-tech industries attraction of foreign direct investment raised living standards and global assertion of national trade interest.
The evolution of the GATT/WTO Accession Protocol: Legal tightening and domestic ratification
Where are the legal roots of WTO Accession Protocols? How much was carried over from the General Agreement on Tariffs and Trade standard and practice? What customary practice governs the preparation and approval of accession decisions and protocols? What is the current substantive standard and basic architecture of Accession Protocols? Are there unique provisions in Accession Protocols that have emerged in twenty years of WTO accession history? To what extent do Accession Protocols come into play in the context of WTO dispute settlement? By comparing the empirical data contained in the WTO Accession Protocols with preceding GATT Accession Protocols this chapter offers waterfront coverage of WTO Accession Protocols from the GATT baseline. The chapter shows that although rooted in its GATT predecessor base and remarkably consistent over time some unique provisions have been incorporated into the architecture of the WTO Accession Protocols since 1995. Because Accession Protocols become integral parts of WTO Agreement after they come into force the chapter argues that the specific ‘terms and conditions of accession’ in WTO Accession Protocols have had a direct and salutary impact on the entirety of the WTO Agreement through its tightened safeguard and upgrade. The chapter concludes by arguing that the evidence suggests that the WTO Agreement has been expanded by the absorption of the Accession Protocols over the course of the last twenty years and that the effect on the WTO Agreement has been significant rather than marginal.
The 2014 WTO accession of Yemen: Accession negotiations as an instrument for domestic reform, national security and international cooperation
In 2011 a popular revolution occurred in Yemen leading to the formation of the government which brought the accession process to its conclusion in 2014 following years of long and complex negotiations. From the beginning Yemen’s accession process was envisaged not as an end in itself but as a means to achieve other more imperative objectives including poverty reduction decreasing levels of chronic unemployment and raising levels of sustained development to meet the needs of a rapidly growing population. This chapter gives an account of the accession process focusing on the positive effects of Yemen’s accession to the WTO both as a catalyst for long sought-after domestic reform and as a useful and convenient path to reach higher levels of reform for which the accession process acted as a spur. The aspiration was to create a competitive business environment that would lead to efficient resource allocation and ultimately boost output and productivity as well as increasing the well-being of the populace and reaping the benefits of WTO membership. Joining the WTO does not mark the end of the reform process. There is work post-accession to establish and strengthen different institutions to exercise the benefits of WTO membership for Yemen.
The future of multilateral investment rules in the WTO: Contributions from WTO accession outcomes
Foreign direct investment and trade are increasingly interlinked due to the deepening integration of trade and production networks. Today there is an ever-increasing percentage of imports in a country’s production. Responding to this increase some countries have sought to limit the percentage of imports in their production by requiring that foreign investors use locally produced inputs as an aspect of implementing priorities in development plans and/or strategic industrial policy. These policies and priorities have also been complicated and exacerbated by protectionism whereby countries discriminate blatantly in order to promote local industries with policies that grant more favours to local producers and/or products and materials. All these practices impact negatively on international trade by distorting the conditions for fair competition. Although different rules have been developed at an international level to streamline these practices currently there is no single comprehensive framework to govern them at the multilateral level. Despite this WTO members through accessions have negotiated with acceding governments to refine and improve extant investment-related rules in the WTO. This chapter argues that WTO-specific outcomes as in deposited Accession Protocols have contributed to improving significantly the predictability of the investment regulatory laws and policies of Article XII members reinforcing existing investment-related rules on trade in goods and services and enhancing the business-friendliness of WTO rules and the relationship with the private sector (including through expanded opportunities for investment) by binding for example their status quo policies and rules and accession-specific obligations codified in domestic law and regulation.
Intellectual property rights protection: The plus/minus debate from a least-developed country perspective – sense and nonsense
This chapter asks whether distinctions exist between the original WTO least-developed country (LDC) members and the Article XII LDCs in respect of their obligations under the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement. The chapter examines the evidence from the protocols of accession of the seven Article XII LDCs in the context of the associated treaty dialogue in their working party reports. It finds that distinctions exist and that the commitments accepted by Article XII LDCs in some respects go beyond the original requirements of the TRIPs Agreements and therefore also go beyond the TRIPs obligations of original LDC members. The chapter investigates these WTO TRIPs ‘plus’ commitments and assesses their merits in relation to the sovereign determined domestic reform priorities of the Article XII members and possible implications for the rules-based multilateral trading system. It is argued that the TRIPs Agreement is a minimum standards agreement consisting of both principles and substantive obligations with built-in flexibilities and considerable scope for interpretation and national implementation of its provisions. WTO members may deviate from these minimum standards to the extent that they benefit from longer or shorter periods of transitional relief which may vary according to an LDC member’s status as either an original member or Article XII member. Accession-specific commitments and associated treaty dialogue also show that there is implementation ‘flexibility’ on the basis of pre-determined action plans. The chapter finds that in those instances where Article XII LDCs members have undertaken legally binding commitments to implement WTO-plus obligations the substantive minimum standards of protection of the TRIPs Agreement have been increased. These WTO-plus binding commitments have been used to ‘lock in’ domestic institutional and structural reforms based on domestic development priorities to encourage innovation and attraction of foreign direct investment and they have served a domestic reform purpose to encourage innovation induce foreign direct investment and strengthen the TRIPs Agreement by increasing substantive minimum standards.
WTO accession and accession to the Agreement on Government Procurement: What is the relationship? Why should WTO acceding governments also consider GPA accession?
The WTO Agreement on Government Procurement (GPA) is unique in its duality as an international trade agreement that promotes and preserves market opening and as an instrument for the promotion of good governance. The recent successful renegotiation of the GPA has enhanced its coverage so that it now provides access to markets valued at US$1.7 trillion annually. In addition the text of the GPA has been effectively modernised making it more relevant economically and simplifying its implementation. Although not a substitute for domestic procurement reforms it is a catalytic and reinforcing factor for reforms that enhance transparency and competition internally – thereby yielding important gains for governments and citizens in terms of value for money in national procurement activities. Participation in the GPA can also promote inward foreign direct investment by signalling a country’s commitment to good governance and the fair treatment of all players under national legislation. The review in this chapter of the evidence from WTO and GPA accessions indicates that the WTO accession negotiations of Article XII members are often used to leverage increased GPA accessions. Specifically of the members that have acceded to the WTO pursuant to Article XII of the Marrakesh Agreement Establishing the WTO (WTO Agreement) twenty-two have undertaken GPA-related commitments and seven subsequently joined the GPA. Out of the ten WTO members that are currently seeking accession to the GPA nine undertook commitments related to GPA accession at the time of their WTO accessions pursuant to Article XII of the WTO Agreement. The chapter concludes that even though WTO accession and GPA accession are formally separate steps the basic policy decision as to whether to join the GPA is often made long before GPA accession negotiations are started at the time of WTO accession. This chapter provides countries and other WTO members considering taking on accession commitments with a strengthened understanding of the relevant benefits and costs.
The 2013 WTO accession of Lao PDR: Specific commitments and the integration of leastdeveloped countries into the global economy
When Lao PDR applied for membership of the WTO in 1997 it used the WTO accession process as a tool to implement its decision to establish a market economy and fully integrate into the world economy. Although at the outset market access was not considered to be the principal benefit to be derived from WTO accession Lao PDR was aware that WTO membership would give its economy additional security and predictability. WTO accession negotiations allowed Lao PDR to apply international best practices and to align its trade policy with the principles of nondiscrimination and transparency. Adaptation to international trade requirements is a longer-term challenge and post-accession challenges remain but the benefits are significant and worthwhile.
Managing the challenge of acceding post-conflict states
This chapter posits that leaving WTO accession in the hands of trade experts or commercial specialists within the acceding government can be unwise. Accession to the WTO goes far beyond the remit of the trade commerce and/or foreign ministry and even beyond the responsibilities of the minister. In order to conclude an accession what is required of the acceding government will involve many if not most ministries call upon governmental agencies and other authorities and may very well include both regional and municipal levels of government. The acceding government must expect to make hard policy choices. Poorer developing countries are likely to come across particular challenges and solutions. Given the demanding nature of this process it is important that the acceding government is entirely convinced before embarking upon the process that it has the right motivations and expectations in wishing to become a member of the WTO.
WTO accessions: What does the academic literature say?
This chapter takes stock of the recent academic literature on accessions. It focuses only on the analytical work published since 2000 in books academic journals and working papers by key WTO scholars across the world. These contributions are related to the procedural legal economic and institutional aspects of WTO accessions and to the proposals for their reform. Country-specific studies research on the impact of accessions on individual industries and reports on accessions by national and international institutions are not included.
Eurasian Economic Union integration: Timetable, priorities and challenges
This chapter focuses on the objectives of the Eurasian Economic Union (EAEU) of the Republic of Armenia the Republic of Belarus the Republic of Kazakhstan Kyrgyz Republic and the Russian Federation within the multilateral trading system. The EAEU has become one of the largest trading blocs in the world with a land area of more than 20 million square kilometres and a population of more than 176 million people. This chapter analyses the history of Eurasian integration and presents its current status as well as the prospects of the Eurasian Economic Union for 2015.
The 2012 WTO accession of Russia: Negotiating experience – challenges, opportunities and post-accession approaches
The working party on the accession of Russia was the biggest and longest in WTO accession history. A big power that decides to join an international organisation even if this is the WTO cannot avoid political burdens. No big country can stay apart from world politics. The WTO accession process is tough demanding and complex with no clear rules. This raises questions about length fairness and lack of procedural clarity. Yet it is risky to stay outside the rules-based multilateral trading system. To navigate the WTO accession process upfront it is critical to define a negotiating strategy and plan the end-game well in advance – a process that requires mobilisation of all negotiating resources concentration and focus. Domestically the challenge for the acceding government is to state a clear rationale for accession demonstrate that there will be real benefits from accession or at a minimum that there will be no negative consequences and define red lines to be defended. Negotiating positions should be aligned with requirements for domestic reform. Strong and consistent political will and leadership with support from the parliamentary majority are necessary to conclude any accession negotiations. WTO accession may in itself play neither a negative nor a positive role for domestic economic developments but by becoming a member a country will obtain benefits in the medium and long term through the creation of better terms for its trade within the WTO itself. In this chapter Russia’s practical experience of its accession negotiation the obstacles encountered its assessment of the benefits of accession including lessons learned during the process are described.
The future of Asia: Unleashing the power of trade and governance
Half a century ago the future of Asia looked quite bleak. Civil and regional conflict ravaged many parts of the region. China was still closed to the world and in the throes of its Cultural Revolution. India and Pakistan were recovering from wars Indonesia and the Philippines were under authoritarian rule and several Central Asian countries were mere shadow states of the former Soviet Union. Since then Asia has surprised the world: Japan and the rest of East Asia have rapidly become industrialised and successive years of high growth have been attained by other Asian countries notably China India and several countries in the Association of Southeast Asian Nations. This growth has been driven in great part by rapidly expanding trade with the liberalisation of China in the late 1970s and of India in the 1990s greater integration among North-east and Southeast Asian countries and the collapse of the Soviet Union.
WTO accession negotiations: Trends and results in agriculture plurilaterals
Thirty-three members have acceded to the WTO since it was established in 1995. In the majority of these accession negotiations reforms to the agriculture sector have featured as a particularly sensitive issue for acceding governments. Why is this the case? What are the existing members’ expectations of acceding governments in relation to agriculture? And how have acceding governments fared through this process? While agriculture trade accounts for less than 10 per wto_cent of world merchandise trade the agriculture sector particularly for many developing countries can be significant in terms of its contribution to both gross domestic product and employment.
Are there different rules for least-developed countries in a rule-based system?
In July 2012 the WTO General Council agreed on a set of new and improved guidelines to facilitate and accelerate negotiations on the accession to the WTO of least-developed countries (LDCs). The process of acceding to the WTO is complex time-consuming and resource-intensive for candidate countries and for LDCs which have limited institutional and administrative capacity in particular. The WTO accession process is very much a political process and requires countries to undertake far-reaching domestic reforms in order to be in a position to implement WTO rules from day one of membership as well as to benefit from MFN market access from WTO members and vice versa. The prolonged accession process is designed to enable acceding LDCs (and others) to acquire the knowledge and expertise to negotiate not only the terms and conditions for their membership but also to function as viable members of the rules-based system. This chapter examines the enhanced guidelines and asks whether the WTO needs to improve the procedures for the benefit of LDCs and of the WTO. It examines how the WTO accession process and procedures as well as the scope of the reforms it requires compare to EU considerations in the process of its enlargement and argues that while the enhanced LDC accession guidelines have made an important contribution some additional steps may need to be contemplated in the future. However before a further enhancement is contemplated it must be understood that the accession process and the substance of WTO accession negotiations in all serious institutions are based on a partnership. This is a fundamental lesson from all successfully completed accessions and enlargement processes. The process is neither unilateral nor automatic.
WTO accession and the private sector: The nexus of rules and market opportunities
A country’s bid for WTO membership can promote a feeling of challenge and uncertainty among members of the private sector as the long-established methods of conducting business are susceptible to undergoing considerable change. In order to overcome the potential resistance to this change acceding governments have responded to the concerns of their businesses by adopting strategies to raise awareness of the long-term benefits of reform during the negotiating period. In this chapter we document some of the benefits related to trade and investment for Article XII members that have undertaken awareness raising strategies and necessary reforms during their accession processes. This chapter underlines that accession commitments which are critical to bringing about domestic policy and regulatory reforms need to be implemented in the right spirit to develop business competitiveness in the long run.
Domestic framework for making and enforcing policies
A core objective of accession results is to establish a legal foundation for the conduct and management of trade policy based on the rule of law. Implementation of accession commitments hinges on the existence of an effective domestic framework for making and enforcing policies. Customarily this is described in the third chapter of working party reports. Twenty-eight of the members that acceded pursuant to procedures in Article XII of the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement) have undertaken a total of fifty-five accession-specific commitments in this regard. The uniquely definable pattern that has emerged from WTO Accession Protocols confirms the uniform applicability of the WTO Agreement throughout and across the entirety of the customs territory of the new member the exclusive authority of central governments to implement and enforce WTO rules the strengthening of due process and the rule of law and the precedence of ratified international treaties over domestic legislation in many instances. These commitments are integral to the WTO Agreement and are enforceable under the WTO Dispute Settlement Understanding. Although normative and standard they confirm the long-standing accession practice that a range of original members have not confirmed and from which several deviate. This chapter studies the specific accession-specific commitments in the domestic framework for making and enforcing policies. It also investigates the relationship between Accession Protocols and domestic legal systems and asks whether original members undertook similar obligations.
Export duty commitments: The treaty dialogue and the pattern of commitments
This chapter focuses pursuant to Article XII accession-specific commitments on the evolving disciplines on export duties distinguished from the broader setting of export restrictions. From a rules angle export duties were not subject to disciplines in contrast to import duties that have classically been bound in schedules of concessions and commitments on goods since GATT 1947. Pursuant to Article XI:1 of the General Agreement on Tariffs and Trade (GATT) 1994 (rules for ‘quantitative restrictions’) prohibitions or restrictions on imports and exports such as bans quotas and restrictive licences are generally prohibited except for duties taxes or other charges. In economic operations export duties with price discrimination effects between domestic and foreign producers have resulted in efficiency losses and anti-competitiveness and have undermined economic welfare. In accession negotiations the establishment of disciplines and improvement in economic welfare has framed the treaty dialogue. This dialogue has made evident a range of issues that are systemic and that have involved questions on international economic cooperation revolving around the broader use of export restrictions and their overlap with export duties. This chapter reviews the substance of the treaty dialogue on export duties and identifies the extent and pattern of specific obligations on export duties in the Article XII Accession Protocols deposited thus far. The analysis shows that fifteen Article XII members have accepted accession-specific obligations on the application of export duties. These obligations range across ‘abiding’ by the provisions of the WTO Agreement; ‘binding and/or fixing’ applied export duty rates; and ‘reducing’ ‘eliminating’ or ‘foreclosing’ on the use of such duties. Of precedential value is the modification of the classical 1947 architecture of the GATT Goods Schedule to create a Part V on Export Duties in the context of the WTO accession commitments of Russia in its Goods Schedule. This chapter argues that accession-specific commitments have deepened and extended original WTO rules governing export duties as an instrument of trade policy. The overall systemic effect has been positive namely to constrain reduce eliminate and/or bind hence contributing to clarity and predictability of the rules with pro-competitive effects enhancement of market access opportunities and improvements in economic welfare. The chapter argues that WTO accession-specific obligations for export duties have set the multilateral standard for disciplines in this area. Nevertheless it is worrying that even as the disciplines on export duties are being formulated and strengthened via Article XII members the facts suggest the higher use of such export duties by original members over the period from 2003 to 2009.
The structural reform implications of WTO accession
This chapter looks at the relationship between the WTO accession process and structural reforms in developing countries. It finds that developing economies that are in the process of acceding to the WTO commit to more policy reforms (proxied by prior actions in the context of the World Bank’s development policy lending) than developing countries that are already members of the WTO or that have not applied to become members. It also finds that for almost all developing economies acceding to the WTO the country risk measured by a composite indicator of political financial and economic risk called the International Country Risk Guide and the policy and institutional indicator measured by the World Bank Country Policy and Institutional Assessment significantly improve when a country achieves WTO membership compared with at the beginning of the WTO accession process.
The 2001 WTO accession of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu: Negotiating experience – challenges, opportunities and approaches post-accession
The economy of Chinese Taipei has always been highly dependent on trade. Nevertheless its WTO accession negotiations were demanding – although the results have been significant and beneficial – involving a total of eleven formal meetings and five informal meetings for the working party and approximately 200 bilateral meetings between Chinese Taipei and thirty different WTO members. The gradual opening of Chinese Taipei’s market exposed domestic industries to global competition necessitating a process of adjustment and adaptation that has ultimately led to economic growth. For the more vulnerable industries the challenges of market liberalisation have acted as an incentive to restructure and reinvent in order to improve competitiveness. Chinese Taipei’s accession to the WTO has also been a catalyst for the globalisation and development of these industries and necessitated a process of adjustment and adaptation that has ultimately led to economic growth. The trade policies and regulations of Chinese Taipei underwent a thorough review and revision as a result of the requirements of WTO membership and this legislative overhaul has been highly beneficial in modernising the trade regime.
Contributions and lessons from WTO accessions: The present and future of the rules-based multilateral trading system
WTO accession still holds a magnetic attraction for non-members. Why is this so in spite of the challenges faced by the organisation conclusions by analysts of deadlock in the Doha Development Agenda assessments that trade policy action has shifted elsewhere to preferential trade arrangements (bilateral and regional trade agreements including more recently ‘mega-regionals’) and repeated forecasts about the WTO’s ‘irrelevance’ and ‘unravelling’? Systemically what have WTO accessions contributed to the rules-based trading system through their processes procedures best practices and results? What effects have accession negotiations had on domestic reforms in Article XII members? Are there broader lessons for the WTO? This chapter demonstrates that after the coming into force of the WTO in 1995 results from WTO accession negotiations served to update trade rules continuously (including influencing WTO jurisprudence) enlarged market access opportunities provided acceding governments with a critical multilateral instrument for legislation-based domestic reforms and supported geopolitical and geo-economic transformations from centrally planned to market-based economies the rule of law and good governance. The changes associated with these results were evident from the 1989 fall of the Berlin Wall and the 1991 collapse of the Soviet Union. The evidence strongly suggests that the accession process and its results have established a legal framework for international cooperation contributed to the global economic transformation of command to market economies and provided a platform for Article XII members to implement their development and modernisation priorities. Overall the legal economic and trade policy impact from the deposited Accession Protocols and the process of accession negotiations per se have not only reinforced existing rules and raised the systemic bar with associated catalytic effect for domestic reforms but have also staked out the parameters for the future of the rules-based trading system including a future WTO work programme.
The 2008 WTO accession of Ukraine: Negotiating experience – challenges, opportunities and post-accession approaches
Ukraine embarked on its road to WTO accession in 1992 a year after it had declared its independence. Fourteen years of intense work steep learning persistence political will and flexibility were to follow. Ukraine faced many immediate challenges and tasks in strengthening its independence and creating and establishing the national institutions required by an independent state moving away from a centralised economy and reinforcing foreign policy. Ukraine had to totally eliminate its post-Soviet legacy. A new system of national government and administration had to be established. Democracy the rule of law and a free market became the guiding principles for political social and economic life. WTO accession implied increased competition which turned out to be quite painful for some companies. However the negative scenarios foreseen by some researchers did not occur; in fact the accession offered the national economy new incentives for structural and long-lasting change. However WTO membership is not simply a recipe for future happiness. While it stimulates trade and business environments members must still work within the multilateral system to keep up to date.
Strengthening transparency in the multilateral trading system: The contribution of the WTO accession process
What specific obligations on transparency and notifications have been negotiated as part of the terms of accession to the WTO since 1995? What patterns and trends have emerged with regard to transparency and notification requirements in WTO accessions over time? What is the implementation behaviour on notification requirements of the states or separate customs territories that have negotiated their terms of accession pursuant to Article XII of the Marrakesh Agreement Establishing the World Trade Organization and joined the WTO in the period 1995 to 2013? How does the compliance of Article XII members on notification requirements under the WTO Agreements compare to the compliance behaviour of original members? By reviewing the empirical data available from more than thirty completed WTO accessions since 1995 representing about one-fifth of the WTO membership this chapter examines each of these questions assessing the extent to which the negotiated accession commitments on transparency have affected the existing transparency and notification obligations under the WTO Agreements. The results of this review suggest that the specific transparency and notification obligations resulting from accession negotiations have safeguarded and reinforced existing transparency requirements embedded across all WTO Agreements. They have also resulted in positive implementation behaviour with regard to notification requirements by WTO members that joined the WTO between 1995 and 2013 and have thus improved the compliance rate of the overall WTO membership. The number and scope of specific transparency commitments negotiated in WTO accessions underscores the importance that the WTO membership attaches to transparency one of its founding principles.
The year 2012: WTO accession of Montenegro – why did we apply to join? Priorities and results
Montenegro’s path to becoming a member of the WTO began in 1966 when the Socialist Federal Republic of Yugoslavia became party to the General Agreement on Tariffs and Trade (GATT). However pursuant to the constitution of the Federal Republic of Yugoslavia (FRY) in 1992 its application to continue as part of the GATT was not accepted. In 2000 the FRY re-started the process of accession to the WTO aware that WTO membership would increase its competitiveness in the international market with the acquisition of the so-called ‘WTO label’. In 2004 Montenegro decided to continue the accession process as an independent customs territory. This chapter describes the process of Montenegro’s accession up to and beyond its becoming a member of the WTO in 2012. With the country’s membership in the WTO an entirely new chapter begins in comparison to the period prior to accession negotiations. Post-accession the interest of each member is to be involved as much as possible in the activities of the WTO and to seek the scope to influence the decisions and rules that will be applied in the future.
Market access goods negotiations: Salience, results and meaning
Trade negotiations and the exchange of concessions on trade in goods have been the cornerstone of the multilateral trading system. This chapter examines the salient features results and meaning of the schedules of tariff concessions and commitments on goods of Article XII members: what they mean and what they have contributed. We find that the bilateral market access of Article XII members has shaped the landscape of tariff commitments that provide transparency and predictability to today’s merchandise trade relationships. We also found that the large number of post-2001 accessions coincided with an extended period of global growth particularly among the major emerging economies fostered by the stability of trade regimes. When we compared Article XII members with General Agreement on Tariffs and Trade (GATT) members on bound tariffs we found that the comparable bound tariff rates were higher for GATT members and that a number of original members retained unbound tariff lines for non-agricultural products. Overall results from the concluded accessions have produced more liberal tariff concessions than those of original WTO members expanding the market access for WTO members’ exports. The lower barriers to trade in these Article XII members’ markets have improved economic efficiency increased competition and led to better resource reallocation.
The 2004 WTO accession of Cambodia: Negotiating priorities and experience – growth and integration eleven years later
Cambodia was the first least-developed country to complete negotiations to become a member of the WTO. Its negotiations took place in the context of the Decision on LDC accessions taken by the WTO General Council in December 2002 in which WTO members agreed that they would be bound by certain restraints in dealing with LDCs seeking to join the WTO. Given the constraints that as an LDC it faced when entering the negotiations Cambodia recognised that joining the WTO could play an important part in accelerating its growth and development. This chapter describes Cambodia’s approach to the accession negotiations: its negotiating strategy the negotiations themselves and their outcome and Cambodia’s post-accession activities. The foundation of all international trading arrangements is the WTO its concepts and its rules most of which are carried over into preferential trading arrangements. Being a member of the WTO provides a member’s traders with the transparent and predictable trading environment that they need to prosper. It can truly be said that being a WTO member is one of the main pillars of Cambodia’s successful economic performance.
The macroeconomic implications of WTO accession
This chapter proposes a holistic framework by which acceding governments may evaluate the macroeconomic impact of joining the WTO. Because both acceding governments and WTO members are interested in preserving their own systemic stability and the stability of the multilateral trading system evaluation of the Accession Package can be achieved by examining its impact on the domestic and external stability of the acceding country. The chapter concludes that in the long run the impact should be positive and should be driven by better resource allocation as the acceding economy opens to international trade makes deep structural reforms and aligns its institutions and policies with internationally recognised standards. However in the short term implementation of WTO commitments may lead to substantial adjustment costs in the public and private sectors. Overall the design and implementation of WTO accession commitments is a matter of public policy that should aim to promote systemic stability and accelerate domestic reform while addressing transitional costs.
WTO accessions: A market access perspective on growth – the approach of the European Union
A strong multilateral trading system is vital to developing countries’ longterm interests both for its rulebook and for the market access that it guarantees in all key markets. Markets are increasingly located in developing countries. Indeed for the first time in recent history South–South trade outweighs North–South trade even though barriers to South–South trade are much more significant than those to developed countries’ markets. Through their WTO accession acceding economies can reap the benefits of more and better access to most world markets – that of the European Union being among the biggest.
Sanitary and phytosanitary measures: Trends in accession plurilateral negotiations
Since 1947 effective levels of average tariff protection have declined as regulatory protectionism – behind the border – has risen. To a large extent the greater gains from continued trade opening lie in the area of procompetitive domestic regulatory reform codified in duly enacted legislation with associated implementing regulations. In the practice of WTO accession negotiations specific obligations have focused more on regulatory areas of the foreign trade regime. The evidence from thirty-three deposited Accession Protocols shows that there have been ninety-three specific obligations undertaken on sanitary and phytosanitary (SPS) measures. Pursuant to WTO Accession Protocols these are now integral to the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement). The quantum of citation in WTO jurisprudence in the area of SPS is considerable: since 1995 42 out of 494 WTO dispute settlement cases have cited the WTO Agreement on Sanitary and Phytosanitary Measures in the request for consultations. This chapter examines the evolution of accession results on SPS from 1995 to 2015 and their contributions to the enhancement of the existing WTO legal and policy framework on SPS. Specifically this chapter focuses on the increasing importance of SPS regulatory issues in the foreign trade regimes of WTO members the substance of specific SPS obligations undertaken by Article XII members and their relationship to the WTO Agreement and the core questions that have emerged on the SPS accession treaty dialogue in the context of customs union agreements. As demonstrated in this chapter SPS accession commitments undertaken by thirty-three Article XII WTO members have exercised a significant influence on WTO jurisprudence. To a large extent this has further clarified and strengthened WTO law.
Accession Protocols as building blocks
This book provides multiple perspectives on the process and results from WTO accession negotiations. The perspectives reflected are those of economists lawyers academics chief negotiators of selected original WTO members and Article XII members chairpersons of WTO accession working parties professionals from the multilateral institutions of the WTO World Bank International Monetary Fund and International Trade Centre. Analysis is combined with ‘stories’ enriched by anecdotes. The detailing of the facts of trade policy drudgery is accompanied by explanatory narratives that bring the situations to life. In many ways what will strike the reader is that this is a unique book of high value that has emerged from a system that has yielded higher levels of transparency albeit grudgingly and only when pressed.
A reflection on accessions as the WTO turns twenty
As the WTO celebrates its twentieth year it is appropriate to ask what WTO accessions have contributed to the rules-based multilateral trading system. What demands have been made by the original and incumbent WTO members on acceding governments? How have the acceding governments fared? This chapter finds that WTO accessions have expanded the reach of the trading system not only geographically but conceptually by clarifying disciplines and pointing the way to their further strengthening in future negotiations. Members who have acceded under Article XII of the General Agreement on Tariffs and Trade now account for 20 per wto_cent of total membership of the WTO. Meanwhile with globalisation the increased prevalence complexity and capillarity of international exchange has greatly increased the need for a universal system of trade rules. Crucially accession negotiations have been used by governments as an instrument for wide-ranging domestic reforms including by means of far-reaching new legislation that has effectively changed the business landscape. In several instances the WTO accession negotiating platform has been used for the much broader purpose of facilitating new closer geopolitical relationships. As the negotiating arm of the WTO continuously adapts the success of accession negotiations also points to the opportunities inherent in variable negotiating configurations such as plurilaterals around specific issues. There is also considerable scope for improving the process of accession negotiations to ensure greater transparency streamlining and fairness.
WTO Accessions and Trade Multilateralism
Trois questions importantes seront déterminantes pour l'avenir de l'OMC: le règlement des différends les négociations et l'intégration régionale. Le règlement des différends est généralement considéré comme l'un des succès majeurs de l'OMC durant ses dix premières années d'existence. La conclusion des négociations du Cycle de Doha est l'un de ses principaux défis. L'intégration régionale est désormais au premier plan du débat alors que les accords régionaux prolifèrent et que les décideurs et les universitaires prennent la mesure de leur incidence sur le système commercial multilatéral. Ces questions et leur interaction sont traitées par d'éminents spécialistes et professionnels du droit commercial international originaires d'Amérique du Nord d'Europe et de la région Asie Pacifique. En outre des sections spécifiques sont consacrées à la région Asie Pacifique à sa participation au règlement des différends et aux négociations dans le cadre de l'OMC et aux tendances récentes à une plus grande intégration régionale.AE1:AE10
WTO rule-making: WTO Accession Protocols and jurisprudence
This chapter examines rule-making in the WTO. It explains the legal provisions governing how rules are made in the WTO and describes WTO rule-making in practice including through the adoption of decisions by the Ministerial Conference and the General Council and by way of dispute settlement. The role of consensus and voting in WTO rulemaking are discussed. The chapter also refers to different types of rules and decisions – such as ministerial declarations authoritative interpretations amendments and waivers – and considers their legal value and effect as well as how different types of rules or decisions have been interpreted or applied. Finally it also includes a look at rule-making in the context of accessions and considers Accession Protocols and working party reports through the lens of WTO dispute settlement.
Article XII Members - The 2001 WTO accession of China: Negotiating experience – challenges, opportunities and post-accession approaches
China is among the Article XII members which joined the WTO after its establishment in 1995. Membership of the WTO has served as a major stabiliser and strong accelerator for China’s economic take-off although China’s accession commitments were highly demanding. One of the most profound impacts brought about by China’s accession has been that the country fully embraced the rules-based spirit upheld by the WTO. Concepts such as non-discrimination transparency and the rule of law are no longer trade jargon but common words for the general public. To this end China conducted the largest legislative reform in its history to establish a WTO-consistent legal system. China’s accession brought tangible benefits to the Chinese people quadrupling the gross domestic product per capita increasing people’s income and improving people’s livelihood. Household income increased from about US$800 to US$3300 marking an annual growth of 10 per cent. More than 200 million people were successfully lifted out of poverty. As China benefited from integration into the WTO and the rules-based multilateral trading system it has shared these benefits with other WTO members including and in particular least-developed countries.
Facilitating accessions: The role of the working party chairperson
What is the role of the chairperson of a working party? What instruments can he or she use to manage the complexities of the WTO accession process? Typically WTO accession negotiations are time consuming because of extensive domestic legislative and institutional reforms which need to be aligned with economic development strategies. These reforms focus on the tough questions of eliminating trade barriers improving governance tackling corruption and enforcing the rule of law through WTO-consistent legislation. Formally the function of the chairperson is to preside over working party meetings. In practice the chairperson works as part of a team with the WTO Secretariat led by the Accessions Division in seeking to identify the balance of interests and what the market can bear and hence leading the working party to develop a common view of its purpose and shared responsibility.
Developments in the global economy and trading system effects: The transformation of world trade
The Great Recession of 2008–2009 tested the resilience of economies across the world and placed enormous strain on the frameworks underpinning global cooperation. In no arena was the test more severe than in world trade which against a background of collapsing output and surging unemployment in the industrialised countries fell about one-quarter in the first half of 2009 a rate of decline that exceeded the worst years of the Great Depression of the 1930s. Although the rate of recovery remains sluggish and the pace of trade liberalisation has slowed a relapse into protectionism has been avoided and world trade volumes have surpassed the pre-crisis peak by some 25 per cent. The world trading system seems to have passed this most strenuous of tests. This chapter examines how two great changes in the global economic landscape deepening trade integration (trade as a means of production as well as consumption) and the rising weight of developing countries are changing trade and investment flows and creating new challenges for policy-makers.
WTO accessions: A rules perspective on growth – the approach of the European Union
In today’s difficult economic conditions and in the aftermath of the global financial crisis growth is more than ever the priority of governments. Economic growth employment wealth health and political stability are intrinsically linked notions and each is essential for the others. Trade and economic integration have been credited as core means to deliver growth. The heads of the EU member states have recently reiterated the importance of free fair and open trade for growth and have highlighted the European Union’s objective to promote among other things international regulatory convergence. Trade liberalisation is a major structural reform in itself creating incentives for investments modernisation and increased competitiveness. Moreover in a world of increasing production interdependence as a consequence of global supply chains achieving regulatory convergence is not a question for consideration but an imminent necessity if trade and growth are to be preserved and stimulated. The WTO offers both a beacon for economic reforms and an unprecedented forum for economic partnership.
Disciplining state trading practices: Lessons from WTO accession negotiations
This chapter addresses a number of concerns associated with state trading. What are the applicable WTO rules in this area and have they kept up with the evolving nature of production methods and the changing landscape of state trading enterprises (STEs)? How have state trading practices been approached in WTO accession negotiations? How many WTO members acceding under the provisions of Article XII of the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement) have accepted specific obligations aimed at disciplining the operations of STEs? What specific patterns have emerged across these commitments and how have they evolved over time? Have the commitments resulting from WTO accession negotiations offered a more effective and forward-looking approach to disciplining STE activities? What is the systemic relevance of STE-related accession commitments and what lessons can be drawn about possible future multilateral disciplines in this area? What has been the contribution of accession commitments relating to transparency in privatisation programmes? STE disciplines have been in the rulebook of the multilateral trading system since 1947 but have not kept track with the evolving nature of state trading operations. State trading plays a significant role in the economies of the majority of Article XII members. The applicability of existing WTO rules in this area has therefore been put to practice in their accession negotiations. The commitments resulting from accession negotiations have produced more comprehensive and forward-looking disciplines which arguably capture modern-day state trading operations more adequately. Specifically STE-related accession commitments have evolved over time to extend the scope of obligations to the purchases and sales of both goods and services contribute further definitional clarity to the term ‘state trading enterprise’ and address the transparency deficit in this area. In addition to steering the operations of acceding governments’ STEs towards conformity with WTO principles the evolution of these commitments is of systemic relevance to the multilateral trading system as it points to the possible direction of future disciplines in this area. While not pre-judging the future development of multilateral provisions on state trading it is argued that Article XII members which today account for one-fifth of the WTO membership are well placed to influence the direction of future discussions in the area of STEs.
China - Measures Related to the Exportation of Rare Earths, Tungsten, and Molybdenum
On 13 March 2012 the United States requested consultations with China with respect to China’s restrictions on the export of various forms of rare earths tungsten and molybdenum. The request refers to materials falling under but not limited to 212 eight-digit Chinese Customs Commodity Codes and over 30 measures. The request also refers to a number of Chinese published as well as unpublished measures that operating separately or collectively allegedly impose and administer export restrictions. These restrictions include export duties export quotas minimum export price requirements export licensing requirements and additional requirements and procedures in connection with the administration of the quantitative restrictions.
China - Measures Related to the Exportation of rare Earths, Tungsten, and Molybdenum
On 13 March 2012 the United States requested consultations with China with respect to China’s restrictions on the export of various forms of rare earths tungsten and molybdenum. The request refers to materials falling under but not limited to 212 eight-digit Chinese Customs Commodity Codes and over 30 measures. The request also refers to a number of Chinese published as well as unpublished measures that operating separately or collectively allegedly impose and administer export restrictions. These restrictions include export duties export quotas minimum export price requirements export licensing requirements and additional requirements and procedures in connection with the administration of the quantitative restrictions.
China - Measures Related to the Exportation of Various Raw Materials
On 23 June 2009 the United States requested consultations with China with respect to China's restraints on the export from China of various forms of raw materials. The United States cites 32 measures through which China allegedly imposes restraints on the exports in question and note that there appear to be additional unpublished restrictive measures.
United States - Measures Affecting Imports of Certain Passenger Vehicle and Light Truck Tyres from China
On 14 September 2009 China requested consultations with the United States concerning increased tariffs on certain passenger vehicle and light truck tyres (subject tyres) from China. The decision was announced on 11 September 2009 following an investigation pursuant to section 421 of the Trade Act of 1974 (19 U.S.C. 2451 et seq.). The USITC determined that there was market disruption as a result of rapidly increasing imports of subject tyres from China that were a significant cause of material injury to the domestic industry. Following a Presidential decision additional duties were imposed on subject tyres imports for a three year period in the amount of 35 per cent ad valorem in the first year 30 per cent ad valorem in the second year and 25 per cent ad valorem in the third year (the tyres measure). This measure took effect on 26 September 2009.