IT ACCORD NOW COVERS 38 NATIONS

12:21 PM Mar 3, 1997

IT ACCORD NOW COVERS 38 NATIONS
Geneva 3 Mar (Chakravarthi Raghavan) -- Some 38 countries have now agreed to join the Information Technology Products agreement, which provides for elimination of all tariffs and other charges and duties by year 2000, taking the trade coverage to a little over 92 percent.

The tariff is reduction to be achieved by equal reductions beginning 1997, but some of the developing countries have sought and been given extended staging.

The schedules are to be scrutinised plurilaterally among the parties, with the review process to be completed by 1 April. In view of the Easter holidays, in the last week of March, this process is expected to be completed in the week of March 23.

At Singapore, last December, 28 countries with a trade share of 83.4 percent had signed the Ministerial declaration on the accord, which was primarily negotiated amongst the Quad -- US, EC, Japan and Canada.

The declaration issued at Singapore was signed by Australia, Canada, the EC (for the 15 members of the EU), Hong Kong, Iceland, Indonesia, Japan, Korea, Norway, Singapore, Switzerland, Turkey and the United States, as well as Taiwan which is negotiating its accession to the WTO.

For the agreement to be effective, the declaration set a minimum threshold of countries accounting for 90% of the trade, but with a provision for participants to make an assessment whether they should still bring the accord into force if the percentage fell "somewhat short of 90 percent."

Since Singapore, ten more countries have agreed to join -- India, Malaysia, Thailand, Romania, Estonia, Israel, New Zealand, Costa Rica, Macau and the Philippines. This takes the trade coverage over the 90 percent level.

Excepting for Costa Rica, none of the Latin American and Caribbean countries have agreed to join, and Costa Rica sought and has got an extended time for eliminating the tariffs.

In terms of the accord at Singapore, all the countries were to have filed their schedules by 1 March, with scrutiny and verification process beginning 3 March.

While not a part of the ITP accord, but negotiated side by side at Singapore and indirectly linked to it, the US and EU agreed at Singapore to eliminate tariffs on "white spirits" (including vodka, rum, gin and liquers), with the tariffs to be phased out beginning July 1997 and completely eliminated by 1 January 2000.

The accord on 'white spirits', and the amendment to the US and EC tariff schedules, have not been so far notified to the WTO, but is expected along with the IT accord. Like the IT accord, the US-EC accord for zero tariffs on white spirits, will be applied on an MFN basis, providing duty free access to the US and EU markets to all spirit producers worldwide.

This will eliminate the preferential market access, under a quota regime, that rum producers of the Caribbean countries have had on the EC market under the ACP Lome accord, as well as on the US and Canadian markets under their special regimes for the Caribbean.

This agreement on 'white spirits' has come even as the Caribbean countries have been making representations to the European Community for a transitional preference scheme for all ACP rums for an extended 20-year period after the expiry of Lome-IV in year 2000.