5:14 AM Aug 3, 1994


Geneva 2 Aug (TWN) -- The Budget Committee of the Preparatory Committee for the World Trade Organization agreed on Tuesday on the new apportionment formula for contributions to the WTO budget to be brought into force from 1 January 1996, according to GATT sources.

The new formula, to reflect shares in world trade in goods, services and intellectual property and is to be based on the IMF's balance-of-payments data.

A simulation exercise done by the GATT secretariat shows that the new formula would increase the contributions of some and reduce that of others, with many changes marginal.

However, the contributions of some would go up substantially.

These include Singapore's which would increase by about 40 percent over its 1994 contribution of 1.198 million dollars and of Egypt's which will go up 60 percent over its 1994 contribution of 157,930 dollars.

For both, the increases are due to their services trades -- in the case of Singapore in tourism, banking and other financial services etc, and for Egypt reflecting the tourism and worker remittances.

Others whose shares would go up include Australia, Austria, Colombia, France, Italy, Kuwait, Mexico, Norway, Philippines, Sweden, Switzerland, Turkey and the United States.

Those whose shares would go down include the UK, Germany, Canada, Hungary, India, Indonesia, Ireland, Malaysia, Netherlands, Peru and Thailand.

GATT sources said that the simulation had been done in a short time and using a variety of sources. While reasonably accurate they were indicative and would need to be further refined and updated.

The shares in intellectual property from BOP data reflect only licence fees and royalties and don't fully reflect benefits of countries whose nationals (natural or juridical) own such property and will enjoy greater protection and monopoly rights globally in the future.

At the Budget Committee meeting, Singapore and Egypt reportedly noted their reservations on the new formula but agreed to join the consensus. Egypt also complained of the lack of transparency in the negotiations (in a smaller GATT's budget committee) leading to the compromise.