10:55 AM Sep 29, 1994

EARLY WTO RATIFICATION, GOOD FAITH IMPLEMENTATION URGED

Geneva 28 Sep (Chakravarthi Raghavan) -- The need for early ratification of the Uruguay Round Final act by all signatories, and particularly by the major trading countries in order to prevent any delay in establishment of the WTO has been stressed in draft agreed conclusions for the Trade and Development Board.

The draft agreed conclusions have been adopted by the Board's sessional committee which ahs conducted an analysis and assessment of the outcome of the Uruguay Round, in particular in areas of cocnern to developing countries and economies in transition.

It will go before the Board at its final plenary Friday for adoption.

The ratification appeal, and particularly that addressed to the major trading nations, comes even as news from Washington casts doubts on it, after the announcement by the Chairman of the Senate's Commerce Committee of his intention and decision to hold up, as well as President Clinton's threat to keep Congress in session until the implementing legislation is disposed off.

Perhaps equally important, and though not specified addressed to the major trading nations, is another related part of the UNCTAD agreed conclusions: "It was also stressed that implementing legislation should be drawn up in good faith and strict accordance with the agreements, and not contain provisions or be accompanied by measures that would not be consistent with or undermine the commitments undertaken".

The agreed conclusions recognised the high quality of the secretariat documentation -- the initial assessment in TDR 1994 and the supplement to it giving detailed analysis of several of the agreements and the futuristic issues of the Marrakesh shopping list.

The conclusions then added: "This had inevitably been an intiial assessment by UNCTAD, and more policy analysis was required, particularly in identifying the problems and opportunities for developing countries in key sectors such as agriculture, textiles and clothing and services, with a view to making concrete proposals.

"This work should lead to a better understanding of problems and identification of opportunities at the national level.

"UNCTAD should also continue background work and consensus-building on trade and economic policy issues before they became the subject of negotiations in the WTO. In this context, there was a need to take a wider view of their implications for balanced development, as well as for economic growth. While the most urgent task was to implement the agreements already reached, UNCTAD would have a key role in undertaking policy analysis on new and emerging issues as these moved to the front of the agenda."

It was also noted that the activities of the new Ad Hoc Working Group on Trading Opportunities in the New Trading Context woudl be relevant to many of the issues mentioned, as would the seminar on regional economic arrangements and their relationship with the multilateral trading system planned for June 1995. it has already been decided to hold an executive session of the Board at the earliest possible opportunity to address the modalities for dealing with the implications for trading opportunities of developing and countries in transition concerned of new and emerging issues on the international trade agenda.

The draft also said the Uruguay Round agreements offered developing countries new opportunities and challenges.

UNCTAD could play an important role in suggesting how developing countries, especially the LDCs, could take maximum advantage of its new possibilities and meet new challenges, and in explaining the implications of differential treatment that had been accorded.

Improvements in GSP schemes, it was noted, could be helpful in areas where MFN duties remained relatively high and in areas where tehre was erosion of preferences. On the other hand, reliance on preferential margins was not a long-term solution.

Developing countries, the recommendation to the Board said, would have to participate actively in the WTO to pursue and defend their interests. It was recognized that developing countries would require technical assistance in adapting to the challenges and opportunities presented and in increasing their participation in the international trading system, including strengthened dispute settlement system.

In particular, they would face problems of strengthening their institutional and human resource capacities and their information management. UNCTAD, with its experience of supporting developing countries during the negotiating process and tis analytical capacity, would have a major role to play in this regard, while bearing in mind the need to arrive at a fruitful and complementary division of labour between UNCTAD, WTO and ITC, as well as efficient cooperation with other relevant international organizations.

The agreed conclusions also dealt with the problems, and technical assistance needs, of the LDCs, the 'economies in transition' and developing not contracting parties to the GATT.

The LDCs, it said, were likely to face particular problems in adjusting to the results of the Uruguay Round as a result of the erosion of preferential margins, difficulties in effectively implementing the agreements and the need to pursue their interests within the framework of the WTO. In addition these and net food-importing developing countries might experience negative effects in terms of the availability of adequate supplies of basic foodstuffs from external sources on reasonable terms and conditions, including short-term difficulties in financing normal levels of commercial imports of basic foodstuffs. Although some of these problems had been addressed in the Final Act, UNCTAD could usefully make proposals for translating the Ministerial commitment into concrete action.

In this context, it was suggested that UNCTAD should consider how such countries could benefit from a "safety net" which would assist them in dealing with the transitional costs of adjustment. African countries, in particular, required more imaginative long-term solutions to overcome their competitive disadvantage deriving from dependency on primary exports, a weak industrial and export base and technological backwardness. Assistance for Africa should remain a matter of priority for UNCTAD.

The studies and technical assistance provided by UNCTAD to the transitional economies had been found useful by countris in transition aiming to become full participants in the international trading system through their accession to GATT/WTO, and should be continued and, if possible, intensified without prejudice to developing countries. In this process, trading partners should understand the difficult economic situation in which these countries were negotiating their accession."

UNCTAD should also support those developing countries that were not GATT contracting parties in their efforts to integrate into the multilatgeral trading system.

The Board also expressed the hope that negotiations would be successfully concluded to allow China to become an original member of the WTO.