Key differences re-surface in NAMA report and meeting
20 April, 2006
Goh Chien Yen (TWN), Geneva, 19 April 2006
Updating members on his recent consultations, the Chair of the NAMA negotiating group, Ambassador Don Stephenson of Canada, in a 18-page report circulated at the start of the meeting on Tuesday, said that 'there was no progress on either the architecture of the Formula or the level of ambition.'
According to his report, members could not agree on the value of the coefficients to be used in the formula for the developed and developing countries. 'In the view of some Members the distance between the two coefficients had to be in sight of each other, and sufficiently low to ensure real market access,' he said.
A delegation had proposed 'a range of 5 to 15 for developed countries and 10 to 20 for developing countries.' However, other members have pointed out that 'developing countries had to do less than developed members, as provided for in less than full reciprocity in reduction commitments.'
During Tuesday's consultations, several developing country members such as Argentina, Venezuela and the Philippines pointed out that there is no convergence on the issue of the coefficients because the demands of the developed countries had failed to respect the principle of less than full reciprocity. India added that adherence to this principle means lower percentage reductions for developing countries.
Under the current proposals made by the developed country members, developing countries will have to undertake far more significant percentage cuts to their industrial tariffs compared to the developed countries.
Responding to the developing countries, the US said that while they supported the principle of less than full reciprocity in tariff reduction commitments, there was no consensus that it should be understood only in terms of percentage reduction.
On the issue of flexibilities for developing countries, which was also discussed on Tuesday, members remain divided on the number of tariff lines that would be wholly or partially exempted from the tariff-reduction formula.
This division was also described in the Chair's report, which reported that some members 'made a reference to the numbers in paragraph 8 [in Annex B on NAMA of the August 2004 Framework] as being the bare minimum, and wished to see an enhancement of them. Of course, others indicated that in their view, paragraph 8 numbers were already too generous, and would reduce the benefits accruing to them.'
However, the Chair did observe some common understanding among all members on some of the technical issues in relation to the paragraph 8 flexibilities, which was reflected at yesterday's meeting.
According to the Chair's report: (i) 'no less than half formula cuts' meant 50% of the formula cut or more at the discretion of individual delegations; ( ii) the imports referred to were NAMA imports; (iii) the reference to tariff lines was to tariff lines at the national level and; (iv) the phrase 'not entire HS chapter' would be interpreted in a legalistic way (this means that a exclusion of a single tariff line would constitute not an entire HS chapter).
Finally, on the issue of treatment of unbound tariffs which was one of the three topics discussed on Tuesday, members were still unable to agree on a value to mark up the unbound tariff lines by.
According to the Chair's report, some members are looking for a higher mark up than the range of 5 to 30.
The Chair in his report then proposed the text 'constant non-linear mark up of [