Why and How Differentiate Developing Countries in the WTO? Theoretical Options and Negotiating Solutions
Jean-Marie Paugam and Anne-Sophie Novel
IFRI/ AFD Conference
“Trade for Development : the future of Special and Differential Treatment of Developing Countries
Paris, October 28, 2005
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Presentation Outline
Legal and Economic Cases for Differentiation
Theoretical Solutions for the WTO
Political Options within the DDA?
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1 -The Differentiation Principle: Legal Case
Not Only Permitted: - Legal Basis; - India - EU Appelate Body Ruling; But Already Implemented:
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Implementation of agreements establishing categories of DCs (LDCs, SCM, NFIDCs); Political recognition of sub categories (SIDSs, LLDCs)
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Chart 1: Exam
le of Differentiated WTO Sub-Cate
ories
Source: : Authors, from WTO (2005), Keck & Low (2004).Except for Senegal (recently added to the list) LDCs are not taken into account in this chart since they automatically benefit from the measures at stake
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1 -The Differentiation Principle: Economic Case in the Literature
“One size does not fit all:
- International Economic Organization Other than the WTO
- Table
Trade Policy as second best development tool
Various Negative Externalities
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UN Class.
2 - Theoretical Options for the WTO
Geographic Criteria
1 Country Based Differentiation
gionalR GRreoupingsNateulireafl,RCleismouatrec,es
Socio Economic Indicators
SocialEconomic
Least Small Islands LandLocked Developed Developing States Developing Countries Countries SIDSs LLDCs LDCs
Institutional
Trade
FAO Categories 7
2 - Theoretical Options for the WTO
WTO Disciplines
Criteria per SDT Measure
2 Rule Based Differentiation
Stevens - Net Food Importing Developing Countries (NFIDCs) and Agreement on Agriculture (AoA)
SDT Objectives
Corresponding Group of Countries
Keck&Low - Subvention Countervailing Measures
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Stevens
Source: Authors, from Stevens (2002), FAO (2005), World Bank Online Database on Development Indicators.
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2 - Theoretical Options for the WTO
LDC+
3 Mix
Tailor Made Approach
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3 - Any Political Options for differentiation in the DDA? Political Economy of Differentiation