Page 47 - Banking Finance October 2019

ARTICLE

was also 10th largest importer of commercial services in classification of developing member status has been a long-
2018. standing practice and best serves the WTO's objectives. They
have also expressed their willingness to assume more
US Memorandum Against Developing international obligations or responsibilities in the WTO that
are compatible with their economic development level and
Countries' Status and Benefits: capabilities.
In its Memorandum, USA President demanded WTO to
review and reform on self declared developing country status In the joint letter, all four developing countries have also
and benefits inappropriately enjoyed by developing claimed that many WTO rules have actually favored the US
countries. In this regard, there are some important facts and other developed countries, in the areas of agricultural
which are needed to be looked into : support, textile quotas and intellectual property rights
protection.
First of all, a 'Developing Country' member does not
automatically mean that it will get benefits from the The Commerce and Industry Minister of India, Sh. Piyush
unilateral preference schemes of some of the developed Goyal on 22 Aug, 2019 also said that US memorandum for
country members. In practice, it is the preference giving WTO reform should not undermine the WTO's fundamental
country which decides the list of developing countries that principles i.e. Special & Differential (S&D) treatment
will get benefits from the preferences. for developing countries, consensus based decision
making and objective of development for all member
Membership to WTO is a result of negotiation on all aspects countries. He further said that it should not be a piecemeal
of trade and economic policies of a country including its reform i.e. self-declared developing country status only but
status. The process of membership also includes bilateral for wholistic reform taking into consideration the interests
talks between new member and other individual member of different member countries with disparate GDP, especially
country as per their trading interests. These bilateral talks the stark inequality among developed and developing
also cover tariff rates and specific market access and status nations and; also challenges and aspirations of developing
of the country. countries.

The developing countries' exports to other developing He also pointed that protectionism, unilateral measures and
countries have surpassed its exports to developed countries. imposing of excessive non-tariff barriers by some developed
The exports of developing countries to other developing countries are seriously impeding market access
countries have been around 52% since year 20014. opportunities for developing countries. The dominance of
developed countries on international agriculture markets,
In recent trends, the Coalition building among member subsidies and dispute settlement mechanism are also to be
countries is the natural result of economic integration and reviewed and reformed.
sharing of common interests. The increasing number of
coalitions involving developing countries reflects the broader As majority of WTO members are developing countries,
spread of bargaining power with developing countries in the many more developing countries may join hands with India,
WTO. China, South Africa and Venezuala in coming days or months
to oppose the US Memorandum. The increasing presence
On the same lines, China, India, South Africa and Venezuela and contribution of developing countries in international
have opposed the US memorandum on reforming self- trade along with the fact that more of their exports is to
declared developing country status in WTO. All four developing countries only instead of developed countries, it
developing countries have come untied to voice their might impact any decision taken by highest WTO body i.e.
common voice to firmly uphold their fundamental rights and Ministerial Conference.
safeguard their development interests.
As it is a fresh and very sensitive issue, it may take some
The group of four developing countries has already more time to continue and we have to wait for the final
submitted a paper to the WTO saying that the self- result, whether big reforms or no reforms take place. T

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