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WTO to lower entry bar for poorest countries

World Trade OrganizationDirector-General Pascal Lamy gestures gives a press confrence at WTO headquarters in Geneva.  WTO is making a push to widen its membership, having failed to deepen the scope of its agreements in the Doha round of talks which collapsed last year. - AFP photo

 

GENEVA: The World Trade Organization has agreed new membership standards for the weakest economies, lowering the bar for countries such as Afghanistan, Ethiopia and Sudan to join the global trading club, according to a document seen by Reuters on Wednesday.

In the document, which was agreed on June 29 and will be rubber-stamped by the WTO's General Council on July 25-26, the WTO's 155 existing members promise to show restraint in the demands they make on the poorest candidate countries and to allow them flexibility in applying the WTO's rules.

The agreement has “strengthened, streamlined and operationalized” 10-year-old guidelines on admitting the “least developed countries”, or LDCs, according to the document, which has been submitted to the General Council by the WTO's sub-committee on LDCs.

Normally, as well as bringing their trade-related laws into line with WTO rules, countries wanting to join have to buy their way in by meeting the demands of every existing member, so they may be locked out until they offer to open their markets enough in return.

But the WTO is making a push to widen its membership, having failed to deepen the scope of its agreements in the Doha round of talks which collapsed last year.

Under the new rules, LDCs hoping to join will not be asked to cut the average “bound tariff” for agricultural goods - the legal ceiling once they join the WTO - below 50 per cent.

For non-agricultural goods, they will be allowed to keep 95 per cent of tariffs at an average bound rate of 35 per cent.

Longer transition periods may be allowed than under normal WTO rules in some cases, and will be “favourably considered on a case-by-case basis”.

In trade in services, WTO members will take account of the LDCs' “serious difficulty” in making commitments, allowing them to open fewer sectors, liberalise fewer types of transactions, and only open up their markets as their economies develop.

There are 26 countries in the queue to join the WTO and 10 of them are designated as LDCs. They include Laos, which is putting the final touches to its membership bid and likely to seal the agreement later this year.

Another LDC, Yemen, is also far advanced in its negotiations to join but has been held up by failure to agree terms with Ukraine. Yemen made a “final offer” to Ukraine in mid-June and its case is likely to be aired at the WTO's General Council meeting if Ukraine has not accepted its terms by then.

Ethiopia has stepped up the pace of its membership bid this year, while Afghanistan is still in the initial stages of its quest to join the WTO, a process that can take a decade or more.

Sudan applied for membership in 1994 but its application has been stuck since 2006.  Other LDCs in the queue are Bhutan, Comoros, Equatorial Guinea, Liberia and Sao Tome and Principe.

Other non-LDC countries still outside the WTO include Russia, which is expected to ratify its WTO membership deal later this month and become the 156th member 30 days later.

Iran, Iraq, Libya and Syria are also all still outside and have made no headway since applying to join. The oldest candidate is Algeria, which applied 25 years ago.


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