ISLAMABAD, Sept 14: The ministerial meeting in Hong Kong, in December 2005 provides a last chance to 148 WTO-member countries to restore confidence in the Doha Development Round (DDA) started in 2001, says a UN report.

“That meeting needs to deliver tangible and practical results. These results should include a down payment on the development round in three specific areas: market access, agricultural support and special and differential treatment for developing countries,” according to the UNDP Human Development Report 2005 released here on Wednesday.

The report, a copy of which was made available to Dawn said that the 2005 ministerial meeting provides an opportunity to remove some of the more egregious market access restrictions that limit the ability of poor countries to benefit from trade.

It would be unrealistic to expect the Doha Round to fully resolve this longstanding mismatch between poor and rich countries but it would be disastrous for the multilateral trading system, if it failed to deliver tangible progress.

The UNDP report recommended that binding schedules should be agreed upon to eliminate tariff peaks and reduce tariff escalation by lowering maximum tariffs to no more than twice the average tariff by 2010. Implement the proposal of the UK sponsored Commission for Africa to apply duty-free and quota-free access to all exports from low-income Sub-Saharan Africa and to extend this access to all least developed countries in other regions.

The report proposed relaxing of rules of origin by adopting before 2007 legislation based on international best practice to reduce the value-added requirement for eligible products to 25 per cent of export value and allow countries receiving preferences to source inputs from anywhere in the world.

It also propose to establish in 2006 a trade adjustment compensation fund providing $500 million a year for the next decade to compensate countries for preference erosion. Progress in agriculture is critical.

The report says that immediate priorities for a schedule of commitments by developed countries should provide for the following— a binding prohibition on all direct export subsidies by 2007:

*A reduction in overall subsidies by 2010 to a level no higher than 10 per cent of the value of production.

*Compensation for developing country producers most affected by developed country agricultural policies in key commodities such as sugar and cotton.

*Phased reduction in import tariffs through the so-called Swiss formula, which makes the deepest cuts on the highest tariffs, with a ceiling of 10 per cent by 2010.

*An end to Blue Box provisions that allow countries to provide unlimited market based support.

The 2005 ministerial meeting provides a chance to elaborate these rules for market access and agriculture. To this end, developed countries should agree to limit reciprocal demands for market access in non-agricultural goods, allowing developing countries to reduce average tariffs through a formula that allows a high degree of flexibility.

Exempt special products in agriculture from any requirement to liberalize, and permit developing countries to apply safeguard mechanisms to restrict market access when import levels threaten food security. These products should include basic food staples as well as crops that are important for rural livelihoods and the income of poor households.

The report proposed revision of WTO accession rules to ensure that new developing country members do not have to comply with liberalization demands inconsistent with their development status.

There should be a commitment to relax the constraints imposed on the development of active industrial and technology policies through Trade-Related Investment Measures and other agreements.

The TRIPS agreement arguably should not have been brought on to the WTO agenda. The challenge now is to strengthen the public health provisions in the agreement, increase the scope for technological innovation and, for developed countries, to act on the TRIPS commitment to help finance technology transfer.