Market access for LDCs: Issues to be addressed

Journal of World Trade

Volumn 36, Issue 1, 2002, Pages 85-116

  Inama, Stefano ^a  

^a International Trade Division

Author keywords

[No Author keywords available]

Indexed keywords

INTERNATIONAL TRADE;

EID: 23044532890     PISSN: 10116702     EISSN: None     Source Type: Journal    
DOI: 10.1023/A:1014540316840     Document Type: Review

References (56)

1. See WTO document WT/GC/2/195.
2. The AGOA, which is part of the Trade and Development Act of 2000, was signed into law by the United States President on 18 May 2000.
3. See Council Regulation 416/2001, OJ L60 of 1 March 2001.
4. The phasing-in period for bananas is 2002-2006, and for sugar and rice 2006-2009. However, a duty-free quota on sugar and rice, based initially on the best figures for LDC exports during the 1990s, will be immediately made available to LDCs. These quotas will then be increased by 15% each year in order to ensure effective market access for LDCs in the European Union market during the interim period.
5. See Document LDC/MM/ZNZ/1/Rev.1 of 24 July 2001. In order to appreciate the accuracy and focus of this latter text in comparison with previous formulations it is sufficient to contrast it with the text which emerged from the Third UN Conference held in Brussels during this spring.
6. See, for instance, UNCTAD document, The Post-Uruguay Round Tariff Environment for Developing Countries' Exports: Tariff Peaks and Tariff Escalation (TD/B/COM.1/14/Rev.1), of 28 January 2000.
7. Product coverage is defined as the ratio between imports that are covered by a preferential trade arrangement and total dutiable imports from the beneficiary countries.
8. Utilisation rate, defined as the ratio between imports actually receiving preference and covered imports, can refer to all beneficiaries, to a sub-group or to single countries. Higher or lower utilisation rates, on the other hand, have to do with the complexity of the conditions required to grant a product preferential treatment together with the capacity of exporters to comply with these requirements.
9. Utility rate, defined as the ratio of imports actually receiving preference and all dutiable imports (covered or not), refers to the percentage of total dutiable imports which receive preferences. A low level of this ratio means that a large part of dutiable imports (either covered or not) pay MFN rate.
10. Average for all the QUAD GSP schemes for the latest year available of each preferential scheme.
11. Non-ACP LDCs include Afghanistan, Bangladesh, Bhutan, the Lao People's Democratic Republic, Cambodia, Nepal, Yemen, the Maldives and Myanmar (the latter has been temporarily excluded from GSP benefits). These countries, until the entry into force of the EBA, have been the only effective beneficiaries of the European Union GSP scheme.
12. Market access conditions under the former Lomé Convention and European Union GSP for LDCs were not equivalent. For decades, the preferences granted under Lomé conventions were more generous than those provided under the European Union GSP for LDCs. Only recently has Council Regulation 602/98 (OJ L 80, 18.3.98, p. 1) granted LDCs not party to the Lomé IV Convention preferences almost equivalent to those enjoyed by signatories.
13. This low figure, recorded in 1997, was probably due to the fact that new preferences for LDCs were made available in June 1997. Thus, the utilisation rates may have been influenced by this event. In fact, utilisation rates for the years 1994, 1995 and 1996 have been 74%, 70% and 69%, respectively.
14. According to 1998 trade data, such a low coverage rate, however, appears to be constant in the United States GSP scheme, since it was 4.9, 4.7 arid 1.8% in 1994, 1995 and 1996, respectively.
15. In a report of the United States International Trade Commission on Advice on Providing Additional GSP Benefits for LDCs, Investigation No. 332-370, of February 1997, it was actually foreseen that the inclusion of GSP benefits for energy products would have been relevant for Angola. In fact, page 2-1 of the report stated that "United States energy imports from the Least Developed Beneficiary countries are likely to grow slightly in the future as a result of recent United States investments in Angola to expand production for export". On page 2-2 of the same report, on industry instruction, it is indicated that Chevron and TEXACO announced, at that time, an estimated investment of $700 million and $600 million, respectively.
16. Trade data for these countries refers to 1997.
17. For a definition of utility rate, see note 9, above.
18. See J. Herin, Rules of origin and differences between tariff levels in EFTA and in the EC, occasional paper No. 13, EFTA Secretariat, 1986.
19. See Article 7 of Regulation 416/2001, as note 3, above.
20. For the monitoring and implementation of this declaration UNCTAD may be called to establish an ad hoc working group.
21. Such extended analysis is contained in a comprehensive UNCTAD forthcoming study on LDCs' exports market access in the QUAD countries.
22. A full list of non-covered products is contained in document UNCTAD/DITC/TNCD/4, see note *, above.
23. For the list of products which remain excluded even after this improvement, see note 22, above.
24. Weighted average of ad valorem tariffs, not including the applicable specific rates (2000).
25. These 20 products account for 70% of the uncovered LDCs' exports.
26. See the list of AGOA eligible countries published on the AGOA web site: 〈www.agoa.gov〉.
27. Tariffs of 2000.
28. For minerals ad valorem equivalents of product specific duties were not available.
29. Ad valorem duty only (tariff 1999, trade 1996).
30. All trade weighted MFN rates refer to tariffs applicable in 1999 matched with trade from 1996, the latest trade data available at such disaggregated level.
31. LDC fish exporters to Japan number, among others, Mauritania, Bangladesh, Myanmar, Solomon Islands and the United Republic of Tanzania.
32. Tariff rate of 1999.
33. Trade-weighted coverage is given by matching a covered product with LDC trade (this is the main indicator utilised in the study to assess the relevance of the preferential schemes for LDCs).
34. A detailed analysis of the preferences granted under Lomé/Cotonou agreements will be contained in a forthcoming UNCTAD publication.
35. However, their relevance for ACP LDCs is limited to Somalia (bananas), Madagascar (beef and sugar) and Malawi, Uganda and the United Republic of Tanzania (all for sugar).
36. As to the phasing-in periods, see note 4, above.
37. See Article 6 of Regulation 416/2001, as note 3, above.
38. See ibid., Article 4.
39. See UNCTAD document, Globalisation and the international trading system-Issues related to rules of origin, UNCTAD/DITC/TSB/2, 24 March 1998.
40. See also Luis Jorge Garay and Antoni Estevadeordal, Protección, desgravación preferencial y normas de origen en las Americas, in Integración y Comercio, 1998.
41. An analysis of the trade data on the utilisation rate of the European Union GSP for non ACP-LDCs indicates that three-quarters of their textile and clothing exports have not received GSP treatment although fully covered. The explanation for this low utilisation rate can be found in the experience of Bangladesh, as described in the present article.
42. Malawi, Mozambique, Tanzania, and Zambia.
43. Southern Africa Customs Union.
44. See UNCTAD document, Compendium of the work and analysis conducted by UNCTAD working groups and sessional committees on GSP rules of origin, Part I, UNCTAD/ITD//GSP/34, 24 February 1996.
45. The implementation of the SADC Trade Protocol containing, among other things, the schedules of tariff reduction, a revised set of rules of origin, an agreement on trade in sugar and a detailed regulation on the settlement of trade disputes among SADC members, started on 1 September 2000. At the time of writing, Mauritius, Botswana, Lesotho, Swaziland, Zambia and South Africa had deposited their instruments of implementation.
46. See Articles 2 and 6 of Protocol 1 on rules of origin to the Cotonou Partnership Agreement (CPA) published in the supplement to the Courier, Special Issue, September 2000, Directorate General for Development, Brussels, Belgium.
47. ACP countries are also granted an expansion of the concept of regional cumulation through the inclusion of "neighbouring developing countries belonging to a coherent geographical entity" (Article 6, paragraph 11, of Protocol 1). In addition, a qualified cumulation system is allowed with South Africa. According to the discipline provided in Article 6, paragraphs 3 to 10, whenever materials originating in South Africa are used in the manufacture of a product in an ACP State, such materials are regarded as originating in the ACP only if the value-added there exceeds the value of the South African materials. If this is not the case, the product concerned will be considered as originating in South Africa.
48. Except that Brunei Darussalam and Singapore have been graduated out of the United States GSP programme.
49. See Article 72, 72a and 72b of the ECCC, as last modified by Commission Regulation 1602/2000 (OJ L 188, 26.07.2000).
50. In the case of Canada the percentage of local content requirement in the case of an LDC is 40% against 60% for other beneficiaries.
51. See Article 76 of the ECCC, Commission Regulation (EC) No. 1602/2000 of 24 July 2000 amending Regulation (EEC) No 2454/93 laying down provisions for the implementation of Council Regulation (EEC) No. 2913/92 establishing the Community Customs Code (OJ L 188, 26.7.2000).
52. See Article 31 of Protocol 1 concerning the definition of the concept of "originating products" and methods of administrative co-operation, to the Lomé IV Convention, as revised by the agreement signed in Mauritius on 4 November 1995.
53. See Article 38 of Protocol 1 concerning the definition of the concept of "originating products" and methods of administrative co-operation, to the ACP-European Union Partnership Agreement, signed in Cotonou on 23 June 2000.
54. For an example of a derogation on textile and clothing under the previous Lomé Convention, see Decision No. 1/93 of the ACP-EEC Customs Co-operation Committee, of 16 April 1993, derogating from the definition of the concept of "originating products" to take account of the special situation of Lesotho with regard to its production of certain garments (OJ L. 123, p. 32). For an example of derogation for canned tuna under the Cotonou Agreement, see Decision No. 1/2000 of the ACP-EC Customs Cooperation Committee of 18 October 2000, derogating from the definition of "originating products" to take account of the special situation of Fiji, Mauritius, Papua New Guinea and the Seychelles regarding the production of canned tuna and of tuna loins (HS heading ex 16.04) (OJ 276, p. 89).
55. As an example, in the EU rules of origin for fishery products the fish must be caught by a vessel registered in an LDC country, flying the flag of that country and the captain and the majority of the crew must be nationals of the same country. Preserved fish, like canned tuna of Chapter 16 of the harmonised system, should also follow the same rule.
56. See UNCTAD document, as note 43, above.