Global trade rules:
doing the job?
Ana Luiza Cortez*
UN-CDP Secretariat
1st International Symposium on Development
Policies in a Global World
Fundaciόn Mujeres por Africa
Madrid, 29-30 October 2013
* The views expressed here do not necessarily reflect those of the UN or the CDP.
WTO
RTA FTA
FTA RTA PTA
EPA AGOA
FTA MERCOSUR
RTA FTA EPA PTA FTA FTA
BTA FTA
UNCTAD PTA
EPA WIPO RTA FTA
RTA FTA EPA PTA FTA FTA
FTA ICA
FTA BTA RTA PTA
RTA FTA EPA PTA FTA FTA
BTA RTA
FTA EPA
FAO FTA RTA FTA EPA PTA FTA FTA ICA
RTA FTA EPA PTA FTA FTA BTA EPA PTA FTA
FTA NAFTA EPA PTA FTA FTA BTA RTA RTA FTA
FTA
RTA FTA
RTA FTA EPA PTA FTA FTA
BTA FTA FTA
Global trade rules
• Trade flows
• Equity
• Governance
• Coherence
Global trade rules:
Current state of affairs
1. Trade flows
 Predicable and growing:
MFN and national treatment
Less than full reciprocity
Dispute settlement machinery
Small hiccups
2. Contributing to higher standards of living, full
employment, real income growth?
3. Developing countries securing a share in trade
growth compatible with development needs?
3. Developing countries securing a share in trade
growth compatible with development needs?
Patterns of insertion matter → what you produce
matter: participation in dynamic markets
How you produce matter  linkages with he
domestic economy
Strategic trade liberalization: means to promote
structural transformation (carrots and sticks)
Strategic association with foreign investor
 Shrinking policy space (other culprits)
Global trade rules = enablers?
 GATT/WTO are about trade liberalization, however, approach changed:
Before the Uruguay Round:
•
Deviations from disciplines Special and differential treatment: BOP
difficulties, protect/promote industries
•
Pick and choose
•
Less than full reciprocity of commitments (rules, tariffs, preferential
access)
•
Not for free: exclusions, tariff peaks, tariff escalation
→ Shift in the development paradigm: role of the state, trade as an end
→ Rising importance in global trade (NICs)
With the Uruguay Round:
 Single undertaking: additional commitments; adjustment costs
 SDTs: The old: preferential market access; fewer deviations with
stricter disciplines; The new: flexibilities for implementation and
procedures plus technical assistance: institutional capacity gaps
WTO: Development = SDTs
 139 provisions; several deficiencies
• Best endeavor
• Not enforceable
• Add-ons
• Offsets
• Lacking coherence
• Delinked
• Insufficient

•
•
Doha mandate
SDTs to be strengthened, more effective, precise and
operational (mandatory): “early harvest” status (2002)
Disappearing proposals: >150 → condensed into 88 →
38 in Cat. I (“easy”) → 28 ; Cat. II (agreement specific):
38 → 6…
We’re not in Kansas anymore…
•
Giants, dwarfs and
the in-between
• GVCs business
model
• PTAs/FTAs and BITs



Decision making process
Nature/scope of disciplines
The future of SDTs
A new generation of SDTs?
Trend: from developing countries to individual country needs:
•
•
•
•
•
•
Differentiation in WTO
Differentiation by trading partners
Linked to individual needs: inventory
Implementation according to capacity, technical assistance
Temporary
No deviations, no exemptions
Trend: the vanishing principle of “less than full reciprocity”
•
•
Further reductions in policy space (advanced economy policy
package)
Sustainable dynamic transformation requires flexible rules
adaptable to domestic conditions
Moving forward
Emerging approach:
•Diversified developing world: SDTs based on needs  implementation
issues (definition, monitoring, etc.)
•Graduation rules to be discussed multilaterally
However,
- SDTs = second best solution: equal rules to unequal partners. Right
policy package?
- For developing countries: development friendly/neutral rules X
exceptions to the rules
Summing up:
- Stable and predictable flows not enough
- Trade as a means: disciplines compatible with the needs of dynamic
transformation of all economies
Thank you!