Key WTO Issues from the Perspective of a Recently-Acceded Member: The Experience of the Kingdom of Saudi Arabia H.E. Dr. Abdolazeez S. AL-OTAIBI Ambassador and Permanent Representative to the WTO Kazakhstan's Role In A Globalizing World: Trade And Investments Astana, Kazakhstan 4 September 2014 Benefits and Challenges of WTO Membership • The Kingdom of Saudi Arabia joined the WTO in 2005 after 12 years of challenging negotiations. • We learned a great deal about the benefits and challenges of the WTO during our accession process. • The Kingdom’s economic progress since 2005 shows a positive correlation between WTO membership and economic growth. • We strongly support Kazakhstan’s bid to join the WTO on fair terms and the completion of your negotiations as soon as possible. 2 Benefits of Membership • As for the Kingdom of Saudi Arabia’s progress since WTO accession, major indicators have improved rather markedly since our WTO accession due to the efforts of the Kingdom and the positive association between WTO rules and economic growth. • The following slides show indicators of our progress. 3 World Bank Indicators of Saudi Arabia’s Economic Performance US$ billion WTO Accession 800 US$ 60,000 700 50,000 600 40,000 GDP (current billion US$) 30,000 Exports of goods and services (current billion US$) 20,000 GNI per capita, PPP (current international US$) 500 400 300 200 10,000 100 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: World Bank Economic Indicators 4 World Economic Forum Indicators – Post-WTO Accession Ranking WTO Accession 2007-2008 2012-2013 0 10 20 Global Competitiveness Index 30 IP Protection Goods Market Efficiency 40 50 60 Source: World Economic Forum – Global Competitiveness Reports 5 Investment – into KSA $ million WTO Accession 250,000 200,000 150,000 Inward Investment Stock (Millon US$) 100,000 50,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: UNCTAD World Investment Reports 6 Non-oil Exports SR million WTO Accession 250,000 200,000 150,000 Non-oil exports (million SR) 100,000 50,000 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: Saudi Arabia Central Department of Statistics and Information annual export statistics reports 7 Importance of WTO Rules for Key Saudi Arabian Exports • Saudi Arabia is diversifying its economy and exporting steel and petchem products. • These sectors represent 62% of all AD cases and 57% of all CVD cases. • Saudi Arabia has faced such investigations but avoided restrictions on our trade due to a proactive approach, which relies on WTO-based rules. 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total HS section name VI Products of the chemical and allied industries VII Resins, plastics and articles; rubber and articles XV Base metals and articles Total 1995 Anti-dumping Initiations: By Sector 01/01/1995 - 31/12/2013 31 20 43 157 42 26 39 226 21 36 64 246 24 33 111 264 74 40 111 359 63 24 109 296 67 56 137 372 96 40 96 311 73 24 53 234 49 44 38 220 37 37 39 200 39 24 31 203 56 16 24 166 34 21 70 218 47 31 52 217 44 24 43 173 29 13 58 165 34 40 76 209 48 41 93 283 908 590 1287 4519 7 1 9 3 15 1 6 2 8 3 3 6 2 2 10 11 12 25 23 33 Total 2013 2010 4 9 2012 2009 1 3 4 2 1 4 3 7 11 11 16 28 2011 2008 2 2007 2002 2 3 8 4 2006 2001 2003 2000 1999 1998 1 2 4 7 2 2 7 12 20 11 14 16 25 41 18 27 2005 10 2 2004 1 1997 1996 HS section name VI Products of the chemical and allied industries VII Resins, plastics and articles; rubber and articles XV Base metals and articles Total 1995 Countervailing Initiations: By Sector 01/01/1995 - 31/12/2013 31 30 131 335 8 Source: WTO Secretariat Summary of Benefits of Membership • The above evidence shows that WTO accession has supported positive growth in the Saudi economy for almost 10 years – notwithstanding the global financial crisis. • The average person on the street benefits from WTO protections through: – export-related jobs, – enhancement of consumer welfare, and – access to high-quality, affordable products and services in the market, whether insurance or banking services, local industrial production, or others. • Benefits depend on wise leadership in parallel to WTO rules. – King Abdullah oversaw the reform of more than 40 laws and regulations. 9 Challenges in the Accession Process • Requests for “WTO-plus” commitments: – Saudi Arabia’s response: focus on WTO disciplines and the actual commercial interests of trading partners. • Acquiring necessary WTO/trade expertise: – Saudi Arabia’s response: create public-private partnerships and utilize trainings from the WTO and others. – Fortunately, Kazakhstan already has strong leadership and a deeply knowledgeable and competent negotiating team. 10 Issues for New Members • Compliance with obligations: – Ensure that implementation of obligations and new government measures are consistent with WTO rules. – May require new administrative mechanisms, increased knowledge of WTO disciplines, and vigilance to avoid problems. • Monitoring of trading partners’ actions and advancing national interests: – Use WTO rules both proactively and defensively to protect national economic interests, especially in cases where exports are restricted by measures that might violate WTO obligations. – Find groups of countries with shared interests for cooperation in negotiations and in day-to-day administrative work at the WTO. 11 The Status of the DDA • The absence of a conclusion to the Doha Development Agenda: – Important systemic impacts on the credibility of the WTO. Rules of the past must be updated to respond to the needs and expectations of developing countries. – A failure of the DDA is a failure to deliver on the promise to correct the imbalance between the obligations of acceding countries and less ambitious commitments by existing Members. – Existing Members have a special responsibility to conclude the DDA on fair terms for all Members. 12 Two Points in Conclusion • Saudi Arabia’s WTO accession has supported our economic development and diversification. • Kazakhstan’s WTO accession is in Saudi Arabia’s interest, and we support your efforts to join as an equal and important Member. 13 THANK YOU 14