Benchmarks for LDC Accession to WTO

The decision, as mandated by ministers at the Eighth WTO Ministerial Conference in December 2011 [document WT/L/846], will now be submitted to the General Council on 25 and 26 July for formal adoption.

Among the 48 LDCs listed by the United Nations, 32 to date have become WTO members, including four LDCs which acceded after the establishment of WTO in 1995. These are Cambodia (2004), Nepal (2004), Cape Verde (2008)¹, and Samoa (2012). Vanuatu completed its accession process in 2011 and will become a Member upon completion of its domestic ratification.

Another ten LDCs are in the process of acceding to the WTO: Afghanistan, Bhutan, Comoros, Equatorial Guinea, Ethiopia, Lao PDR, Liberia, Sao Tome & Principe, Sudan, and Yemen. Among them, the accessions of Lao PDR and Yemen have reached their final stage and are poised for conclusion this year.

The proposed Decision will set benchmarks for acceding LDCs for market access negotiations. It also provides some concrete guidelines to operationalize the notion of restraint” when seeking commitment from acceding LDCs. The Decision contains five key elements: benchmarks on goods, benchmarks on services, transparency in accession negotiations, special and differential treatment (S&D) and transition periods, and technical assistance.

Goods benchmarks

Acceding LDCs will bind all agricultural tariff lines at an average rate of 50 per cent. (Normally full binding of agricultural tariff lines is a standard feature in all WTO Members’ commitments).

Acceding LDCs will bind 95 per cent of tariff lines for industrial goods at an average rate of 35 per cent. The LDCs have the flexibility to retain 5 per cent of their industrial tariff lines unbound, though the specific lines would need to be negotiated. A footnote clarifies that the unbound tariff lines will include lines that take into account the sensitivities of acceding LDCs.

In order to encourage more comprehensive binding coverage in industrial goods, the guidelines provides an alternate option to the LDCs: If any acceding LDC desires to move towards comprehensive binding coverage, they would be allowed proportionately higher average bound rates than 35 per cent overall average rate, with transition periods of up to 10 years for up to 10 per cent of their industrial tariff lines.

Services market access

Although the mandate given at the Ministerial Conference simply asked Members to explore benchmarks in services, Members were able to agree on certain broad parameters. The decision provides that acceding LDCs shall not be required to undertake commitments in services sectors and sub sectors beyond those that have been committed by existing WTO LDC Members. Nor shall they be required to undertake commitments in sectors and sub-sectors that do not correspond to their individual development, financial and trade needs. 

Transparency in Accession Negotiations

To enhance the transparency of the accession process, Members stressed the importance of making use of the Accession Working Parties to serve as a forum for collective review of the different bilateral market access negotiations on goods and services.

S&D and Transition Periods

Members reiterated that acceding LDCs would be able to access all special and differential treatment provisions from the day they become Members of the WTO.

It is underlined that requests for additional transition periods, beyond those foreseen under the WTO Agreements, would be favourably considered, on a case-by-case basis.

Technical Assistance

As part of each LDCs accession process, the WTO Secretariat will draw up technical assistance framework plans, in order to achieve better coordination and more effective delivery of technical assistance at all stages of the accession process. These plans will be shaped by input from the acceding LDCs themselves, and will be adjusted over time to reflect changes in their needs.