Position of Latvia to the WTO 5th Ministerial Conference in Cancun, Mexico (September 10 – 14, 2003)
Position of Latvia to the 5th Session of the WTO Ministerial Conference (The Cancun Ministerial Conference) is based on Latvia's position for the new round of WTO multilateral trade negotiations, formulated in 2001 to the 4th Session of the WTO Ministerial Conference in Doha (November 9 – 13, 2001) and still reflects Latvia's aims and interests within the WTO multilateral trade negotiations. Position for the elaborated section "Agriculture" was adopted by the Cabinet of Ministers of the Republic of Latvia on January 9, 2001, and the position for the new round of WTO negotiations was adopted by the Cabinet of Ministers on October 30, 2001.
Having regard to the fact that Latvia will soon join the European Union (EU), Latvia does consider the coordination of its position with the EU. Joining the EU, Member States delegate their competence in the external trade issues to the European Commission, their positions and interests are coordinated within the framework of Ad Hoc Article 133 Committee, Working Group on Trade Questions as well as in the other committees and working groups of the EU Council. Hence Latvia's position is drafted according to the Council conclusions, adopted by the General Affairs and External Relations Council meeting on July 21 –22, 2003. The Council conclusions are conformed with the ministries represented in the Consultative Board of Latvia's membership to the WTO according to Article 11 (3) of Regulations # 286 "On the temporary procedure, according to which the formulation, adoption and representation of national positions on the European Union matters is coordinated", adopted by the Cabinet of Ministers.
Latvia supports the following fundamental aims of the European Union common commercial trade policy within the WTO:
To establish an international trade system, which with the help of its market access conditions, rules and the sanction mechanism, will invest in the growth of sustainable economy, will create new working places, as well as will give an adequate response towards the challenges of globalization;
A successful conclusion of the new multilateral negotiations round (Doha Development Agenda – DDA) until the end of 2004, understanding the DDA as a single undertaking, which, according to the goals formulated at the Doha Ministerial Conference, is aimed at the preparation of an overall and balanced set of agreements with respect to market access conditions and provisions as well as an improved integration of the developing countries into the multilateral trade system.
Cancun Ministerial Conference will lead the work program (multilateral negotiations) started in Doha into the final phase, therefore it bears a significant role in the process of the negotiations. Latvia affirms its wish for the adoption of a declaration on the key issues of negotiations at the Cancun Ministerial that accordingly would allow concluding the round until the end of 2004.[1]
Latvia notes that the DDA negotiations are based on a broad agenda and supports its equal continuation in each issue. Having regard to the specific issues of the Cancun Ministerial Conference, Latvia stresses the following:
(1) Trade in agricultural goods. Latvia supports the need to adopt the procedure of agricultural negotiations.
The Reform of Common Agricultural Policy[2], adopted by the EU Council of Agriculture on June 25 – 26, 2003, will be implemented also in Latvia, after Latvia joins the EU (the decision on conditions will be adopted later). Thus it is to be concluded that the goals and the offered negotiations strategy of the EU in the multilateral negotiations on agriculture is similar with the position of Latvia for the WTO multilateral negotiations on agriculture, adopted on January 9, 2003.
(2) Trade in non-agricultural goods. In the Conference a decision must be adopted on the procedure of negotiations on the increased market access for non-agricultural goods and the harmonization of tariffs level, which would include one (single, universal) formula that would not exclude several sectors, would solve the problem of tariff peaks and the tariff escalation and different tariffs would be reduced in a diverse manner. With the reduction of import tariffs level, application of non-tariff barriers is increasing, thus the intensification of corresponding negotiations would be of utmost importance.
Latvia supports a free market access for goods originating from the least developed countries. This would facilitate the development of these countries on the global scale, and would not create a negative impact on the Latvia's economy in the meantime. The proportion of these countries in the trade balance of Latvia does not exceed 0,5% and also there is not awaited a considerable increase of import from them in the perspective. Similarly, Latvia supports the need to increase the market access in the mutual trade of the developing countries.
(3) Trade in services. Latvia emphasizes the need to organize a strict schedule of services negotiations. In the meantime, Latvia welcomes the present pace of the negotiations on the liberalization of trade in services.
Considering the high level of market openness of Latvia, fixed in its WTO commitments, a similar liberalization of the markets of other Members would be welcome. Latvia has prepared a liberalized services offer, inserting only technical modifications noting the end of agreed transitory periods as well as clarifying some issues with respect to services sector classification in the existing schedule.
Latvia is interested in the liberalization of maritime transport services sector and has submitted a request to the US, as well as has joined the communication proposed by Japan on the liberalization of the market of maritime transport services.
(4) Trade and development. Latvia emphasizes its wish to see at the Cancun Ministerial Conference a considerable progress in several issues, being of utmost importance for the developing countries. Latvia expresses its support for adoption of package of essential decisions as regards the special and differential treatment and the implementation of the WTO Agreements as well as to reach a common agreement on further details of the agenda concerning the remaining issues. Latvia also underlines the importance of reaching an agreement during the Cancun Ministerial Conference with regard to specific measures to provide support for the least developed countries (LDCs). That would be a response to the offer provided by the least developed countries, which was approved during the LDC ministerial meeting in June 2003 in Daq. Our response step would have to include the elimination of tariffs and quantitative restrictions on all goods originating from the least developed countries. To maintain the essential goal that all WTO Members should benefit from the development and expansion of the trade throughout the world, the attention should be particularly focused on the founded interests of the developing countries.
Latvia hopes that the draft decision on the Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health, prepared by the chairman of the TRIPs Council on December 16, 2002 will be accepted by all WTO Members. If possible, the decision must be adopted in advance to the Cancun Ministerial Conference.
(5) Singapore Issues (trade and investment, trade and competition, transparency in government procurement and trade facilitation). Latvia supports the position for the adoption at Cancun Ministerial Conference of modalities in Singapore Issues, which would provide detailed provisions not only with regard the negotiation procedure but also the material rules, however not yet formulating the proposed outcome of these negotiations. Thus the immediate beginning of the formal negotiations would have started, as was agreed at the Doha Ministerial Conference. Latvia emphasizes that the initiation of the negotiations on the whole four items of the Singapore Issues would maintain the principle of the Single Undertaking. Thus Latvia supports the goal of having parallel negotiations on new rules in all four fields and rejects the consideration to dismiss any of the Issues from the Single Undertaking.
(a)Trade and competition. Latvia supports the adoption of multilateral competition policy rules, having regard to the basic principles of the WTO (transparency, non-discrimination, etc.) and ensuring the application of mechanism for the implementation of fair competition policy, as well as to examine the cases of international cartels, applying the multilateral treaties and using the dispute settlement mechanism with regard to the issues of jurisdiction. Similarly, we support a voluntary cooperation between the Members' institutions, which aim to facilitate the implementation of fair competition within the state. Likewise, the developing countries should be provided with a long-term technical assistance.
(b)Trade and investment. Latvia supports the adoption of provisions for the regulation of multilateral investment policy, which would be of benefit both to investors and the country receiving investment. The rules should provide for a regime that would improve the investment climate in developing countries and countries in transition by facilitating the welfare growth in these countries and the expansion of the global market. The new investment rules should be attributed to the direct investments only. The adoption of multilateral rules regulating the investment policy would reduce the necessity to conclude bilateral agreements on facilitation and protection of investments among lots of countries, which currently do not have such agreements, including the developing countries. The principle of transparency is particularly vital in creation of investment policy. Latvia maintains its position for the establishment of a procedure requiring each country to notify on its legislative acts as well as exchange information concerning the issues related to investment, thus facilitating a predictable investment policy and environment, which in turn would facilitate the increase of investment flows between countries.
(c)Trade facilitation. In the field of trade facilitation Latvia supports the adoption of provisions that would facilitate a secure and predictable trade system bearing no inefficient and needless barriers to exports and imports. Simplified, harmonized and automated procedures, a reduced amount of paperwork and an increased transparency, having regard to the WTO principles of non-discrimination and national treatment, would be of particular significance for Latvia as a transit state. With the simplification of customs paperwork the expenses related to customs formalities would reduce as well as reduce their proportion in the cost price of goods. That in turn would promote the representation of small and medium enterprises in the international market. Similarly, the environment for attracting investments would improve and, from the government perspective, it would improve the administration, reduce the expenses, increase the turnover of trade and cut the amount of illegal trade transactions.
(d)Transparency in the government procurement. Latvia supports the inclusion of the transparency in the government procurement issue in the new round of negotiations, as well as expresses its support to the proposals by the European Commission on market access in the government procurement.
(6) The establishment of the register of geographical indications. Latvia regards that at the Cancun Ministerial Conference the negotiations on notifications and the establishment of the multilateral system of the registration of geographical indications for wines and spirits should be concluded. In the context of general negotiations the opportunities and the effects of extended additional protection on other products must be examined.
(7) Trade and environment. Latvia emphasizes the importance of reaching a decision on the correlation of provisions of trade and environment, as well as on the market access for goods / services that gives benefit for the protection of environment, and eco-labelling thus providing the WTO input towards sustainable development. Latvia as a becoming Member State of the European Union supports the adoption of a decision to grant the observer status to executive institutions of multilateral environment treaties.
(8) Improvement of the WTO Dispute Settlement mechanism. Latvia stresses that the negotiations on the improvement of the Dispute Settlement mechanism are still important for the WTO system and the corresponding mandate should be approved possibly sooner.
(9) Trade rules (anti-dumping, subsidies, provisions of regional trade agreements). Latvia notes that as concerns the additional issues requiring a formal decision, then the Cancun Ministerial Conference should provide for impetus on a further progress also in the other issues of the Doha work program. In this regard Latvia draws a particular attention towards the negotiations on anti-dumping and subsidies, expressing its support for an essential outcome within the Single Undertaking: to reach an agreement on common provisions, which would create more stringent, clear-cut and simplified application of trade defense instruments and in the meantime would maintain the efficiency of these measures, broaden the control possibilities over the initiation of examinations and would similarly reduce the expenses related to the examinations, particularly as regards the expenses for the parties involved in the examinations. However, considering the situation in the Latvian fishery and the specific needs to restructure the sector, Latvia's position towards the reduction of fishery subsidies is precautious and subject to be clarified in the course of the negotiations.
(10) Trade and labor standards. Preparing for the Cancun Ministerial conference,[3] Latvia expressed its support towards the EU Council conclusions, adopted by General Affairs and External Relations Council on July 21 – 22 and which provides for a position against the trade and labor standards being a subject of the WTO negotiations. Latvia in the context of the WTO supports the commitment of the EU to unilaterally analyze the issues of basic labor standards within its trade policy reviews (in every two years), as well as to take into account the country's performance of the standards when granting the preferences in the framework of the general system of preferences (GSP). The European Commission regards that the adoption of the decisions in the current wording will not create needless impediments in the WTO negotiations.
[1] EU General Affairs and External Relations Council on July 21 – 22, 2003 affirmed that the decision adopted in October, 1999, Doha Ministerial Declaration and the related texts that were adopted at the Doha Ministerial Conference, EC written submissions in the WTO negotiations, as well as the decision of Council of Agriculture, adopted on June 26, 2003, forms the basis of the EU activities within the DDA and preparation process for the Cancun Ministerial.
[2] On June 25 – 26, 2003 at the EU Council of Agriculture Member States reached a political agreement on the reform of the Common Agricultural Policy (CAP). Accordingly, the decisions that are adopted with regard to the aforementioned issue constitute a significant input from Europe in the DDA negotiations on agriculture. Moreover, the Council of Agriculture has emphasized that the flexibility for the DDA negotiations reached with the help of the reform of Common Agricultural Policy the EU can offer only if the other partners will similarly offer conditions of equal value for the liberalization of agriculture, as well as if special interests of the developing countries are considered. After the agreement on CAP reform, the EU is ready to agree on a significant liberalization within the multilateral negotiations in agriculture, that would include the EU export interests for the market access of other WTO Members and non-trade concerns in the agricultural sector (e.g. rural employment, historically-cultural landscape, etc.)
[3] Preparing for the WTO Seattle Ministerial conference (November 1999) as well as the Doha Ministerial conference (November 2001), the developing countries and the EU candidate countries communicated a common opinion against the binding together both the labor standards and trade provisions. Position of Latvia was communicated according to the mandate of the Latvian delegation, which was approved by the government prior to the abovementioned Ministerial conferences.
