Lanka protects agricultural, industrial interests at WTO
Sri Lanka secured special protection for its agricultural products as
a developing country, at the 6th Ministerial Conference of the World
Trade Organisation in Hong Kong giving it the freedom to protect
important products like rice, potatoes, onions, chillies, milk and
poultry, etc. from further tariff reduction.
Earlier, in the opening session of the conference, Trade, Commerce,
Consumer Affairs and Marketing Development Minister Jeyaraj
Fernandopulle, who led the Sri Lankan delegation, had expressed the
importance of including special provisions to protect the agriculture of
developing countries, in the final package on Agriculture.
Referring to the 'Mahinda Chinthanaya' of President Mahinda Rajapakse,
Minister Fernandopulle reiterated at this international conference, that
one of the prime objectives of the new government was to lift the
vulnerable people out of poverty, adopting a path of pro-poor
He said that the village, the periphery had not benefited from the
current waves of globalisation. As a leading member of the grouping
known as G-33, consisting of developing countries particularly
interested in agriculture, Sri Lanka was an active proponent throughout
negotiations over the past several years, of a unique proposal known as
This proposal, which was included in the Ministerial Text in Hong
Kong, allows developing country members of the WTO to designate
agricultural products which are critically important and contributing
for food security, livelihood and rural development of the country, as
Special Products, protecting them from further tariff reduction. Such a
measure would prevent local producers from being threatened by cheaper
Sri Lanka together with members of the G-33 actively advanced a
proposal known as a Special Safeguard Mechanism, which would allow Sri
Lanka to impose higher tariffs in order to protect its local producers
in the event of an import surge of agricultural products.
Sri Lanka and several other delegations repeatedly requested that
concerns raised by small, vulnerable economies such as Sri Lanka, be
addressed. They called on the WTO to establish ways to provide
flexibilities for these members in undertaking further commitments in
liberalising their economies.
On negotiations in trade in services, Ministers agreed to provide
appropriate flexibility for individual developing countries in making
offers for further liberalization in both overall and individual service
sectors. Sri Lanka has already made initial offers in areas of
telecommunication, tourism, and financial services on the basis of
existing level of liberalisation. Even if Sri Lanka makes any new or
improved offers for further liberalisation of services, this can be done
on the basis of prevailing level of liberalisation.
However, Sri Lanka has ensured that it is not required to make any
new commitments in any area against our wishes as a result of the
negotiations at the Ministerial Conference, particularly in areas such
as health, education and water.
Member countries are now able to make new requests individually or as
a group for further liberalisation. If such requests are made, Sri Lanka
needs to enter into negotiations and can utilise flexibility available
for developing countries in considering the requests. In addition, Sri
Lanka could obtain technical assistance available for developing
countries to fully engage in negotiations.
During the consultation process on issues relating to biodiversity,
Sri Lanka actively engaged in the discussion on the relationship between
the Agreement of Trade Related Aspects of Intellectual Property Rights
(TRIPS Agreement) and the Convention on Biological Diversity with a view
to commencing negotiations next year.
Sri Lanka made several interventions, supporting the position of
India and other developing countries that the current level of
consultations, which have been going on since 1998, should now be moved
up to substantive negotiations. Minister Fernandopulle, who spoke for
Sri Lanka, firmly highlighted the need for an immediate end to
bio-piracy, currently a serious threat to Sri Lanka's rich biodiversity.
Though reservations were made by several developed countries, the
Ministerial Text took a step forward by setting a deadline of July 2006
by which the General Council is expected to take appropriate action. On
the sidelines of the main Ministerial Conference, Minister Fernandopulle
held a series of important and constructive bilateral meetings with
Fair market access for apparels
During the World Trade Organisation Ministerial Conference in Hong
Kong, Sri Lanka also took up the issue of fair market access for its
exports including apparel.
In his speech to the Ministerial Conference, Minister Fernandopulle
stated that although the EU had extended duty free access to their
markets through the GSP + scheme for Sri Lanka, that other developed
countries had not granted similar concessions, even after the tsunami
Sri Lanka, together with Pakistan jointly proposed to the other
Members, that a special package of duty free, quota free access to be
granted to Least Developed Country Members (LDCs), should also be
extended to other developing country members whose economies are
dependent on a few products, particularly those that would be adversely
affected by such expanded concessions to LDs.
The draft decision on duty-free treatment for the LDCs has been
modified to accommodate the concerns of Pakistan and Sri Lanka in a
manner that would preserve our competitiveness in our main markets.
The original draft decision required all developed countries to
provide duty-free quota-free treatment to LDCs for all products. This
would have reduced Sri Lanka's competitiveness in the US, in particular
for apparel products.
The proposal submitted by Pakistan and Sri Lanka resulted in lowering
the product coverage for duty free quota free treatment to 97%. This
would allow developed countries to exclude approximately 157 tariff
lines, which is sufficient to cover the apparel sector.
More specifically, our trading interest in the US market for apparel
products could be protected, as the text permits the US to exclude both
products such as garments and our LDC competitors receiving duty free
quota free access.
Apart from seeking improved market access in the formal WTO process,
Sri Lanka held informal consultations with a group of 14 Least Developed
Countries to seek preferential market access in the US.
Sri Lanka was added to this group of 14 LDCs because of the blows it
suffered to its economy as a result of the tsunami. The group, now known
as the "Fourteen-Plus-One Group" will actively pursue its interests with
the U.S. authorities in seeking duty-free market access.
In relation to trade in industrial products (also known as
non-agricultural products), as per an initiative of Sri Lanka,
flexibilities were accorded to countries who have bound less than 35% of
their total industrial products, allowing them to maintain their current
This is an important flexibility for Sri Lanka, as otherwise, all
Members have been required to reduce their tariffs on such products
according to a negotiated formula, leading to drastic reductions in