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International Trade and Finance

Notes • To give developing countries Special and Differential Treatment in negotiations to enable them
effectively to take into account their development needs
• To ensure negotiations on trade in services aimed at promoting the economic growth of all
trading partners and the development of developing and least developed countries
• To reduce or eliminate tariffs and non-tariff barriers in non-agricultural markets, in particular
on products of export interest to developing countries
• Doha Development Agenda (DDA) is a ‘single undertaking’ that means nothing is agreed until
everything is agreed.
Cancun Ministerial Conference

The fifth MC was held in Cancun (Mexico) during 10–14 September 2003 under heightened strain
between the major developed and developing countries. Developing countries believed that heavy
subsidies on production and exports of agriculture in developed countries had been grievously
harming their agriculture which is means of livelihood of their major population unlike in developed
countries. There was hardly any significant action perceived on the part of the developed countries
in the areas of implementation of issues and Special and Differential Treatment. On the other hand,
developed countries insisted upon starting the negotiations on the Singapore issues. Under this
atmosphere of complete apprehension, anger, and mistrust, no agreement could be reached and the
MC terminated without any comprehensive declaration.
The Hong Kong Ministerial Conference
The sixth MC took place in Hong Kong during 13–18 December 2005. It called for conclusions in 2006
of negotiations launched at Doha in 2001 and establishment of targets and time frames in specific
areas. The key outcomes of the Hong Kong Ministerial Conference included
• Amendment to TRIPS agreement reaffirmed to address public health concerns of developing
countries.
• Duty free, quota free market access for all LDC products by all developed countries.
• Resolved complete Doha work programme and finalized negotiations in 2006.
• Elimination of export subsidies in cotton by developed countries in 2006; reduction of trade
distorting domestic subsidies more ambitiously and over a shorter period.
• Elimination of export subsidies in agriculture by 2013 with substantial part in the first half of
the implementation period. Developing countries, such as India will continue to have right to
provide marketing and transport subsidies on agricultural exports for five years after the end
date for elimination of all forms of export subsidies.
• The agreement that the three heaviest subsidizers, i.e., the European Union, the US, and Japan,
were to attract the highest cut in their trade distortion domestic support. Developing countries
like India with no Aggregate Measurement of Support (AMS) will be exempt from any cut on de
minimus (entitlement to provide subsidies annually on product-specific as well as non-product
specific basis each up to 10 per cent of the agricultural production value) as well as on overall
levels of domestic trade distortion support (consists of the AMS, the Blue Box, and de minimus).
• Establishment of modalities in agriculture and Non-Agriculture Market Access (NAMA).
• The agreement that developing countries were to have flexibility to self-designate appropriate
number of tariff lines as special products. In order to address situations of surge in imports and
fall in international prices, both import quantity and price triggers have been agreed under the
Special Safeguard Mechanism for developing countries.
• The agreement that in NAMA and Special and Differential Treatment (S&DT), elements such
as flexibility and less-than-full reciprocity in reduction commitments for developing countries
reassured.
• No sub-categorization of developing countries when addressing concerns of small, vulnerable
economies.

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