WTO and EU: Promoting sustainable development in trade

The World Trade Organisation (WTO), being a vital player in international trade, incorporates all major trading blocs in the world including the European Union (EU). The ties that the WTO and EU hold are extremely significant and relevant to the countries of the EU as well as the trading partners of the EU. Through the WTO, the EU seeks to promote sustainable development in trade in four main fields as follows:

Everything but Arms Initiative

The ‘Everything but arms Initiative’ refers to the trade cooperation signed by the EU and the world’s poorest countries. This was made possible by the WTO where all imports from the world’s poorest countries enter the EU free of import duties or quotas with the exception of armaments and ammunition. Through this, the WTO and the EU seek to help poorer countries develop their exports to the EU without facing tariffs and quotas in a bid to promote export growth in the exporting countries which then also helps the economy of the country progress.

GSP+

Another venue that the WTO and EU partnership seeks to promote would be an incentive arrangement for sustainable development and good governance which is otherwise known as the Generalised Scheme of Preferences+ or GSP+. The general Generalised Scheme of Preferences arrangement offers generous tariff reductions to developing countries which means partial or entire removal of tariffs on two thirds of all product categories. In addition to this, the “GSP+” enhanced preferences refers to a full removal of tariffs on essentially the same product categories as those covered by the general arrangement. According to the agreements made by the WTO-EU partnership, these are granted to countries which ratify and implement core international conventions relating to human and labour rights, environment and good governance. According to the European Commission, in December 2012, the EU identified a list of products that had become so competitive that they no longer need support to be successfully exported to the EU. Of these identified list of products, countries such as Costa Rica and Ecuador are able to export products such as vegetables and live plants to the EU under the scheme in the absence of tariffs

Aid for Trade

The WTO ‘Aid for Trade’ initiative helps developing countries, and particularly least developed countries, trade. Many developing countries face a range of supply-side and trade-related infrastructure obstacles which constrains their ability to engage in international trade. The WTO-led Aid for Trade initiative encourages developing country governments and donors to recognize the role that trade can play in development. In particular, the initiative seeks to mobilize resources to address the trade-related constraints identified by developing and least-developed countries. Since the launch of this initiative in the WTO’s 2005 Hong Kong Ministerial Conference, the EU has been actively participating and cooperating with the WTO in this initiative to better allow developing countries to engage in more effective and efficient international trade.

Doha Development Agenda

At the Fourth Ministerial Conference in Doha, Qatar, in November 2001 WTO member governments agreed to launch new negotiations. They also agreed to work on other issues, in particular the implementation of the present agreements. The entire package is called the Doha Development Agenda. According to the World Trade Organisation, the original 1 January 2005 deadline for the agenda was missed. After that, members unofficially aimed to finish the negotiations by the end of 2006, again unsuccessfully. Further progress in narrowing members’ differences was made at the Hong Kong Ministerial Conference in December 2005, but eventually there resulted a suspension in the negotiations in July 2006. Efforts have continued since the resumption of negotiations to achieve a breakthrough with the latest being in 2013 at the Bali Ministerial Declaration which successfully addressed bureaucratic barriers to commerce thereby fulfilling a small part of the Doha Agenda. However, criticisms remain that the unconcluded Doha round prompted several countries to attach more importance to bilateral agreements as compared to the multilateral trade agreements that the WTO promotes and hopes to instill.

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