Nothing epitomises this more than the agreement relating to textiles. From
the point of view of the developing countries, the most visible and
"multilaterally" accepted non-tariff barrier arrangement prior to the
Uruguay Round was the Multi-Fibre Arrangement. That arrangement was the
end-result of a series of negotiated agreements starting in the 1960s, all
of which sought to provide the developed countries with the time needed to
restructure their industries so that competitive textile exports from
lower-cost developing countries do not "disrupt" their markets. Despite
three decades of agreement on that principle and periodic revisions of the
deadline for ending import restrictions, textiles still were by the
late-1980s not permitted free entry in developed-country markets. The case
for an immediate end to such restrictions, under a new multilateral trade
regime was therefore strong. However, though the Uruguay Round agreement
on textiles and clothing provided for the phasing out of restraints
stemming from the Multi-fibre Arrangement, it once again delayed the
process of liberalisation. The process was designed to occur in four
stages over a ten-year period and is heavily "back-loaded", in the sense
that most of the liberalisation occurs during the last stages. The four
stages defined involve the following:
-
In the first
stage, beginning on the date on which the Uruguay Round became
effective, each signatory nation was required to remove quotas only on
products that account for 16 per cent of its total volume of imports of
four categories of textiles and clothing in 1990 (tops and yarns,
fabrics, made-up textiles products and clothing);
-
In the second
stage, beginning three years and one month after the agreement came into
force, quotas were to be removed on a further 17 per cent of the total
volume of 1990 imports; In the third stage, which begins four years
later, quotas are to be removed on products that account for not less
than 18 per cent of the total volume of 1990 imports;
-
Finally, after 10
years and one month, all other quota restrictions are to be eliminated.
This prolonged and
back-loaded agreement in a labour-intensive area in which the developed
countries had agreed to open up markets more than three decades back,
points both to the relative positions of power of developed and developing
countries in the Uruguay Round negotiations as well as to the extent of
commitment of the latter to offer greater market access as a quid pro quo
for the rapid liberalisation of trade and investment rules in the
developing countries. What is more revealing is the evidence on the
progress on this front. With two stages of the phase out process being
complete, 33 per cent of imports by volume of four categories of textiles
and clothing are ostensibly outside any quota regime.
Chart 8 >>
Chart 9 >>
However, out of the quotas under MFA notified by the US, EU and Canada
(Chart 8), after the completion of the second stage of implementation of
the MFA phase out, only 1, 7 and 14 per cent respectively (Chart 9) have
been withdrawn. Much of the phase out thus far covered commodities which
were not even in consideration. Further, most of these are textile
products which do not dominate the developing countries' export basket.
Above all, as Charts 11 and 12 indicate, the extent of tariff concessions,
both in terms of tariff reduction and the share of the relevant imports
subject to cuts, provided by the developing countries have been higher
than that provided by the developed in industrial products in general and
in the textile area in particular. That is, five years after the
completion of the Round and at a time when talk is already on with regard
to initiating a new round, developing-country, market-access "gains" in an
area most crucial to them have been minimal.
Chart 11 >>
Chart 12 >>
The implication of this is obvious enough. Even in an area as basic as
market access, what is called for now is a review of the Uruguay Round
aimed at redressing the inequalities it carried through in its fine print
rather than an extension of the Round either in the form of more intensive
liberalisation or in the form of extending the multilateral framework into
new areas. However, neither the outcome of the Uruguay Round nor the
current discussion is influenced by the interests of the developing
countries. The perception that the Marrakech agreement of 1994 constituted
a qualitative advance sprang from many sources. To start with, it created
a formal international institutional framework in the form of the World
Trade Organisation, to oversee the implementation of the terms of the
agreement. This was expected to correct the inadequacy that there was no
formal institutional framework governing world trade, especially because
the agreement included clauses aimed at strengthening dispute settlement
mechanisms and disciplinary norms regarding the use of safeguard measures
like anti-dumping and countervailing duties which can be used to sidestep
uncomfortable trade liberalisation policies.
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