Special Treatment and Policy Space for the Developing Economies in the Multilateral Trade Regime

Abstract

The contemporary multilateral trading system comprises members ranging from high- to very low-income countries; this range has a bearing on the operations of the multilateral trade regime. Presence of a large number of low-income members is the new systemic reality. Special and differential treatment (SDT) has operated for the developing economies, principally for the small, low-income ones, for many decades. The concept of SDT grew in three basic stages, on which this article elaborates. Theoretically this concept was meaningful and significant, but in reality it has not engendered substantial benefits to the intended beneficiary groups, the developing economies. The Uruguay and the Doha Rounds of multilateral trade negotiations (MTNs) reaffirmed faith in SDT. The Doha Development Agenda (DDA) was clear about reaffirming the importance of SDT to the multilateral trade regime and referred to it as an integral part of the WTO Agreement. During the Fifth Ministerial Conference in Cancun and the subsequent WTO meeting in Geneva in July 2004, small developing countries held together as the Group-of-Ninety (G-90). They made their presence felt in the Hong Kong Ministerial Conference as well. As SDT has not spawned large benefits for the target groups of countries, there is a pressing need to refine the concept. Academics and policy makers have debated over what future shape SDT should take so that it will be able to meet the expected goals. Taking these concerns into account, this article presents a comprehensive set of recommendations.