TERMS RELATED TO WTO

NAMA
NAMA refers to all products not covered by the Agreement on Agriculture. In other words, in practice,
it includes manufacturing products, fuels and mining products, fish and fish products, and forestry
products. They are sometimes referred to as industrial products or manufactured goods.
The Uruguay Round produced significant improvements in market access for NAMA products in
the developed country markets, as tariff averages were reduced from 6.3% to 3.8%. In the case of
developing countries, the most important contribution was made in the form of new tariff bindings.
Binding coverage for NAMA products in developing countries increased from 21% to 73%, which has
considerably increased the predictability of trade.
A tariff binding is a ceiling level above which a Member cannot apply a tariff. In other words, it is
the maximum tariff that may be applied by a Member. However, such rates are not cast in stone. They
may be increased or withdrawn subject to compensation being provided to the WTO Members affected
by such action.
Despite the significant improvements in market access for NAMA products that previous GATT
rounds and the Uruguay Round produced, tariffs continue to be an important barrier to world trade,
as tariff peaks, high tariffs, and tariff escalation remain.
What is a non-tariff barrier?
There is no official definition but, in general terms, it refers to any measure other than a tariff
which protects domestic industry. Many non-tariff measures are based on a legitimate goal (such as the
protection of human health) and can be introduced in a WTO consistent manner. Agreements such as the
SPS and TBT aim at allowing governments to take due care of these legitimate goals while minimizing
the impact on trade and avoiding the temptation to use them as disguised protectionism.

S and D Treatment
The WTO Agreements contain special provisions which give developing countries special rights and
which give developed countries the possibility to treat developing countries more favourably than other
WTO Members. These special provisions include, for example, longer time periods for implementing
Agreements and commitments or measures to increase trading opportunities for developing countries.
These provisions are referred to as “special and differential treatment” (S&D) provisions.
The special provisions include:
z longer time periods for implementing Agreements and commitments,
z measures to increase trading opportunities for developing countries,
z provisions requiring all WTO members to safeguard the trade interests of developing countries,
z support to help developing countries build the capacity to carry out WTO work, handle disputes,
and implement technical standards, and
z provisions related to least-developed country (LDC) Members.

TBT Agreement
The Technical Barriers to Trade (TBT) Agreement aims to ensure that technical regulations, standards,
and conformity assessment procedures are non-discriminatory and do not create unnecessary obstacles
to trade. At the same time, it recognises WTO members’ right to implement measures to achieve legitimate
policy objectives, such as the protection of human health and safety, or protection of the environment.

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The TBT Agreement strongly encourages members to base their measures on international standards
as a means to facilitate trade. Through its transparency provisions, it also aims to create a predictable
trading environment.

Agreement on Subsidies and Countervailing Measures (SCM AGREEMENT)

The “SCM Agreement” addresses two separates but closely related topics: multilateral disciplines
regulating the provision of subsidies (export based and import substitution based), and the use of
countervailing measures to offset injury caused by subsidized imports.
Developed countries should eliminate these subsidies within 3 years and the member also need
to notify within 90 days when they enter into agreement.
Developing countries are divided into 3 parts:
z LDCs (exempted from removing subsidies)
z Members with a GNP per capita of less than $1000 per year (exempted from removing subsidies)
z other developing countries (8 years period to phase out their export subsidies)

For Import Substitution:

z LDCs (8 Years)
z Members with a GNP per capita of less than $1000 per year (8 Years)
z other developing countries (5 years period to phase out)

SPS Agreement
The Agreement on the Application of Sanitary and Phytosanitary Measures (the «SPS Agreement»)
entered into force with the establishment of the World Trade Organization on 1 January 1995. It concerns
the application of food safety and animal and plant health regulations.
Under the SPS agreement, the WTO sets constraints on member-states’ policies relating to food
safety (bacterial contaminants, pesticides, inspection and labelling) as well as animal and plant health
(phyto-sanitation) with respect to imported pests and diseases. There are 3 standards organizations
who set standards that WTO members should base their SPS methodologies on. As provided for in
Article 3, they are the
z Codex Alimentarius Commission (Codex),
z World Organization for Animal Health (OIE) and the
z Secretariat of the International Plant Protection Convention (IPPC).
The SPS agreement is closely linked to the Agreement on Technical Barriers to Trade, which
was signed in the same year and has similar goals. The TBT Emerged from the Tokyo Round of WTO
negotiations and was negotiated with the aim of ensuring non-discrimination in the adoption and
implementation of technical regulations and standards.

ITA
The Information Technology Agreement (ITA) was concluded by 29 participants at the Singapore
Ministerial Conference in December 1996. Since then, the number of participants has grown to 82,
representing about 97 per cent of world trade in IT products. The participants are committed to
completely eliminating tariffs on IT products covered by the Agreement. At the Nairobi Ministerial
Conference in December 2015, over 50 members concluded the expansion of the Agreement, which
now covers an additional 201 products valued at over $1.3 trillion per year.
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TFA
The Trade Facilitation Agreement (TFA), was confirmed in Bali, Indonesia in December 2013 at
the Ninth Ministerial Conference. After almost 20 years of Negotiations the agreement was officially an
open invitation for acceptance from the 160 members of the World Trade Organisation (WTO) on 27
December 2014. However the agreement will only be ratified once 2/3 of the members have informed
the WTO of their agreement. For the WTO, the agreement can be viewed as a historic achievement as it is
the first multilateral agreement since the WTO’s inception in 1995. The Trade Facilitation Agreement of
2014 is a global multilateral initiative to rationalise the stringent procedures which govern international
trade. The principal focus of the Agreement is to have numerous positive consequences on developed
and Least Developed Countries. Estimates have shown that the Trade Facilitation Agreement would
reduce trade costs by an average of 14.5%. In turn, this would prospectively improve trade globally by on
trillion dollars. This reduction of bureaucratic ‘red tape’ will have favourable effects on small to medium
Businesses, making it easier for them to trade and join global value chains. One of the most significant
aspects of this agreement, lies in the new principle that developing and Least Developed Countries
commitments to the implementation of the provisions outlined by the agreement are conditioned on
their procurement of necessary technical capacity.
Till now 142 countries out of 164 have ratified it.

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