WTO: Members praise Viet Nam’s new offers

Members praise Viet Nam’s new offers, but seek improvements and more clarification

The 63 WTO members negotiating a membership package with Viet Nam praised the Southeast Asian country on 15 June 2004 for considerably improving its market access offers for goods and services, and its programme for applying WTO agreements.

They said they were much closer to agreement with Viet Nam than at the previous Working Party meeting last December, and they supported the Vietnamese objective of joining the WTO “as soon as possible”.

Viet Nam’s latest offers, circulated in April, include commitments to cut tariffs to an average of about 18% (a 4-percentage point improvement over the previous offer), and to provide some access to services in 10 sectors or 92 sub-sectors. Viet Nam has also supplied a considerable amount of additional information in response to members’ requests.

However, working party members also said a lot of work still remains, in continuing to negotiate market access and other terms of Vietnam’s membership, in obtaining further clarification of Viet Nam’s regulations and policies, and in putting into place the necessary laws and regulations.

“I believe it is my duty to emphasize to the Vietnamese delegation the absolute need to accelerate the laws and enforcement regulations,” chairperson Seung Ho (Rep of Korea) told the working party. “The pace of this accession will depend on the pace at which the Vietnamese government manages to implement these.”

In addition to seeking further improvements in the market access offers, members also raised concerns about Viet Nam’s use of “specific” import duties (fixed amounts per tonne, etc, instead of percentages of the value or “ad valorem”) or combinations of specific and ad valorem rates, the use of tariff quotas on agricultural products, proposed transition periods for implementing parts of the Sanitary and Phytosanitary Measures Agreement, and apparent lack of progress on Viet Nam’s own schedule for applying the intellectual property (TRIPS) agreement.

A proper first draft working party report could now be prepared in October or November, to be discussed at a meeting that could be held in December. This means that Viet Nam is not going to achieve its earlier ambition to join by 1 January 2005 (see news report of previous meeting). Instead, Trade Vice Minister Luong Van Tu spoke only of joining “as soon as possible".

The Vietnamese delegation had already held bilateral negotiations in Geneva with 10 members before the working party meeting, with five more scheduled afterwards — in addition to negotiations in Hanoi and some members’ capitals over the past few months. Cuba has become the first country to announce in the working party that it has completed its bilateral negotiations.

Members worked through “elements” of a draft report, a revision of the document first discussed at the last meeting in December, compiling information supplied by Viet Nam together with its replies to questions posed by its negotiating partners.

Speaking through interpreters, Vice Minister Luong said: “We are encouraged to see that members of the working party have adjusted their requests more reasonably.” While members asked for Viet Nam to offer more, he called on them to be even more flexible and to take into account Viet Nam’s economic situation.

For his part, Chairperson Ho said Viet Nam and the working party members should “intensify their [bilateral] negotiations with a view to moving closer to conclusion”.

BROADLY

Again the question of Viet Nam’s economic situation was raised, with ASEAN (the Philippines speaking) and some other developing countries supporting Hanoi’s argument that as a heavily indebted low-income developing country, with a per capita income of less than $400 per day, it should be treated leniently, and in particular should be eligible for exceptions under the Subsidies Agreement (Annex 7).

Again, some developed countries said that while this was true, Viet Nam should also take into account that it is a vibrant economy with strong potential.

SOME DETAILS

Among the many issues raised in the discussion:

AGRICULTURE: Viet Nam has now agreed to eliminate export subsidies, for coffee immediately on joining the WTO, for other products after a short transition. Several members of the Cairns Group (which lobbies for agricultural liberalization) want it to eliminate export subsidies immediately.

A smaller group “plurilateral” meeting on agriculture was held the previous day (14 June 2004). Some members reported good progress, but with a particularly detailed discussion on domestic support.

SANITARY/PHYTOSANITARY MEASURES: Vietnam has agreed to implement the agreement when it joins the WTO, except in three areas where it wants a transition period until 1 July 2008 — “harmonization” (to make national SPS measures consistent with international standards, guidelines and recommendations), “equivalence” (recognizing exporting countries’ methods as providing equivalent levels of protection as one’s own), and control, inspection and approval procedures. Viet Nam says it needs this because it lacks resources and the issues are complicated. Several members (e.g. the EU, Australia, and Canada) said this covers a major part of the SPS Agreement and is not necessary. They called for a smaller group “plurilateral” on SPS.

IMPORT RESTRICTIONS, QUOTAS AND BANS: Although Viet Nam has agreed to get rid of most quantitative restrictions, members still had a number of questions about why some products remain on the list, such as scrap metal.

TRADE-RELATED INVESTMENT MEASURES: Viet Nam confirmed it will comply with the agreement when it joins, including the agreement’s ban on export requirements in investment regulations, but it said it needs to retain investment incentives as a means of developing, and because investors from the major working party members demand the incentives.

INTELLECTUAL PROPERTY: The US said this is the one area where it has seen little progress since the last meeting. Viet Nam assured the working party that it will comply with the TRIPS Agreement on the date it joins the WTO.

NEXT

Plurilateral and bilateral meetings will continue in Geneva, the Vietnamese delegation saying it is available until 22 June.

The chairperson aims to call this year’s second meeting in December, when members could discuss a proper first draft working party report, if replies to questions and updated information arrives on schedule.

BACKGROUND

WORKING PARTY MEMBERS: Argentina, Australia, Brazil, Brunei, Bulgaria, Canada, Chile, China, Colombia, Croatia, Cuba, Dominican Republic, Egypt, European Union and member states, Honduras, Hong Kong China, Iceland, India, Indonesia, Japan, Republic of Korea, Kyrgyz Republic, Malaysia, Morocco, Myanmar, New Zealand, Norway, Panama, Paraguay, Philippines, Romania, Singapore, Switzerland, Chinese Taipei, Thailand, Turkey, United States, Uruguay

CHAIRPERSON: Seung Ho (Rep of Korea)

Viet Nam’s Working Party was established on 31 January 1995. The previous meeting of the Working Party was held on 10 December 2003. Bilateral market access are well underway and will continue.

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