Brazil and India Hang Tough
Geneva - Brazil and India agreed this week to reject a coefficient of "15" as advanced by the European Union and the United States in the tariff-cutting formula for developing countries in the nonagricultural market access negotiations, Brazilian diplomats told WTD (WTD, 3/7/07).
The two nations participating in bilateral negotiations with the United States and the European Union recently on the Doha Development Agenda negotiations also agreed not to negotiate "paragraph eight" flexibilities for developing countries.
While the "Swiss" formula with appropriate coefficients will remain the basis for cuts in all tariff lines, there will be no shielding of any products from the formula, WTD was told. The United States and the EU want to exclude textile and leather tariffs from formula cuts.
On "paragraph eight" flexibilities, Brazil and India will insist that tariff lines be decided on the basis of self-selection. The EU and the United States had demanded up-front notification of which products would fall under "paragraph eight" exceptions.
Regarding how the principle of "less-than-full reciprocity" needs to be addressed, Brazil and India restated its importance to the development goals of the negotiations. The spread between the two coefficients in the NAMA formula for industrialized countries and the developing nations should be in the range of "25" - meaning "5" for industrialized countries and 30 for developing countries or "10" and "35" respectively.
EU insistence on "10" and "15" coefficients is simply not "do-able" - and remains a deal breaker, according to Brazilian sources.
Commenting on sectorals - as pursued by Brussels and Washington - Brazil and India noted that they are "voluntary add-ons for higher market access requirements" - over and above the core modalities. The two countries said sectorals must be decided only after finalizing the core issues of coefficients, "less-than-full- reciprocity" and flexibilities, trade diplomats argued.
The two countries have reiterated that they would work closely with their partners in NAMA-11.