Special and Differential Treatment of Developing Countries in the WTO Agreement on Trade Facilitation: Is there a cause for optimism? IPRA Working Paper 106

The growing evidence of market failure, uncertainties in international cooperation and complexities of the problems of global inequalities has made special and differential treatment of developing countries (S&DT)not only increasingly necessary, but also increasingly difficult. In this paper, we examine the S&DT measures in the WTO Agreement on Trade Facilitation (TFA), in addressing the delicate balance between the concerns of developing countries and fostering the TFA’s objectives of expediting the movement, release and clearance of goods, including goods in transit. We find that,while the S&DT appears, in the face value, to offer flexibility for developing countries especially the least developed countries in implementation of the TFA, this flexibility has been eroded by conditioning assistance and support for capacity building to notification of commitments. The linking of support to commitment creates not only dilemma for developing countries on the timing of commitment (implementation) but also exposes them to risks of taking on increasing commitment before prerequisite capacity. Given the ‘best endeavour’ nature of the relevant provisions, it is not apparent that the benefits of implementing the Agreement will outweigh its costs if developed countries relegate on their promise to provide assistance and support for capacity building.