APPENDIX 3
Memorandum by the Chemical Industries
Association
1. The Chemical Industries Association (CIA)
has been fully engaged with other national and EU chemical associations
to produce a number of position papers on different aspects of
the Doha Round. We very much appreciate, following the launch
of its inquiry on 20 July 2005, the opportunity to present to
the Trade and Industry Committee an overview of the UK and global
chemicals industry on our Doha Round objectives and in particular
our position on chemical tariffs within the non-agricultural market
access (NAMA) negotiations.
2. The UK chemicals sector annually exports
£32 billion and imports £27 billion providing a net
balance of payments surplus of nearly £5 billion. Given the
importance of trade to UK industry, it is therefore not surprising
that we want rules on international trade adapted to improve sustainable
business, social and environmental practices between the UK chemicals
industry and its global customers. Our positions regarding trade
facilitation, trade barriers and intellectual property seek to
improve the efficiency of moving chemicals and technology around
the world whilst taking account of the sustainable development
needs of exporting and importing countries. These are covered
in the summary paper below produced by the ICCA, of which CIA
is a member via our pan-European trade body, Cefic (European Chemical
Industry Council).
3. Work on the Doha Round this year has
become increasingly technical with the negotiators trying to resolve
individual specific issues within the modalities of the entire
negotiation. While this is a necessary process, it has become
difficult and contentious, especially in the agriculture negotiations,
where serious roadblocks have emerged on some key issues. These
have affected progress in NAMA negotiations because some developing
countries—led by India, Brazil and Argentina—have
tied the concessions they are willing to make in NAMA to the ambition
they see in the technical results of the agriculture negotiations.
This politicisation of the negotiations has not been a welcome
development as it has resulted in unnecessary focus on process
than on outcomes. It is business that conducts trade around the
world—not governments. This fact seems to have eluded many
of the negotiators.
4. To be fair to the DTI, officials have
been open and communicative in providing feedback and have been
generally supportive. The dogma lies at Community level where
industry's position seems to play second fiddle to the EU's diplomatic
objectives. The UK and European chemicals sector want to liberalise
trade with their main trading partners that are developed countries.
The chemicals industries from these and other major industrial
countries are already signed up to a proposal to scrap tariff
barriers. However, trade officials in Geneva will not consider
such a proposal until the agriculture issues are resolved and
an across-the-board formula approach is agreed for reducing industrial
tariffs. In the commercial world these tariff reductions are mutually
exclusive and there is no logic in linking them together. But
the diplomatic world seemingly has to justify all the resources
and status that it has so far expended in the Doha Round process
by over-complicating the negotiating process.
5. In the next few months, WTO members will
have to demonstrate the political will to make key concessions
so that the Doha Round can proceed and the technical negotiating
issues can be finally resolved. However, it is still unclear whether
that political will exists. We would like more focus on outputs
from WTO negotiators. In particular, we want the UK government
and the Commission to support the formal WTO proposal, sponsored
by Canada, Japan, Norway, Singapore, Switzerland, Taiwan and the
United States, for a specific negotiation on chemical tariff elimination
in the Doha Round. We seek to have this proposal formally approved
by the entire WTO membership in Hong Kong but this clearly will
not happen unless the Commission takes a more pragmatic negotiating
position. We hope the Committee's Inquiry will provide some support
to this cause.
28 September 2005
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