WTO

A PRESENTATION TO KFUPMOCT 18, 2003

FAWAZ AL-ALAMYDEPUTY MINISTER OF COMMERCE & INDUSTRY

KINGDOM OF SAUDI ARABIA

contents What is the WTO Accession process Bilateral negotiations 1. Goods 2. Services Multilateral issues 1. WPR 2. COMMITMENTS Legislation The SWOT Analysis A “Cost-Benefit” Analysis

WHAT IS THE WTO

1

THE THIRD SIDE OF THE TRIANGLE

I M FW B

W T O

The

Bretton Woods

Institutions

2

A GLOBAL VILLAGE

GATT 47 , ONLY 27 CONTRACTING PARTIES WTO 95 , 129 MEMBER COUNTRIES GATT , GATS , TRIPS & TRIMS TODAY , 148 COUNTRIES CONTROL : 80% OF WORLD TRADE 90% OF FINANTIAL TRANSACTIONS 92% OF TELECOM & IT 97% OF IPR’s

3

A MEMBER-DRIVEN ORGANIZATION

UNLIKE OTHER WORLD ORGANIZATIONS IDEAS – INNITATIVES – AGREEMENTS 28 AGREEMENTS & INNITIATIVES SINGLE UNDERTAKING PRINCIPLE 4 PILARS ; 1. MARKET ACCESS 2. NATIONAL TREATMENT 3. MFN & RECIPROCITY 4. TRANSPARENCY & PREDICTABILITY

4

A BORDERLESS WORLD

MFN Principle

Market Access &

National Treatment

K S AWTO COUNTRIES

5

THE ACCESSION PROCESS

THE ART OF NEGOTIATION

6

CODIFIED GLOBALIZATION

Protocol of Accession

Bilateral Negotiations

Multilateral Issues

Legislation

29 Agreement

14 Signed

WP Report

Commitment Para's

TRIPS

Customs Valuation

TBT & SPS

Import Licensing7

BILATERAL NEGOTIATIONS

THE CONFRONTATION

8

GOODS (GATT94)

7054 AGRI & NON-AGRI PRODUCTS : 1. ITA, 219 LINE ITEMS 2. CHEMICAL HARMONIZATION 3. ZERO-FOR-ZERO INNITIATIVE ( pharmaceuticals, equipment, steel, wood, cotton, toys, fish & paper ) 4. ARTICLE 20 OF GATT 94 ( health, environment, security, religious ) 11 OTHER SISTER AGREEMENTS

9

GOODS OFFERS

Average Rate

1997 1998 1999 2003

Requests

0%

10%

20%

30%

40%

50%

60%

1st 2nd 3rd CU10

SERVICES (GATS)

12 MAJOR SECTORS WITH;

155 Sub-sectors & 620 Activities In:

Business, Telecom, Distribution, Tourism,

Education, Banking, Insurance, Recreation,

Transportation, Environmental, Engineering,

Health, Audio-visual & Other Services Market Access & National Treatment GATS is the most complicated agreement of WTO

11

Market Access ( Services )

1) Cross Border Supply

2) Consumption Abroad

3) Commercial Presence

4) Movement of Natural Persons

UnboundBound

None

Unbound*12

SERVICES OFFERS

44%

72%

85% 86%

66%

0%

50%

100%

Bahrain Oman Jordan China KSA

Market Access

1995 1999 2001 2001 200213

GOODS

I T A

Zero Tariff

SERVICES

Telecom Agreement

Nominal Cost

Pervasive Computing

THE ELECTRONIC TAP

+

+

+

14

MULTILATERAL ISSUES

THE BATTLE OF IDEAS

15

WORKING PARTY REPORT

A FACTUAL SUMMERY OF THE WP Meetings ANSWERS TO QUESTIONS RELATED TO: 1. INDUSTRY, TRADE & AGRICULTURE 2. PRIVATIZATION & STATE TRADING 3. TAXES, DUTIES, CHARGES & AMS 4. SUBSIDIES, PRICING & LICENCING 5. INVETMENT & ENT MEASURES 6. ENFORCEMENT, DUE PROCESS 7. STANDARDS & SPECIFICATIONS

16

COMMITMENTS

NOTIFICATIONS WITHOUT FLEXIBILITIES ACC4, ACC5 & ACC8 TRANSPARENCY & PREDICTABILITY ENFORCEMENT & IMPLIMENTATION PLURILATERAL MATTERS TRADING ARRANGEMNTS BUSINESS & FISCAL POLICIES

17

LEGISLATION

THE AGONY OF REFORM

18

THE NEW RULES OF THE GAME

IPR LAWS: 1. TRADE MARKS 2. TRADE NAMES 3. COMMERCIAL DATA 4. COPYRIGHT 5. PATENTS

6. INT CIRCUITS LAYOUT & INDUSTRIAL DESIGNS 7. PLANT VARIETIES 8. COMPETITION 9. BORDER MEASURES IMPORT LICENCING SANITARY & PHYTOSANITARY MEASURES TECHNICAL BARRIER TO TRADE CUSTOMS VALUATION

19

THE SHOWDOWN

GENEVA,47 – SEATLE,99 – CANCUN,03 ONE – TWENTY EIGHT – THIRTY TWO ON GOING LIBERALIZATION REGIONALISM VS MULTILATERALISM DEVELOPED VS DEVELOPING ONE WORLD, ONE LAW & ONE VOTE DISPUTE SETTLEMENT BODY

20

THE FUTURE CHALLENGES

UNITED WE WIN, DIVIDED WE LOOSE STRATEGIC ALLIACES ARE REQUIRED TECHNOLOGY EDGE; IS THE FUTURE COMPARATIVE ADVANTAGE; IS A MUST SME’s ARE THE ENGINE OF GROWTH SERVICES RATHER THAN GOODS SPECIAL & DIFFERENTIAL TREATMENT

21

SWOT Analysis

S

T

O + 10

W

10 ــ

• Integrated – Proactive

• DSB ( regulated )

• Employment ( Saudization )

• MKT Access – National Treatment

• FDI ( T & P ) – Services Upgrading

• Confined - Reactive

• Vulnerable - Undersized

• Unemployment

• Single Undertaking

• Stagnation

IN WTO

OUT OF WTO22

A “COST-BENEFIT” ANALYSIS

SECURED AGAINST CHAOS

23

SAUDIZATION TODAY, WE HAVE: 4.5M JOBS IN THE PRIVATE SECTOR, WITH ONLY 10% SAUDIS IN 2020, WE WILL HAVE: 10M JOBS WITH 75% SAUDIS

COMMITMENTS ON ICT 25% ONLY

24

FOREIGHN DIRECT INVESTMENT

EXPONENTIAL FDI INCREASE DUE TO: 1. ECONOMIC REFORM 2. RESTRACTURING STRATEGY 3. UP-TO-DATE LEGISLSTION 4. TRANSPARENCY & PREDICTABILITY 5. ENFORCEMENT & DUE PROCESS 6. COMPARATIVE ADVANTAGE

25

HEALTHY COMPETITION

CONSUMER WIDER CHOICES 148 BORDERLESS MARKETS NO UNILATERAL DECISIONS AD, COUNTERVAILING & SAFEGARDS RULES OF ORIGIN MEASURES FREE TRADE AREAS ARRANGEMENTS FULL INTEGRATION IN WORLD

ECONOMY

26

THANK YOU

27