GLOSSARY. Aid for Trade: Initiative endorsed at the Hong Kong WTO Ministerial Conference in 2005 to provide assistance to DCs and LDCs: (a) to address supply-side

Aid for Trade: Initiative endorsed at the Hong Kong WTO Ministerial Conference in 2005 to provide assistance to DCs and LDCs: (a) to address supply-side constraints that hamper their participation in global markets and (b) to assist them in coping with transition costs resulting from the liberalization of trade regimes and erosion of preferences. It consists of technical assistance, capacity building, institutional reform, investments in trade-related infrastructure, and budget support to offset adjustment costs of trade liberalization.

Best endeavour clause:Usually an undertaking which does not represent a legally binding commitment for the signatory in the WTO context. Consequently, failure to implement a best endeavour clause or undertaking is difficult to challenge through recourse to the DSU/DSB. Developing countries have repeatedly noted that special and differential treatment provisions have the nature of best endeavour clauses.

Bottom line: Level under which no more concession would be accepted because vital objectives and needs would not be met.

Bound tariffs: Maximum rates (ceilings) of custom duties to which the country has committed itself in the WTO, in its schedules of concessions. The country cannot increase its duties beyond this level without compensating the affected trading partners. The purpose of bound duties is to provide greater commercial certainty through a ceiling on tariffs which cannot be breached. In practice, the effectively used duties (so-called applied tariffs) are often lower than the bound tariffs.

CARIFORUM: Established to ensure the follow up and the management of funds provided by the European Development Fund to the Caribbean region. It brings together the countries of the CARICOM (Antigua and Barbuda, Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, Saint Christopher and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Suriname, Trinidad and Tobago) and the Dominican Republic that is not part of it. The CARIFORUM is the subregional body which negotiated an EPA with the EU.

Domestic support: Sometimes called Тinternal supportУ. Any domestic subsidy or other measure which acts to maintain producer prices in agriculture at levels above those prevailing in international trade: direct payments to producers, including deficiency payments, and input and marketing cost reduction measures available only for agricultural production. The WTO Agreement on Agriculture classifies domestic support into three categories: amber box, blue box and green box. Measures in the amber box are regarded as trade distorting and were subject to reduction commitments in the Uruguay Round. Direct payments under production-limiting programmes (blue box) were not subject to reduction commitments, nor were those in the green box which are regarded as non-trade distorting.

Enabling clause: Outcome of the Tokyo Round (1973-1979) of the GATT, it allows developed countries, members of the WTO, to take action favouring DCs without granting the same treatment to other members. Its main measures include the GSP (see below) and SDT (see below).

Early harvest: Advanced provisional implementation of agreements reached in a trade round, when parties to an agreement agree that some of the targets they have set themselves should be implemented earlier than had originally been expected, without expecting the formal conclusion of the overall negotiations.

Export subsidies: Direct government payments or other financial contributions by governments provided to domestic producers or exporters to foster exports of goods or services. They are prohibited under the WTO Agreement on Subsidies and Countervailing Measures (Article 3) and, in the agricultural sector, have been subject to reduction commitments under the Agreement on Agriculture (Part V).

Fast Track procedure: Mechanism under which US Congress can only approve or disapprove a regional or multilateral trade package negotiated by USTR in its entirety. The Fast Track procedure (now replaced by the Trade Promotion Authority) was voted by the American Congress for a determined period of time, specifying the mandate given to the negotiators. It also shortened the ratification process by preventing the Congress from amending specific provisions of the agreements.

Free riders: Expression used to qualify a country that does not make any trading concession, but takes advantage of the tariff reductions and concessions granted by other countries.

G-20: Group of developing WTO members - most of them competitive agricultural exporters - that works to secure an ambitious result on farm trade in the Doha negotiations; generally led by Brazil. It was formed before the Cancun Ministerial Conference in 2003. The original group of signatories went through many changes resulting in different names, such as G-21 or G-22. The current membership (as of November 2010) consists of 23 countries. It is distinct and separate from the G-20 established in 1999 to bring together important developed and developing economies to discuss key issues in the global economy.

GSP: Acronym for Generalized System of Preferences. International rules, agreed upon in UNCTAD in 1971, by which developed countries grant a margin of preference on the custom duties applied to DCsХ exports to developed countries, increasing in this way their competitiveness. The massive tariff reductions since 1971 have reduced the importance of GSP to many DCs and has led to Тpreference erosionУ (see below).

Integrated Framework and Enhanced Integrated Framework (IF and EIF): The Integrated Framework is a trade-related technical assistance project targeting LDCs. It was established in 1997 by six agencies (IMF, ITC, UNCTAD, UNDP, World Bank, WTO) to support their trade-related capacity building and to incorporate trade issues into their national development strategy. In May 2007 the IF became the Enhanced Integrated Framework aiming at 1) additional and more predictable financial resources, 2) strengthened in-country capacities to manage, implement and monitor the IF process, and 3) enhanced IF governance.

Less than full reciprocity: Normally applied to developing countries in market access negotiations where those members are not expected to offer concessions at levels equivalent to those provided by other (developed) members.

Linear and Swiss formula: Different methods are possible in tariff reduction negotiated at the WTO. They are all based on different mathematical formulas. For example, the Swiss formula is intended to reduce higher tariffs by a greater proportion than lower tariffs, while the linear formula applies tariff cuts of equal magnitude across whole classes of products.

Lock-in gains: Gains that cannot be questioned once they are enforced.

Mode 4 of services delivery: Mode of supply in trade in services - the Тtemporary movement of natural personsУ. Nationals of one country obtain a contract limited in time to work in another country. At the end of their contract, they are supposed to come back to their home country. This mode of supply is generally identified as promising in terms of potential economic gains for developing countries.

Multi-functionality (of agriculture): Concept stressing the multitude of functions served by a sector or industry aside from production. In the context of WTO negotiations in the agricultural sector, certain countries stress the role of agriculture in environmental protection, landscape preservation, animal rights, rural development and employment, food security, traditional habits, etc. Due to this multi-functionality, they oppose trade liberalization in the sector.

Policy space:Capacity for national authorities to take policy decisions unencumbered by international obligations. Used increasingly as a reason for avoiding new WTO commitments, notably in the agriculture and services sectors.

Positive and negative list approach: A positive list approach to commitments means that only those areas actually listed are covered by the commitment, while those not listed are considered excluded. This is sometimes referred to as a Тbottom-upУ approach. A negative list approach to commitments means that all areas are covered, with the exception of those listed. This is sometimes referred to as a Тtop-downУ approach.

Preference erosion: Process by which the preferential margin granted to DCs, through GSP or other preferential schemes, gets "erodedУ (becomes too small to have a positive impact on competitiveness of the products concerned) because of the overall cuts in MFN tariffs which apply to the competitors.

Singapore issues: Investment, public procurement, competition and trade facilitation introduced in the Singapore WTO Ministerial Conference in 1996. Only trade facilitation is currently being negotiated.

ТSpaghetti bowlУ: Metaphor for the growing proliferation of intertwined bilateral and subregional agreements, creating complexity and divergent loyalties in the international trading system.

Special and Differential Treatment (SDT): Provisions in the WTO Agreements that give developing countries particular rights, and allow and encourage developed countries to provide preferential market access and other trade advantages to DCs. Preferential access to markets of developed countries means that DCs participating in trade negotiations need not to reciprocate fully the concessions they receive. Other trade advantages include, for example, longer time periods for implementing agreements and commitments, lower levels of commitment and measures to increase trading opportunities.

Stumbling block and building block: Terms created by the economist Jagdish Bhagwati. Stumbling block is used to describe free-trade areas that impede multilateral trade liberalization. On the other hand, building block is used when free-trade areas are seen as helping the multilateral trading system in bringing down trade barriers.

WTO plus provisions: Provisions of bilateral or subregional agreements that go further in liberalizing trade than what is required by the WTO agreements.

Sources for the glossary:

- AITIC glossary at http://zulu.worldcom.ch/acici/Membres/documents/aitic%20glossary%20web/Index_EN.php

- Walter Goode, (1998), ТDictionary of trade policy termsУ, Centre for International Economic Studies, University of Adela•de

- WTO glossary at http://www.wto.org/english/thewto_e/glossary_e/glossary_e.htm

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