Special and differential treatment:

Certain basic features of the multilateral trading system, e.g.,  reciprocity, are not quite appropriate when countries at vastly different  levels  of development  are  the members. From time to  time, efforts have been made to rectify this  lacuna by taking corrective actions,  commonly called "special and differential  treatment" (S&D  treatment) of the developing countries.

'Right since the  1960's,  some new provisions were  included  in  the GATT, whereby the developed countries undertook the obligation to  accord high priority to the reduction and elimination of  trade barriers to products currently or potentially of particular export interest to the developing countries. They also resolved to  refrain from introducing, or increasing  the  incidence of, customs duties or other import barriers on products currently or potentially  of particular export interest  to  the developing countries. (Articles XXXVI, XXXVII and XXXVm of the GATT  1994). And  all this  was to  be  done  without expectation of  reciprocity  from the developing countries. These commitments are, however, not of a contractual nature and as such  they cannot be enforced through the dispute settlement system of the WTO. The developed countries never took them seriously  and the developing  countries  have not derived much benefit from them in reality.

In the WTO agreements emerging out of the Uruguay Round of multilateral trade negotiations (MTN) (1986-94) there are very few substantial provisions for S&D treatment. In many cases, these are merely in the form of  longer periods of implementation of the obligations.  [One important example  of substantial special provision is the permission in the Agreement on Subsidies for the developing countries  to give export subsidy if  their  gross national product (GNP) is less  than US$l000 per annum.] Special  and differential  treatment of  the developing countries has been wrongly considered  by  the  developed countries  as  being  something  like a  grant or charity.

In actual fact, it should be the essential and integral element of the system in order to ensure that  the  developing  countries  that constitute such  large majority in the multilateral trading system have the opportunity  to share the benefits of  the system.  Amultilateral  system  is  stable only  if the members have a stake in it. For this to happen, it is important that the developing countries have confidence that they will derive adequate benefit from the system. In  the  current negotiations  in the WTO following  from  the Doha Work Programme  emerging  out of  the WTO Ministerial Conference  in Doha in 2001, there  is a mandate  to strengthen the S & D treatment  of  the  developing countries  and make  them more precise, effective  and operational. Negotiations are currently (March 2006) going on in the WTO on  this subject.