The Special and Differential Treatment Mechanism and the WTO: Cultivating Trade Inequality for Developing Countries
| Author | Anna Marie Brennan |
| Position | BCL (Law and Irish), LLB (NUI), LLM (NUI), PhD Candidate in University College Cork, Ireland |
| Pages | 143-160 |
THE
SPECIAL
AND
DIFFERENTIAL
TREATMENT
MECHANISM
AND
THE
WTO:
CULTIVATING
TRADE
INEQUALITY FOR
DEVELOPING
COUNTRIES?
ANNA
MARIE
BRENNAN*
Introduction
In
2007,
developing
countries
accounted
for
approximately
37%
of
global
exports
and
imports.'
However,
the
majority
of
this trade
was
accredited
to
only
fourteen developing
nations while
the
other
149
developing nations
only
accounted
for
7%
2
On the
other
hand,
approximately
60%
of
global
trade
was
conducted
by
only
33
developed
countries.3
It
can
be
readily
observed
that
there
is
an
obvious disparity
in
the
level
of
participation
of
developing
countries
in
the
world trading
system.
Despite
the
World
Trade
Organisation's
(WTO)
recognition that
trade
rules may
not
enhance
development
in
developing
countries
and
attempts
to improve
developing
member
countries'
equal
participation
in
the
world
trading
system,
there
is
still
a
marked
difference
in how
developing
countries
are
treated
compared
to
industrialised
countries.
The
WTO
recognises
the
unique
needs
of
developing
countries
via
Special
and
Differential
Treatment
Provisions
(SDT)
which
grant favourable
treatment
to
developing nations
in
trade
so
that
they
may
participate
on
a
"proportionately
beneficial basis"
in
the
world trading
system
"by
going beyond
formal
guarantees
of
equality
and
authorising
positive
steps
to
promote developing
countries'
capacity."
4
In
BCL
(Law
and Irish), LLB
(NUI),
LLM
(NUI),
PhD Candidate in
University
College
Cork,
Ireland.
The
author wishes
to
thank Dr Ursula
Kilkelly
who gave
invaluable suggestions
and
comments
on drafts
of
this
article.
I
These
nations included China,
Hong
Kong,
Singapore,
Malaysia, India,
Mexico
and Brazil
United
Nations
Conference
on
Trade
and
Development,
Handbook
of
Statistics
(2008),
[hereinafter UNCTAD].
890&lang=1>
(visited
27
December
2009).
The
membership
of
the
WTO
includes
32
of
the
50
least developed
countries
recognised
by
the
UN.
It
is
important
to
note
that
there
is
no
definition
under
WTO
law
of
"developed"
or
"developing" countries.
Developing
countries in the
WTO
are
therefore
determined
on
a
self-selection basis.
2
It
is
important
to
note
that
not
all
countries
were
members
of
the WTO.
3
UNCTAD,
note
1.
4
Gillian
Moon,
"Trade
and Equality:
A
Relationship
to
Discover"
(2009)
12
Journal
of
International
Economic
Law
617,
at
618.
C
2011
Anna
Marie
Brennan
and
Dublin
University Law
Society
Trinity
College
Law
Review
spite
of
this,
it
is
broadly
accepted
that
SDT
has
not succeeded
in
its
goal
of
reducing
trade
inequality between developed
and
developing
countries.
This article
will
focus
exclusively
on
whether
SDT
is
an
effective
and
appropriate
means
of
addressing
the
ability
of
developing
countries
to
participate
in
international
trade
to
the
same
degree
as
industrial
countries
such
as
the
United
States or
Germany.
6
Many academics
have
criticised
the
suitability
of
SDT
completely
while
another
category
of
commentators
have
criticised
the
current
state
of
SDT
and
have
advocated
that
it
is
in
need
of
reform.
The
main
purpose
of
this
article
is
to analyse
the
shortcomings
of
the
SDT
mechanism
to
decipher whether developing
countries
are
able to
participate
in
international
trade
to
the
same
degree
as
industrialised
countries.
The
WTO:
A
Forum
for
Equality
Before examining
the
effectiveness
of
measures
designed
to
ensure
that
developing
countries
are
able
to
trade
and
compete
effectively
with
developed
countries,
it
is
first
necessary
to
undertake
an
analysis
of
the
core
objectives
of
the WTO
which
aim
to facilitate trade
equality.
The
WTO
mechanism with
its
multilateral
series
of
laws
is
an
attempt to
"enjoin
the
world's
states
in
a
common
endeavour
of
trade
liberalisation"
with
the
supposition that
it
is
the
best approach
for
countries
to achieve
economic
success.'
The
mechanism partially
realises
Ricardo's
economic
theory
of
comparative
advantage
which
relies
on
the
efficient
use
of
"the
peculiar
powers bestowed
by
nature"
on
a
particular
state.9
Garcia
argues
For
further
reference
on
this
point
see
Joseph
Stiglitz
and
Andrew
Charlton,
Fair
Trade
for
All
(Oxford
University
Press,
2005),
at
87.
6
Many
developing
countries
have faced
particular problems
when
seeking
to
conduct
proceedings
in
the WTO
Dispute Settlement
Body.
For
further analysis
on
this
particular
issue
see
Chad
Bown
and
Bernard Hoekman,
"WTO
Dispute Settlement
and the
Missing
Developing
Country
Cases:
Engaging
the Private Sector"
(2005)
8
Journal
of
International
Economic
Law
861;
Thomas
Cottier, "Preparing
for
Structural
Reform
in
the
WTO" (2007)
10
Journal
of
International
Economic
Law
497;
John
Ragosta,
Navin
Joneja
and
Mikhail
Zeldovich,
"WTO
Dispute
Settlement:
The
System
is
Flawed
and
Must
be
Fixed"
(2003)
27
The
International
Lawyer
697.
For
further analysis
see
Alexander Keck
and
Patrick
Low,
Special
and
Differential
Treatment
in
the
WTO:
Why,
When
and
How?
(WTO
Staff
Working Paper
No.
ERSD-2004-
03).
8
Moon,
note
4,
at
619.
9
David
Ricardo was
able
to
illustrate
mathematically
that
the
removal
of
barriers
to
trade
would
lead
to
the
liberalisation
of
trade
which would
improve efficiency.
For further
reference
see
David
Ricardo,
On
the
Principles
of
Political
Economy
and
Taxation
(John Murray,
1817),
at
19.
It
is
important
to
note
that
this
theory
has
been re-invented
as
the
"efficiency
model"
by
Jeffrey
Dunoff
in order
to
properly
describe
David
Ricardo's
theory.
For
further
[Vol.
14
144
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