Trade remedies as barriers: Implication for SAARC countries

1
UNCTAD

• Trade remedies as barriers Implication for SAARC
  countries
• Abhijit Das
• Senior Trade Officer
• UNCTAD India Programme
• Organised by Teri, 3 May, 2006

2
Who are the users of trade remedies in SAARC ?

• India is the user of trade remedies in SAARC
• It imposed anti-dumping duty on 3 products from
  SAARC countries

3
Impact of anti-dumping duty acrylic yarn imports
from Nepal
Total Acrylic yarn imports from Nepal
4
Impact of anti-dumping duty Lead acid batteries
imports from Bangladesh
5
Impact of anti-dumping duty on Zinc Oxide imports
from Nepal
6
Anti-Dumping measures as trade barriers

• Trade chilling effect of initiation of
  anti-dumping investigation
• Significant reduction in absolute value of
  imports and import share
• Message is clear- initiation of anti-dumping
  investigation and imposition of duties can be
  significant barriers to trade

7
Anti-Dumping LDCs provision in SAFTA

• Give special regard to the situation of the Least
  Developed Contracting States when considering the
  application of anti-dumping and/or countervailing
  measures
• Provide an opportunity to Least Developed
  Contracting States for consultations
• Shall, to the extent practical, favourably
  consider accepting price undertakings

8
SAFTA LDCs provision Is it beneficial

• LDCs provision is an improvement on Art. 15 of
  the ADA
• Possibility of country-to-country consultations
• Although non-mandatory in nature, favourable
  consideration of price undertakings would be a
  positive step
• Whether SAARC LDCs are able to benefit from these
  provisions will depend on their level of
  preparation

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Consultations What preparations required

• Basic data on imports of the product under
  investigation IBIS may be a useful source
• Did the petition contain adequate information
  justifying initiation of the investigation on
  dumping, injury and causality
• Has the analysis of the 15 injury factors been
  done in accordance with the requirements of ADA?
• Documentation of why the investigation is flawed

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Are non-LDCs without any remedy?

• As an interested party, govt. of the exporting
  country has a full opportunity for the defence of
  its interests throughout an anti-dumping
  investigation.
• Preparation similar to that suggested for LDCs
  applicable.
• Investigating authorities are mandatorily
  required to take due account of any difficulties
  experienced by interested parties in supplying
  information requested- need to effectively use
  this provision

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SAFTA Safeguard provisions

• SAFTA safeguards can be imposed only on products
  subject to a concession under SAFTA
• SAFTA does not preclude SAARC countries from
  resorting to global safeguards under WTO.
• Requirement of investigation for imposition of
  SAFTA safeguards investigation procedure to be
  consistent with requirements under Art XIX and
  Agreement on Safeguards

12
SAFTA Safeguards How are these different from
global safeguards

• SAFTA safeguards limited to products covered by
  concessions under SAFTA
• Maximum duration of application of SAFTA
  safeguards is 3 years as against 8/10 years under
  Agreement on Safeguards
• SAFTA has 5/ 15 LDC exception as against 3/ 9
  developing country exception for global safeguards

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SAFTA Safeguards Ambiguities

• Can global safeguards and SAFTA safeguards be
  applied simultaneously on the same product
• What should be the period for determining the 5/
  15 import share for LDC exception
• Can SAFTA safeguard measures be in a form other
  than temporary suspension of tariff concessions

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Conclusions

• Although anti-dumping duties have acted as trade
  barriers in SAARC, effective utilisation of ADA/
  SAFTA provisions could help redress some of the
  underlying problems.
• While SAFTA safeguard provisions may be LDC
  friendly, need for addressing ambiguities.

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• THANK YOU