BackTalks to further liberalize trade in IT products collapse at WTO
China's fierce opposition to include LCD panels and mobile phone processors, as demanded by Korea, has led to the breakdown of the talks
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Geneva: A much-publicized initiative to further liberalize trade in information technology products among select countries has collapsed at the World Trade Organization (WTO).
China’s fierce opposition to include liquid crystal display (LCD) panels and mobile phone processors, as demanded by Korea, has led to the breakdown of the talks.
On Friday, the European Union, which hosted the negotiations among 54 countries to finalize the second-generation Information Technology Agreement (ITA), has conceded it is difficult to bridge the differences between China and Korea. China has adopted an inflexible position that there cannot be any change in the draft list of 200 items, which were largely prepared on the basis of the bilateral agreement Beijing reached with the US last month.
Korea, which is one of the largest suppliers of IT products, has demanded the inclusion of LCD panels and other IT items on the ground that they formed the backbone of the global IT sector. Taipei has also pressed for including several hardware items that go into the mobile phones.
The European Union has coordinated the talks among a core group of countries for the last eight days to wrap up the agreement in time for adopting at the WTO’s general council meeting on Thursday. The EU’s sustained efforts, however, failed to bring about a compromise between the two nations.
The core group of countries negotiating the ITA-II include the EU, the US, Japan, China, Korea, Australia, Switzerland, Norway, New Zealand, Singapore, South Korea, Taipei, Malaysia, Thailand, the Philippines, Hong Kong, Costa Rica, Israel, Croatia, Turkey, Bahrain, Montenegro, Iceland, El Salvador, Guatemala, Colombia, Dominican Republic and Albania.
WTO director general Roberto Azevedo lent a helping hand to conclude the pact before the General Council meeting on Thursday.
At issue is whether the proposed agreement will include all items that belong to the IT sector or will it just contain products that are agreed between the China and the US at the margins of the Asia-Pacific Economic Cooperation leaders meeting in Beijing last month.
Korea has made it clear the draft list of 200 products circulated by the EU cannot be a “basis" to conclude the agreement as it has omitted several core IT products such as LCD panels and memory processors.
China, on the other hand, has maintained it cannot agree to any change in the draft list as it was approved at the highest level within its central government. The ding-dong battle between China and Korea has continued for the last 48 hours when it became clear there will be no agreement at this point.
“The next steps to resume talks next year will be finalized today," an EU official said. “Since last Thursday we have made significant progress", but “there is still some distance—small compared with the long way we have already gone—which needs to be bridged," the EU official maintained.
A large majority of WTO members, including India, Brazil, South Africa and Indonesia, had decided to stay out of ITA-II negotiations. Though India joined ITA in 1996, it decided not to join the current negotiations when they began in 2012. New Delhi has come to the conclusion that the ITA, which was implemented since 1997, undermined the growth of the hardware industry in the country.
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