. /.WORLD TRADE
ORGANIZATIONTN/MA/W/19/Add.3
8 July 2003
(03-3692)
Negotiating Group on Market Access Original:  English
MARKET ACCESS FOR NON-AGRICULTURAL PRODUCTS
Certain Proposed Revisions on Draft Elements of Modalities for Negotiations
on Non-Agricultural Products (TN/MA/W/35)
Communication from the Separate  Customs Territory of Taiwan,
Penghu, Kinmen and Matsu
Addendum
The following communication, dated 7 July 2003, has been received from the Permanent
Mission of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu.
_______________
1.     The Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu has raised a number of
concerns in the past over the Draft Elements of Modalities for Negotiations on Non-Agricultural
Products (TN/MA/W/35) including the inequitable effect of the formula requiring Members with
lower average tariff rates to make deeper tariff cuts. This submission intends to deal with two
additional issues, namely, on the sectoral approach and on newly-acceded Members, and thus shall
not be deemed or in any way interpreted as a change in our positions or concerns as previously
expressed.
2.     With respect to sectoral tariff elimination, the Draft Elements of Modalities for Negotiations on
Non-Agricultural Products (TN/MA/W/35) states in paragraph 7 that “in addition to the application of
the formula, a sector elimination approach is proposed in order to eliminate and bind all tariffs on
products of particular export interest to developing and least-developed country participants.Therefore, the following sectors are proposed: electronics & electrical goods; fish & fish products;
footwear; leather goods; motor vehicle parts & components; stones, gems, & precious metals; and
textiles & clothing.” Footnote 7 further states that “Members will need to determine the product
coverage applicable to these sectors.” The Separate Customs Territory of Taiwan, Penghu, Kinmen
and Matsu considers that it is appropriate to include sectoral tariff elimination as an element ofmodalities for negotiations on non-agricultural products. However, it is also our view that the sectoral
tariff elimination element at this stage should be as neutral as possible in order to avoid any
presupposition of particular results, which shall be decided only through further negotiation. The
sectors currently listed in paragraph 7 are those pr oposed by individual Members only. They have not
been seriously negotiated. In fact, the stage of negotiating the coverage of specific sectors had notbeen reached when the sectors were mentioned by certain Members. It follows then that it would be
inappropriate at the moment for there to be any imp lication that these are the sectors to be covered in
the sector elimination approach. However, footnote 7 seems to imply that these sectors have already
been decided upon and that the only remaining issu e is “to determine the product coverage applicable
to these sectors.”TN/MA/W/19/Add.3
Page 2
3.     To avoid misinterpretation, we propose that footnote 7 be deleted and that the wording
“Therefore, the following sectors are proposed: electronics & electrical goods; fish & fish products;
footwear; leather goods; motor vehicle parts & components; stones, gems, & precious metals; and
textiles & clothing” be replaced by “With respect to the sectors to be included and the product
coverage applicable to the sectors, Members will have to negotiate further.”
4.     On the subject of newly-acceded Members, we note that paragraph 10 of the Draft Elements of
Modalities for Negotiations on Non-Agricultural Products (TN/MA/W/35) states that “newly acceded
Members could have recourse to a higher coefficient in the formula in order to take into account their
extensive market access commitments undertaken as part of their accession and recognizing that
staged tariff reductions are still being implemented.” However, we consider that this paragraph does
not sufficiently reflect the needs of the newly-acceded Members. The reason is that it will beextremely difficult for those industries in ne wly-acceded Members that are subjected to two
concurrent sharp tariff reductions (one from accession commitments, the other from multilateral
commitments) to subsist. Since industries in other WTO Members have already been given a six-year
“resting period”, at least, from the completion of their Uruguay Round tariff reduction commitments
to the starting point of Doha tariff reduction implementation, it follows that newly-acceded Membersshould also be given a similar “resting period” prior to the implementation of the Doha tariff
reduction commitments. We also sensed in our last meeting (May 26-28, 2003), that several Members
view this idea favourably. We therefore propose that the following provision be added to the
above-quoted paragraph 10: “A reasonable grace period should also be given to newly acceded
Members to allow for the further adjustment of th eir industries before the implementation of their
Doha commitments.”
__________