High-level Uzbekistan delegation meet ITC chief in Geneva; attend training on issues key to WTO accession

10.08.2021 306

A trade delegation led by Uzbekistan’s Deputy-Minister of Investments and Foreign Trade, Mr. Badriddin Abidov, met ITC Executive Director Pamela Coke-Hamilton in Geneva on 21 July 2021.  As part of an official visit that took place from 18 to 24 July 2021, Uzbekistan’s delegation also benefited from participating in training sessions organized in support of Uzbekistan’s accession bid to the World Trade Organization (WTO). The training was organized by the ITC under the auspices of the European Union (EU) ‘Facilitating the process of Uzbekistan's accession to the WTO’ project.

Mr. Abidov is Uzbekistan’s chief trade negotiator in the WTO accession process, and this was his first meeting with Ms. Coke-Hamilton. While the ITC-facilitated project commenced at the start of 2020 with an ITC mission undertaken to Uzbekistan in February 2020 to kickstart project implementation, Covid-related restrictions prevented subsequent travel. The talks between Mr. Abidov and Ms. Coke-Hamilton centered on the WTO accession support programme mentioned, as well as the Ready4Trade Central Asia project which is aimed at oiling intra-regional trade in Central Asia. Progress under the was discussed as well as Uzbekistan’s current priority needs to buttress the accession process.

Speaking after the meeting, Mr. Abidov said the ministry was pleased with the progress that has been achieved to date on the national project. “We now hope to maintain this pace for our future cooperation, which will contribute to the efficiency of the process of the republic's accession to the WTO,” he commented.

Three training sessions took place on 23 July, covering pivotal themes in the area of international trade. It was attended by nine high-level officials from several relevant public bodies, including the Ministries of Investments and Foreign Trade, the Ministry of Finance, and the Ministry of Economic Development and Poverty Reduction, and Central Bank of Uzbekistan. In the first session, Mr. Rajesh Aggarwal, Chief of Trade Facilitation and Policy for Business at the ITC, discussed the dynamics of integration into a world economy that is dominated by global value chains (GVCs).

Global value chains are the phenomenon where the production of goods and services is not restricted to one country and firm but is steered by transnational corporations that apportion or source different parts, inputs or stages of the production process to intermediaries in different locations on the basis of optimal costing.

The rise of GVCs is mainly attributable to the pervasive growth of information and communication technology (ICT), a marked drop in the cost of transport and communications and the gradual lowering of trade tariffs over the last century. GVCs are now entrenched worldwide, and all countries participate in them to a greater or lesser extent.

Of particular importance to a country opening its borders to trade is the need to shield the competitiveness of its small and medium-sized enterprises (SMEs), as these firms are key to the economies of countries, notably in the developing world. It has been shown that they contribute between 50–70 per cent to countries’ gross domestic product (GDP). As important is their major role as employers, with SMEs generating up to 70 per cent of jobs worldwide. Moreover, near half of SMEs are owned by women, highlighting their fortifying role for social stability.

The training emphasized the need for countries entering the global economy to tailor a coherent national trade policy framework that reconciles different trade policy domains and instruments in order to buttress the export competitiveness of their SMEs. This implies heeding diverse support interventions at multiple levels, such as providing competitive services, promoting foreign direct investment (FDI) and exports, easing border crossing and improving access to capital and input.

The second training session, presented by the Director of the Accessions Division of the WTO Secretariat, Ms. Maika Oshikawa, gave a historical overview of WTO accession negotiations, and showed the impact WTO membership has had on acceding countries. It was demonstrated that acceding members have, on average, experienced faster growth in GDP, inward foreign direct investment stocks and merchandise trade in goods (exports and imports) – both in comparison with the years prior to WTO accession and when assessed relative to the world average. This growth was achieved even as acceding countries were levelling-pegging or dragged behind world growth of GDP and FDI stock in the five-year period before accession. In many countries WTO accession was also followed by a flourishing of export diversification although this has not been the case for all countries.

Growth rate of goods exports before and after WTO accession

Ms. Oshikawa also set out the state of play in ongoing accessions and outlined the next steps in Uzbekistan’s Working Party cycle.

The third training session, presented by international trade law and policy specialist, Mr. Rambod Behboodi, who is a former partner at the trade law firm Kings & Spalding and former counsellor at the WTO’s Rules Division, centered on the services accession under the General Agreement on Trade in Services (the GATS).

The particular intricacies of the GATS were detailed and a technical presentation was made on how the scheduling of GATS commitments functions and the manner in which a WTO acceding country can weigh its interests in this process in regard to its own concessions and demands. A detailed distinction was drawn between the structure of general obligations as they relate to services, compared with goods, the specific commitments were expounded, while the particular criteria for exceptions under the GATS were fleshed out.

The financial services sector constitutes a strategically sensitive sector under the general service sector industry because it underpins other sectors and economies at large and therefore have systemic impact if unsound. The sector is therefore heavily regulated and is subject to singular disciplines that do not affect other sectors. WTO obligations for financial services are consequentially uniquely tailored under the GATS Financial Services Annex, with bespoke obligations such as cross-border prudential assessment and a hived-off dispute settlement process. The last part of the training was dedicated to exploring the complexities of this sector and traversed the scope, definitions and exclusions set out in the Annex.



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