The Japan's statement on the Rules Chair's text

Mr. Chairman,
First of all, we appreciate the Chair’s efforts in producing the text which must be the result of the Chair’s long and hard work.

We will make our brief comments on antidumping, horizontal subsidies and fishery subsidies in this general session.

First, antidumping;
There are some positive elements in such areas as sunset review and public interest. However, disciplines should be further fortified.   

Having said that, we were taken aback by negative elements in the text such as weakened non-attribution test on injury determination. We also regret that the Chair’s text has not introduced mandatory lesser duty rules.

Now I must refer to the most serious problem of all, i.e. zeroing.
We are both perplexed and disappointed with the Chair’s inclusion of zeroing.

Let me introduce our co-sponsored “Statement on ‘Zeroing’ in the Antidumping Negotiations”: (Para 1-4 below) I would refer to the four countries, Colombia, Indonesia, Pakistan and South Africa newly joined this statement. I would hasten to add that the door is still open.

 
      The Delegations of Brazil; Chile; China; Colombia; Costa Rica; Hong Kong, China; India; Indonesia; Japan; Korea, Rep. of; Mexico; Norway; Pakistan; Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu; Singapore; South Africa; Switzerland; and Thailand made this statement on 7 December 2007 concerning the Rules Chair’s first draft text (TN/RL/W/213), in particular on the issue of “zeroing”. This is without prejudice to the strong views the Delegations may have on other parts of the text.

1. We thank the Rules Chair for his efforts to present this first draft text (TN/RL/W/213). The mandate for Rules calls for clarifying and improving disciplines under the Anti-Dumping Agreement. Clarified and improved disciplines do not imply increased opportunities for imposing barriers to trade. 

2.The Chair’s text must serve the spirit of the Doha Development Agenda, which we understand to be to increase trade flows, enhance predictability, and provide more transparency. The text must also represent the actual discussions which took place within the Negotiating Group. The vast majority of the proposals made by the co-sponsors of this statement have been neglected. We are obliged to say that the Chair’s text lacks balance.

3. The Chair’s text, as it now stands, permits the practice of zeroing, thus running counter to the above. Zeroing is a biased and partial method for calculating the margin of dumping and inflates anti-dumping duties. If the use of such practice prevails in the future, it could nullify the results of trade liberalization efforts. In Marrakesh, Ministers expressed their determination to resist protectionist pressure of all kinds. They believed that trade liberalization and strengthened rules achieved in the Uruguay Round would lead to a progressively more open world trading environment. We call upon all Members to ensure that the Multilateral Trading System is not undermined through zeroing.

4.We, along with others, will continue to make our points in the Negotiating Group. When the Chair’s text is revised, we expect it to reflect to a much larger extent the spirit of the DDA and the reality of the discussions.


 
Mr. Chairman,
I regret to say that positive elements are totally overshadowed or more than offset by negative elements. I have to say the part on antidumping:
- is imbalanced,
- disregards the discussion that took place in our group, and
- overlooks the negative impact of zeroing on future world trade.

I have to say this is not what majority of Members expected you to do.

Let me turn to the second point, horizontal subsidies;
We will continue to be engaged in the further discussion on this matter but will refrain from going into details here.

Third, fishery subsidies;

We appreciate that you have based upon discussions on the Hong Kong Ministerial Declaration. The Hong Kong Ministerial Declaration stipulates that there was “broad agreement that the Group should strengthen disciplines on subsidies in the fisheries sector, including through the prohibition of certain forms of fisheries subsidies that contribute to overcapacity and over-fishing.”

The Chair’s text is basing its argument on this Declaration. We think this is right direction, but requires qualification.

For example, in your new text, the prohibited subsidies include assistance for vessel construction and port infrastructure, support for operating cost of fishing and port processing activities, among others.

Mr. Chairman, to prohibit subsidies regardless of their contribution to overcapacity and over-fishing is not in line with Hong Kong Ministerial Declaration.
The next issue is small-scale fisheries. The basic characteristics of small-scale fisheries are commonly observed across the countries worldwide and, therefore, special treatment for them should be extended to all Members.

Mr. Chairman, we are not in total despair.
Because we know you will revise your paper.
Because we know you will listen to us and try to reflect our collective views.

We will be waiting for your next text. We hope this time it will be a paper to be welcomed by majority of Members.