SDT

Special and Differential Treatment (S&DT) in the WTO usually refers to a category of legal provisions in existing WTO agreements that give, on one hand, developing countries greater flexibility with regards to the application of commitments and use of policy instruments and, on the other hand, developed countries the right to treat developing countries more favourably. S&DT provisions are usually grouped into four categories:
 * longer time periods for implementing agreements and commitments,
 * measures to increase trading opportunities for these countries,
 * provisions requiring all WTO members to safeguard the trade interests of developing countries,
 * support to help developing countries build the infrastructure for WTO work, handle disputes, and implement technical standards.

In addition to S&DT for all developing countries, some WTO agreements also contain special provisions for least developed countries (LDC). These special conditions for LDC include longer timeframes or exemptions (partial of full) for commitments. With S&DT, WTO members recognize the different economic situations of developing countries and their needs in implementing the obligations of WTO agreements. =Relevance in the TF negotiations= S&DT for developing countries will be critical for the implementation of commitments of a future WTO Agreement on trade facilitation. The discussion of S&DT is therefore an integral part of the WTO negotiations on trade facilitation. Such a situation could however be a double failure: a failure for the multilateral trade system in delivering benefits for developing countries and contributing to their economic development; and a failure for advancing trade facilitation globally. The benefits of WTO rules on trade facilitation will only materialize if they are implemented. Whilst cumbersome procedures, lengthly clearance processes and lack of transparency impact economic operations globally, trade barriers are highest in least developed countries, and developing countries in Central and South-Asia and Sub-Saharan Africa. The survey Doing Business Trading Across Borders 2011 highlights the different performance of countries.

The potential gains from trade facilitation reforms are thus high in these countries. The success of the WTO negotiations on trade facilitation would thus not be the conclusion of a written agreement, but the implementation of the provisions of this agreement, particularly in developing countries. Hence, rather than seeking to protect developing and least developed countries from the commitments of the agreement, the focus of S&DT as part of an agreement on trade facilitation should be to support the development of implementation capacity. This would ensure that developing countries benefit from the rules by undertaking reforms to be compliant and by obtaining financial and technical support for these reforms. =Negotiating Process= In Annex D, the document that contains the modalities of the WTO negotiations on trade facilitation, WTO members recognize the different implementation challenges for developing and, in particular, least developed countries. Annex D therefore stipulates that S&DT should be an integral part of the negotiating results, that LDC are exempted from undertaking commitments that would required investments beyond their means, and that technical assistance and capacity building (TACB) has to be made available to support the implementation in developing countries, specifically infrastructure investments. The development of provisions that reflect these premises is part of the negotiating process. In the ongoing negotiating process, time is spent on the discussion. The objective of the discussion on S&DT is to draft an implementation framework that allows developing country members of the WTO to build implementation capacity to be compliant with the rules. This framework will include, on one hand, flexibilities for the application of the commitments and, on the other hand, obligations and provisions for TACB. Drafting and agreeing such a framework is a challenge for the delegates.There is no previous example for such a mechanism in the WTO. Past experience with the operation of S&DT provisions in existing WTO agreements has not been very positive. Most of the S&DT provisions focus on exempting countries from the application of commitments and not on bringing these countries gradually into compliance. The task is to find a new form of S&DT in the WTO that would, as the Annex D stipulates, go beyond the traditional transition periods. =Outlook= The challenges of the negotiations in this pillar centre around three questions: Finding consensus on the implementation framework is also hindered by a lack of trust on commitments for TACB and uncertainty over the actual cost of compliance, i.e. the costs of undertaking the investments and reforms. Cost figures vary depending on how costs are defined and analysed. It is also clear that costs will vary from country to country and cannot be assessed globally. =Literature= Evdokia Moïsé "Special and Differential Treatment in the Area of Trade Facilitation", OECD Trade Policy Working Papers, No. 32 (OECD 2006(TD/TC/WP(2009)9/FINAL). Available from [] World Trade Organisation, //Information on the utilisation of special and differential treatment provisions. Note by the Secretariat,// 7 February 2002 (WT/COMTD/W/77/Rev.1/Add.4) World Trade Organisation, Information on SDT. Available from [|http://www.wto.org/english/tratop_e/devel_e/dev_special_differential_provisions_e.htm] United Nations Conference for Trade and Development "Reflections on a Future Trade Facilitation Agreement: Implementation of WTO Obligations - A Comparison of Existing WTO Provisions", Transport and Trade Facilitation Series, No. 2 (New York and Geneva, 2010) (UNCTAD/DTL/TLB/2010/2). Available from []
 * How to design a monitoring mechanism as part of the agreement that would allow identification of the implementation gaps and the supervision of the delivery of TACB?
 * How to monitor TACB delivery at the WTO level if the delivery remains bilateral or multilateral?
 * How to ensure that TACB commitments are forthcoming if no legally binding financial pledges are part of the agreement or linked to the negotiating result?