TNAG-0132-FCO40-168-Tariff-preferences-for-developing-countries-1969 — Page 126

Mr. Stewart

Reference.....

B

UNCTAD PREFERENCES.

One of the most difficult problems facing the special group of the OECD of Trade with Developing Countries has been to determine criteria for determining developing status. The group report of January 1968, prepared for UNCTAD II in New Delhi, discussed this question at length, and decided that countries should decide for themselves whether they were developing or not. The recommendations of the report included these paragraphs:-

2.

(A) Beneficiary countries:

Special tariff treatment should be given to the exports of any country, territory or area claiming developing status.

This formula would get over the difficulty which would otherwise arise of reaching international agreement on objective criteria to determine relative stages of development.

Individual developed countries might, however, decline to accord special tariff treatment to a particular country claiming developing status on grounds which they hold to be compelling. Such ab initio exclusion of a particular country would not be based on competitive considerations (which would have to be dealt with by the procedures discussed under (C) and (G) below).

It is to be expected that no country will claim developing status unless there are bona fide grounds for it to do so; and that such a claim would be relinquished if those grounds ceased to exist.

(C) Exceptions:

It is probable that developed countries will find it necessary to exclude from outse from the benefit of the special tariff treatment, a limited number of products in respect of which developing countries are already competitive.

(This Report is at D on the Folder).

This solution leaving a decision to the international conscience of the country concerned was accepted as 1) it avoided the possibility of long drawn out arguments over criteria; 2) it avoided the necessity of applying criteria in borderline cases and 3) it prevents truly developing countries from foming a schism with other countries with less claim to such status.

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