./.WORLD TRADE
ORGANIZATIONG/SG/N/7/EGY/2
26 September 2000
(00-3887)
Committee on Safeguards Original:  English
NOTIFICATION UNDER ARTICLE 12.4 OF THE AGREEMENT ON
SAFEGUARDS BEFORE TAKING A PROVISIONAL SAFEGUARDS
MEASURE REFERRED TO IN ATICLE 6
EGYPT
The following communication, dated 25 September 2000, has been received from the
Permanent Mission of Egypt.
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Pursuant to Article 12.4 of the Agreement on Safeguards, and in light of the notifications
format under the Agreement as adopted by the respective committee (G/SG/N/6, 7 February 1995),
Egypt hereby submits a notification before taking a provisional measure regarding imports ofpowdered milk, under Article 6 of the Agreement.
1. The product subject to the proposed provisional safeguard measure
Powdered milk classified under tariff headings 04.2.10.91, 04.2.10.99, 04.2.21.91, 04.2.21.99,
04.2.29.91 and 04.2.29.99 of Egypt's harmonized tariff.
2. The proposed provisional safeguard measure
The provisional safeguard measure recommended will be applied in the form of tariff
increase, by the introduction of the additional duty at the level of 45 per cent c.i.f. value applied to all
imports of powdered milk irrespective of their source.
3. The proposed introduction of the provisional safeguard measure
The provisional safeguard measure is scheduled to enter into force 26 September 2000.
4. The expected duration of the safeguard measure
The provisional safeguard measure will apply for a period up to 200 days, during which the
investigation will proceed further.
5. Preliminary determination that increased imports have caused or are threatening to cause
serious injury
It was found that a substantial increase in powered milk imports was recorded during the
period from 1996 to the first six months of 2000, as imports increased by 10 per cent in 1997
compared to 1996, and increased by 21 per cent in 1998 compared to 1996, and it continued toG/SG/N/7/EGY/2
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increase reaching 89 per cent in 1999 compared to 1996, and finally reached 66 per cent during the
first six months of 2000 compared to the same period in 1996.
Substantially increased imports of powdered milk have adverse effect on the industry, it was
found that the growth in imports, rising from 10 per cent in 1997 compared to 1996, and to 66 percent during the first six months in 2000 compared to the same period in 1996, had caused a very
serious decline in the profit of the domestic producers.  This decline was so serious that the continued
viability of the domestic producers was in real doubt.  The domestic producers were facing a critical
situation which if not remedied soon would be very damaging to them.  Such damage would be
difficult to repair.
6. Determination of critical circumstances where delay would cause damage which would be
difficult to repair
In view of the evidence submitted, the Ministry of Economy and Foreign Trade determined
that this constitutes critical circumstances as provided for in Article 6 of the Agreement on
Safeguards.  It also concluded that the increased imports of powdered milk caused serious injury inthe form of the decline in sales, average selling price, return on investment and profits and
consequently the Egyptian producers of fresh milk have been serious injured.  Upon reaching this
conclusion, a full range of factors relating to the industry was examined.  The evidence of serious
injury showed significant overall impairment in the position of the domestic producers.
Therefore, it was considered that the situatio n is so critical that it calls for immediate
introduction of a provisional safeguard measure.  Such a measure must be introduced immediately in
order to prevent even greater damage that would be difficult to repair.
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