. /.RESTRICTEDWORLD TRADE
ORGANIZATIONG/SCM/W/448
22 May 2001
(01-2591)
Committee on Subsidies
and Countervailing MeasuresOriginal:  English
FOLLOW-UP QUESTIONS AND COMMENTS CONCERNING
PROPOSALS ON IMPLEMENTATION-RELATED ISSUES
REFERRED TO THE COMMITTEE IN THE 15 DECEMBER 2000
DECISION OF THE GENERAL COUNCIL
Replies of CUBA, DOMINICAN REPUBLIC, HONDURAS, INDIA, INDONESIA,
MALAYSIA, PAKISTAN, TANZANIA, UGANDA AND ZIMBABWE
to Questions from the UNITED STATES1
The following communication, dated 21 May 2001, has been received jointly from the
Permanent Missions of Cuba, Dominican Republic, Honduras, India, Indonesia, Malaysia, Pakistan,
Tanzania, Uganda and Zimbabwe.
_______________
As we indicated in our document G/SCM/W/443, the majority of the WTO Agreements have
transitional periods of 5 years or more.  We can mention the Agreements on Textiles (10 years),
Agriculture (10 years), TRIPS (5 years), TRIMS (5 years), Customs Valuation (5 years) and Subsidies
(8 years).  These transitional periods indicate the minimal period of time necessary for developing
countries to reach the level that would allow them to implement the Agreements.  In this regard, wethink that the minimal period of time for a developing country to reach a stable level of
competitiveness shall be, at least, 5 years.  Our proposal was not based on any statistical analysis but
we know that the actual period of 2 years established in Article 27.6, was neither the result of any
empirical study.
With reference to the second observation of the United States, about the implementation of
this proposal only for the countries included in Annex VII, we wish to reiterate what we already
indicated in the document G/SCM/W/443, that it is important to note that our countries have
submitted a proposal, currently under consideration in the General Council, aimed at improving the
provisions of that Annex so that a larger number of developing countries may benefit from it.Furthermore, the countries that would be incl uded in our proposal for Annex VII are the most
disadvantaged countries and we do not see any reason for the major trading partners to delay a
decision that would benefit  such countries and w ould help them to offset the disadvantages inherent
in their situation.
With respect to the third observation of the United States, again the US assumes that
developing countries' Members are able to give high level of subsidies as direct payments to their
industries, which is not the case.  We wish to reiterate that developing countries neither have the
inclination nor the financial resources to grant export subsidies in any sector.  All that developing
countries can provide as an incentive to their industrial sector are measures involving a fiscal
                                                     
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sacrifice, which do not represent a major disbursement of resources. Furthermore, these very
incentives have been used as instruments of development policies by the developed countries when
they were less developed and which helped them attain their present level of development.  Therefore,
we think that in a situation where a developing country loses its export competitiveness it should be
able to have the flexibility to rein troduce these incentives, in order to be able to help their industrial
sector to recover from the difficulties encountered.
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