   
  
WT/GC/W/936, WT/COMTD/W/291  
IP/C/W/ 713, WT/CTE/W/261  
WT/WGTTT/W/37, G/SCM/W/593  
G/TRIMS/W/ 176 
 
14 May 2024  
(24-3777) Page: 1/3 
General Council  
Committee on Trade and Development  
Council for Trade -Related Aspects of Intellectual 
Property Rights  
Committee on Trade and Environment  
Working Group on Trade and Transfer of Technology  
Committee on Subsidies and Countervailing Measures  
Committee on Trade -Related Investment Measures  Original: English  
 
POLICY SPACE FOR INDUSTRIAL DEVELOPMENT – ADVANCING WTO COMMITTEE WORK  
TO SUPPORT STRUCTURAL TRANSFORMATION AND INDUSTRIAL DEVELOPMENT  
IN DEVELOPING COUNTRIES  
COMMUNICATION FROM THE AFRICAN GROUP  
The following communication, dated 13 May 2024, is being circulated at the request of the delegation 
of Chad on behalf of the African Group.  
 
_______________  
 
1  INTRODUCTION  
1.1.  This contribution is submitted to inform WTO Members of the activities and initiatives the 
African Group will be advancing  in pursuance of the objectives substantively outlined in the various 
submissions by the African Group on Policy Space for Industrial Development .1 
1.2.  Development remains one of the most critical challenges that the world faces today and that 
the World Trade  Organi zation must respond to. This challenge is acutely pronounced in the 
deepening of economic divergences, especially between developing country economies and 
developed or advanced economies.  
1.3.  Developing countries face significant constraints in impleme nting industrial policy measures to 
transform their production structures due to  among others,  existing rules that uphold the status 
quo. This situation highlights a critical oversight by developed countries that historically used similar 
measures to advan ce their industrial development. In response to the reality of unequal distribution 
of the gains from trade and share in global value chains, there is a need to rebalance and recalibrate 
the WTO policy toolbox. This is more so given the imperative of addre ssing contemporary challenges 
such as mitigating climate change and promoting sustainable development.  
 
1 - Policy Space for Industrial Development – A Case for Rebalancing Trade Rules to Promote 
Industrialisation and to Address Emerging Challenges Such As Climate Change, Concentration of Production 
and Digital Industrialisation ( WT/GC/W/868 );  
- A Case for Re balancing the Agreement on Subsidies and Countervailing Measures (ASCM) – Policy 
Space to Promote Industrialisation in Developing Countries – Communication from the African Group 
(WT/GC/W/880 ); 
- The Role of Transfer of Technology in Resilience Building: R einvigorating the Discussions in the WTO 
on Trade and Transfer of Technology – Communication from the African Group ( WT/GC/W/883 , WT/GC/W/884 , 
WT/GC/W/885 , WT/GC/W/886 , WT/GC/W/887 , WT/GC/W/888 ); 
- A Case for Rebalancing the Agreement on Trade -Related Investment Measures (TRIMS) – Policy Space 
to Promote Industrialisation and Structural Transformation in Developing Countries – Communicatio n from the 
African Group ( WT/GC/W/89 6). WT/GC/W/936 • WT/COMTD/W/291 • IP/C/W/7 13 • WT/CTE/W/261 • WT/WGTTT/W/37 • 
G/SCM/W/593  • G/TRIMS/W/176  
 
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  2  COMMODITY DEPENDENCE AND THE IMPERATIVE OF STRUCTURAL TRANSFORMATION  
2.1.  In the wake of the multiple crises that buffeted the world since the COVID -19 pande mic, the 
global economy is marked by deep economic divergences, with activity in many developing regions 
and countries still below pre -pandemic levels. Some recent updates, including the WTO Global Trade 
Update 20242, have painted a positive picture of rising activity in trade in goods and services, with 
developing countries ' exports showing an uptick largely based on increasing commodity prices. The 
export baskets of most developing countries in general are, however predominantly commodity -
based, essentially primary commodities.  
2.2.  Commodity dependence leaves developing countries vulnerable to international price shocks, 
particularly in the context of global uncertainty, with such events among others triggering reversals 
in capital inflows and g enerating macroeconomic dislocation that results in dwindling revenues, debt 
spirals, inflation, and poverty.3 As reported in the IMF World Economic Outlook 20244, these 
secondary effects compound the development challenges faced by many developing count ries. 
UNCTAD goes further to point out that a country 's Human Development Index value is significantly 
and negatively correlated with export concentration and commodity dependence .5 
2.3.  This reality amplifies the importance of manufacturing and value addition  as the bases for 
developing sustained industrial capabilities. This has been true of those middle -income countries 
that broke out of the middle -income trap through innovation -led growth with a strong focus on 
industrial upgrading and productive services. If we take the example of critical minerals, Africa 's 
historical position fixed at the bottom rung of global value chains could potentially worsen if trade 
rules do not promote structural transformation.  
2.4.  Multilateral trade rules cannot remain static in th e face of these extant challenges and historical 
patterns of international trade that have inhibited structural transformation and crippled the 
resilience of many developing countries, especially African economies. The WTO has an important 
role to play in contributing to inclusive development and, principally, meaningful integration of 
developing countries in global value chains. Export diversification is a crucial factor for resilience. It 
is vital for global stability that all countries build resilience i n their production base and that their 
exports are broadly diversified.  
2.5.  Overcoming the trust deficit in the multilateral trading system and bolstering the relevance of 
the WTO will entail making the institution responsive to developing countries ' developm ent needs. 
Fundamentally, this  must include support ing a shift in Africa 's structural profile so that the continent 
is not trapped in a commodities -based growth path but also produces and exports a diversified range 
of products. This transformative possibi lity will require more than just structural reforms; it also 
needs to draw on industrial policy measures and tools to help developing countries close the existing 
industrial development gap. There is abundant evidence of the utility of such policy measures  both 
in the past and the present that have been utilized successfully by a diverse subset of WTO Members.  
2.6.  It is notable that those developed economies that are building new capabilities, diversifying 
their economic base, and discovering new sources of co mpetitiveness are not relying solely on 
structural reforms. They are deploying various state -backed instruments to sustain competitiveness 
and create high -paying jobs in these new sectors. The consistency of some of these measures with 
WTO obligations appe ars questionable. Some of these Members have used and continue to use 
measures such as local content requirements, providing state aid and grants, and tapping into 
development finance institutions to provide subsidised capital. These measures are capabilit ies that 
the majority of developing countries do not possess, yet they are constrained by the rules in 
undertaking similar measures to support their economic resilience. Moreover, certain provisions 
under GATT 1994/TRIM s Agreement, for example constrain de veloping countries from enhancing 
 
2 WTO Global Trade Outlook and Statistics: 
https://www.wto.org/english/news_e/news24_e/tfore_10apr24_e.htm#:~:text=The%20volume%20of%20wor
ld%20merchandise,downside%20risks%20to%20the%20forecast .  
3 UNCTAD. 2023. Inclusive Diversification and Energy Transition.  Geneva. 
https://unctad.org/system/files/official -document/ditccom2023d2_en.pdf   
4 World Economic Outlook, April 2024: Steady but Slow: Resilience amid Divergence : 
https://www.imf.org/en/Publications/WEO/Issues/2024/04/16/world -economic -outlook -april-2024   
5 https://un ctad.org/system/files/official -document/ditccom2023d3_en.pdf  WT/GC/W/936 • WT/COMTD/W/291 • IP/C/W/ 713 • WT/CTE/W/261 • WT/WGTTT/W/37 • 
G/SCM/W/593  • G/TRIMS/W/176  
 
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  domestic spill -overs from investments. This demonstrates the relevance of policy space to promote 
industrial upgrading.  
3  BUILDING ON MC13  
3.1.  Although MC13 could not produce the outcome the African Group envisaged, the rich 
engagements on this topic by Ministers highlighted the urgency of the WTO to confront the structural 
transformation and industrialization challenges faced by many developing countries. Indeed, several 
Members underscored the need to rebalance existing trade rules, particularly in the Agreement on 
Subsidies and Countervailing Measures (ASCM), Trade -Related Investment Measures (TRIM s), and 
Trade Related Aspects of Intellectual Property Rights (TRIPS), including technology transfer, in a 
manner responsive to the ir development needs and facilitating the integration of developing 
countries into global value chains.   
3.2.  The re -examination of the policy instruments identified by the African Group has even greater 
significance today in light of the green transition. The  African Group will be building on the 
longstanding papers it has submitted on several occasions to the WTO over the years to explore how 
trade rules can become a positive force for promoting shared growth and inclusive development, 
including in the race t owards a green transition. At the core of the Africa n Group 's objectives for 
policy space is that trade rules should create an enabling environment for developing countries to 
undertake measures to promote structural transformation and industrial developme nt.   
4  WAY FORWARD  
4.1.  The WTO must build on the momentum generated by the ministerial discussions at MC13 in 
Abu Dhabi on the need to recalibrate specific WTO rules to make them fit for purpose, primarily to 
support structural transformation and inclusive deve lopment. We call on Members to engage in good 
faith discussions on the African Group proposals on policy space.  
4.2.  The African Group intends for such discussions to be focussed and structured. This relates to 
the specific aspects of each identified agreement  while introducing in some cases a sectoral 
dimension to facilitate the discussions.  
4.3.  The African Group will pursue discussions in the CTD as a focal point for the consideration and 
coordination of work on development in the WTO6, including relevant WTO s ubsidiary bodies, as 
necessary and in line with their technical mandates, e.g. the SCM Committee, TRIM s Committee , 
the TRIPS Council, WGTTT, etc. Such engagements will be canvassed in formal regular agendas of 
these meetings and through other modes of engagement, including thematic sessions. Cross -
committee collaboration between relevant WTO bodies will also be proposed in the conduct of some 
of these activities.  
4.4.  The Africa n Group remains open to ideas and suggestions from all Members that would help 
advance the objectives outlined herein, including the technical elements envisioned in the policy 
space for industrial development submissions. The activities outlined above will also enrich and 
inform any improvements to the proposed recalibration of WTO ru les to meet the objective of 
industrialization and confront other contemporary challenges. The Africa n Group will consult with 
Members in various formats to seek their support and consider their contribution to this endeavour.  
4.5.  The Africa n Group is keen to  see progress on the recalibration of the rules to advance 
industrialisation and structural transformation ahead of MC14 and believes the GC is well placed to 
make decisions between Ministerial conferences. The GC will, therefore, need to provide oversight  
on the work undertaken by the various Committees through periodic reports by the Committees on 
their respective work so as to inform decision -making.  
 
__________  
 
6 Terms of reference of the CTD contained Decision of the General Council on 31 January 1995 
(WT/L/46 ). 