Trade negotiators on Saturday tentatively agreed to eliminate tariffs on an array of technology products valued at US$1 trillion worth of global commerce.
The breakthrough toward the WTO’s Information Technology Agreement (ITA) took place at an ambassadors’ meeting at the EU embassy in Geneva.
“Very optimistic that we’ll have a final successful deal by the end of next week,” WTO Director-General Roberto Azevedo said on Twitter. “We have the basis for an agreement.”
US Trade Representative Michael Froman hailed a “major breakthrough” in what would be the first significant tariff-cutting deal at the WTO in 18 years.
“This will open overseas markets for some of America’s most competitive companies and workers,” he said in an e-mailed statement. “We are confident that all parties will now give formal approval to their participation.”
TAIWAN AND CHINA
In talks that started on Tuesday, members took on the question of various tariffs, notably on LCD screens, which were contested by Taiwan and China, and an EU request concerning car radios. South Korean negotiators withdrew their opposition to an extended agreement and members agreed to consider a draft list of covered products.
Tariffs on semiconductors, magnetic resonance imaging machines, global positioning system devices, printer ink cartridges, video game consoles and other products would be cut to zero under the deal, according to the US Trade Representative office.
The expanded product list will now undergo consideration from trade ministers at their various capitals.
“We have the basis for an understanding,” Azevedo told reporters in Geneva after the meeting. “The list is out, members are going to consult their capitals, and we will know by Friday whether we have final approval on the list of products and the declaration itself.”
The product list could pave the way for a finalized deal that would contribute as much as $US190 billion to global GDP and support 60,000 US jobs.
250 PRODUCTS
Technology manufacturers like Intel Corp, Samsung Electronics Co, Sandisk Corp and Texas Instruments Inc stand to benefit from the elimination of tariffs on about 250 products.
The 80 WTO countries that participate in the ITA talks account for about 97 percent of global trade in IT products.
The ITA requires participants to eliminate import tariffs on technology products on a most-favored-nation basis, meaning that any duty-free terms are applied to all WTO members.
In September, ITA negotiators are to start talks on schedules of concessions for tariff reductions, also known as staging.
That allows countries to gradually phase in the tariff reductions for certain products deemed too sensitive for the ITA’s various signatories.
DECEMBER TALKS
Negotiators are also set to hold technical negotiations with the goal of completing the agreement by the WTO Ministerial Conference scheduled to be held between Dec. 15 and Dec. 18 in Nairobi, Kenya.
US technology industry officials are hopeful the deal could enter into force as soon as July next year.
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RESHAPING COMMERCE: Major industrialized economies accepted 15 percent duties on their products, while charges on items from Mexico, Canada and China are even bigger US President Donald Trump has unveiled a slew of new tariffs that boosted the average US rate on goods from across the world, forging ahead with his turbulent effort to reshape international commerce. The baseline rates for many trading partners remain unchanged at 10 percent from the duties Trump imposed in April, easing the worst fears of investors after the president had previously said they could double. Yet his move to raise tariffs on some Canadian goods to 35 percent threatens to inject fresh tensions into an already strained relationship, while nations such as Switzerland and New Zealand also saw increased
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