G-77, China to be invited to sign trade deal

The forthcoming United Nations Conference on Trade and Development (Unctad) XI meeting in Brazil is expected to adopt a declaration inviting the G-77 countries and China to become signatories to the Agreement on the Global System of Trade Preferences (GSTP), ahead of its third round of negotiations in November this year, according to senior commerce ministry officials.

"One of the outcomes of the Unctad XI meeting being held in Sao Paulo is a declaration that will include an invitation to G-77 countries and China to become signatories to the GSTP without any pre-conditions," Joint Secretary Rajeet Mitter said, addressing a discussion meeting on the agenda of Unctad XI.

At present, 47 countries, including India, are signatories of the GSTP. So far, two rounds of negotiations have been held under the GSTP for exchanging tariff concessions.

While 48 countries exchanged trade concessions during the first round, in the second round only 24 countries participated, including Mercosur, which was there as a regional group.

Mitter said the G-77 and China were being invited on board the GSTP as there was a clear case for South-South economic cooperation. Usually, countries signing the GSTP have to offer tariff concessions, but this condition is being waived for the G-77 and China.

The thinktank Research and Information Systems (RIS) has in a background paper prepared for the Unctad XI meeting said, "A third and more ambitious round of the GSTP could be launched to bring down tariffs on intra-South trade by 50 per cent with eventual elimination subject to appropriate rules of origin."

According to RIS, there are rich prospects for increasing exports from GSTP members to the rest of the world in sectors such as cereals, automobiles, oilseeds, processed food, plastic and rubber.