Trade impacts of LDC graduation - Matters related to the WTO agreements

WTO members offer special treatment to least-developed countries (LDCs). They benefit from greater market access opportunities, flexibilities in implementing WTO rules and assistance aimed at strengthening their capacity to trade. Over the years, WTO members have taken important decisions to further support LDC integration into global trade, including duty-free and quota-free (DFQF) market access for LDC products, preferential rules of origin guidelines, and decisions to facilitate the services trade from LDCs (i.e. the LDC Services Waiver). Once a member graduates from LDC status, the benefits associated with that status are no longer applicable. At the request of the LDC Group, the WTO Secretariat assessed possible trade impacts of LDC graduation. The main findings of this work were published in Trade Impacts of LDC Graduation in 2020, which highlighted that graduating LDCs have diverse economic profiles and the impact of graduation will vary for each LDC, depending on factors such as export structure, use of preferential treatment and their terms of entry into the WTO. This pocket edition summarizes the impacts of LDC graduation on matters eelated to the WTO agreements. It reviews the most pertinent LDC-specific provisions in WTO agreements and the extent to which graduation could have an impact on the participation of graduating LDCs in the WTO. Certain agreements that contained longer transition periods for LDCs have already expired; hence those agreements are no longer relevant for graduation assessment. There are other agreements that contain references to LDCs, but those provisions did not lead to substantial benefits and hence have not been covered in this analysis. There are three broad areas requiring careful monitoring: trade-related aspects of intellectual property, the use of non-agricultural export subsidies and agriculture policies on export competition. The extent of the impact on LDCs will vary, depending on the use of these flexibilities and domestic policies in place. This succinct agreement-specific assessment aims to support policy makers in LDCs take informed decisions and to help international organizations involved in the preparation of smooth transition strategies. Section 1 examines the implications of LDC graduation on WTO rules. Section 2 examines selected institutional aspects. Section 3 provides some concluding observations.