Understanding Special and Differential Treatment in the WTO
Special and Differential Treatment (SDT) acknowledges that countries at different stages of development need different rules to support economic growth and seeks to addresses this challenge through a set of legal provisions that exempt Developing Countries from some of the binding commitments that accompany WTO membership. It also allows Developed Countries to unilaterally ‘discriminate’ in favour of Developing Countries in bilateral trade agreements.
However, since it involves favourable treatment for Developing Countries, and since countries currently self-designate their status as ‘Developing’, the issue of who should have the right to claim SDT is highly contested within the WTO. In recent years, tensions surrounding SDT have been exacerbated, with a number of Developing Countries continuing to claim SDT, despite having achieved significant economic growth and development. This has occurred during a period when Developed Countries have been forced to grapple with increasing levels of voter scepticism concerning globalization and liberal trade, amplifying concerns that SDT is unfair.
A number of options for reforming SDT have been advanced by WTO members, but these have been viewed unfavourably by some Developing Countries. With the process of reform at a standstill in Geneva, new thinking is needed to move beyond the current stalemate.
The key findings of a recent study undertaken by The University of Adelaide’s Institute for International Trade intended to enhance the understanding of the pertinent issues pertaining to, and different perspectives on, SDT amongst key stakeholders in international trade policy’. Without proposing quick fixes, this study set out to illuminate the outstanding issues and bridge certain gaps in their understanding, with the intention of contributing to the current debate and encouraging a meaningful conversation in this space.