The purpose of this session was to look at those main areas where developing countries most (and least) require changes to multilateral trade rules and to ask how the WTO fits into their wider plans and expectations for poverty reduction.

Clearly, developing countries are not a homogenous group and their position in the negotiations will differ. While the five speakers in this session each ‘represented’ different regions, it must be noted that there are also differences in the position of countries within regions. More detailed information about the position of countries and/or regions can be found in the papers and presentations of this session.

Among the various issues addressed by the presentations, several were frequently highlighted:

• Significant benefits expected from the previous round have not materialised. The perception from most, if not all, developing countries/regions is that the balance of benefits from previous rounds has been heavily in favour of developed countries. In particular, little progress is made in those sectors and areas that are of greatest relevance to developing countries (e.g. textiles and agriculture). In addition, the feeling is that agreements have been formulated in such a way that developed countries gain far more than developing countries (e.g. the TRIPS agreement).

• Lack of implementation of agreements by developed countries both ‘in spirit’ as well as ‘in letter’ is major factor contributing to developing countries disillusion with the multilateral trade system. A prime example is the limited phasing out of quotas under the Textiles and Clothing Agreement, where those quotas that have been phased out are largely irrelevant for developing countries. Another further example is the lack of action undertaken regarding the "best endeavours" clause of Special and Differential Treatment.
• Capacity constraints in developing countries are a major problem. These constraint effect not only the ability of developing countries to determine their position in the negotiations, to enter into negotiations and to implement agreements and capacity but also to adjust to the challenges posed and opportunities offered by liberalisation.

And, on specific potential agenda items:

• Developing countries are generally opposed to the inclusion of labour and environmental standards on the agenda. They feel that these issues will be used as a new form of protectionism by developed countries.
• Positions on the inclusion of investment and competition policy on the agenda differ greatly among developing countries. Some countries are opposed (e.g. India), others are in favour (e.g. Latin America), and others feel that more research is needed to formulate a clear position on the issue.

From the presentations, it is clear that if a new trade round is to be launched, developed countries should take action to restore the confidence of developing countries. Specifically, this means addressing the lack of implementation by developed countries and lack of capacity in developing countries.

During the discussion a number of participants mentioned that, in order to determine the desirability of a new multilateral trade round, it is necessary to also consider what are the alternatives:

• If the alternative is increasing regional protectionism, everybody can end up worse off.
• On some issues it is better to have multilateral rules than to undertake no action at all. For example, the absence of multilateral rules may result in the proliferation of standards and labels, which ultimately can be harmful for developing country exporters.

On the link between trade and poverty it was noted that trade is often not the most important instrument to reduce poverty. Given the very limited resources at the disposal of developing countries, one has to wonder if the costs of negotiating and implementing trade agreements (e.g. TRIPS) are justified when there are alternatives that would contributed more to poverty reduction.