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DTIS, Volume I - Enhanced Integrated Framework (EIF)

DTIS, Volume I - Enhanced Integrated Framework (EIF)

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The Modalities provide that the results of negotiations shall take into account the<br />

principle of SDT on the understanding that this should extend beyond the granting of<br />

traditional transition periods for implementing commitments; Members are not obliged to<br />

undertake investments in infrastructure projects beyond their means; and that in cases<br />

where required support and assistance for such infrastructure is not forthcoming, and<br />

where developing or LDC Members continue to lack the necessary capacity,<br />

implementation would not to be required. Furthermore, Annex D of the July <strong>Framework</strong><br />

explicitly states, “Least Developed Country Members will only be required to undertake<br />

commitments to the extent consistent with their individual development, financial and<br />

trade needs or their administrative and institutional capabilities.”<br />

The most important aspect of this for the Maldives is the aspect of “enhancing technical<br />

assistance and capacity building” in the area of Trade Facilitation. This will be very<br />

relevant for the Maldives, especially in the aspect of Customs procedures. The other<br />

relevant outcome concerning trade facilitation from the Hong Kong ministerial meeting<br />

was the endorsement of both the enhanced <strong>Integrated</strong> <strong>Framework</strong> and the “Aid for Trade”<br />

initiatives, under which technical assistance and financial support is expected to be made<br />

available to LDCs for various aspects of infrastructure development. The “Aid for Trade”<br />

initiative is complementary to the IF and aims specifically to address supply side<br />

constraints to trade.<br />

D. REGIONAL INTEGRATION<br />

Under the terms of the South Asian Preferential Trade Area (SAPTA) Agreement (signed<br />

on 11 April 1993 and implemented from 7 December 1995), Maldives enjoys preferential<br />

access to six regional markets on selected products. 15 In return, Maldives provides similar<br />

access to regional producers to its market. Since its inception, there have been four<br />

rounds of trade negotiations under SAPTA covering over 5,000 commodities. However,<br />

the extent (product coverage) and depth (level of preference) is limited.<br />

Regional imports have averaged 23.6 per cent of all Maldivian imports over the last five<br />

years. 16 This share has been virtually stagnant during this time with decline experienced<br />

in 2005. The reason for this decline was the ending of imports of textiles for the garment<br />

industry at the end of 2004. See Table 3.11<br />

Regarding exports, the proportion of regional trade is limited to an average of 16 per cent<br />

of total exports over the last five years, with just one country (Sri Lanka) accounting for<br />

virtually all the regional exports, and India taking an extremely small proportion. As<br />

shown in Table 3.12, the trend is a declining proportion of regional exports. With a<br />

limited export base, the Maldives has obviously not been able to take any real advantage<br />

of the SAPTA agreement. The main exports to Sri Lanka are dried and salted fish.<br />

15 Bangladesh, Bhutan, India, Nepal, Pakistan and Sri Lanka<br />

16 5 Year average (2000-04) calculated from Customs Services Import/Export Statistics 2004<br />

32

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