Cotance meeting in Bologna

Members welcomed the joint statement signed by Cotance with its US counterparts in the leather sector earlier in February (see Leather International, May, page 6, and [http://www.euroleather.com]) Cotance members issued a special call to all stakeholders in the leather industry to ensure that the Doha Round delivers the timely deal on free and fair trade that the industry requires

National associations present were: Italy (UNIC), Spain (CEC-FECUR), Germany (VDL), France (FFTM), Sweden (SG), United Kingdom (UK Leather Federation), Netherlands (FNL), Belgium (UNITAN) and Hungary (BCE)

World trade in the leather sector represents US$46 billion ranking among the most important internationally traded commodities.

Tariff and Non-Tariff Barriers on imports and exports of the sector's products constitute an enormous cost handicap for the leather industry worldwide, consuming resources that could be better allocated in increasing wealth in the leather industry. They adversely distort global trade flows and interfere critically in the pricing of supplies causing irreparable damage to the leather industry's structures in rich and poor nations.

An ambitious tariff liberalisation coupled with an end to export taxes/restrictions on raw materials and intermediate products in mature and emerging markets would bring huge benefits to the leather trade in both developed and developing countries. It would avoid preference erosion for least developed countries as well as provide them a real opportunity to grow.

The European leather industry plays a key role in innovation and market development but has lost 30% of its companies and workforce over the last decade. Failure to achieve a firm commitment of trade partners to open up their markets to international competition and to eliminate export taxes/restrictions on raw materials would have significant consequences in the EU leather value chain, its companies and its workforce as well as on the sustainable development of industrial know-how, environmental liability, innovation and R&D that Europe develops benefiting the global leather industry.

Cotance position

* Cotance agrees to the removal by the EU of all import duties and to the avoidance of export restrictions, including export duties, applied on the products covered by HS Chapter 41 provided that at least the following countries take the same commitment: Brazil, Argentina, Uruguay, Paraguay, USA, India, Pakistan and China

* Cotance recommends a sectoral agreement for HS Chapter 41 products to be negotiated between the EU, the USA, Mercosur, India, Pakistan and China as core trade partners

* The phasing out of conventional import duties and the elimination of export restrictions, including export duties, should be at the same rhythm so as to arrive at full liberalization at the same time. Developing countries might follow different timetables for the implementation of their commitments on the import tariff side but not with regard to export restrictions, including export duties. Full liberalization of core trade partners should be enforced in a timeframe that does not exceed three years between those having eliminated all protection and those others benefiting of a longer timetable.

* Special and differentiated treatment should apply to all least developed countries joining the initiative, notably ACP countries, whereby they may be entitled to longer timetables for elimination of their import tariffs and export restrictions, including export duties, on products covered by HS Chapter 41, where justified due to their low participation in the sector's international trade. It is recommended, however, that the maximum delay until full liberalization does not exceed a phasing in period of ten years so as to stimulate active industrialization policies.

* Japan should implement a trade regime for HS Chapter 41 in full reciprocity with its developed trade partners (EU, USA) eliminating thus its TQ system for leather.

* COTANCE commits to work towards this goal by promoting this sectoral agreement among the other trade partners for being implemented in the Doha Development Agenda.

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