GENEVA: The World Trade Organization on Friday said major exporters of information technology products agreed, after years of talks, to cut tariffs in the sector, in the first such deal at the WTO in nearly two decades.
"Today's agreement is a landmark," WTO Director General Roberto Azevedo said in a statement, describing the accord as "the first major tariff cutting deal" at the organisation in 18 years.
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The deal covers more than 200 products, from video games to medical equipment, worth about $1.3 trillion in annual global trade. Once finalised, the agreement to update the WTO's 18-year-old Information Technology Agreement (ITA) will add the products to the list of goods covered by zero-tariff and duty-free trade.
Additional duty-free products include computer software and software media, video game consoles, printer ink cartridges, GPS devices, medical devices such as MRI machines and next generation semiconductors, the Technology CEO Council said.
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The products account for approximately 7% of total global trade today, the WTO said. "This is larger than global trade in automotive products - or trade in textiles, clothing, iron and steel combined."
While the full terms of the agreement will not be released until next week, the WTO said the highlights include the elimination of "the majority of tariffs" within three years on products ranging from GPS systems to touch screens.
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The deal is an expansion of a pact reached in 1996 by 81 WTO members, known as the Information Technology Agreement (ITA). In 2012, member states resolved that new terms for the ITA were needed because innovation had advanced so dramatically. But there were considerable hurdles to striking a broader agreement, notably differences between the United States and China.
In November of last year, President Barack Obama said in Beijing that the two sides had "reached an understanding" on moving the talks forward. While only 54 WTO member-states took part in the talks, all 161 nations that make up the organisation can benefit from its terms, the WTO said.