Negotiations on Agriculture State of Play by Surabhi Mittal WTO &The Doha Round : The Way Forward 6-7 April, 2006

Negotiations on Agriculture

State of Play

by

Surabhi Mittal

WTO &The Doha Round : The Way Forward6-7 April, 2006

25 years of ICRIER - Linking India to the World Economy

Hong Kong Declaration: Key Decisions• Export subsidies will be eliminated by 2013, but this

date is confirmed only upon completion of modalities.

• Export subsidies on cotton to be eliminated by the

end of 2006.

• Developing countries can self-designate products as

special products (SP) guided by indicators based on

the criteria of food security, livelihood security and

rural development.

• Developing countries can recourse to Special

Safeguard Mechanism (SSM) based on import

quantity and price triggers.


Domestic SupportStatus

• Three bands of reduction in final bound total aggregate measure of support (AMS) and in overall cut in trade distorting domestic support (TDS).

• Higher linear cuts in higher bands.

• Some convergence for overall cut and in product specific and non-product specific de minimis limits.

• Criterion laid to agree on blue box support to lie between 2-5% of aggregate total value of agricultural production .

• Green Box criteria to be reviewed

Issues• Overall cut in TDS (amber

box + de minimis + blue box) with 20% in first year and more later by Tiered Formula

• Additional effort in AMS reduction by developed country members in the bottom band.

• Reduction in de minimis for developed countries.

• Time frame and cap to be discussed on Blue Box.

• Need to strengthen criteria on blue and green box to prevent box shifting.


Export CompetitionStatus

• Elimination of all forms of export subsidies and disciplines on all export measures with equivalent effect to be completed by the end of 2013.

• The disciplines on export credits, insurance programmes, exporting STEs and food aid to be completed.

• To ensure that trade-distorting monopolistic practices of STEs are eliminated.

• A “safe box” for bona fide food aid to be provided to ensure that there is no unintended impediment in dealing with emergency situations.

Issues• Some convergence on

disciplines on export credits but number of critical issues remained, including: possible exemptions to the 180 day rule.

• Differences regarding the scope of practices to be covered by the new disciplines on STEs.

• What type of food aid is to be permitted in non emergency situations is also still unclear.

• African and LDC’s want that safe box is used as for emergency food aid and should not be under any disciplines.


Market AccessStatus

• Four bands for structuring tariff cuts recognized.

• Convergence on a linear-based approach for cuts within bands

• Tariff escalation to be addressed through a formula.

• Focus is on sensitive products- partially shielded from any tariff cutting formula.

• SP and the SSM shall be an integral part of the modalities and the outcome of negotiations in agriculture.

Issues• To agree on thresholds,

tariff cap and its size.• Deeper cuts in higher

tariffs should be progressively.

• Formula to address tariff escalation.

• Will SP also have automatic access to the SSM?

• Basis for the quantity based and price based SSM be calculated.


Country PositionsEU

•Pressing for more concessions from developing countries like Brazil and India on Industrial tariff and services.

USA

•US is not willing to reduce domestic support to protect its farmers.

JAPAN

•Japan has taken a protectionist position in agriculture. •Japan is against tariff cap.

Developing Countries

•India supports taking DDA forward but is not ready to go an extra mile on NAMA and agriculture.•G33 proposal contain some specific values on SSM, but nothing agreed on.


Road Block

• EU, US and Japan: Demanding deeper cuts in industrial tariffs and then willing to offer reduction in support on farm products.

• Developing countries waiting to see the magnitude of the reduction that EU, USA and other DC’s are ready to offer in agricultural subsidies.

• The key question is to how to reach a right level of convergence on three issues -Agricultural Domestic Support, Agricultural Market Access and NAMA to move forward.

• To unblock agriculture: • US need to move forward on domestic support • EU on market access • India and Brazil and other big developing countries need

to show greater flexibility on industrial goods.


Timelines

• Next session for Agriculture Negotiations begin on April 18, 2006.

• April 30th, 2006 is the deadline to finalize modalities both for Agriculture and NAMA.

Thank you

Documents

Negotiations on Agriculture State of Play by Surabhi Mittal WTO &The Doha Round : The Way Forward 6-7 April, 2006