KEY ISSUES IN AGRICULTURE NEGOTIATIONS
MARKET ACCESS
DOMESTIC SUPPORT
EXPORT COMPETITION
Special
Products (SPs)
Special
Safeguard
Mechanism
(SSM)
Tariff
Reduction
Formula
Preferences
Sensitive
Products
Blue Box
Green Box
Food Aid
State
Trading
Enterpris
es (STEs)
Descripti
on and
Analysis
of the
issue
Includes products
important for food
and livelihood
security, and rural
development.
Developing
countries are
allowed to selfdesignate any
number of products
based on these
criteria. The G-33
are the main
proponents of SPs.
SPs alone cannot
ensure food
security, but it
offers an important
protection against
imports that
undermine national
productive
capacities.
Governments have
accepted the tool
but the main
opponents including
the U.S., Australia,
New Zealand,
Argentina, Chile,
Uruguay continue to
seek strict limits on
the products to be
included.
A mechanism
for developing
countries to
protect
domestic
agriculture
against import
surges. The G33 are the
main
proponents of
the
mechanism. It
offers an
important
protection
against
dumped
imports. The
main
opponents are
agro-exporting
countries
including the
U.S.,
Australia, New
Zealand,
Argentina,
Chile,
Uruguay.
Tariff formulae will
determine which
tariffs get cut and
by how much. The
U.S. and some
Cairns Group
countries are
promoting
aggressive tariff
cuts It is intended to
increase access for
agricultural
exporters to markets
all around the
world. It benefits a
handful of
companies who
dominate the trade
in agriculture.
Countries should
have the policy
space to determine
how to structure and
support their basic
level of national
agricultural
production, so long
as their national
policies do not
damage other
countries’ ability to
do likewise.
Preference
agreements exist
between many of
the poorest
developing
countries and some
developed countries
(particularly the EU
and US) enabling
the developing
country to export
products without
being subject to
tariffs. As
developed countries
lower their tariffs,
the margin of the
preference is
eroded. This is
particularly a
problem in relation
to the EU and ACP
countries. Many
Latin American
countries argue that
their exporters are
disadvantaged
because of the
preferential access
given to ACP
countries.
Developed
countries
with more
defensive
agricultural
interests,
particularly
the G-10
and the E.U.
have
proposed
that some
number of
agricultural
tariffs
should have
lesser cuts.
Countries
remain far
apart on
how many
tariff lines
could be
included
and the
treatment of
such
products.
Subsidies
classified under
this box are
assumed not to
affect production
levels (although
empirical
evidence suggests
otherwise). The
EU is the main
user of the green
box. Many
developing
country Members
would like to
review the
criteria to ensure
that payments do
not have a
harmful effect. A
review and
clarification of
the green box is
mandated. The
box will be
amended to
ensure that
programs of
developing
countries are
effectively
covered.
WTO Members agreed to establish a
“safe-box” for genuine food aid
dealing with emergency situations.
Governments have agreed to negotiate
disciplines to deal with the most
harmful food aid practices. The
proposal could force some changes to
U.S. food aid practices, particularly
monetization of food aid (where food
aid is sold in the open market), which
can disrupt local markets and depress
prices for local producers and
commercial importers. These is a
powerful lobby in the U.S. to resist
new disciplines.
Government
s have said
the new
agreement
will address
the future
use of
monopoly
powers
related to
exporting
STEs. The
more critical
question of
disciplines
on the
marketdistorting
behaviour of
private
monopolies
and
oligopolies
remains off
the table
despite the
exacerbatio
n of
agricultural
dumping by
concentrate
d market
power.
Proposals
to limit
the
negative
effects of
the
negotiati
ons?
No limit for the number of SPs
provided they meet criteria
No tariff reduction on SPs
Any product that receives domestic
support or an export subsidy should
automatically be eligible for SPs and
quantitative import restriction in
developing countries
SSM should be available for all
products
Support and strengthen G-33
position on SPs and the SSM
Strengthen border
measures in
developing
countries so as to
protect small
farmers and farm
workers
Proposals for how to address the
issue of preference are still to come.
WTO Members
have agreed to
expand the criteria
of the blue box.
This was a demand
of the U.S., which
wanted to include
some payments not
linked to production
limits. Many WTO
members are
concerned that this
will make the blue
box more tradedistorting. The U.S.
should not be
allowed to expand
the blue box to
accommodate its
counter-cyclical
payments (countercyclical payments
compensate
producers of some
major commodities
when their market
price is lower than a
target price set but
the government). To
stop their being
included, further
criteria are needed
to restrict the
expansion of the
blue box.
Reject the
expansion of the
blue box to include
counter-cyclical
payments
Ensure that any
new criteria
includes only
programs with a
production-limiting
objective
Support
developing
country proposals
to amend the
green box to
include programs
of developing
countries
Review, clarify
and tighten
criteria of the
green box to stop
dumping
Encourage a transition to untied, cash-based food
aid with strong targeting measures
Phase out all sales of food aid
 Impose strict limits on existing in-kind food aid
with a view to protecting resources for emergencies
and ensuring a transition to fully untied food aid. Food
aid should be purchased locally whenever possible and
must prioritize procurement from small-scale farmers.
 Ensure WTO defers to appropriate bodies and
assures that trade rules respect the rules set by these
bodies
Country
Positions
SPs
SSM
U.S.
A limited number
of products. SPs
must still be
subject to some
cuts so as to
provide
meaningful
market access.
Seen as a
transitional
mechanism only.
To provide only
transitional
protection from
import surges.
Tariff
Reduction
Formula
Developed
countries
expected to cut
tariffs by 60-90%
with steeper cuts
to higher tariffs.
Cuts not
specified for
developing
countries but
expected to make
at least 2/3rds of
developed
country cuts (i.e.
40-60%).
Preferences
Sensitive
Products
Blue Box
Green Box
Food Aid
STEs
Wants very
limited number
of sensitive
products (1% of
tariff lines) and
must be subject
to expanded
tariff rate quotas
(TRQs). U.S.
expected to
include sugar
and orange juice
as sensitive
products.
Wants to limit
spending to 2.5%
of the value of
agricultural
production.
Expand criteria to
include payments
that are not linked
to production
limits. Wants to
include countercyclical payments
that were found
illegal in BrazilU.S. cotton
dispute.
No review or
changes to
existing criteria
but open to
negotiations on
developing
country
concerns.
Highly defensive.
Puts food aid into 3
categories:
emergency food aid;
food aid to net foodimporting
developing countries
(NFIDCs) and
LDCs; and the rest.
Only the last
category should be
subject to
disciplines. [This
assumes that
NFIDCs and LDCs
are too poor to have
producers with an
interest in their local
and national markets.
It presumes that
displacement of local
farmers cannot take
place. This
absolutely
contradicts the
empirical evidence.]
Wants to
eliminate
monopoly export
rights in
developed and
developing
countries.
Bottom Line: The U.S. is defensive on the expansion of the Blue Box and disciplines for food aid. The U.S. exerts severe pressure on developing countries for
commitments on market access in agriculture, NAMA and services.
EC
Developed
countries
expected to cut
tariffs by an
average of 46%.
Developing
countries
expected to cut
tariffs by an
average of 31%.
Would like to
preserve
preferences
because it means
less tariff cuts for
the EU.
Want to be able
to designate a
considerable
number of
sensitive
products (8% of
tariff lines).
Products
expected to
include beef,
poultry, butter,
fruits, vegetables
and sugar.
No detail. EU
wants to keep 5%
because it uses the
Blue Box.
No review or
changes to
criteria.
Bottom Line: The E.C. is defensive on the tariff reduction formula, sensitive products and the Green box. The E.C. is very critical of U.S. food aid programs and exerts
severe pressure on developing countries to make commitments on market access in NAMA and services.
SPs
SSM
G-201 (Brazil
and India are
leaders.
Argentina
also an active
member)
Support the G-33.
Support the G33.
G-332
(Indonesia
and
Philippines
are leaders.
India also
active
member)
Want very broad
criteria and selfdesignation of SPs
so that selection
of products is
informed by the
national policy
objectives of each
developing
country. Propose
20% of tariff lines
to be designated
as SP. The G-33
also propose that
any product that
receives amber or
blue box subsidies
or export
subsidies, should
automatically be
Want the SSM
to apply to all
products. Want
to use a price
trigger and a
volume trigger
(this means that
the SSM can be
triggered if
there is a drop
in world prices
or if there is an
increase in the
volume of
products
imported.)
1
Tariff
Reduction
Formula
Developed
countries
expected to cut
tariffs by an
average of 54%.
Developing
countries
expected to cut
tariffs by an
average of 36%.
Some members
support the G-20
proposal other
members support
the ACP
proposal.
Preferences
Sensitive
Products
Blue Box
Green Box
Want very
limited number
of sensitive
products (1% of
tariff lines)
Wants to introduce
criteria to restrict
the expansion. One
criterion they
propose is to
ensure that blue
box programs are
less tradedistorting than
amber box
programs. They
also want an
explicit obligation
to include only
programs with a
productionlimiting objective.
Want to review
and clarify
green box
criteria to
tighten the
criteria. They
are concerned
about mounting
evidence that
decoupled
income support
payments affect
production and
therefore trade.
The G-20 also
made a proposal
for language to
include support
programs used
by developing
countries.
Supports the G20 position
Food Aid
(21 WTO members) Argentina, Bolivia, Brazil, Chile, China, Cuba, Egypt, Guatemala, India, Indonesia, Mexico, Nigeria, Pakistan, Paraguay, Philippines, South Africa, Thailand, Tanzania, Uruguay,
Venezuela, Zimbabwe
2
(42 WTO members) Antigua and Barbuda, Barbados, Belize, Benin, Botswana, China, Congo, Côte d'Ivoire, Cuba, Dominican Republic, Grenada, Guyana, Haiti, Honduras, India, Indonesia, Jamaica,
Kenya, Rep. Korea, Mauritius, Madagascar, Mongolia, Mozambique, Nicaragua, Nigeria, Pakistan, Panama, Peru, Philippines, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines, Senegal, Sri
Lanka, Suriname, Tanzania, Trinidad and Tobago, Turkey, Uganda, Venezuela, Zambia, Zimbabwe
STEs
Africa,
Caribbean
and Pacific
(ACP)3 (Benin
is the leader.
Mauritius and
Kenya are
vocal
members)
G-104
(Switzerland
is leader)
3
eligible for SPs in
developing
countries.
SPs
SSM
Support G-33
Support G-33
Tariff
Reduction
Formula
Developing
countries
expected to cut
tariffs by an
average of 24%.
Preferences
Sensitive
Products
Most vocal on the
issue of
preferences. They
would like the
WTO to develop
adequate
mechanisms to
deal with
preference erosion
including: longer
transition periods
for tariff reductions
on products
receiving
preferences; an
adjustment
mechanism;
technical and
financial assistance
etc… Most vocal
countries are
Mauritius, Guyana,
Jamaica, Barbados
and Kenya.
Products related
to preferences
should be
designated
sensitive
products. This is
important for
addressing the
problem of
preference
erosion.
Strong advocates
of sensitive
products and for
limited TRQ
increases for
such products.
Blue Box
Green Box
Big users of the
blue Box; opposed
setting spending
limits.
Strong
supporters of the
existing green
box, but do not
consider it
sufficient for
their domestic
support needs.
Food Aid
(56 WTO members out of a total of 79):
Angola, Antigua and Barbuda, Barbados, Belize, Benin, Botswana, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Congo, Cote d'Ivoire, Cuba, Democratic Republic of the Congo,
Djibouti, Dominica, Dominican Republic, Fiji, Gabon, The Gambia, Ghana, Grenada, Guinea, Guinea-Bissau, Guyana, Haiti, Jamaica, Kenya, Lesotho, Madagascar, Malawi, Mali, Mauritania,
Mauritius, Mozambique, Namibia, Niger, Nigeria, Papua New Guinea, Rwanda, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines, Senegal, Sierra Leone, Solomon Islands, South Africa,
Suriname, Swaziland, Tanzania, Togo, Trinidad and Tobago, Uganda, Zambia, Zimbabwe
4
(9 WTO members) Iceland, Israel, Japan, Rep of Korea, Liechtenstein, Mauritius, Norway, Switzerland, Chinese Taipei
STEs
India,
Indonesia,
the
Philippines
(Members of
both G-20
and G-33)
SPs
SSM
Would support a
lower percentage
of tariff lines
designated as SP.
Strongly support
proposal to allow
any subsidized
products to be
automatically
designated as SP.
Are willing to
accept some tariff
reductions on SP.
Want all
products to be
eligible for the
SSM.
Tariff
Reduction
Formula
Officially
support the G-20
proposal.
Indonesia and
Philippines in
particular would
prefer to apply
less tariff cuts,
for example the
ACP proposal.
Preferences
Sensitive
Products
Blue Box
Officially
support the G-20
proposal of 1%
of tariff lines but
would be happy
with more if it
meant a higher
percentage of
tariff lines for
SPs.
Green Box
Food Aid
STEs
Strongly support
additional
criteria for
Green Box to
accommodate
programs used
by developing
countries.
Bottom Line: India, Indonesia and the Philippines are defensive on the tariff reduction formula and strongly support SP and SSM. India, Indonesia and the Philippines
are strongly pressured by the U.S. and EC to open markets in NAMA and services. India is offensive in some areas of the services negotiations.
Brazil (G-20)
Supports G-33
Supports G-33
Supports G-20
proposal and
U.S. proposal. Is
among the most
aggressive of the
G-20 members in
seeking broadly
based tariff
reductions for
agriculture, with
provision for
specific
developing
country needs
(SPs, etc.)_
Interested to work
towards a solution
that suits both the
ACP and Latin
American
countries.
Supports 1% of
tariff lines.
Strongly opposed
to expanding
criteria, especially
since the U.S. is
expected to shift
counter-cyclical
payments from the
amber box to the
blue box. (These
subsidies were
found to be illegal
in the Brazil-U.S.
cotton dispute)
Bottom Line: Brazil is offensive on the tariff reduction formula but strongly supports SPs and the SSM. Brazil is defensive on NAMA and services but is strongly
pressured by the U.S and EC to open markets in NAMA and services.
Kenya
No official
position but
would be best
suited to the
ACP proposal.
Very vocal on
preferences in
support of the
ACP.
Kenya is a food aid
recipient and is
concerned that the
U.S. will cut food aid
spending (including
emergency food aid
spending) if the
WTO disciplines are
too strict.
Kenya has an
STE that could
be targeted.
Bottom Line: Kenya is defensive on the tariff reduction formula and strongly supports SP and SSM. Kenya is very vocal on the problem of preference erosion, the
potential impact of further disciplines on food aid and exporting STEs.
Argentina
Wants SPs to be
subject to tariff
cuts.
Opposed to a
price trigger.
Wants to limit
Supports G-20
proposal and
U.S. proposal.
Disadvantaged by
the preference
regime and
the number of
products that
benefit from the
SSM.
opposes further
protection.
(Uruguay and
Chile share the
same position.)
Bottom Line: Argentina is offensive on the tariff reduction formula. Argentina is defensive on NAMA but is strongly pressured by the U.S and EC to open their markets.
Argentina will be hard hit by the NAMA tariff reduction formula since its bound and applied tariffs are very close together.
Tropical
Products
Group5
Advocating
liberalization of
tropical products.
Many of these
countries are
disadvantaged by
the preference
regime and oppose
further protection
of preferences.
(most vocal are
Honduras,
Guatemala, Costa
Rica, Ecuador
etc…)
Bottom Line: The Tropical Products Group is calling for complete liberalization in tropical products. They are disadvantaged by the EU-ACP preference arrangements.
5
Bolivia, Venezuela, Colombia, Costa Rica, Ecuador, El Salvador, Honduras, Guatemala, Nicaragua, Panama, Peru