AGRICULTURE
Issues on the table
•
Public stockholding for food security
purposes and food aid
•
General services
•
TRQ administration
•
Export competition
Structure of the
Agreement on Agriculture
Market Access
Domestic Support
Export Competition
Tariffs
Green Box
Export subsidies
Tariff rate quotas
Blue Box
Anti-circumvention
Article 6.2 –
Development
Programmes
Export prohibitions
and restrictions
Special safeguards
Amber Box



Food purchased by governments from farmers
at supported/government-set not market
prices counts towards “Amber Box”.
Amber Box is limited, subject to reduction
commitments.
Developing countries are allowed an amount
that is conceptually minimal - up to 10% of
VOP – so called “de minimis”


Amend the Agriculture Agreement so that
price support (administered prices) in
developing countries to benefit low-income
farmers/those that lack resources not count as
AMS, but be considered as “Green Box”
Expand the list of “general services” under the
Green Box to include more programmes that
are relevant to developing countries


Public stockholding for food security is the most suitable policy
instrument for them to address food security
 Policy tool allows addressing two elements of food security:
availability & access to food
Policy space has been eroded by increasing market prices and
therefore higher administered prices


Several developing countries are in danger of reaching/exceeding their
permitted limits
Methodology for calculation of support makes it difficult to stay
within permitted limits


AMS calculation is not based on actual expenditure; instead price support takes external
reference prices (1986-88) and sees how much higher are a government’s current
administered prices
Inflation & rising commodity prices have forced up the administered prices, and with
them the AMS calculation




Lack of in-built policy constraints & adequate targeting to limit
potential trade distortiveness
 Procurement might continue even if stocks enough for stated
objective
 Procurement might not benefit only low income but also larger
producers
potential trade distorting consequences
different situations of different developing Members – one-sizefits all approach unlikely to address specific problems of
individual Members
Systemic impact of changing current rules, outside a wider
negotiation



Increasing clear that November 2012 proposal
was unlikely to obtain consensus in time left
Without prejudice to November 2012 proposal,
but to allow for exploration of other avenues,
some ideas by subset of G-33 members
Four variables for clarification/modification




De-minimis level
External Reference Price
eligible production
administered prices
Question One:
 Whether Members were willing to consider
that the Bali Declaration recognises, subject to
the requirement of the Green Box relating to no
or minimally trade or production distorting, a wide
range of general services policies in
developing countries, along the lines
suggested by G-33.



All expressed willingness to work
Make clear that chapeau to Green Box applied to these policies
Need better understanding of G-33 policies, with view of finetuning list
Question Two:
 Taking into account what the Ministerial
Conference had said in the past, could
Members use Bali and send a convergent
political message that recognised the role
played by public stockholding and similar
policies in some developing countries?



positive response at general level
Message should bring some value added
Need to ensure balanced message; acknowledgement of wider
dimension of food security across all pillars; encourage further
reform; and greater transparency
Question Three:
 Whether Members were prepared in the lead up
to Bali to agree on any amendment or
interpretation of existing WTO AoA
disciplines that might provide greater flexibility
in the area of public stockholding that was
currently the case.
 If so, what was this amendment/interpretation?
If not, were Members prepared to consider
further work on these issues in the post-Bali
period and how would it be framed?



Those that supported a general systemic
solution through amendment/interpretation
Those not convinced that
amendment/interpretation was possible or
desirable by Bali, but open to discussion of
possibilities post-Bali
Nuanced position: half way house: temporary
remedy + ongoing work post-Bali
Question Four:
 Whether Members were willing to consider a
mechanism or process whereby any member
with specific concerns that their PSH policies
aimed at addressing food security objectives
were at risk of breaching their WTO
commitments could bring those concerns to
the attention of members & seek additional
flexibility on an interim basis, pending
broader agreement to modify the disciplines in
general.

Openness to consider mechanism but…




Time-limited; non-automatic; should create no or
minimal trade or production distortions
Flexibility should not be at expense of needed
economic reforms
Transparency important- timely notifications
Other view: whatever the temporary solution –
must be operational and not substitute for
broader solution


Three options to address G-33 concerns
Option A:


Option B:


Agree that developing countries use of a three year rolling
average to calculate contribution of food stockholding
purchases to overall farm subsidy limit
Agree on draft decision allowing Members to take into account
excessive rates of inflation (higher than 4%) in calculating
AMS
Option C:

Agree to a peace clause exempting these programmes from
legal challenge



As Bali approached, clearer that amending the
AoA would on this point was too controversial
to be agreed on time.
Focus instead shifted to work on an interim
solution – due restraint/”peace clause”
Although not originally proposed by the G-33,
they were willing to discuss it.








Nature of the solution (political/legally
binding)
Its character (automatic/nonautomatic/hybrid)
Its coverage
Transparency & Reporting
Safeguards to minimize distorting effects
Other terms & conditions
Duration & review
Post-Bali work
The final legal weight would depend on
The
Ministerial
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toMechanism
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Once
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debe
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stockholding
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country
Members
benefiting
should
have:
preclude
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countries
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Member
de diet
minimis
obligations
This decision shall not be used in a
manner that results in an increase of the
support subject to the Member’s Bound
Total AMS or the de minimis limits
provided under programmes other than
those under paragraph 3.a.
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the
Committee
on
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that
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and
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than
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11 and
Ministerial
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Decision
the progress
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Programme
Agriculture
submissions
solution
Work Programme
wanted to make the market price support in FN 5 Green
Annex 2
Bali deal:
the market price support remains Amber but will not be
challenged
30



Decision recognizes the contribution of general services programmes
to rural development, food security and poverty alleviation,
particularly to developing countries
Subject to Annex 2 of the AOA (Green Box- Chapeau), types of
programmes in the decision could be considered as falling within the
scope of the non-exhaustive list of general services programmes in
Annex 2, paragraph 2
The programmes relate to land reform and rural livelihood in order
to promote rural development & poverty alleviation.

The monitoring activity of the Committee will
depend on whether Members decide to use the
Decision.

Conversion on the WP has already started at
the January CoA meeting

Tariff Rate Quota


Current Rules on TRQ Administration



import duties are lower on quantities within the
quotas and higher for quantities outside
Art XIII GATT
Import-licensing Agreement
A number of methods employed for
administration:

Exporting countries: methods used for
administration can become an additional trade
barrier.


Evidence - when parts or all of the quotas are not
used (“under-filled”).
Importing Countries: the under fill is caused
by supply and demand in the market.
Many TRQs have low fill rates

Average annual fill rates (2002-2011) range
from 59% to 66% in this period

Absolute annual fill rates (2002-2011) range
from 27% to 100%

% of scheduled tariff quotas without notified
imports also varies (from 33% to 77%)

Two distinct elements:



Transparency provisions
An under fill mechanism
The text was not new: it was taken from
paragraphs 115–125 and Annex E of the 2008
draft “modalities” for the agriculture
negotiations as a whole, and the version
circulated in October 2012 was essentially
identical.


Refers to existing disciplines of the Import
Licensing Agreement
Highlights how ILA provisions are relevant to
TRQ Administration including on:



Timing of publication of information related to tariff
quota opening
Processing of tariff quota applications
Obligation to notify to Agriculture
Committee of tariff quota fill rates



Identifies situations where Members do not
notify TRQ fill rates or fill rate is below 65%
Monitoring in the Committee on Agriculture
with detailed consultative procedure
Final stage –requirement to allocate TRQs
using prescribed methods, with S&D for
developing countries
First Monitoring Year
Third and Subsequent
Monitoring Year
Where
If anyan
the
of importing
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rateconditions
is Member
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The
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awhen
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the
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or
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Three
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Provide unencumbered access
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A
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period
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RAISE A SPECIFIC
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ANY DOCUMENTATION
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FOR FURTHER
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The importing
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the tariff quota with all
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provide to the Committee on
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Agriculture
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andelements
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fully
of
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of objective
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consider Members’
all
documentation
data
submitted by the importing Member
The importing Member shall take either specific
actions requested or such other actions it
considers will effectively improve the fill rate of
the tariff quota
If the actions lead to a fill
rate above 65 per cent or
interested Members are
otherwise satisfied
If the fill rate remains below
65 per cent
This will be marked as
RESOLVED
in
the
Secretariat Registry and will
be no longer subject to
monitoring
A Member may continue to
REQUEST
additional
modifications
to
the
administration of the tariff
quotas
Choose
Developing
a tariff
Country
quota administration
Members MAYmethod
choose
Automatic,
An
alternative
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Provided that timely
notifications
for the TWO YEARS
Aunconditional
first-come,
In taking a decision
on which of these two options to
It will
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NOTED
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CLOSED
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on
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place
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and the concern
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method
only
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tariff quota
Extend/Modify
Decision at 12th
Ministerial
Conference
Absence of
decision S&D
provision lapses
All Members
comply
Members
voluntarily
comply
Annex B: Some
Members
reserve their
rights not to
apply


The Committee on Agriculture is expected to
review and monitor the implementation of the
Understanding
The monitoring to be conducted in the context
of the Under Fill Mechanism will depend on
Members' submissions

Hong Kong Ministerial Decision



Para 6: “We agree to ensure the parallel elimination of all
forms of export subsidies and disciplines on all export
measures with equivalent effect to be completed by the end of
2013. This will be achieved in a progressive and parallel
manner, to be specified in the modalities, so that a substantial
part is realized by the end of the first half of the
implementation period”.
2008 Rev 4 text- Export Competition Pillar
stabilized?
Small package for Bali - Linkages



Step forward in Bali: legal commitments to
reduce subsidies, in keeping with HKD
deadline
Incremental approach for the progressive
elimination of all forms of export subsidies
Down payment:


developed countries halve their ceilings on the
money they spend on export subsidies by the end of
2013
envisaged setting a new limit on the quantities of
subsidized exports, at the average actually exported
with subsidies for 2003–2005.



Developing countries to continue to benefit
from Article 9.4 provisions for 5 years after the
end-date for elimination
Prohibition of export subsidies on cotton
phasing in the repayment period for export
credits .




Committed to elimination, but conditions to modify
the legally commitments by Bali, in their view not met
 That could only be done as part of an overall
agricultural package within the Doha Round.
Actual use decreased, therefore the proposed freezing
of subsidies at current levels would penalize those that
had undertaken reforms
Another Group: proposal would have real impacts on
their use, and not cut only “water”
Proposal not balanced in terms of developing country
commitments.


Stopped short of making legal commitments.
But it contains some of the strongest statements
of intent that have ever been made on the
subject.




First, clear message recalling that export subsidies in
all forms are a highly trade distorting form of support;
Second, acknowledgement that export competition
remains a key priority
Third, a reaffirmation of the final objective on export
competition “the parallel elimination of all forms of
export subsidies and disciplines on all export measures
with equivalent effect”
Fourth, revised draft modalities (Rev 4, from December
2008) remains important basis for ambitious final
outcome




First, recognition of the decrease in recent years in use
of export subsidies that are subject to reduction
commitments;
Second, acknowledgement that the reforms
undertaken by some had contributed to this positive
trend;
Third, this is not a substitute for the final objective
Fourth, emphasize importance of consolidating
progress; importance of further engagement to achieve
the final objective



Encouragement to maintain & advance
domestic reform processes. Encourage those
who have not undertaken reforms to do so
Shall “exercise utmost restraint” with regard
to recourse to all forms of export subsidies
To the end above will ensure that



Progress towards parallel elimination is maintained
Levels of export subsidies remain significantly below
Members’ commitments
A similar level of discipline is maintained on use of
export measures with equivalent effect.


Fulfilling the objective of parallel elimination as
in the HKD remains a priority
Agree to continue to work actively for further
concrete progress in this area, as early as
feasible



Commitment to enhance transparency and
monitoring of policy developments
Agreement to hold dedicated discussions in
the CoA on an annual basis to examine
developments in the field of export competition
Basis of examination process – timely
notifications & information compiled by
Secretariat on basis of questionnaire in Annex
of Declaration

Agree to a review of the situation in export
competition within 2 years (10th Ministerial
Conference)




Declaration calls for dedicated discussions based on
notifications & a questionnaire to be circulated by the
Secretariat
Annex: elements for enhanced transparency which
will form basis of Secretariat’s questionnaire
CoA agreed to hold the annual discussion at its June
meeting. Similar timing could be appropriate for 2015
Secretariat to circulate questionnaire with view to
circulating a summary of the results in advance of the
June meeting.