WTO AGRICULTURAL NEGOTIATIONS Portfolio Committee Agriculture and Land Affairs April 2003 Günter...
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Transcript of WTO AGRICULTURAL NEGOTIATIONS Portfolio Committee Agriculture and Land Affairs April 2003 Günter...
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Portfolio Committee Agriculture and Land Affairs
April 2003
Günter Müller
Directorate: International Trade
National Department of Agriculture
N ational Departm ent of Agriculture
WTO Agricultural Negotiations
• Part of the broader WTO Round launched in Doha, Qatar in November 2001 by the 4th WTO Ministerial Meeting
• WTO Round: “Doha Development Agenda”
• Agriculture is a critical part of broader negotiations
• 4th WTO Ministerial agreed on a detailed mandate for the agricultural negotiations
• Agreed on a schedule for the negotiations
Doha Decisions on Agriculture (“Mandate”)
Building on the work carried out to date:
Substantial improvement in market access Reductions of, with a view to phasing out, all forms of export subsidies Substantial reductions in trade distorting domestic support Special and differential treatment for developing countries Non-trade concerns will be taken into account
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
• Agricultural negotiations chaired by Ambassador Stuart Harbinson (Hong Kong)
• Meetings in Geneva in informal and formal negotiation sessions with broad, active participation, also by developing countries
• First Modalities Draft Paper by Chair: 12 February 2003• According to schedule: Agreement should have been
reached on modalities by 31 March 2003.
Modalities: framework/structure for commitments by individual WTO members, e.g. formula for tariff reductions, size of reduction in domestic support, time frame for eliminations of export subsidies
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Major Negotiation Issues• Market Access: Level of tariff reductions, special treatment for
certain products, Safe Guard Clause, Tariff Preferences
• Domestic Support: Level of reduction in support, Non-trade concerns, definition of “boxes” amber, blue and green
• Export Competition: Elimination or not of export subsidies, time frame, handling of export credits, state trading enterprises
Positions of WTO members on these and other negotiation issues far from reaching a compromise
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Harbinson Draft (released February 2003)
• Based on work carried out with the objective to build bridges
and “attempt to identify possible paths to solutions”• Text was discussed during special negotiation sessions in
Geneva in February and March with very little sign of progress towards an agreement
• WTO Membership is split mainly on the level of ambition• Agriculture one of various deadlines in the broad WTO
Round that has been missed
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
RSA Objectives (summarized)
• Domestic support: provide for the development of historicaly disadvantages farmers, rural and farming communities, and, facilitate a substantial reduction in current high levels of support to bring about real structural change in developed countries.
• Market Access: Substantial improvement in market access in targeted markets for South African agricultural products with export potential
• Export Competition: Elimination of all export subsidies (included subsidies under export credits) over the shortest period of time possible
• Link between further market access commitments by RSA and substantial reduction in domestic support by developed countries
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
RSA Approach
• Approach negotiations from a development perspective
• Close consultation and co-operation with SACU and SADC
• Active participation in Africa Group• Active participation in Cairns Group
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Harbinson draft modalities
N ational Departm ent of Agriculture
HARBINSON TEXT: TARIFFS
Developed Countries (reduce over 5 years)
Original tariff Average reduction
Minimum per line
90 + 60 45
15 - 90 50 35
15 - 40 25
N ational Departm ent of Agriculture
TARIFFS
Developing Countries (reduce over 10 years)
Original tariff Average reduction
Minimum per line
120 + 40 30
20 - 120 33 23
20 - 27 17
SP (? % of agri products)
Food + livelihood security, rural development
10 5
HARBINSON TEXT
Harbinson
UR Formula
Developed Countries
500%
Tariff peaks? Not addressed
Tariff escalation? Reduction to be higher on processed product
Flexibility
275%
Developing countries
500%
Tariff peaks?
Tariff escalation?
SP products to be reduced by an average of 10% with minimum of 5% per line
475%
SACU IMPORTS: 2001Duties: Major Products
0
20
40
60
80
100
Applied Bound
RSA IMPORTS 2001
EU: PREF. TRADE22%
SADC10%
EU: OTHER TRADE2%
ARGENTINA15%
USA7%
AUSTRALIA7%
Thailand 6%
Brazil 5%
Malaysia 4%
China 3%
Other19%
0
30
60
90
120
Applied Bound
AVERAGE TARIFFS ON RSA EXPORTS
EXAMPLES (%)
RSA EXPORTS 2001
EU37%
USA5%
DEVELOPING26%
DEVELOPED12%
SADC20%
N ational Departm ent of Agriculture
Market Access (other)
Preferential Schemes tariffs of products of vital interest to developing countries may be
reduced over 8 instead of 5 years Erosion of preferences: major topic for negotiations
Tariff Quota volume
Developed Countries Increase to 10% of consumption over 5 years (additional flexibility) Developing Countries Increase to 6.6% over 10years (additional flexibility)
In quota tariff: No proposal
N ational Departm ent of Agriculture
Market Access
Safeguard Clause – Article 5
Will be phased-out for developed countries after 5 years
New provision for SP products developing countries based on Article 5 of AoA, detail to be agreed
Debate: Countervailing measure for developing countries to act against subsidized imports
Non-Trade Concerns
GIs, Animal welfare, food safety
N ational Departm ent of Agriculture
Export Competition
Export Subsidies
• 50%: to zero in 5 years
• 50% to zero in 9 years
Improved rules
Export Credits
Food Aid
State Trading Export Enterprises
Export Restrictions and Taxes
Export CompetitionCommitment and expenditure in US $m
0
2000
4000
6000
8000
10000
12000
14000
Base (end UR) 1995 1996 1997 1998
World Total
Year 1
Year 2Year 3
Year 4
Year 5
Harbinson Proposal
N ational Departm ent of Agriculture
Domestic Support
Green Box No major changes
Blue Box Capped at 1999 – 2001 level and reduced by 50% over 5 years Alternative: included in amber box
Amber Box To be reduced by 60% over 5 years
De Minimis Developed countries: reduce from current 5% to 2.5% over 5 years Developing countries: maintain 10% level
Article 6.2 (input subsidies, developing countries)
To be maintained and enhanced
Harbinson Proposal: EU Domestic Subsidies
0
10
20
30
40
50
60
70
80
Bound AMS Current Amber, de minimis +Blue Box(1999)
60% Reduction of AB & 50%reduction of BB
Types of Support & Effects of Reduction proposals
Harbinson Proposal on US Domestic Subsidies
19.1
10.47.6
2.4
4.8
2
4
6
8
10
12
14
16
18
20
Bound AMS Current Amber, de minimis+ Blue Box(1998)
60% Reduction of AB &50% reduction of BB &
deminimis
Types of Supprt
Lev
el o
f S
up
po
rt(
bill
ion
US
$)
Harbinson Proposal: Japan Domestic Support
0
5
10
15
20
25
30
35
40
Bound AMS Current Amber, de minimis + BlueBox(1998)
60% Reduction of AB & 0.5%reduction of BB
Types of Support & Proposed Reductions
Lev
el o
f S
up
po
rt (
Mill
ion
US
$)
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Negotiation time frame and deadlines
• Agreement on Modalities: 31 March 2001 • Tabling of draft country schedules by the 5th Ministerial
Meeting in Mexico (September 2003)• Conclusion of Round by 1 January 2005
N ational Departm ent of Agriculture
WTO AGRICULTURAL NEGOTIATIONS
Contentious Issues
• Level of ambition• Special flexibility to developing countries• Scope of negotiations