Agriculture
Agricultural
produce is protected by high tariff barriers, production support
and the use of export subsidies in many countries. Over the
years there have been attempts to reduce barriers to trade in
the agricultural sector, but it was not until the Uruguay Round
that, for the first time, a comprehensive 'Agreement on Agriculture'
was concluded, bringing this area firmly within the scope of
WTO rules.
There
are three major planks to the Agriculture Agreement. Firstly
the improvement of import access by reducing tariffs and providing
new access opportunities; secondly, a reduction in the volume
and value of subsidised exports, and thirdly the reduction of
domestic support measures subsidising production. While the
Uruguay Round took an important first step in eliminating these
barriers to free trade, there is still more work to be done.
The Agreement on Agriculture contains a commitment to continue
the reform process in the negotiations which started in March
2000.
At
the World Trade Organisation (WTO) 5th Ministerial
in Doha, which took place in November 2001, another important
step was taken. Building on the work already undertaken in the
negotiations on the Agreement in Agriculture, the Ministerial
Declaration further committed the WTO members to firm negotiations
without prejudging their outcome on substantial improvements
in market access; reductions of, with a view to phasing out,
all forms of export subsidies; and substantial reductions in
trade distorting domestic support. At the same time, the Doha
Declaration committed members to take account of non-trade concerns
(e.g. environment, rural/social development, animal welfare)
and to negotiate special and differential treatment for developing
countries.
The
Doha Development Agenda set an ambitious time table which required
modalities (rules and commitments) to be agreed by 31 March
2003 and detailed schedules to be prepared in time for the next
WTO Ministerial, to be held September 2003 in Cancun, Mexico.
The Chair of the Agriculture negotiating group, Stuart Harbinson,
proposed draft modalities in February, but disappointingly,
WTO Members did not reach agreement on these by the 31 March
deadline.
Since
the 31 March, further technical work has been undertaken on
some elements of Harbinson’s modalities, but this has not bridged
gaps between WTO members’ positions on the main issues (cuts
to domestic support and export subsidies and increases in market
access). In order to make progress, WTO Trade Ministers attending
the recent mini-Ministerial meeting in Montreal (28/29 July)
therefore requested the EU and US to work together on developing
a compromise proposal by mid-August.
The
EU and US presented their joint paper to other WTO Members on
13 August. This paper proposes the main elements of a framework
for a new WTO Agriculture agreement, setting out an approach
on domestic and export subsidies reductions and market access
increases. There are no figures and many important issues (Special
and Differential Treatment, the peace clause, sectoral initiative
to name a few) are not addressed in detail, but remain on the
table for further discussion.
Although
it is clearly a significant step forward that the EU and US
have agreed an overall approach to the negotiations, they represent
only 16 of the WTO’s 147 members and the paper must now be discussed
and agreed by all WTO members if this kind of approach is to
be adopted at Cancun. A series of WTO discussions to further
discuss this paper are now taking place in Geneva.
For
more information on this agreement, see the agriculture
pages of the WTO website. The UK Government supports further
progress in this area including further fundamental reform of
the EU's Common Agricultural Policy (CAP). For more information
about the EU's agriculture policy see the EU
website.
Last
updated 26 August 2003
