Info Service on WTO and Trade Issues (Oct15/22)
29 October 2015
Third World Network
Call for balanced outcome
on three agri-pillars at Nairobi
Published in SUNS #8120 dated 26 October 2015
Geneva, 23 Oct (D. Ravi Kanth) - Trade envoys and agriculture negotiators
on Thursday (October 22) called for balanced outcomes in all three
pillars of the Doha agriculture negotiations at the Nairobi ministerial
meeting despite insidious attempts by the leading developed countries
to cobble a small package in the export competition pillar without
adhering to the 2008 revised draft modalities (Rev.4), several agriculture
negotiators told the SUNS.
At a closed-door meeting with the chair for Doha agriculture negotiations,
Ambassador Vangelis Vitalis from New Zealand, trade envoys and agriculture
negotiators from around 17 developing countries demanded balanced
outcomes on all the three pillars - market access, domestic support,
and export competition - based on the Rev.4, said people familiar
with the meeting.
Trade envoys/negotiators from Mexico, Tunisia, Brazil, Mauritius,
Israel, Turkey, Venezuela, Thailand, Korea, Uruguay, Barbados which
is the coordinator for the ACP (Africa, Caribbean, and Pacific) group,
Pakistan, India, Indonesia, Colombia, and Dominican Republic took
part in the meeting.
The chair sought to know the participants' views on the proposed deliverables
in the export competition pillar.
Some developed countries apparently said they want to see the elimination
of the two sub-paragraphs within paragraph 162 of the Rev.4, the chair
informed the participants.
The paragraph 162 in the Rev.4 has stipulated a down payment of 50%
cut in budgetary outlay commitments by the end of 2010 in equal annual
installments from the date of entry into force and the remaining 50%
to be eliminated by 2013.
It reads: "Developed country Members shall eliminate their remaining
scheduled export subsidy entitlements by the end of 2013. This shall
be effected on the basis of:
(a) budgetary outlay commitments being reduced by 50 per cent by the
end of 2010 in equal annual instalments from the date of entry into
force, with the remaining budgetary outlay commitments being reduced
to zero in equal annual instalments so that all forms of export subsidies
are eliminated by the end of 2013.
(b) quantity commitment levels being applied as a standstill from
the commencement until the end of the implementation period at the
actual average of quantity levels in the 2003-05 base period. Furthermore,
throughout the implementation period, there shall be no export subsidies
applied either to new markets or to new products."
The underlying rationale (as put forward by the developed countries)
for the elimination of the two sub- paragraphs in paragraph 162 is
that the developed countries do not want to pay any down payment and
eliminate all their subsidies in one go at the end of the implementation
period in 2020, an African agriculture negotiator told the SUNS.
In response to the chair's elaboration of the demands made by some
developed countries, the developing countries said they want to see
a written proposal from those countries that are seeking substantial
The chair said he has not received any proposal from the proponents,
including the United States, which is pressing for outcomes in the
export competition pillar till now.
Ambassador Vitalis also drew attention to paragraph 164 in which the
developed countries wanted elimination of Article 9.4 of the Agreement
on Agriculture. The paragraph reads: "In accordance with the
Hong Kong Ministerial Declaration, developing country Members shall,
furthermore, continue to benefit from the provisions of Article 9.4
of the Agreement on Agriculture until the end of 2021, i.e. five years
after the end-date for elimination of all forms of export subsidies."
The developing countries said it is incorrect to eliminate the Article
9.4 as it would be tantamount to substantial changes in the Rev 4.
The developing countries maintained such a change would go against
the chair's assurance that there should be minimal changes as far
as possible in the Rev.4 It amounts to re-writing paragraph 162 and
164 of the Rev.4, the developing countries argued.
The chair maintained that he is waiting for the written proposals,
according to the participants familiar with the meeting.
During the meeting several developing countries raised sharp concerns
over the adjustments sought by developed countries.
India said the export competition pillar is not balanced, maintaining
that there has to be an overall balance in outcomes on all three pillars.
If ambition goes up or down in one area, it must be reflected in other
areas as well, India argued. More importantly, "the special and
differential treatment is non-negotiable," India emphasized.
Brazil, which no longer speaks on behalf of the G-20 farm coalition,
called for the elimination of export subsidies as well as other elements
in the export competition pillar. Brazil said the outcomes must be
based largely on Rev.4 so to ensure "balance" in the outcomes,
according to participants present at the meeting.
In conclusion, the chair Ambassador Vitalis spoke on eight elements
stemming from his discussion. The elements include i) balance is a
concern, ii) Rev. 4 text to be basis for the outcomes, iii) minimal
adjustments in the Rev.4, iv) changes to be accommodated on a reciprocal
basis, v) special safeguard mechanism has to be there as part of the
balance in agriculture, vi) importance of special and differential
treatment, and continuation of Article 9.4 along with flexibilities
for small and vulnerable economies, vii) calibration of ambition,
and viii) transparency in the negotiating process.
Meanwhile, the African Group of countries on Thursday circulated a
detailed proposal on agriculture, maintaining that "since the
Uruguay Round, developing countries have waited 20 years for the implementation
of the Built-In Agenda of the Agreement on Agriculture to reform agriculture."
Lesotho, on behalf of the African Group, said the Doha mandate with
"substantial reductions in trade distorting domestic support"
must be achieved. "This would contribute to correcting the imbalances
inherited from the Uruguay Round ... This is because the continuation
of massive domestic support in developed countries is a major distortion
of the trading system," the African Group said.
As most of the farmers are small subsistence farmers in Africa, "subsistence/smallholder
agriculture can play an important role in reducing the vulnerability
of rural and urban food-insecure households, improving livelihoods,
and helping to mitigate high food price inflation," the African
Moreover, the African farmers "are extremely vulnerable to the
subsidised imports that for several decades have had negative impact
on their production, for example, of cereals, poultry, tomato paste,
dairy and cotton."
"Also, the high subsidies as well as high agriculture tariffs
in developed countries almost denied market access for exports of
agricultural products from the African countries. All of these, in
combination, have meant that many of our small farmers have been edged
out of their domestic markets, whilst not having access to other markets,"
the African countries argued.
"It is well established that the current global system is distorted
and pits small-scale, largely subsistence farmers against farmers
of developed countries who during the past century have been heavily
assisted to increasingly capture economies of scale," the African
More disturbingly, the developed countries continued to not only maintain
trade-distorting subsidies but "one study estimates that Green
Box subsidies increased agricultural productivity by around 60% in
the European Union and 51% in the United States."
"A substantial reduction in US and EU Green Box subsidies would
lead to a rise in export volume and revenues and a fall in their import
costs for LDCs," according to the African Group.
Even the 2008 revised draft modalities only provided modest landing
zones and must be strictly followed to tackling all the trade-distorting
measures, the African countries argued. "The African Group reaffirms
the mandates for the agriculture negotiations as provided in the Doha
Ministerial Declaration (2001), July Framework (2004), Hong Kong Ministerial
Declaration (2005), and the Bali Ministerial Declaration (2013),"
the Group maintained.
In short, "the outcome of the DDA negotiations in the area of
agriculture must achieve the following for Africa:
i. Substantial reduction of trade-distorting domestic support in the
agricultural sector. In particular, trade- distorting domestic support
which historically have been and are still currently provided by developed
countries must be substantially reduced, especially reduction of subsidies
to products produced by African small farmers. There should also be
strict disciplines regarding "box-shifting" towards Green
Box supports, to ensure that these supports are truly minimally or
ii. Allow African countries to pursue "agricultural policies
that are supportive of their development goals, poverty reduction
strategies, food security and livelihood concerns" (para. 2,
Annex A, July 2004 Framework)."
Pressure is mounting on the World Trade Organization Director-General
Roberto Azevedo and the developed countries to deliver credible outcomes
in the Doha agriculture package at Nairobi. A storm is already brewing
against attempts to finalize a small package of deliverables by turning
a blind eye to the overall Doha Development Agenda mandates. The next
few weeks will indicate whether the African countries can secure equitable
outcomes at Nairobi or remain cheated on their own soil, several developing
country envoys argued.