Info Service on WTO and Trade Issues (Nov15/05)
9 November 2015
Third World Network
Differences over export competition, US isolated
Published in SUNS #8126 dated 3 November 2015
Geneva, 2 Nov (Kanaga Raja) - The Chair of the WTO agriculture negotiations
has reported that while export competition has been identified as
a possible deliverable for the upcoming Nairobi Ministerial Conference,
"it is also clear today that there are still some significant
outstanding issues within this pillar."
Ambassador Vangelis Vitalis of New Zealand gave this assessment, while
providing an update of his recent consultations at an informal meeting
of the Special Session of the Committee on Agriculture on 30 October.
The remarks and statements of various delegations at the meeting showed
that the United States was isolated and faced opposition from developing
and developed countries over its demands for a "safe harbour"
approach and exemption for itself from the obligations of the SCM
Agreement over export credit and food aid policies.
According to trade officials, the differences also remained on whether
export competition should be linked with other issues, such as the
special safeguard mechanism (SSM), and by how much should the Nairobi
decision deviate from the 2008 Rev. 4 draft agriculture modalities
text on export competition.
At the informal meeting, Indonesia, on behalf of the G-33, introduced
a revised proposal on the SSM, saying that this version of the proposal
is more flexible compared with the group's earlier submission.
According to trade officials, the G-33 proposal was supported by the
African Group and the African, Caribbean and Pacific (ACP) Group.
However, members of the Cairns Group expressed concern over the linking
of the export competition pillar with the SSM, and argued that the
SSM would allow countries to raise tariffs instead of opening markets,
which would be a step in the wrong direction of agriculture reform.
They were also of the view amongst others that introducing the SSM
without tariff cuts would be meaningless.
According to trade officials, the Chair said that he plans to hold
consultations on the technical aspects of the SSM proposal on 6 November.
According to trade officials, India said all three pillars of the
agriculture negotiations - market access, domestic support and export
competition - must be balanced, and that members must not "cherry
pick" any pillar.
China said that members should not push any issue off the table, trade
Many members were also of the view that domestic support and market
access issues should continue to be addressed after the Nairobi Ministerial
According to trade officials, the Chair also provided his assessment
on the various elements in the export competition pillar, namely export
subsidies, export credits, food aid and state-trading enterprises.
While Members generally agreed that the Rev. 4 text on export competition
should be the starting point for the negotiations, there were differences
on what elements of the text should be adjusted.
On export subsidies, where the Rev. 4 text specifies a timeline when
export subsidies shall be fully eliminated and where some of these
deadlines have already passed, Ambassador Vitalis proposed a simple
transposition by simply adding seven years to the original text.
This would mean: the end of 2020 as the date of elimination of scheduled
export subsidies by developed country Members; the end of 2023 for
the date of elimination of scheduled export subsidies by developing
country Members; and the end of 2028 for the termination of the Article
9.4 (of the Agreement on Agriculture) flexibilities for developing
According to trade officials, the Chair's proposal was supported by
According to trade officials, on export finance, the US has insisted
that its own export financing programmes allow 24 months' maximum
repayment, and that it is not ready to accept the six months' (180
days) repayment term contained in Rev. 4.
The US also noted the need to include some kind of "Safe Harbour
provision" to grant some protection against challenges to its
export credit policies under the Agreement on Subsidies and Countervailing
According to trade officials, Australia, Canada and Norway voiced
objections to the notion of a "Safe Harbour provision".
They argued that it would be backtracking and a step in the wrong
The US said that it will continue to participate actively and constructively.
The Chair also reported that the current Rev. 4 text on agricultural
exporting State Trading Enterprises has not, so far, attracted specific
On provisions on international food aid, several developing countries,
in particular the African Group, stressed the importance of disciplines
in this area in order that international food aid would not be used
to distort markets and hurt domestic industries.
According to trade officials, Ambassador Vitalis encouraged all members
to stay as close as possible to the existing Rev. 4 text on export
competition, and that any amendments to that text be "as limited
as possible and only to the extent necessary".
On cotton, the Cotton 4 countries - Benin, Burkina Faso, Mali and
Chad - circulated on 12 October their proposal on cotton, containing
three elements on market access, domestic support and export competition.
The Chair reported on his consultations on these three elements:
* On market access, some participants asked the Cotton-4 to detail
the list of products that would be covered by the duty-free and quota-free
scheme. The Cotton 4 has provided a list of products with HS tariff
line codes, which will be discussed shortly.
* On domestic support, the Chair said that "the feasibility and
the overall balance of a possible outcome in Domestic Support remain
a central issue... and it is clear that this remains a challenging
* On export competition, a cotton-related outcome should be envisaged
within the scope of a wider outcome on export competition.
On public stockholding for food security purposes, the Chair, reporting
on his consultations on this issue, said: "Unfortunately, I did
not see any fundamental change in Members' well-known positions."
"On one hand, there were G-33 Members and others who saw the
proposal as the basis for a permanent solution, and on the other hand,
there were many other Members who highlighted what they considered
to be the core problem of the proposal - that is transferring market
price support to the Green Box," he said.