Info Service on WTO and Trade Issues (May16/12)
17 May 2016
Third World Network
Developing countries stress on importance of SSM
Published in SUNS #8240 dated 13 May 2016
Geneva, 12 May (Kanaga Raja) -- A large number of developing countries
at the World Trade Organisation (WTO) have strongly underlined the
need for a Special Safeguard Mechanism (SSM) in agriculture in order
to protect themselves from sudden import surges and/or price declines.
They also argued that such a mechanism should be simple and effective
to use, and that the issue of SSM should not be linked to other areas
of the negotiations, in particular market access.
The views of these developing countries came at the first session
of the Committee on Agriculture in Special Session since the Nairobi
Ministerial Conference last December dedicated to discussing the issue
The Nairobi Ministerial Decision on the Special Safeguard Mechanism
for developing country Members states:
"1. The developing country Members will have the right to have
recourse to a special safeguard mechanism (SSM) as envisaged under
paragraph 7 of the Hong Kong Ministerial Declaration.
"2. To pursue negotiations on an SSM for developing country Members
in dedicated sessions of the Committee on Agriculture in Special Session
"3. The General Council shall regularly review progress in these
In his statement at the dedicated session held on Wednesday (11 May),
the Chair of the Agriculture Committee in Special Session, Ambassador
Vangelis Vitalis of New Zealand, said that since 8 March, he has had
44 bilateral consultations, and these were supplemented by meetings
with many negotiating Groups.
Based on these consultations, the Chair said that it is clear to him
that the basic positions of Members on the SSM have not changed from
the pre- and during Nairobi meetings, and that these positions reflect
the underlying concerns on both sides that have remained unchanged.
According to the Chair, the proponents continue to emphasize the importance
that they attach to this issue. Since they consider the SSM to be
a stand-alone issue, they do not see a linkage with market access
Some Members have stressed that an outcome on SSM is necessary for
MC11 (in 2017) and that without an outcome in this area it would be
hard to envisage broader outcomes.
Other Members consider that it would be difficult to achieve convergence
on the SSM in the absence of outcomes on market access more generally.
"We can't deny these persistent gaps between Members' fundamental
positions. At the same time, we shouldn't disregard ideas from the
past that may hint at pragmatic ways forward to bridge these gaps,"
said the Chair.
He reiterated that there is a clear mandate from the Ministers and
he intends to make all the necessary efforts to facilitate discussions
on the SSM.
VIEWS OF MEMBERS
According to trade officials, Indonesia, on behalf of the G33, said
that the WTO agreement on safeguards is very cumbersome to apply,
hence there is need for a special safeguard mechanism for agricultural
products, specifically for developing countries, which would be easier
and faster to apply.
Ministers affirmed in Nairobi that developing countries will have
recourse to the SSM, it said, noting that WTO members have also agreed
to work on the SSM in the 2004 July framework agreement and in the
2005 Hong King Ministerial Declaration.
The SSM is of utmost importance to developing country members as a
whole, said Indonesia, expressing hope that the discussion today will
further (the effort) in finding solutions on this issue.
It highlighted that the agreement on safeguards is not tailored to
adjust import surges in an abrupt manner for developing countries.
Import surges and price falls need to be addressed immediately as
Indonesia urged work on an agreement that will be meaningful in establishing
such a mechanism.
The G33 had been constructively engaging in the discussion in the
lead up to Nairobi, and had submitted numerous proposals to the Agriculture
Committee in Special Session.
The G33 said it has shown flexibility, and in its proposal, it has
provided special treatment for least developed countries and small
and vulnerable economies. It also has limited product coverage and
addressed the issue of predictability.
Despite all these efforts however, some members have rejected the
idea and have lingered around a political debate.
Trying to link the SSM with other issues will be counter-productive,
Indonesia cautioned, adding that there should be no preconditions
India said that it does not have access to the safeguards that is
already allowed in the agriculture agreement.
It cited an example of tapioca production in the country, saying that
it used to have tapioca production but the industry got wiped out
due to import surges. By the time it could use the safeguards according
to the WTO agreement, it was already too late, with tapioca cultivation
being wiped out.
India used this example to underscore why developing countries would
need a special safeguard mechanism.
China, supporting the G33 statement, said that the SSM is a stand-alone
issue. Unlike the special safeguard that is already in the agriculture
agreement, SSM is anticipated to be an instrument for developing countries
to address import surges.
It called upon all members to implement the Nairobi decision to actively
respond to the G33 proposals.
Botswana, on behalf of the African, Caribbean and Pacific (ACP) group,
said that it supports the affirmation at Nairobi that developing countries
should have the right to use the SSM. It appreciated the fact that
the negotiations will be undertaken in dedicated sessions. It also
emphasised that the SSM must be simple and effective to use.
According to trade officials, Turkey, South Africa, Sri Lanka, the
Philippines, Bolivia and Korea supported the G33 statement.
South Africa said that as a developing country, it has access to special
safeguards under Article V of the Agreement on Agriculture, but is
unable to use it as it is too complicated.
The SSM is of great interest to many developing countries and South
Africa is ready to work constructively towards such an outcome.
Bolivia said that the G33 has shown considerable flexibility to take
into account the concerns of members. The need to have a SSM is on
account of the imbalanced outcome of the Uruguay Round. So, the use
of the SSM should not be exceptional, it added.
Turkey said that it has read the Nairobi decision very carefully which
states that developing country members have a mandate to have recourse
to SSM. Our mandate is not to discuss whether to talk about SSM -
the objective is to design an operational mechanism.
The July 2015 paper submitted by the G33 is a good basis for work,
it said, adding that it is ready to discuss concrete proposals.
The European Union said that it has heard very different views today.
The SSM as designed in the Rev. 4 text (2008 draft agriculture modalities
text) was linked to significant tariff cuts.
It was an exceptional measure used in exceptional circumstances. SSM
should be designed as a specific instrument, it said.
According to trade officials, Australia submitted two questions on
the issue beforehand and introduced it at the meeting:
1. What is the experience of members using safeguards in Free Trade
Agreements (FTAs) and in the WTO?
2. What has changed in agriculture market access since SSM was proposed
Norway said that there is need to address the issue of free trade
agreements (FTAs) with regards to the SSM. If we exclude everyone,
what is the point of it, it asked.
According to trade officials, India said that the issue of FTAs keeps
coming up. The free trade agreements do not feed into the multilateral
system, it pointed out.
Bolivia underlined that FTAs are not a subject in this house.
According to trade officials, several large agricultural exporters
including Paraguay, Mexico, Uruguay, Brazil, Argentina, Colombia and
Chile expressed concerns over the SSM as it limits their exports to
the markets of developing countries. This mechanism could have a negative
impact on South-South trade, they said.
According to trade officials, the United States did not speak on this
According to trade officials, in his concluding remarks, the Chair
said that it was a good ‘throat-clearing' session.
There is a clear message from the G33 that there is no link of the
SSM with market access, and price decline is a real problem.
He welcomed the fact that no one has opposed the discussion on SSM.
You are all very faithful to the ministerial decision, he said, adding
that many of you want to see movement elsewhere in order to calibrate
He also said that there is no clear division between developing and
developed countries. You all seem to have shared concerns on price
decline and import surges, but you draw different conclusions, said
A lot of countries who are for the SSM say that this is a mechansim
to counter-balance the fact that rich countries are subsidising their
Members also have an interest in the other part of the negotiations,
whether it is market access or domestic support. Now, the homework
is to follow up, said the Chair. +