Agriculture Committee Discusses Bali and Nairobi
Ministerial Decisions, Farm Policies and COVID-19 Impact
·
Review of the Bali
Decision on TRQ Administration
·
Regular review of
agriculture policies
·
Discussion of the
Nairobi Ministerial Decision on Export Competition
·
Enhancing
transparency and the committee's review process
·
Review of the list of
net food-importing developing countries
·
Discussion on
COVID-19 and agriculture
At a meeting of the Committee on Agriculture on 21-23 September,
WTO members examined their respective agriculture policies and continued their follow-up
to the 2013 Bali Decision on Tariff Rate Quotas and the 2015 Nairobi Decision on
Export Competition. Members also discussed COVID-19’s impact on agriculture, with
the aim of improving transparency and members’ policy responses to the pandemic.
Samoa was added to the WTO list of net food-importing developing countries.
The new
chair, Ms Maria Araceli Escandor
(Phillipines), facilitated the meeting.
At an
informal meeting on 21 September, members followed up on the recommendations approved
by the General Council in December 2019 on the review of the Bali Tariff Rate Quota
(TRQ) Decision (G/AG/29).
The aim
of the 2013 Bali Decision is to
improve the utilization of TRQs related to agricultural products. It provides new
transparency guidelines for the administration of TRQs, which allow import quantities
inside a quota to be charged lower duty rates than those outside the quota.
Discussions
were based on two new documents prepared by the WTO Secretariat - a background paper
on TRQ administration and fill rates (G/AG/W/183/Rev.1)
and a draft Tracking Register to record matters raised under the underfill mechanism. The two papers, prepared in accordance
with the recommendations contained in G/AG/29 (Annex 2), were welcomed as “thorough
and comprehensive” and instrumental in enhancing transparency on TRQ administration.
The chair
urged members to examine and provide comments on the draft Tracking Register by
the committee's November meeting. It was also noted that the finalized Tracking
Register would be operational once a matter was raised under the mechanism.
One member’s
suggestion to abolish some scheduled tariff rate quotas on the grounds that they
were “without tariff advantage” was met with questions, with one member citing the
linkage of such tariff quotas with the special agriculture
safeguard (SSG) and market access negotiations. A tariff quota “without tariff
advantage” means the out-of-quota tariff is the same or lower than the in-quota
tariff.
Members’
discussions of their respective agriculture policies have intensified, especially
since the start of the COVID-19 pandemic. Pointing to the record number of questions
(520) raised by members in 2020 regarding the implementation of their respective
commitments, the chair said: “This level of engagement reflects the value that members
place on the review function of the WTO Committee on Agriculture.”
The policies
discussed relate to the three pillars of agriculture trade: market access, domestic
support and export competition. In addition to discussions on COVID-19 agricultural
measures under the committee's new standing agenda item on "COVID-19 and agriculture",
several questions related to this topic were posed by members during the review
process. The full list of questions from members can be found in G/AG/W/207.
China's
border measures designed to avoid transmission of COVID-19 were questioned by some
members citing the lack of scientific evidence to suggest transmission of COVID-19
through food and agricultural products. These members urged China and all members
to ensure that COVID-19 regulatory measures were proportional to the risk and science-based.
China
disagreed with the questioning members, noting that its measures were based on available
scientific evidence and consistent with the guidelines of the relevant international
organizations. The measures were applied only to food products transited through
the "cold-chain" - temperature-controlled transportation - and were regularly
monitored in view of the evolving situation. In response to China's reference to
discussions in the Committee on Sanitary and Phytosanitary
Measures and the Technical Barriers to Trade Committee, members pointed out that
the matter also fell under the purview of the Committee on Agriculture.
The air
transport assistance schemes of Australia and New Zealand were subject to continued
scrutiny. Both members were asked how their respective schemes were not an export
subsidy within the definition of Article 9.1(d) of the Agreement on Agriculture
and how those measures could be reconciled with their revised "Nil" export
subsidy schedules pursuant to the Nairobi Decision. Both members emphasized that
their measures were temporary, targeted, proportionate emergency measures. New Zealand
also noted that its air transport scheme was a services measure and hence outside
the scope of the Agreement on Agriculture.
Regarding
the US government's additional direct farm payments in response to the COVID-19
pandemic, the United States said it did not have additional comments on 2020-2021federal
government outlays beyond what had already been announced. These short-term programmes were designed to minimize market impacts and were
targeted to help mitigate the negative impacts of COVID-19 on US agriculture and
consumers, the United States said, adding that it remained fully committed to respecting
its WTO domestic support commitments.
Addressing
some members’ concerns about the recent EU-US tariff reduction agreement, the European
Union said it saw “this initiative as a first step to de-escalate bilateral trade
tensions and to support the settlement of on-going disputes. No agricultural products
were concerned by this agreement” (meaning no product falls under the HS tariff
codes set out in Annex 1 of the Agreement on Agriculture). The United States echoed
the EU’s view and confirmed that “tariff reductions associated with this agreement
will be extended on a most-favoured-nation basis”.
The United
Kingdom provided clarifications on its upcoming phase-in of border-control measures
with the EU starting from 31 December 2020, saying that the measures would
only apply to imports from the EU, and that import controls for traders from outside
the European Union remained unchanged. It stressed that the new border controls
would be applied on a risk-assessment basis as currently applied to all other members.
India
answered questions on the agriculture policies and transparency issues arising from
its domestic support notifications. The recurring matters included India’s quantitative
restrictions on pulses, subsidies for the sugar industry, and export subsidies through
its transport and marketing assistance scheme. India provided detailed information
on its sugar production for the 2020-2021 season. It said that, according to the
Nairobi Ministerial Decision
on Export Competition, as a developing country, India could provide
export subsidies under Article 9.4 of the Agreement on Agriculture until the end
of 2023.
Members
showed continued interest in India’s public stockholding
programmes. One member encouraged India to provide
a table with information for all products included in its food stockholding programme, given India recently invoked
the Bali Public Stockholding Decision to notify 2018-2019 de minimis support
for rice, in excess of its WTO limit. India said there was no breaching
of commitments for other products and provided the link to its public stockholding scheme
guidelines, which showed stocks would be utilized domestically by the bidder and
not exported.
The detail
of all the committee questions and answers is publicly available on the Agriculture
Information Management System (https://agims.wto.org/).
Members
conducted their annual dedicated discussion on export competition to monitor the
implementation of the Nairobi Ministerial Declaration
on Export Competition of 19 December 2015.
With
a few exceptions for processed and dairy products as well as swine meat, the 2015
Nairobi decision stipulates that developed members immediately eliminate their remaining
scheduled export subsidy entitlements for agricultural products. As a general rule,
also with some exceptions, developing members were similarly required to eliminate
their export subsidy entitlements by the end of 2018. Developing members have until
2023 (2030 for net food-importing developing countries) to eliminate export subsidies
used for reducing the costs of marketing exports and for internal transport and
freight charges on export shipments.
The new
WTO Secretariat background paper (G/AG/W/125/Rev.12 and four addenda, circulated
on 20 July) which provides detailed information on export subsidies, export financing
support, agricultural exporting state trading enterprises and international food
aid was welcomed by many delegations.
New Zealand,
a member of the Cairns Group– a group of agricultural exporting nations lobbying
for agricultural trade liberalization – said it was important for WTO members to
reply to the questionnaire on export competition (30 members replied this year).
Together with other members, it reminded delegations that the five years grace period
foreseen in the Nairobi Decision will come to an end in 2021 and that all members
would be required to answer the questionnaire, including all developing members.
Many
members emphasized the importance of transparency in this area and regretted the
persisting low rate of replies. They stressed the need to look at ways to enhance
it, including by identifying and addressing the difficulties that may be encountered
by some developing countries.
Canada
presented a room document entitled “Observations on agricultural exporting state
trading enterprises (STEs)”. This included data on the export share of STEs in global
trade, which Canada considered to be useful to supplement the monitoring of the
activities of exporting agricultural STEs.
Some
developed members also suggested enhancing transparency on the use of the so-called
"Article 9.4 of the Agreement on Agriculture flexibility" (export subsidies
consistent with the special and differential treatment provisions for developing
country members) in the context of this annual discussion.
Members
were also updated on the situation regarding modification of members' schedules
of commitments pursuant to the Nairobi decision. The chair noted that out of the
16 members with export subsidies reduction commitments in their schedules, 11 members
have had their revised schedule certified (i.e. made binding under WTO rules). Two
members — Canada and the EU — circulated their draft schedule in 2017 and three
members (Brazil, Indonesia and Venezuela) have not yet circulated their draft schedule.
Indonesia
said it is currently working on its revised schedule and would soon submit it to
the WTO. Brazil stated that revising its schedule remained the government’s priority
despite the pandemic disruption. Brazil clarified that it has not provided any export
subsidies and will submit its revised schedule soon. Venezuela noted that, as a
net food-importing developing country, it has the right to use export subsidies
until 2030.
The chair
asked members to reply or update their replies to the questionnaire by 16 October
2020 and announced that the next dedicated discussion on export competition would
take place during the September 2021 meeting of the committee, taking into account
the current working hypothesis regarding the date of the next Ministerial Conference.
Summing
up the situation of overdue notifications, the chair noted that G/AG/GEN/86/Rev.39,
circulated on 9 September, reflected the current status of compliance with notification
obligations by WTO members. She commended the Dominican Republic, the Kyrgyz Republic
and Nepal for bringing their notifications fully up to date. Meanwhile, she pointed
out that a significant proportion of domestic support (34%) and export subsidies
(31%) notifications remained pending for the period 1995 to 2018. She urged members
to “step up efforts towards meeting their notification obligations”.
Monitoring
pending responses to questions in the committee review process, the WTO Secretariat
document circulated on 9 September (G/AG/W/204/Rev.1) finds that, as of 8 September
2020, the number of pending replies for the period 2013-2018 amounts to 82, higher
than the 2012-2017 period figure (55). The chair encouraged members to continue
their efforts to reduce outstanding responses and collectively enhance transparency
in the committee.
The chair
noted members’ concerns regarding outstanding notifications and the lack of timely
responses to questions. Several members expressed appreciation to the WTO Secretariat
for the “organic improvements” made to the Agriculture Information Management System,
which will help enhance transparency in the committee. Modifications to the system
will improve members' ability to identify repeat questions in the AG IMS, identify outstanding responses,
and follow up on matters that were previously raised. Some members suggested additional
features for the Secretariat to consider, such as allowing members to follow issues
of interest raised by other members. An information session on transparency and
the AG IMS will be organized on the margins of the November committee meeting, the
Secretariat said.
Members
approved Samoa’s request to be listed as a net food-importing developing country
(NFIDCs). The
Secretariat circulated an updated list of NFIDCs (G/AG/5/Rev.11).
In its
statement, Samoa highlighted its increasing dependence on imported food which accounts
for 27% of Samoa’s total merchandise trade. It also stressed that, as a small island
developing state, it is vulnerable to geographic weaknesses, trade disadvantages,
economic volatilities and natural disasters, issues which were further compounded
by the COVID-19 pandemic.
Samoa
hoped to enjoy the benefits of being an NFIDC. According to the WTO Ministerial decision
on measures concerning the possible negative effects of the reform programme on least-developed and net food-importing developing
countries, in the event of short term difficulties and aimed at financing
normal levels of commercial imports, all least developed countries (LDCs) and NFIDCs
are eligible to draw down on the resources from the various action mechanisms that
the decision establishes, including those within the domain of international food
aid.
Including
Somoa, 79 developing and least-developed countries are
currently eligible as beneficiaries of the NFIDC Decision based on a list established
by the Committee on Agriculture.
The subject
of COVID-19 and agriculture is listed as a standing agenda item of the committee
following members’ request at the June special meeting. Members discussed nine ad
hoc reports of COVID-19 related agriculture measures and four joint statements submitted
by members.
Four
international organizations - the United Nations Food and Agriculture Organization
(FAO), the Organisation for Economic Co-operation and
Development (OECD), the World Food Programme (WFP) and
the Inter-American Institute for Cooperation on Agriculture (IICA) - shared their
studies and work on COVID-19’s impact on agriculture (G/AG/GEN/168, G/AG/GEN/169,
G/AG/GEN/170 and G/AG/GEN/171).
The nine
ad hoc reports were submitted by the EU (G/AG/GEN/159/Add.2), Israel (G/AG/GEN/160),
the US (G/AG/GEN/161), Paraguay (G/AG/GEN/162), El Salvador (G/AG/GEN/163), Switzerland
(G/AG/GEN/164), Brazil (G/AG/GEN/165), Canada (G/AG/GEN/167/Rev.1) and Japan (G/AG/GEN/166).
Four
joint statements were submitted by members (WT/GC/208/Rev.2- G/QG/30/Rev.2, WT/GC/218/Rev.1-
G/AG/31/Rev.1- TN/AG/44/Rev.1, RD/AG/77, RD/AG/79).
Some
members stressed the importance of having both the regular notifications and ad hoc reports
to improve transparency during emergency situations such as the COVID-19 pandemic.
They commended the WTO goods measures
tracker on the WTO's COVID-19 website page as a useful tool to monitor
members’ agriculture measures. Some suggested adding an agriculture measures tracker
or finding a way to easily search all agriculture measures.
One developed
member regretted the small number of ad hoc reports and the absence of data in some reports.
Several members encouraged the submission of ad hoc reports. Some noted that the
WTO tracker could provide a format for all ad hoc reports so that it was easy to
compare and consolidate the information. A few members, however, pointed out the
need to focus on improving regular notifications, which could not be replaced by
ad hoc
reports. One developing member said the crisis only made the negotiations on public
stockholding programmes even more urgent.
A few
members welcomed specifically the WFP statement. Highlighting the importance of
humanitarian food aid in the pandemic to ensure food security for vulnerable communities,
they called on members to expedite negotiations in the committee in order to reach
an agreement to exempt WFP purchases for humanitarian purposes from any export restriction.