Agriculture
Negotiations Costa Rica Chair Introduces Draft Text for Ministerial Outcome on
Farm Trade
Ø
Next Meet in Sept
Ø
Much Heat Generated in Debate
The Chair of the negotiations on agricultural trade, Ambassador
Gloria Abraham Peralta (Costa Rica), introduced on 29 July her draft negotiation
text aimed at facilitating consensus among members and seeking possible landing
zones for an outcome on agriculture at the WTO’s 12th Ministerial Conference (MC12)
starting in late November.
The draft
text sets out suggested ministerial decisions on 7 agriculture negotiation topics:
domestic support, market access, export restrictions, export competition, cotton,
public stockholding for food security purposes, and a special safeguard mechanism;
and one cross-cutting issue, transparency.
In her
introductory remarks, the Chair said the draft text was an attempt to reflect the
collective efforts made by members over the past year through various informal and
formal processes. It builds upon the Chair's report and the reports of the Chair
facilitators (who assisted the Chair's work on each topic) and drew inspiration
from members' submissions, including those submitted in recent weeks.
¨The
text takes into account the range of views that have been expressed by Members and
seeks to chart a way forward with this in mind. It represents my honest effort to
identify potential 'landing zones'. It's not meant to be perfect or summarize all
views. But it is a tool for you to engage with one another in a constructive exchange,"
the Chair said, noting the document is meant to evolve as the negotiations proceed
to reflect new inputs and submissions.
For some
areas where wider gaps remain in positions, the Chair said the text seeks to identify
options for members to consider, thereby sketching out the contours for possible
compromises and trade-offs within and across negotiating areas.
The Chair
emphasized that more than 25 years after the conclusion of the Uruguay Round, the
mandate set out under Article 20 of the Agreement on Agriculture
to continue the reform process was still valid today: establishing a "fair
and market-oriented agricultural trading system"; progressively reducing support
and protection; and taking account of all members' interests, including special
and differential treatment for developing countries, non-trade concerns such as
food security, and protection of the environment.
The Chair
pointed out that agriculture trade remains highly distorted and protected, despite
the rapid growth in trade in food and farm goods over the last quarter century,
more integrated markets, and improvements to food security that have resulted from
rising average incomes over this period.
However, she said that new challenges such as COVID-19 and climate change
are compounding existing problems associated with low agricultural productivity,
persistent underinvestment, stagnating rural incomes and enduring poverty, and that
it was vital WTO members took action to help address these problems.
"WTO
members can and should contribute to improving how food and agriculture markets
function by redoubling their efforts to achieve an outcome at MC12”, she told the
meeting.
Noting
members´ continued divergences, including on some critical issues, the Chair admitted that "an MC12 outcome won't be a comprehensive
solution to all the problems facing food and agriculture markets today." Nevertheless,
"it is urgent for us to lay out a pathway forward to guide our future work
and set out markers for what we wish to achieve together, including at subsequent
Ministerial Conferences, " she said.
Looking
ahead, the Chair appealed for members' efforts to enhance engagement, summon political
will, and set out a direction for future progress at the WTO negotiating table.
"It is our responsibility to contribute to the broader collective effort to
rebuild more inclusive and sustainable economies as we all work to overcome the
pandemic and lay the foundations for a more resilient future."
The Chair
said that, given the limited time before MC12 and the continued divergences on how
to discipline trade-distorting domestic support, her view is that a substantive
outcome at MC12 in which members would agree on concrete modalities for the reduction
of entitlements appears to be out of reach. Instead, she believes that MC12 "can
deliver a useful intermediary step forward in the DS reform process that would define
the path ahead for the benefit of all members."
The aim
of the text is therefore to encourage members to meet one another midway in this
high priority area, bearing in mind the common objective of disciplining trade-distorting
domestic support. The text proposes some alternatives to provide a more malleable
basis for finding consensus, building on members' ideas, submissions, the reports
of the facilitators who have assisted the Chair, and her own consultations, she
said.
The Chair
maintained that the inclusion of market access elements in an MC12 agriculture package would assist
members in reaching a balanced result at the ministerial conference.
Her text addresses two components: a decision on some transparency-inspired elements,
and a work programme on market access negotiations post-MC12.
She said
the draft decision on applied tariff transparency
and the treatment of shipments en route is primarily based
on the joint proposal from Australia, Brazil, Canada, and Ukraine. On a post-MC12 market access work programme, the text incorporates some elements from the joint
proposal from Argentina, Brazil, Ecuador, Paraguay, Ukraine and Uruguay. The text also invites members to report the calculation
of duties in cases where such duties are not set in value terms. The Chair noted
that this was only to facilitate an informed conversation among members on possible
approaches to reducing tariffs. The text
also reflected some members' desire to address non-tariff barriers and acknowledges
the linkages between market access and other pillars, especially domestic support.
The Chair
said the text in this section acknowledges the importance of transparency to ensure
proper implementation of the Nairobi Ministerial Decision
on Export Competition, as well as continuation of negotiations post-
MC12.
The text
also builds upon elements contained in a recent submission from Canada, Chile, Norway
and Switzerland suggesting options aimed at helping members to find a balanced way
forward to enhance and streamline transparency requirements while taking into account
concerns expressed by a large group of developing country members cautioning against
burdensome additional transparency requirements. In addition, the text suggests
that the WTO Secretariat could provide relevant trade-related data to ease the burden
on members.
The Chair
said the text seeks convergence on two issues: exempting World Food Programme (WFP) humanitarian food purchases from export restrictions,
and enhancing compliance with notification requirements under Article 12 of the
Agreement on Agriculture.
According
to the Chair, on the first issue, the text that emerged from the December 2020 discussions
on a possible General Council Decision continues to be a plausible basis for members
to re-engage in the negotiations. The goal of the negotiations is to reach an MC12
outcome that would facilitate the highly valued humanitarian work of the WFP, while
taking due account of supplying members' concerns regarding domestic policy and
food security considerations. On transparency, the text is intended to capture elements
contained in the submissions from the proponents to minimize the potential effects
of export restrictions on price volatility and the food security of importing countries,
while addressing developing members' concerns over additional burdensome transparency
requirements. The text also suggests concrete ways in which the Secretariat could
further assist members in fulfilling notification obligations and notes the possibility
for members to explore how to revise current notification requirements and formats.
The Chair
indicated the text mainly covers transparency and trade-distorting domestic support
for cotton, which reflects the mandate to address
cotton ambitiously, expeditiously, and specifically, while also taking into account
the overall context of the agriculture negotiations, particularly the negotiations
on domestic support generally.
Talks
in this area focus on a proposed new special safeguard mechanism that would allow
developing countries to raise tariffs temporarily in the event of a sudden surge
in import volumes or price depression.
The Chair
said her text is aimed at addressing the problem of a lack of technical engagement
among members. Based on the facilitator's report, the text highlights 5 main aspects
of an SSM on which members could deepen their discussions: evaluation of import
surges and price decreases; triggers and cross-check; remedies; scope, including
coverage and the treatment of preferential trade; and transparency and other issues.
She also said the existing special agricultural
safeguard (SSG) could offer inspiration for members to enhance their
technical engagement on this issue.
Talks
in this area address how farm subsidy rules should apply when developing countries
buy food at government-set prices as part of their public stockholding programmes for food security purposes.
The Chair
highlighted that PSH remains
a priority issue for the proponents who have repeatedly stressed its usefulness
as a tool for addressing food security and rural livelihoods, especially in times
of crisis such as the COVID-19 pandemic.
She noted however that, given the widely divergent views of members, she
had found it very difficult to propose a way forward on this issue. Her text's first
proposed option draws inspiration from the draft text circulated at the 2017 Buenos
Aires Ministerial Conference by the ministerial facilitator as well as recent submissions
made by members. The second option proposes a way forward with an intermediary step
to be taken at MC12.
The Chair
said that this issue is seen as important by several members. Her draft text proposes
a comprehensive way forward after MC12. As it is a cross-cutting issue, it should
also be seen in the light of provisions on transparency that are included in the
draft decisions on various negotiating topics. The text also addresses the role
of the Secretariat in respect of technical assistance and the development of IT
tools, she said.
The Chair
asked members to use the summer break to study the text carefully in a constructive
spirit and get ready to plunge into an intensive text-based negotiation phase starting
in September. Highlighting the sense of urgency, she asked members to focus on building
convergence and avoid repeating longstanding positions in the negotiations, bearing
in mind the broader objective of making difference in people's lives.
"Working
together and exercising the necessary flexibility, we can achieve a credible outcome
on agriculture at MC12", she said.
The Chair´s
text was circulated to members after the 29 July meeting. The next agriculture negotiations
meeting will take place on 7-8 September.
A spike
of new submissions (14 in total), were presented for discussion at the agriculture
committee negotiations meetings in the ten days preceding the introduction of the
Chair's text. These submissions addressed most of the topics under negotiation,
including domestic support, public stockholding for food security purposes, the
special safeguard mechanism, transparency across the board as well as in different
areas such as changes to applied tariffs, export competition or export restrictions,
and various food security-related concerns.
The submissions
sparked intense debate among members. While views remained divergent on several
issues, including some fundamental ones such as the approach to be followed on domestic
support, public stockholding or the special safeguard mechanism, many members emphasized
their willingness to explore ways to narrow gaps and seek common ground. Members
also underscored the same sense of urgency on reaching a meaningful outcome on agriculture
at MC12. The Chair praised members for their constructive engagement and urged members
to redouble efforts to build convergence.