Trade officials gave a cautious welcome to new proposals
on farm trade at an informal WTO negotiating meeting last Friday, sources say.
Officials told that the proposals could help countries
carve a path towards a scaled-down package of measures to be agreed at the
global trade body’s ninth ministerial conference in Bali, slated for next
December. However, deep-seated differences remain over how best to resolve the
overall impasse in the WTO’s Doha Round of trade talks, which were launched
over a decade ago.
Making it easier to send agricultural goods overseas to
countries that use import quotas could be one step forward, developing
countries in the G-20 coalition at the WTO have argued. Such a move could also
help “re-balance” a separate package of measures on trade facilitation, says
the group, which includes major economies such as Brazil, China, and India.
The G-20 proposals are being widely seen as “doable,”
trade sources, with negotiators from the G-10 group of countries with
highly-protected farm sectors amongst those saying they were willing to engage
in discussions.
A request from the G-20 for the WTO secretariat to
conduct studies on export subsidies and related areas was not opposed by other
members, despite initial misgivings by some that had feared the issue could be
linked to the trade talks. G-10 countries asked that these studies also include
updated information on export restrictions - measures which they fear can
exacerbate price spikes on world markets, and harm food-importing countries.
Food stockholding: more discussion needed
A proposal from another developing country coalition, the
G-33, was seen as more complex by trade officials. Members of the coalition -
which includes China and India, alongside other countries with large
smallholder farming populations - were among those privately saying that more
discussion may still be needed on the proposal, which would exempt subsidised
food purchases from current WTO ceilings under certain conditions.
Proponents of the initiative, which trade officials said
had been led by India, had argued that subsidised food purchases for public
stockholding or domestic food aid should not have to count towards countries’
maximum-permitted levels of trade-distorting support, so long as the food has
been bought from low-income or resource-poor producers.
However, both developed and developing countries
privately cautioned that the move could counter reforms aimed at moving towards
less trade-distorting forms of farm support, by allowing payments that could
distort trade to be included without any limit under WTO rules.
The lack of any agreed definition of “low-income or
resource-poor producers” could also make it harder to ensure support was being
targeted towards the most vulnerable farmers, said others.
Some negotiators warned that the move could lead to
over-production of certain products - possibly leading to the ‘dumping’ of farm
goods in other markets, and harming small farmers elsewhere. Others said that
many small developing countries lacked the resources to run food stockholding
schemes or provide substantial amounts of domestic food aid.
However, proponents of the G-33 initiative said that the
flexibility could be important in cases where public food stockholding schemes
caused poorer countries to run up against their current ‘de minimis’ ceilings
under WTO rules.
Currently, each developing country is allowed to provide
trade-distorting support so long as this does not exceed ten percent of the
value of the country’s agricultural production. Under a special arrangement
made when China joined the global trade body, Beijing has to keep within a
lower ceiling of 8.5 percent.