Introduction to Agricultural Trade in the WTO Links to the “Agriculture” section of the WTO Guide “Understanding the WTO” In principle, all WTO agreements and arrangements on trade in goods apply to agriculture, including the GATT 1994 Agreements and the WTO Agreements on topics such as customs valuation, import authorisation procedures, pre-shipment inspection, emergency measures, subsidies and technical barriers to trade. However, in the event of a conflict between those agreements and the Agreement on Agriculture, the provisions of the Agreement on Agriculture shall prevail. The WTO Agreements on Trade in Services and on Trade-Related Aspects of Intellectual Property Rights also apply to agriculture. (i) product-specific domestic support that would otherwise have to be included in a Member`s calculation of the current EMS if such support does not exceed 5 % of the total value of production of a basic agricultural product in the year concerned; and the 1958 Haberler Report stressed the importance of minimising the impact of agricultural subsidies on competitiveness and recommended replacing price support with additional non-production direct payments in order to anticipate the debate on Green Box subsidies. But it is only recently that this change has become the heart of the reform of the global agricultural system. [1] At the 2013 WTO Ministerial Conference in Bali, Indonesia, ministers also agreed on a range of agricultural issues. At the WTO Ministerial Conference in Bali in 2013, WTO members agreed not to question the consistency of support provided under public storage programmes with the Agreement on Agriculture. This has been done on the condition that developing countries meet certain conditions, such as.B. provide more information on how these programmes work and how stocks have been purchased and released. Two years later, at the Nairobi Ministerial Conference, ministers agreed that talks on a “durable solution” in this area would also take place in special negotiating sessions and on a separate track. WTO members took important decisions on agriculture at the 2015 WTO Ministerial Conference in Nairobi, Kenya. These include the obligation to remove agricultural export subsidies, as well as decisions on public livestock for food security, a special protection mechanism for developing countries and trade rules for cotton.

Export subsidies are the third pillar. The 1995 Agreement on Agriculture required industrialized countries to reduce export subsidies by at least 36% (in value) and 21% (in volume) within six years. For developing countries, the agreement provided for reductions of 24 per cent (in value) and 14 per cent (in volume) over ten years. Food price inflation in the late 2000s raised new concerns among some developing countries that WTO rules on agricultural subsidies could limit their ability to buy food at government-set prices under their public storage programmes for food security purposes. While there is no limit to the amount of food governments can buy at market prices under these programs, support to farmers through state-administered minimum prices must be factored into a country`s overall cap on agricultural support under WTO rules. Domestic support schemes for agriculture are governed by the Agreement on Agriculture, which entered into force in 1995 and was negotiated during the Uruguay Round (1986-1994). The long-term objective of the AoA is to establish a fair and market-oriented agricultural trading system and to initiate a reform process by negotiating support and protection obligations and establishing stronger and more operationally effective rules and discipline. Agriculture is therefore special because the sector has its own agreement, the provisions of which prevail. The peace provisions of the agreement aim to reduce the likelihood of disputes or disputes over agricultural subsidies over a nine-year period, until the end of 2003. The 2003 CAP reform, which decoupled most of the existing direct aid, and the subsequent sectoral reforms resulted in the transfer of most of the aid from the Yellow and Blue Categories to the Green Box (EUR 61.6 billion in 2016/2017, see table below). Aid under the “yellow box” (AMS or aggregate measure of support) increased from EUR 81 billion at the beginning of the contractual period to EUR 6.9 billion in the period 2016-2017, even with successive waves of enlargement. The European Union is thus largely respecting the commitments made in Marrakesh (€72.38 billion per year) for the AMS.

In addition, the “blue box” reached €4.6 billion during the same registration period. Domestic policies that have a direct impact on production and trade must be reduced. WTO members calculated the amount of such support they provided to the agricultural sector per year during the reference years 1986-88 (using calculations known as the total aggregate measure of support or total DEME). The industrialized countries have agreed to reduce these figures by 20 per cent within six years of 1995. Developing countries have agreed to make reductions of 13 per cent over a period of 10 years. The least developed countries do not have to make cuts. (This category of internal support is sometimes called the orange box, an indication of the orange color of traffic lights, which means slower.) These agreements contain flexibility in their implementation by both developing countries, WTO Members (special and differential treatment) and least developed countries (LDCs) and net food-importing developing countries (special provisions). In the 1980s, public payments to agricultural producers in developed countries caused large crop surpluses, which were dumped on the world market by export subsidies and lowered food prices. The tax burden of safeguard measures has increased, due to both lower revenues from import duties and higher domestic expenditures. Meanwhile, the global economy has entered a cycle of recession and the perception that open markets could improve economic conditions has led to calls for a new round of multilateral trade negotiations. [2] The round would open up markets for high-tech services and goods and ultimately deliver much-needed efficiencies. To include developing countries, many of which were “demands” for new international disciplines, agriculture, textiles and clothing were added to the major arrangements.

[1] For example, import barriers and domestic subsidies can make harvesting from a country`s domestic market more expensive. Higher prices can encourage overproduction. If the surplus is to be sold on world markets, where prices are lower, export subsidies are needed. As a result, subsidizing countries can produce and export much more than they normally would. For products whose non-tariff restrictions have been converted into tariffs, governments can take special emergency measures (special safeguards) to prevent rapidly falling prices or increased imports from harming their farmers. However, the agreement specifies when and how these emergency measures may be introduced (e.g.B. they cannot be applied to imports under a tariff quota). .