Till now we have discussed, origin of WTO followed with its organisational structure, philosophy, agreements, criticisms which led to Doha development round and have started with Agreement on Agriculture. In agreement on agriculture, we have discussed about the types of subsidies, impact of these policies on developing nations in general and Indian Food security in particular.
For these parts of the lecture please refer to the following Links.
Part 1 - (Click here)
Part 2 - (Click here)
Part 4 - (Click here)
In this lecture we will discuss about other aspects of Agreement on Agriculture like market access, July Package (2004), Export subsidies and latest trends followed with other agreements such as Non-Agricultural Market access, Service sector, IPRs etc.
Agreement on Agriculture (Continued):
Each member nation of WTO set out is "schedules of concessions" in which it declares the tariff and non-tariff measures of the nation for specific products, for entry of product in the domestic market. The schedules represent commitments not to apply tariffs above the listed rates — these rates are “bound”. WTO Members seek to continually improve market access through the regular WTO work programme and through negotiations such as those launched at the Doha Ministerial Conference in November 2001.
Debate on market access for agricultural products:
Developed nations are offensive when it comes to gaining more market access while developing nations are found to be defensive on this issue. This means, that while developed nations demand lower tariffs, developing nations ask for high tariff rates so as to protect their domestic industry which might not be competent enough to face international competition.
Developed nations have reduced tariff barriers but they impose non-tariff barriers in the name of Sanitary and Phytosanitary measures like plant and animal health. This leads to developing nations not gaining any substantial increase in export.
July Package, 2004:
2003 Ministerial conference at Cancun resulted into deadlock. WTO members in Geneva, attempted to reinitiate negotiations which resulted in the form of July Package of 2004. July package introduced two new frameworks on special products and Special safeguard mechanism.
These are those products which developing nation consider as having special interest in poverty alleviation, rural development and rural livelihood.
These products can be kept out of tariff liberalisation indefinately.
There is debate over how many commodities can be treated as special products. While USA limit it to five commodities, India want the list to not have a ceiling.
Special Safeguard mechanism:
Special safeguard mechanism is a tool that will allow developing countries to raise tariffs temporarily to deal with import surges or price falls.
This was discussed at the Nairobi ministerial. As per the ministerial, WTO members will continue to negotiate the mechanism in dedicated sessions of the Agriculture Committee in Special Session, and the General Council will regularly review the progress.
Countries position differ on the issue of the linkage between the SSM and the overall market access negotiations.
At Nairobi ministerial it was decided that all forms of agricultural export subsidy will be eliminated.
Developed countries will remove export subsidies immediately except for a handful of agricultural products while developing countries will remove them by 2018, with a longer time frame in some limited cases.
In addition, developing countries will keep the flexibility of covering marketing and transport costs for agriculture exports until the end of 2023, while the poorest and food-importing developing countries will enjoy additional time to cut export subsidies.
Various Groupings under WTO Negotiations:
A number of countries have formed coalitions in the WTO. These groups often speak with one voice using a single spokesperson or negotiating team. Below are the compositions of some of the most active groupings in the WTO. Groupings in blue colour are having India as its member.
( Agreement on Agriculture is over and other aspects like NAMA, Services, IPRs Etc. will be taken up in subsequent lectures of the same series. All the best.)