Is Progress In Global Trade and Agriculture Talks Possible?

Resolving the tensions between developed and developing countries over global trade in agriculture is the key challenge in the current round of World Trade Organization (WTO) negotiations. A new paper in the Carnegie Endowment's Trade, Equity, and Development series explores solutions for "LIBERALIZING AGRICULTURAL TRADE AND DEVELOPING COUNTRIES," written by David Orden (Virginia Tech), Rashid S. Kaukab (South Centre), and Eugenio Diaz-Bonilla (International Food and Policy Research Institute).

On March 14th, Carnegie held a briefing at the U.S. Capitol Building with authors Orden and Diaz-Bonilla. They were joined by discussants: Peter Scher, former US Special Trade Ambassador on Agriculture at USTR; Maria Fe Alberto-Chau Huu, the agricultural attaché to the Philippine Mission at the WTO; Louisa Bernal of the South Centre, Geneva; and John Audley, director of the Trade, Equity, and Development Project at the Carnegie Endowment. Elizabeth Becker, New York Times correspondent, moderated.

Orden and Diaz-Bonilla emphasized 3 key points explored in their paper:

1. Progress in reducing agricultural support and protection among the world's wealthy countries would be an important accomplishment for both development and the strengthening of the global trade regime. Key recommendations include: eliminating export subsidies, constraining trade-distorting domestic support, expanding TRQs, and establishing a maximum 50 percent tariff on any agricultural product.
2. Controversy surrounds proposed policies to "tilt the balance" toward protection of agriculture in developing countries.
3. Overall, there are substantial grounds for agreement about agriculture between advocates of international development and those who broadly advocate strengthened global trade opportunities and institutions. Achieving significant reforms in the Doha Round negotiations, however, will require a concerted effort and genuine policy dialogue.

In the discussion that followed, panelists recognized that developing countries are calling for real reform in domestic and export subsidies, as well as for special and differential treatment granting them flexibility in market access [e.g. safeguard mechanisms]. Faced with resource constraints, poorer countries must rely primarily upon trade remedies to protect their vulnerable agricultural sectors; they can not duplicate the domestic subsidies employed by industrialized countries. In addition, panelists noted the need to employ policy to support farmers, rather than to protect agricultural products or large agribusiness interests. They also voiced differing opinions about the concept of agricultural 'multifunctionality,' which seeks flexibility to address such issues as the environment, rural development and food security through agricultural production.

Event summary prepared by Vanessa Ulmer, Junior Fellow, Carngie Endowment for International Peace. For further information contact vulmer@ceip.org.