what needs to be done to make doha a development round? atdn - meeting, 30.3.2006, berlin marita...
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What needs to be done to make Doha a Development Round?
ATDN - Meeting, 30.3.2006, Berlin
Marita
Wiggerthale
Deutschland
Balance the Imbalances! Agreement on Agriculture („Special treatment for Developed Countries“)
safeguard Measures for Developed Countries (SSG Art. 5/AoA): 6072 Tariff Lines
peace Clause till the end of 2003 creation of the Blue Box reference period 1986-88 = favourable for DedCs
Little special treatment for Developing Countries only 21 DCs do have access to SSG, no LDC Art.6.2: low income and resource poor farmers longer implementation periods and lower reduction commitments
General imbalance: Support measures of DedCs continue to be allowed, those used by DCs have to be reduced
Deutschland
The neglected actor: the European Food Industry Not threatening the export competition
no early end date, no effective front-loading, no volume cuts advocating the parallelism approach (success of Coceral, the association of grain
traders) i.e. elimination of unfair practices threatening the export competition Not threatening import competition
making sure that the EU market is opened according to the progress in the internal reform process of the different CMOs (i.e. drawing internal prices down close to world market prices) flexibility!
Increasing the export potential by opening up markets especially for processed food tariff reduction formula ensuring improved MA for PAPs few exemptions (only a few SPs, no total exemption from tariff reduction
commitments etc.)
Deutschland
Threat: weak safeguard measures I
Challenge 1: inclusion of special products (SP) and special safeguard mechanism (SSM) should not be used as a justification to demand higher tariff reduction commitments from DCs
Challenge 2: make sure that the formula eventually agreed to does not undermine the concepts of SP and SSM
Challenge 3: the treatment of SPs should not be linked to sensitive products
Challenge 4: designation of SPs and SSM for products of export interest to DedCs
Challenge 5: simple, transparent and effective rules for SP and SSM
Deutschland
Threat: weak safeguard measures II Successfully defended elements of safeguards:
self-designation of SPs SSM based on price and volume trigger
Concessions already being made: not all SPs totally exempted from tariff (50-65%), rest 5-10% SSM: no use of quantitative restrictions
To be negotiated and defended: SSM SSM availability for all agricultural products incl. SPs and processed agricultural
products (PAPs) simple and transparent SSM trigger levels allowing for effective remedy action no requirement for proof of injury
Deutschland
Threat: weak safeguard measures III To be negotiated and defended: SPs
stand-alone category of SPs appropriate number of tariff lines (defence of 20%) total exclusion of many SPs from reduction commitments Inclusion of substitutes and PAPs in SP concept automatic eligibility of products benefiting from product-specific support for SP
Needed implementation inside and respect outside the WTO: inscription of modalities in DC’s schedules (e.g. lobby power of global player in
food sector, bilateral pressure from WTO mbs with strong ag-export interest) IMF/World Bank policies regional free trade agreements
Deutschland
Threat: harsh tariff reductions for DCs (Basis: 60 DCs, Reduction in applied tariffs in X DCs)
Deutschland
Poultry Sugar Sorghum Oilseeds
US-formula 28 24 20 18
EU-formula 23 20 17 16
Veg. Oils Wheat Rice Corn
US-formla 20 12 25 20
EU-formula 13 11 17 16
Threat: continuation of dumping
Deutschland
EU proposal for EU: 70%US proposal for US: 60%
EU (bn €) USA (bn $)
End-AMS (UR) 67,2 19,1
AMS after reduction70% EU, 60 %US
20,2 7,6
EU: Estimation post 2003US: Notification 01/02
16,3 14,4
Required change + 3,9 - 6,8
Threat: late elimination of most export subsidies Around 40% „water“ between bound and applied export subsidies, but little water in
allowed volume levels Attention: processed products do not have a volume limit! UR round: reduction in value and volumes Effective front-loading in first half of implementation period would require:
inclusion of processed products (Non-Annex I - products) volume cuts and/or substantial value cuts esp. in dairy and sugar
Interest of food industry: no volume cuts, late total expiry of most of export subsidies
EU-Council decision (Hong Kong, 13-18 December 2005): phasing out of export subsidies should be fully in line with agreed CAP reforms. text should not interfere with the EU's preference that export subsidy elimination
should be expressed in value terms
Deutschland
Threat: tariff escalation not addressed The weighted average approach
(conversion formula) leads to higher AVEs for commodities than for PAPs i.e. deeper cuts in EU tariffs for commodities than for PAPs
No specific coefficient to address tariff escalation (see Harbinson)
Food industry: Tariffs for processed products should continue to be calculated on the basis of content (e.g. the higher the proportion of sugar, the higher the tariff)
Deutschland
Threat: increasing buying power of retailers I Top 30 supermarkets control around 33% of world wide food sales
market power puts retailers in a dominant position in price negotiations and in definition of quality producer standards and conditions and timing of delivery
Liberalisation in distribution services... stops DCs from moderating the emergence of retail driven supply chains seriously restricts regulations aimed at enhancing the capacity and
power of small farmers to supply retailers on favourable terms Few DCs have introduced regulations to ensure a more equitable
relationship between producers and distribution companies (e.g. Malaysia: ban of new hypermarkets in certain areas till 2009)
Demand of Eurocommerce on distribution services: Liberalisation in GATS/Mode 3 in China, India, Japan, USA, Malaysia, Mexico, Brazil, Australia
Deutschland
Threat: increasing buying power of retailers II Current state of GATS negotiations on distribution services:
EU bilateral request to 36 DCs (a.o. China, India, Malaysia, Mexico, Brazil, Bolivia, Ecuador, Philippines, Indonesia, South Africa)
EU bilateral request to 16 DCs (to consider making commitments) collective request by EC, Chile, Japan, Korea, Mexico, Singapur, Taiwan and
USA: covering all sub-sectors (commission agents’ services, wholesale trade services, retailing services and franchising) and all modes
Likely consequence: rapid expansion of supermarket driven supply chains regulations that would require, for example, retail companies to purchase at
least part of their supplies from small producers and assist them to meet higher standards, could be challenged through WTO dispute settlement process
Deutschland
WTO - a recipe for disaster or development? Agriculture: much left still open for negotiation, see threats NAMA: removal of flexibility and needed policy space for industrial
development unprecedented: line-by-line tariff cuts, previous rounds: average cuts unprecedented: DedCs ask DCs to make stronger tariff cuts (violation of
principle of LTFR, necessary: coefficient of 80 for DCs and 5 for DedCs) NAMA negotiations are simply unacceptable in their present form
GATS: increased pressure to liberalise service sectors, not enough time, space and flexibility for DCs to make right decisions (effectively irreversible!)
LDCs: market opening for 97% of tariff lines, but under the EBA the use of 18 tariff lines was enough to exclude sugar, rice and bananas. 3% allows the exclusion of 10 times this number of tariff lines
Deutschland