WTO Services and Agriculture negotiations: meetings set for February and March

The General Council also unanimously agreed to address the trade and developmental impact on developing countries during mandated reviews of WTO agreements including those on intellectual property rights (“TRIPS”) and trade-related investment measures (“TRIMS”).

“Today’s decisions show that the WTO is very much in business” said WTO Director-General Mike Moore afterwards. “The members reached agreement with a tremendous amount of goodwill. This is the result of a lot of serious and constructive preparation.

“The decisions provide a platform, not only for the mandated negotiations and reviews, but also for other issues which members would like to see included in the WTO’s programme,” Mr Moore said. “With work underway constructively in agriculture and services, discussions on the other issues can also progress.

“Agriculture and services are vitally important for the prosperity of people all over the world,” the Director-General said. “Half of the world’s workforce — 52% of the female workforce and 46% of the male workforce — are in agriculture according to the World Bank’s latest figures, and 29% work in service industries.

“Both sectors are already going through fundamental reform and liberalization under the WTO, and the launch of the new negotiations will provide WTO member governments with the opportunity to thrash out their differences and continue with the reforms in a way that best serves their priorities and their interests,” he said.

“While both subjects have been difficult to negotiate in the past, and will no doubt continue to be difficult in the coming years, WTO member governments did reach important agreements six years ago. I’m confident they’ll do so again. There’s just too much at stake.”

Many of the topics discussed today remain on the table following failure to reach agreement at the 30 November to 3 December 1999 Ministerial Conference in Seattle.

The negotiations on agriculture and services are required under current WTO rules (Article 20 of the Agriculture Agreement and Article XIX (i.e. 19) of the General Agreement on Trade in Services).¹ These talks will cover sectors accounting for about half of the world economy and about a quarter of international trade. According to WTO figures, in 1998, out of about $6.7 trillion of world trade in goods and services, agriculture accounted for $0.5 trillion (over 8%), and services for $1.3 trillion dollars (almost 20%).²

The objectives are to further liberalize trade in services and to continue the agricultural reform programme in which WTO members have agreed gradually to reduce subsidies and tariff- and other barriers.

The present programme for agriculture lasts six years (until the end of this year) for developed countries, and 10 years (to 2004) for developing nations. It includes reductions in export subsidies, trade-distorting domestic support, and import tariffs. In services, new post-Uruguay Round agreements were reached on telecommunications liberalization in February 1997, and financial services liberalization in December 1997.

The new negotiations will take place in parallel with routine work in the Services Council and Agriculture Committee. This includes monitoring how the present agreements and commitments are being implemented.

Members are already consulting among themselves and with Mr Moore about how to proceed with discussions on implementing a number of other present agreements — including proposals to postpone deadlines for developing countries in certain areas such as intellectual property and investment measures — and special concessions for products from least developed countries.

The General Council agreed today to intensify consultations on these issues, and on how to improve decision-making so that the process is more efficient and at the same time allows all members to participate and keep informed about developments. It instructed Mr Moore to consult with members on possible steps to be taken on all of these subjects.

SEE ALSO Press Release 166:Director-General’s statement to General Council

For more information on agriculture and services in the WTO, see the agriculture or the services section of the WTO guide “Understanding the WTO”, the introduction to the WTO, also available on the WTO website at http://www.wto.org/thewto_e/whatis_e/tif_e/tif_e.htm

THE MANDATES (back to top)

Article 20 of the Agriculture Agreement:

“Continuation of the Reform Process

“Recognizing that the long-term objective of substantial progressive reductions in support and protection resulting in fundamental reform is an ongoing process, Members agree that negotiations for continuing the process will be initiated one year before the end of the implementation period, taking into account:

1. the experience to that date from implementing the reduction commitments;
2. the effects of the reduction commitments on world trade in agriculture;
3. non-trade concerns, special and differential treatment to developing-country Members, and the objective to establish a fair and market-oriented agricultural trading system, and the other objectives and concerns mentioned in the preamble to this Agreement; and
4. what further commitments are necessary to achieve the above mentioned long-term objectives.”

Article XIX of the General Agreement on Trade in Services:

“Negotiation of Specific Commitments

“1. In pursuance of the objectives of this Agreement, Members shall enter into successive rounds of negotiations, beginning not later than five years from the date of entry into force of the WTO Agreement and periodically thereafter, with a view to achieving a progressively higher level of liberalization. Such negotiations shall be directed to the reduction or elimination of the adverse effects on trade in services of measures as a means of providing effective market access. This process shall take place with a view to promoting the interests of all participants on a mutually advantageous basis and to securing an overall balance of rights and obligations.

“2. The process of liberalization shall take place with due respect for national policy objectives and the level of development of individual Members, both overall and in individual sectors. There shall be appropriate flexibility for individual developing country Members for opening fewer sectors, liberalizing fewer types of transactions, progressively extending market access in line with their development situation and, when making access to their markets available to foreign service suppliers, attaching to such access conditions aimed at achieving the objectives referred to in Article IV.

“3. For each round, negotiating guidelines and procedures shall be established. For the purposes of establishing such guidelines, the Council for Trade in Services shall carry out an assessment of trade in services in overall terms and on a sectoral basis with reference to the objectives of this Agreement, including those set out in paragraph 1 of Article IV. Negotiating guidelines shall establish modalities for the treatment of liberalization undertaken autonomously by Members since previous negotiations, as well as for the special treatment for least-developed country Members under the provisions of paragraph 3 of Article IV.

“4. The process of progressive liberalization shall be advanced in each such round through bilateral, plurilateral or multilateral negotiations directed towards increasing the general level of specific commitments undertaken by Members under this Agreement.”

Background Data(back to top)

Note that trade figures for “agriculture” do not correspond exactly with the activities under negotiation since they include fisheries products.

• World trade in agricultural products, 1998

• Top 15 agricultural exporters and importers, 1998

• Agricultural products’ share in trade, by region, 1998

• Leading exporters and importers in world trade in commercial services, 1998

• Agriculture and services as % of GDP

• Employment by economic activity

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¹ At the end of the 1986–94 Uruguay Round of trade talks the countries which were to become the WTO’s membership agreed to resume negotiations on both subjects at the beginning of this year. This was written into the agreements.

² These are best available estimates adjusted to take account of the following: the services agreements exclude government services, and the Agriculture Agreement includes processed food and exclude fisheries products. Available figures are: agriculture (excluding processed food but including fisheries products) and services (including government services) account for 65% of world GDP (World Bank). Agriculture (including processed food and fisheries products) and services (excluding government services) account for 27% of international trade (WTO).