The chairperson, who is New Zealand’s ambassador, was reporting to the full membership on the consultations he has held with a number of delegations since the last meeting in May.
Norway used the meeting to propose an idea that might help solve one of the difficult issues under discussion: how to allow developing countries to use price support when they purchase and stock produce for food security without breaching their committed limits on domestic support.
The proposed solution would involve an adjustment in calculations to take account of markets that do not function properly, enabling at least some developing countries to acquire food at administered prices for the purpose without breaching limits on trade-distorting domestic support.
It was welcomed by several delegations as an example of the new ideas needed at this stage. Ambassador Adank urged members to use the WTO’s summer break — August to early September — for more creative thinking.
“As I’m not in a position to announce today that we have consensus in any area of our work in relation to Bali, this means that the period after the summer break will necessarily need to be extremely focused and intensive if we are in fact to deliver on the expectation that has been set now for several months that ‘elements of agriculture’ will form part of a suite of Bali decisions,” he said.
“So delegations need to adjust their mind-set to take into account this timeframe. I would encourage you before you depart for the summer break to register where things are with your capital, and ensure that both you and they are focussed on the challenge that will need to be met if we are to arrive at convergence on agricultural elements for the Bali Ministerial.”
The consultations have focused on the stockholding-for-food-security proposal from the G–33 group of developing countries, which would require some rules changes on domestic support, and a proposal from the G–20 group of developing countries active in agriculture, on export subsidies and related issues grouped as “export competition”.
The two are among proposals currently on the table in agriculture, as issues that might be agreed at the 3–6 December 2013 Ministerial Conference in Bali ahead of other issues in the Doha Round talks.
A third envisages tighter disciplines for administering tariff-rate quotas — how governments allocate among importers shares of quotas for lower-duty quantities, and how to deal with the possibility that the methods used might impede trade. This has not been discussed recently, and members still have reservations about it, Ambassador Adank reported.
This meeting was the last before the final session of the Trade Negotiations Committee (TNC) — which oversees the Doha Round talks in all subjects — before the summer break, from August to early September. With a number of differences remaining on core issues in the proposals, delegates agreed with the chairperson that more intensive negotiations are needed after the break.
(The chairperson’s statement is below.)
Once again, the increased political importance of this phase of the talks was reflected in the presence of ambassadors as heads of several of the delegations.
Public stockholding for food security
The G–33, with Indonesia as its coordinator, is a group of developing countries seeking extra special treatment to protect and support their poor farmers. Here, it proposes amending the Agriculture Agreement to loosen disciplines on domestic support, including using price support for public stockholding and food aid purposes, in order to enhance food security by supporting poor farmers and consumers. It draws on the text in Annex B of the December 2008 draft “modalities”, the main agriculture draft currently on the table.
See more details here.
One of the problems identified by the G-33 is the possibility that when a government purchases at an “administered price” instead of the market price, it risks exceeding the country’s limit on domestic support, particularly when prices are high. This is because the size of the support is calculated using the difference between present reference prices and those of the 1986–88 base period when prices were considerably lower than they are now.
Norway’s proposal envisages a downward adjustment in the administered price when markets do not function properly, although Norway said how the adjustment would be determined still needs to be discussed.
As in the previous meeting, the chairperson reported on members’ responses in the consultations to four questions he previously asked. He reported signs that the talks on two of them could produce text in a Bali declaration in December, although in both cases further work is needed.
One deals with adding various programmes such as rural development and land reform to the list of government services included in the Agriculture Agreement’s provisions on the Green Box — support that does not distort trade or does so minimally, and is therefore allowed without limits.
Members discussed some modifications to the proposal. As a result, a convergence seems to be emerging around the possible wording for a Bali declaration that would broadly recognize those programmes as “general services” in the Green Box, provided the general conditions apply such as being no more than minimally trade-distorting, the chairperson said.
The other deals with a possible political statement by ministers in Bali that could include a possible “due restraint” statement along the line of the 2001 Doha Decision on Implementation. This “urges members to exercise restraint in challenging measures notified under the green box by developing countries to promote rural development and adequately address food security concerns.”
Although some differences remain and there is no consensus on what the statement might contain, Ambassador Adank said he remains convinced that a broader convergence should be possible on this political message as members reflect further.
Once again, members remain divided on the third and fourth questions, which deal with amending or interpreting the Agriculture Agreement before or after Bali, or possible additional flexibility for individual countries that risk exceeding their Amber Box limits.
However, the chairperson noted that the most progress had been made on the possibility of an “interim mechanism” providing flexibility for specific members (the subject of question 4).
Although the G–33 had not originally proposed this, they were willing to discuss it, he said. His report (below) described the conditions that were being discussed.
G–33 members confirmed in this meeting that they would need some “legal certainty” that their use of the mechanism would not be subject to legal challenge. Other members said they sought a mechanism with time limits, transparency and a means of preventing a “spill-over” that would distort markets.
Part of the discussion is about what can be done before the Bali meeting in December, with some countries calling for broader work on food security after the conference.
The chairperson said some progress has been made as members consider seriously the “parameters” of possible solutions, particularly on possible flexibility for specific countries, but crucial differences remain unresolved.
“So, to sum up, the consultations have moved into serious consideration of the parameters of possible solutions. Members have a considerable number of elements to consider, and I have been careful to allow them the space to do so,” he said.
“Time is however now pressing and I think it’s important that members start to deepen the discussion of the most appropriate models for delivering flexibility under an interim mechanism, assuming that this is what members are prepared to envisage as an outcome for the Bali meeting.”
Ambassador Adank said that the debate on the export competition proposal is clearly still at an early stage. Members need to discuss it seriously further in order to get a better idea of what could be possible in Bali, he said.
“I think the challenge here, perhaps, is to see if we can find what we might be able to agree on, rather than what we can’t agree on, which is of course always our challenge in this house,” the chairperson said. “But sometimes getting to that point takes a little while.”
He went on: “Obviously this issue has had a clear profile in the negotiations, but I think you can also see that there persist quite different perspectives in terms of the concrete steps that may be possible at this point.
“So I guess my thought would be: Are there points of convergence amongst all of that, that we might be able to arrive at as our work continues in coming weeks? Rather than get into any more detail on that we should just simply reflect and come back in September when we will have to pick up some of these conversations. ”
The proposal was circulated in May by the G–20 group of developing countries active in agriculture. It envisages first steps towards eliminating export subsidies and disciplining export credit to reduce the chance that the credit is subsidized.
The group, whose coordinator is Brazil, has proposed that developed countries halve the maximum amounts they can spend on export subsidies by the end of 2013. The maximum allowed quantities of subsidized exports would also be reduced by the end of 2013to the average actual quantities in 2003–05. All WTO members would phase in a 540-day limit in the repayment period for export credit (the eventual target is the benchmark for commercial terms, ie, 180 days).
The proposal arises partly from 2013 deadline for eliminating all forms of export subsidies originally agreed at the Hong Kong Ministerial Conference in 2005, which is highly symbolic for many members.
Ambassador Adank reported that some members supported the G–20’s proposal, including some who may still have some questions related to the proposal. But, he said, objections came from some of the largest subsidizers — strictly speaking, those that have the biggest committed export subsidy limits after implementing reductions from their historically high levels, even though currently the actual subsidies might be low. This last group argued that the 2013 deadline was only agreed in Hong Kong as part of a complete Doha Round deal.
Some members also said the G–20 proposal would have a real impact on their actual use of export subsidies (for many others, the reduced ceilings would not affect the considerably lower subsidies they are actually using at the moment).
Tariff-rate quota (TRQ) administration
The chairperson had little to report on TRQ administration since there were no consultations in recent months as negotiators focused on other issues.
Tariff-rate quotas (or tariff quotas) are where duties on quantities inside the quotas are lower than on quantities outside.
Some countries argue that the way the quotas are managed (including the methods for allocating the quotas to importers or exporters, and various other administrative practices), can be too cumbersome and hamper exporters’ ability to access markets.
The G–20 proposes tighter disciplines for this. It envisages a number of measures for sharing information and monitoring how quotas are used. If a quota is persistently under-filled, the importing government would have to apply one of a prescribed set of methods for administering quotas aimed at removing impediments. Developing countries would have some additional flexibility in choosing the method of administering the quotas.
Most speakers said they consider this issue to be a candidate for agreement in Bali. They described it as less complicated technically. Some called it simply implementation of the present, Uruguay Round, Agriculture Agreement. However several expressed concern about provisions offering special treatment for developing countries.
Some feared it would allow developing countries to have persistently underfilled quotas without having to act on the administration method, while several developing countries stressed that they need the special treatment.
Further small group consultations and meetings of the full membership, dates to be announced
Explanation back to top
This was an informal agriculture negotiations meeting of the full membership, officially an “Informal Open-Ended Special Session” of the Agriculture Committee.
Modalities: The way or method of doing something — in this case, how to cut tariffs, enlarge quotas and reduce subsidies and support, along with flexibilities to deal with various sensitivities. The core methods are formulas for cutting tariffs and supports, with a number ways of achieving the flexibilities or tightening disciplines. Once the modalities have been agreed, countries can apply the formulas to tariffs on thousands of products and to various support programmes.
Chairperson’s statements back to top
Use these links to download the audio files or to listen to what he said in the meeting:
The chair’s statements:
Text back to top
[Note, “JOB” documents are not available publicly]
The purpose of today’s meeting is to update members about recent consultations concerning the G–33 proposal on public stockholding for food security (JOB/AG/22) and the G–20 proposal on export competition (JOB/AG/24), and to allow delegations an opportunity exchange views on these proposals, as well as on the G–20 proposal on TRQ [tariff-rate quota] administration (JOB/AG/20), or any other issues.
But I think before we commence this overview of the state of play we need to remind ourselves of the time that we now have remaining in the lead up to the Bali meeting.
As members will be aware, the end of next week marks the beginning of the summer break, with many WTO delegates taking leave during August and no expectation of a real resumption of WTO work until September. That of course is the case each year but this year is different as when delegations return in September we can expect our work to intensify significantly if we are to prepare effectively for the Bali Ministerial in early December.
So, I think it’s important that we all recognise that we will have at the very most around two months — perhaps only 6 to 8 weeks — when we return after the summer break to prepare the ground for the Ministerial.
As I’m not in a position to announce today that we have consensus in any area of our work in relation to Bali, this means that the period after the summer break will necessarily need to be extremely focussed and intensive if we are in fact to deliver on the expectation that has been set now for several months that “elements of agriculture” will form part of a suite of Bali decisions.
So delegations need to adjust their mind-set to take into account this timeframe. I would encourage you before you depart for the summer break to register where things are with your capital, and ensure that both you and they are focussed on the challenge that will need to be met if we are to arrive at convergence on agricultural elements for the Bali Ministerial.
For this meeting I would plan to proceed as follows — first, I plan to report back on consultations on the G33 proposal, following which I will seek views from members. Second, I will report back on the G20 Export Competition proposal and also seek views, before finally, touching base on the G20 TRQ proposal and any other issues that members may want to raise. My point would be that I would prefer members to keep their comments today specific to the various proposals to make for an orderly discussion. If there are members who have statements of a general nature to make could I ask them to make them now before we proceed into a discussion of the individual topics.
Would any member or group like to make a general statement? (As I’ve said, if your statement is specific to a proposal could I ask you to make it when we come to that proposal.)
If I could begin this report back with a report on the discussions around the G-33 proposal. Since we last met in May, I have continued to hold consultations on the proposal, based on the four questions I initially outlined in the senior officials meeting on 30 April 2013.
I can report that at a basic level some elements of potential convergence have begun to emerge. I shall outline these for you today, as well as the areas where potential convergence is still elusive.
If you allow me, as last time, I will proceed again question by question.
Question 1 back to top
Are members willing to consider that the Bali Declaration/decisions include recognition that, subject to the fundamental requirement of the Green Box relating to no or minimal trade or production distortion, the Green Box needs to be flexible enough to encompass a wide range of general services policies in developing countries along the lines indicated in the proposed paragraph (h) (which the G–33 proposal suggests be added to the Illustrative List of Green Box measures)?
Regarding Question 1, further progress has been made in clarifying views of members on a number of issues that members have had regarding the “general services” elements outlined in proposed paragraph (h) referred to in the G–33 proposal. Following some initial discussion in a smaller group which highlighted potential overlap between some elements in the proposed paragraph (h) and existing elements of the Green Box lists contained in Annex 2 of the Agreement on Agriculture [which defines the Green Box,], it was suggested by Indonesia, on behalf of the G-33 to delete “provision of infrastructure services” and “nutritional food security” from the list of general service programmes in the proposed paragraph (h), given that both of these aspects are addressed in other parts of Annex 2. The suggestion was positively received by others.
Draft language was also proposed for a potential Bali outcomes document to introduce the requested clarification. To address the concern raised that the suggested drafting might be understood as implying that only developing country members would be allowed to classify such programmes in the Green Box, it was suggested to delete “in developing country members” in the sentence starting by “Policies and services related to …” introducing the list of programmes, with the reference to developing countries’ specific needs being maintained in the introductory paragraph. I have asked the Secretariat to circulate the proposed revised drafting to members.
So, overall there seems to be some convergence emerging around outcomes language for Bali that would recognize in general terms that the policies and programmes mentioned in the first part of the G–33 proposal — with the suggested modifications — could be considered to fall within the scope of “General Services” of Paragraph 2 of Annex 2 to the AoA [Agreement on Agriculture], provided that the declaration makes clear that the chapeau contained in Paragraph 1 of Annex 2 would fully apply to such policies and programmes.
I think this is positive news.
Question 2 back to top
Taking into account what the Ministerial Conference has said in the past (including in the Implementation Decision of 2001), can we use Bali to send a convergent political message that recognises the role played by public stockholding and similar policies in some developing countries?
The response to Question 2 (that suggested considering a political message to be delivered in Bali recognizing the role played by public stockholding in developing countries) has also been positive at a general level. However, divisions remain between: those who have expressed their readiness to start working without delay on text for a possible Bali Communique or Declaration and those who consider that the debate on Question 2 should take place once the “contours” of the possible outcome on the other elements of the G–33 proposal (notably replies to Questions 3 and 4) are clearer.
For a potential declaration text it has been suggested to take into account previous existing declarations from various regional or multilateral agricultural contexts. Other members have cautioned that any consensus statements for MC9 [the ninth WTO Ministerial Conference, in Bali] will necessarily need to be acceptable to all members. And it of course goes without saying that members do retain different perspectives on the issue of food security when we get into detail — so we need to be realistic and I think avoid seeking to reinvent the wheel.
Regarding a possible “due restraint” statement along the line of the 2001 Implementation decision, different opinions have been expressed. Some members consider that the message should bring some value added by comparison with the 2001 decision. Some other members consider that clarification would be required on the possible scope of such a decision in terms of the type of measures and the members covered, and that such a measure should be: i) limited in time and/or linked to with the duration of a post-Bali work programme on food security and/or ii) associated with an engagement to further reform agricultural policies. The discussion in this area was in the minds of many members linked to where the discussion on Questions 3 and 4 would take us.
So, currently while no consensus has been reached about any specifics of the potential elements to be included in the Bali outcome text, I remain hopeful that, as members reflect further, a broader convergence should be possible on this political messaging issue. I would encourage all members to look at the further discussions we will necessarily need to have in this area in a positive and realistic light, and avoid seeking to advance propositions that they know from the long history of past discussions are unlikely to be amenable to consensus. We simply don’t have the time for this.
Turning to Question 3, which reads:
Question 3 back to top
Are members prepared in the lead up to Bali to agree on any amendment or interpretation of existing WTO AoA [Agreement on Agriculture] disciplines that might provide greater flexibility in this area of public stockholding than is currently the case? If so, what is this amendment or interpretation? If not, are members prepared to consider further work on these issues in the post-Bali period, and how would this work be framed?
Regarding Question 3 about a potential amendment or interpretation of existing WTO AoA disciplines, the situation has not changed. Members’ opinions are still divided between those favouring a general systemic solution to the issue for Bali (through an amendment or interpretation of the existing rules); and those questioning whether such amendment or interpretation is either possible or desirable by Bali.
Members were also asked to comment specifically on the various ideas raised by G33 members for amending or interpreting the rules relating to:
(i) de minimis criteria;
(ii) the external reference price;
(iii) the “eligible production”; and
(iv) the administered price
It was felt by many that modifying any of the four sub-items would have implications that go far above the public stockholding and therefore are a too big issue for Bali.
Regarding the sub-question about the further work on these issues in the post-Bali period, while some members have suggested focussing now on what a post-Bali work programme might look like, others have suggested that the focus must necessarily remain on what is doable for Bali and only after this is clear should the focus revert to the post-Bali issue..
If I could now turn to Question 4, which it’s fair to say, has been the focus of quite a lot of discussion, since I think it’s generally recognised that efforts to achieve a consensus in this area may in fact be more realistic in the time that we have before the Bali meeting. This question reads:
Question 4 back to top
Are members willing to consider a mechanism or process whereby any member with specific concerns that their public stockholding policies aimed at addressing food security objectives were at risk of breaching their WTO commitments could bring those concerns to the attention of members and seek additional flexibility on an interim basis, pending any broader agreement to modify the disciplines in general?
This question about a possible interim mechanism has made probably the most progress since we last met in May. Different positions on the threshold conditions and the main characteristics of a potential mechanism have been expressed more clearly and some elements of convergence have been starting to emerge. For example, it has been generally agreed that the mechanism could:
- cover public stockholding programmes of developing countries related to food security;
- be limited to staple crops, given the food security focus;
- that its use could be subject to an on-going provision of information that would allow members to monitor the situation;
- that members could look at safeguards or guarantees aimed at avoiding potential spill-over effect on markets;
- that the Committee on Agriculture would be the appropriate home for the mechanism in terms of notification and monitoring discussions.
There is also a general sense that any flexibility delivered under a mechanism should be time-limited and the mechanism itself should be an interim one. I think “interim” here meaning that the mechanism should provide some additional breathing space for members having trouble respecting their commitments in respect of public stockholding for food security programmes while working to find a more lasting solution.
Among the threshold conditions to access the mechanism, it has been also generally suggested that the member must find itself in a situation of near-breach of its commitments. Other conditions that might justify recourse to such a mechanism have been noted as possibly including
- extraordinary and sudden increases in food prices;
- the presence of market failure;
- respect of the existing notification requirements; and
- the importance of ensuring that recourse to the mechanism does not displace a general policy orientation towards economic reforms.
Despite this progress, some crucial questions remain. These include notably the question whether the flexibility delivered under such a mechanism should be
- approved on a case by case basis; or
- a hybrid arrangement that would involve some degree of automaticity as well as case by case elements.
A related question here is the nature of the flexibility delivered under any self-executing or automatic mechanism? If members considered that this would need to be expressed very clearly, how would they express it?
I stress that members have yet to determine which of these three general directions they prefer to pursue. If a mechanism is to be elaborated further, arriving at some clear direction in this area will be extremely important to enable the elaboration of a mechanism in the remaining weeks that we have at our disposal.
Some members have also highlighted the need to ensure that any flexibility delivered under any such mechanism would need to be legally robust to ensure that members were not challenged under the Dispute Settlement mechanism. How would the mechanism be packaged to provide appropriate legal flexibility? Would it be like a WTO waiver, or something else?
My understanding is that members have been thinking of pros and cons of different options for the mechanism and I encourage them to continue to do so.
It should be also noted that while the G–33 has been engaging on Question 4, it has also reminded other members that the idea of a mechanism does not come from them, and therefore does not reflect the group’s position which is to favour a change to existing rules, rather than an interim solution.
So, to sum up, the consultations have moved into serious consideration of the parameters of possible solutions. Members have a considerable number of elements to consider, and I have been careful to allow them the space to do so.
Time is however now pressing and I think it’s important that members start to deepen the discussion of the most appropriate models for delivering flexibility under an interim mechanism, assuming that this is what members are prepared to envisage as an outcome for the Bali meeting.
I have been encouraged that at the technical level among agriculture attaches there have continued to be active discussions and I would encourage these discussions to assist the Ambassador plus 1 process that I would plan to continue to try to identify convergence for Bali.
Can I now invite members to comment on the state of play as I have outlined or to share their own perspectives on it if these differ from my own — and can I particularly encourage members to come forward with practical suggestions about how we might take our work forward in this area. For my part I will continue my consultations with the aim of widening the zones of convergence and narrowing the remaining differences, keeping in mind the overall requirements of the Bali preparatory process.
Export competition back to top
Now, moving to the G–20 proposal on export competition.
Following the circulation of the G-20 proposal on export competition (JOB/AG/24) on 21 May and the preliminary reactions expressed at the last meeting of the Special Session of the Committee on Agriculture on 23 May, I have had consultations in various formats — both with a broader group as well as individual bilateral consultations — to get a better sense of where members stand. I’d like to report back today on the views that members have expressed here — my purpose being to avoid a simple repetition of these views today — of course if any member feels that I am not capturing their own views they should feel free to say so.
On one hand, the G-20 and a group of other members, including some who may still have questions related to the G-20 proposal including the references to Article 9.4 of the AoA [which gives developing countries some exemptions during the implementation period], clearly want a step forward in Bali on export competition, including in terms of legal commitments. This position is presented as in keeping with the 2013 deadline agreed in Hong Kong in 2005 for the elimination of all forms of export subsidies, which was of course also incorporated in the Rev4 draft modalities text.
On the other hand, some of the members with the largest export subsidies commitments, have underlined that while they remain committed to the elimination of export subsidies, the conditions under which they could modify the legal commitments in the field of export competition are in their view not met. And this is notwithstanding that their actual use of export subsidies has significantly decreased in recent years. For them, the text agreed at Hong Kong in 2005 and the Rev 4 text on export competition that followed on from this was conditional upon the overall conclusion of the Doha Development Agenda, as was the implementation of the rev 4 text overall. A partial implementation of the export competition pillar — or even the full implementation of the export competition pillar without accompanying delivery of other key elements of the Doha package — is therefore not seen as a viable option for the Bali meeting.
There is also another group of members with export subsidy commitments who point out that the G20 proposal would have real practical impacts for their use of export subsidies rather than just “cut water” out of their scheduled commitments. While not ruling out a discussion, these members have pointed to the additional difficulty this would cause and highlighted, along similar lines to the previous group of members I’ve referred to, that any move in the direction of the G20 proposal would only be possible in the context of a wider package of reform both across and beyond the agriculture pillar of Doha.
I don’t think the views I am reporting back today come as any real surprise to members that have participated in my consultations or those who have independently taken the opportunity to test waters with other members. Clearly, we have some way to go in this area to locate any convergence, which I think remains a further task we will need to pursue in the weeks ahead.
Tariff-rate quota (TRQ) administration back to top
Now turning to the G-20 proposal on TRQ administration members will be aware there have been no further consultations specifically on this proposal, although I have continued to meet with delegations to hear their views on this issue.
As I mentioned at our last meeting in May, members continue to see this as a useful one to explore for possible decision in Bali, even though there are some sensitivities about aspects of the proposal that members have reflected to me in various consultations.
I think these concerns can be divided into two different areas
- first, some concerns about the actual text and specifically the special and differential treatment elements of it; and
- more general questions that some members have raised with me about how the mechanism would operate in practice and the need to ensure that it does not end up targeting a situation where the underfill was due to market conditions unrelated to quota administration conditions
I think these latter range of concerns are ones that can be worked through in a more practically focused “real world” discussion.
I have said for some time that I don’t think the time is quite ripe for broader discussion in these areas, but we will certainly need to return to this proposal after the summer break to discuss all of these aspects, in the context of other possible components of the Bali package.
I will continue to consult with interested members before we break for summer vacations. I also encourage all members to use the break to think about different proposals and solutions keeping in mind that when resuming the work in September, not much time would be left before Bali.
I will be in touch regarding the specific timing for our next meeting after the summer break and in the meantime would encourage any member who wants to meet with me to set up a time to do so