Triennial Review of the Nairobi Decision on Export Competition and implementation of the Decision
As proposed by the chair, Debora Cumes (Guatemala), members adopted by consensus the report of the first triennial review of the Nairobi Ministerial Decision of 19 December 2015 on Export Competition(G/AG/28).
The Cairns Group (a group of agricultural exporting nations lobbying for agricultural trade liberalization) circulated a supplement to a previous submission (G/AG/W/180/Add.1) aimed at analysing the information on export support collected by the Secretariat (G/AG/W/125/Rev.9).
Since the last meeting in June, the WTO certification procedure of Switzerland's revised schedule for eliminating export subsidies was completed while Colombia, Uruguay and the United States have each tabled amended draft schedules with a "nil" entitlement for all products. So far, among the 18 members with export subsidy commitments, two members — New Zealand and Panama – had already phased out their export subsidies at the time of the Nairobi Decision, ten (Australia, Norway, Israel, Switzerland, the EU, Canada, South Africa, Colombia, Uruguay and the US) have taken actions to amend their schedules, and six (Brazil, Indonesia, Iceland, Mexico, Turkey and Venezuela) still have to submit their revised draft schedule.
During the meeting, Brazil, Mexico, Indonesia and Turkey provided an update on their ongoing internal process to prepare the submission of their draft schedule. The United States asked additional questions regarding other members' export programmes (G/AG/W/184/Corr.1)
The chair, congratulated members that had replied to the Secretariat's questionnaire, including those that had made the effort to reply after the June 2018 meeting. The chair announced that a new questionnaire would be circulated by the Secretariat to prepare for the next dedicated discussion scheduled in June 2019.
Several members called for greater participation in the dedicated discussions and more replies to the questionnaire.
US’s new $12billion farm aid package
The $12billion farm aid package announced by the United States on 24 July provoked strong interest among members (G/AG/W/184, page 9-12). This programme was rolled out by the US government to assist farmers deemed most hit by the retaliatory tariff measures of some WTO members. It will be distributed through the Market Facilitation Program (MFP) as direct payments to farmers, the purchase of certain commodities, and a trade promotion programme. Multiple questions were posed to the United States to seek further clarity on the policy and to better understand its potential impact on global market.
Members sought details on the methodology of the programme, its duration, and its consistency with existing WTOrules. Some members worried that US might exceed its aggregate measurement of support (AMS) entitlement limit of $19 billion per annum, running afoul of the disciplines in the WTO's Agreement of Agriculture.
The United States confirmed that it is a one-time policy, covering the fiscal period September 2018 - January 2019. Regarding the methodology used, the subsidised products will be decided based on its export amount to the countries that have imposed retaliatory tariffs. Asked about its trade distorting effect, the US stressed that this is a short-term programme aimed at dealing with the impact of retaliatory tariffs, and would not entail export subsidies norwoudl it become a public stockholding programme. The US said information on the methodology and market facilitation programme is posted on the US Department of Agriculture (USDA) website and that it planned to submit WTO notifications in a timely manner. The US noted that the programme would not have an impact on farmers’ production decisions since the programme was initiated after farmers had planted their annual crops.
Many members expressed strong interest in following up on the implementation of the programme. Others said they intended to monitor whether the programme is fully consistent with WTO rules.
Meanwhile, India’s farm policies continued to draw attention due to concerns about their potential impacts on global markets. Members pressed for more detailed information regarding India's export subsidies on skim milk powder and proposed domestic support programme (G/AG/W/184, page 6-8). India stated that financial supports provided through various state policies are intended to compensate farmers for marketing, handling, distribution and associated costs, which are allowed under Article 9 of the Agriculture Agreement. It said the proposed national agriculture policy is still under consideration but would be consistent with WTO rules.
Members reviewed submissions of 10 new questions associated with Article 18.6 of the Agreement on Agriculture (review of the implementation of commitments), all included in Secretariat document G/AG/W/184.
Tariff rate quota administration
Members continued to review the Bali Decision on TRQ administration, which seeks to promote a continuing process of improvement in the utilisation of tariff rate quotas. Provisions dealing with the last stage of the underfill mechanism were addressed in the review discussions. The talks were facilitated by two new documents: the Secretariat’s background paper on TRQ administration methods and fill-rates from 2007 to 2016 (G/AG/W/183) and Australia’s “Review of Bali Decision on TRQ administration” (G/AG/W/186). The papers submitted earlier by the Cairns Group (G/AG/W/179) and the European Union (G/AG/W/175)were also discussed.
The exchanges focused on addressing the causes of chronic TRQ underfill and how to share best practices to improve the efficiency and quality of the notifications submitted. The issue of special and differential (S&D) treatment and the universal applicability of the underfill mechanism came up frequently in the discussions. A number of developing members stressed the importance of S&D and cautioned against burdensome TRQ reporting requirements.
Several members expressed interest in organizing a thematic session on TRQ administration and the underfill mechanism in November to promote sharing of experiences on various aspects of TRQ administration arrangements. The chair invited the Secretariat to explore the possible timing for this event. The chair also reminded members of the end-December 2019 deadline, when the General Council must finalize its recommendations on the review; the committee therefore needs to finalize its report possibly by June 2019.
Regular review of agriculture policies
Members continued to review policies related to the three pillars of agriculture trade: market access, domestic support and export competition. Members kept probing for information on the sugar policies of India and Pakistan and expressed concerns regarding their potential trade distorting effects. Questions were also raised regarding the United Kingdom's future schedule of agriculture commitments; the EU said it could not answer the question which related to UK´s future trade policy after UK ceases to be a member of the EU after 30 March 2019. Many members highlighted their strong interest in this issue.
Enhancing Transparency and the Committee on Agriculture Review Process
Norway in its paper (G/AG/W/185) expressed continued interest in revising the notification requirements and formats for the committee, currently set out in G/AG/2. Norway said that the deadlines contained in that document are unrealistic. It also called for best practice sharing to improve notifications and enhance transparency. Members reaffirmed that timely and complete notifications are crucial in order to move negotiations forward. However, some members preferred to maintain the deadlines decided by ministers in 1995 and to focus on how to strengthen notification capabilities.
The next agriculture committee regular meeting is tentatively scheduled for 26-27 November.