DEPUTY DIRECTOR-GENERAL ALAN WM. WOLFF
Ladies and gentlemen,
Welcome to the third edition of the WTO Agriculture Symposium, an important annual rendezvous for addressing the most topical issues in agricultural trade. This year’s Symposium marks the 25th anniversary of the creation of the WTO and the entry into force of the Agreement on Agriculture.
On this special occasion, I would like to extend a warm welcome to our speakers.
Dr. Qu Dongyu, the Director-General of the Food and Agriculture Organization, has played a leading role this year in G20 Summits. At the Summit, you said, "It is essential for the G20 to keep working on preventing this health crisis from becoming a global food crisis."
Your call to invest in agri-food systems, boost farmer productivity, scale-up social protection mechanisms, and work on digital innovation have provided a roadmap for action.
Dr. Agnes Kalibata, the Special Envoy of the UN Secretary-General for the 2021 UN Food Systems Summit. Dr. Kalibata, I wish to offer my somewhat belated congratulations to you on your nomination as Special Envoy of the UN Food Systems Summit. The size of the challenge before you is enormous. But who better than you to take on this role, as a former Minister of Agriculture in Rwanda, and President of the Alliance for a Green Revolution in Africa.
Dr. Michael Fakhri, I wish to congratulate you on your recent nomination as UN Special Rapporteur on the Right to Food this July. The timing of your nomination during a global pandemic and a time of great economic hardship, could not be more important.
Turning to the subject at hand --
In feeding one in every six people around the globe, trade is a vital piece of the food systems and food security.
The WTO’s Agreement on Agriculture remains the only instrument that exists at the international level to govern global trade in agricultural products. Since its entry into force, world exports of agricultural products have tripled from USD 450 billion to USD 1.5 trillion.
The Agreement has during this last quarter century played a vitally important role in facilitating the flow of food from the lands of the plenty to the countries that would otherwise be lands of food deficit. It is a mutually beneficial system that improves the lives of billions of people.
The WTO Agriculture Agreement's role in ensuring orderly trade relations, and in levelling the playing field, is unique.
While many of us would like to see its provisions strengthened, and indeed they should be, we should not forget where we started and what has been achieved.
The world looked very different back in 1994, just prior to the entry into force of the WTO Agreement on Agriculture. World trade in agricultural products was distorted and disorderly. Many countries applied a wide range of unpredictable barriers to agricultural imports. Through a “tariffication” process, quantitative restrictions, variable levies, import bans and other non-tariff measures that had been widespread elements of agricultural protection at national frontiers were replaced with import duties. Tariff reductions then took place.
Similarly, world agricultural subsidy levels were sky high. These subsidies were leading to a crowding out of the agricultural exports of many WTO Members who had neither the desire nor capacity to match these trade-distorting measures.
The Agreement on Agriculture brought an orderly classification of agricultural subsidies based on their degree of trade-distortion. And while the most distortive subsidies were reduced, through a Green Box of permissible subsidies, Members were granted the right to pursue food security, regional development, environmental policy and other goals.
Recognising the special challenges of developing countries, provisions were crafted within the Agreement to allow them to deploy certain subsidies in support of low-income and resource-poor farmers.
Article 20 on the “Continuation of the Reform Process” called for further negotiations with the long-term objective of more open agricultural markets. This led to a significant achievement, the commitment to completely eliminate agricultural exports subsidies at the WTO’s 10th Ministerial Conference in Nairobi -- a result that would have seemed inconceivable just a few years earlier.
This is not to say that a consensus or even a critical mass has been reached for more extensive reforms in the agricultural rules. There is now a pressing need for a breakthrough on all major subjects under discussion – domestic support, market access, food security, and others.
There are no good alternatives to making progress in a multilateral setting. No Regional Trade Agreement has ever tackled the issue of agricultural subsidies. These agreements tend to remain focussed on preferential market access. A judgment should always be made as to whether any given sub-multilateral -- that is regional or bilateral agreement -- is of benefit to non-signatories as well.
Looking at global trade once again, the record of the multilateral trading system has delivered some other strong positive results. From 1995 to today, the share of the developing world in world agricultural trade has risen significantly
Progress still needs to be made. There is no room for complacency.
The COVID-19 pandemic should be a wake-up call for all of us. At the outset of the crisis, many policymakers feared that a global health crisis would turn into a food crisis as well. This fear was driven by the realization that food systems across the globe are now deeply inter-connected and that trade restrictions can create serious and irreversible damage to global food production.
Today agricultural production takes place within Global Value Chains (GVCs). International trade in food has gone far beyond a bag of rice or a bushel of wheat crossing a national border. Primary commodities cross national borders on average at least twice, as they are exported for processing into food.
In March 2020 the then Director-General of the WTO, the Director-General of the World Health Organization and Dr. Qu, on behalf of the FAO, issued a call to keep food markets and trade open. Governments listened.
To date, since the beginning of crisis, agricultural trade has suffered less during the COVID-19 pandemic than have other economic sectors. And, in fact, there have been about as many trade-opening as trade-restricting policies implemented in agriculture.
Many countries moved to reduce food import tariffs to increase access to staples during the disruptions caused by the pandemic and took the important step into the digital age by making available electronic customs procedures.
The lessons from the pandemic for global foods systems are clear. The continued strengthening of the WTO Agreement on Agriculture is absolutely vital. The world should no longer have to rely on political pleas and declarations issued at times of crisis to keep food markets open.
Food should always be able to travel across borders, particularly in times of crisis. A strengthened Agreement on Agriculture should make this outcome beyond question.
I urge participants in this symposium to use the next two days to consider practical avenues for strengthening the WTO rule book on agriculture – the sector that must deliver food security, environmental sustainability, nutrition and other common goals.
What the WTO's Members decide to do can contribute not only to an improved trading system for agriculture but support can make a substantial contribution to the needed economic recovery.