The draft text sets out suggested ministerial decisions on 7 agriculture negotiation topics: domestic support, market access, export restrictions, export competition, cotton, public stockholding for food security purposes, and a special safeguard mechanism; and one cross-cutting issue, transparency.
In her introductory remarks, the Chair said the draft text was an attempt to reflect the collective efforts made by members over the past year through various informal and formal processes. It builds upon the Chair's report and the reports of the Chair facilitators (who assisted the Chair's work on each topic) and drew inspiration from members' submissions, including those submitted in recent weeks.
“The text takes into account the range of views that have been expressed by Members and seeks to chart a way forward with this in mind. It represents my honest effort to identify potential ‘landing zones’. It's not meant to be perfect or summarize all views. But it is a tool for you to engage with one another in a constructive exchange,” the Chair said, noting the document is meant to evolve as the negotiations proceed to reflect new inputs and submissions.
For some areas where wider gaps remain in positions, the Chair said the text seeks to identify options for members to consider, thereby sketching out the contours for possible compromises and trade-offs within and across negotiating areas.
The Chair emphasized that more than 25 years after the conclusion of the Uruguay Round, the mandate set out under Article 20 of the Agreement on Agriculture to continue the reform process was still valid today: establishing a “fair and market-oriented agricultural trading system”; progressively reducing support and protection; and taking account of all members' interests, including special and differential treatment for developing countries, non-trade concerns such as food security, and protection of the environment.
The Chair pointed out that agriculture trade remains highly distorted and protected, despite the rapid growth in trade in food and farm goods over the last quarter century, more integrated markets, and improvements to food security that have resulted from rising average incomes over this period. However, she said that new challenges such as COVID-19 and climate change are compounding existing problems associated with low agricultural productivity, persistent underinvestment, stagnating rural incomes and enduring poverty, and that it was vital WTO members took action to help address these problems.
“WTO members can and should contribute to improving how food and agriculture markets function by redoubling their efforts to achieve an outcome at MC12”, she told the meeting.
Noting members' continued divergences, including on some critical issues, the Chair admitted that “an MC12 outcome won't be a comprehensive solution to all the problems facing food and agriculture markets today.” Nevertheless, “it is urgent for us to lay out a pathway forward to guide our future work and set out markers for what we wish to achieve together, including at subsequent Ministerial Conferences, ” she said.
Looking ahead, the Chair appealed for members' efforts to enhance engagement, summon political will, and set out a direction for future progress at the WTO negotiating table. “It is our responsibility to contribute to the broader collective effort to rebuild more inclusive and sustainable economies as we all work to overcome the pandemic and lay the foundations for a more resilient future.”
The Chair said that, given the limited time before MC12 and the continued divergences on how to discipline trade-distorting domestic support, her view is that a substantive outcome at MC12 in which members would agree on concrete modalities for the reduction of entitlements appears to be out of reach. Instead, she believes that MC12 “can deliver a useful intermediary step forward in the DS reform process that would define the path ahead for the benefit of all members.”
The aim of the text is therefore to encourage members to meet one another midway in this high priority area, bearing in mind the common objective of disciplining trade-distorting domestic support. The text proposes some alternatives to provide a more malleable basis for finding consensus, building on members' ideas, submissions, the reports of the facilitators who have assisted the Chair, and her own consultations, she said.
The Chair maintained that the inclusion of market access elements in an MC12 agriculture package would assist members in reaching a balanced result at the ministerial conference. Her text addresses two components: a decision on some transparency-inspired elements, and a work programme on market access negotiations post-MC12.
She said the draft decision on applied tariff transparency and the treatment of shipments en route is primarily based on the joint proposal from Australia, Brazil, Canada, and Ukraine. On a post-MC12 market access work programme, the text incorporates some elements from the joint proposal from Argentina, Brazil, Ecuador, Paraguay, Ukraine and Uruguay. The text also invites members to report the calculation of duties in cases where such duties are not set in value terms. The Chair noted that this was only to facilitate an informed conversation among members on possible approaches to reducing tariffs. The text also reflected some members' desire to address non-tariff barriers and acknowledges the linkages between market access and other pillars, especially domestic support.
The Chair said the text in this section acknowledges the importance of transparency to ensure proper implementation of the Nairobi Ministerial Decision on Export Competition, as well as continuation of negotiations post- MC12.
The text also builds upon elements contained in a recent submission from Canada, Chile, Norway and Switzerland suggesting options aimed at helping members to find a balanced way forward to enhance and streamline transparency requirements while taking into account concerns expressed by a large group of developing country members cautioning against burdensome additional transparency requirements. In addition, the text suggests that the WTO Secretariat could provide relevant trade-related data to ease the burden on members.
The Chair said the text seeks convergence on two issues: exempting World Food Programme (WFP) humanitarian food purchases from export restrictions, and enhancing compliance with notification requirements under Article 12 of the Agreement on Agriculture.
According to the Chair, on the first issue, the text that emerged from the December 2020 discussions on a possible General Council Decision continues to be a plausible basis for members to re-engage in the negotiations. The goal of the negotiations is to reach an MC12 outcome that would facilitate the highly valued humanitarian work of the WFP, while taking due account of supplying members' concerns regarding domestic policy and food security considerations. On transparency, the text is intended to capture elements contained in the submissions from the proponents to minimize the potential effects of export restrictions on price volatility and the food security of importing countries, while addressing developing members' concerns over additional burdensome transparency requirements. The text also suggests concrete ways in which the Secretariat could further assist members in fulfilling notification obligations and notes the possibility for members to explore how to revise current notification requirements and formats.
The Chair indicated the text mainly covers transparency and trade-distorting domestic support for cotton, which reflects the mandate to address cotton ambitiously, expeditiously, and specifically, while also taking into account the overall context of the agriculture negotiations, particularly the negotiations on domestic support generally.
Special safeguard mechanism (SSM)
Talks in this area focus on a proposed new special safeguard mechanism that would allow developing countries to raise tariffs temporarily in the event of a sudden surge in import volumes or price depression.
The Chair said her text is aimed at addressing the problem of a lack of technical engagement among members. Based on the facilitator's report, the text highlights 5 main aspects of an SSM on which members could deepen their discussions: evaluation of import surges and price decreases; triggers and cross-check; remedies; scope, including coverage and the treatment of preferential trade; and transparency and other issues. She also said the existing special agricultural safeguard (SSG) could offer inspiration for members to enhance their technical engagement on this issue.
Public stockholding for food security purposes (PSH)
Talks in this area address how farm subsidy rules should apply when developing countries buy food at government-set prices as part of their public stockholding programmes for food security purposes.
The Chair highlighted that PSH remains a priority issue for the proponents who have repeatedly stressed its usefulness as a tool for addressing food security and rural livelihoods, especially in times of crisis such as the COVID-19 pandemic. She noted however that, given the widely divergent views of members, she had found it very difficult to propose a way forward on this issue. Her text's first proposed option draws inspiration from the draft text circulated at the 2017 Buenos Aires Ministerial Conference by the ministerial facilitator as well as recent submissions made by members. The second option proposes a way forward with an intermediary step to be taken at MC12.
The Chair said that this issue is seen as important by several members. Her draft text proposes a comprehensive way forward after MC12. As it is a cross-cutting issue, it should also be seen in the light of provisions on transparency that are included in the draft decisions on various negotiating topics. The text also addresses the role of the Secretariat in respect of technical assistance and the development of IT tools, she said.
The Chair asked members to use the summer break to study the text carefully in a constructive spirit and get ready to plunge into an intensive text-based negotiation phase starting in September. Highlighting the sense of urgency, she asked members to focus on building convergence and avoid repeating longstanding positions in the negotiations, bearing in mind the broader objective of making difference in people's lives.
“Working together and exercising the necessary flexibility, we can achieve a credible outcome on agriculture at MC12”, she said.
The Chair´s text was circulated to members after the 29 July meeting. The next agriculture negotiations meeting will take place on 7-8 September.
A spike of new submissions (14 in total), were presented for discussion at the agriculture committee negotiations meetings in the ten days preceding the introduction of the Chair's text. These submissions addressed most of the topics under negotiation, including domestic support, public stockholding for food security purposes, the special safeguard mechanism, transparency across the board as well as in different areas such as changes to applied tariffs, export competition or export restrictions, and various food security-related concerns.
The submissions sparked intense debate among members. While views remained divergent on several issues, including some fundamental ones such as the approach to be followed on domestic support, public stockholding or the special safeguard mechanism, many members emphasized their willingness to explore ways to narrow gaps and seek common ground. Members also underscored the same sense of urgency on reaching a meaningful outcome on agriculture at MC12. The Chair praised members for their constructive engagement and urged members to redouble efforts to build convergence.
The agriculture glossary is available here.