The Chair’s report represents her independent assessment of the state of play in the seven topics under negotiation: domestic support; market access; export competition (including measures seen as comparable to export subsidies); export restrictions; cotton; a “permanent solution” to the problems some developing countries face when buying food at administered prices as part of their public stockholding programmes for food security purposes; and a proposed new “special safeguard mechanism” intended to help developing countries address sudden import surges or price depressions.
Facilitators on each of the seven topics also presented their final reports on consultations they had held since September 2020, following a request from the Chair to support her in identifying prospects for possible progress in the talks.
The Chair pointed out three key challenges in the agriculture negotiations: time, trust and transparency. Time is short until MC12; trust needs to be restored; and transparency is valued by all members, she said.
Seven negotiating topics
Her assessments on the seven topics were as follows:
- On domestic support, an agreement on new disciplines may be out of reach: negotiators could instead usefully focus on elements for inclusion in a framework agreement, work programme or work plan for post-MC12 negotiations;
- On market access, negotiators at MC12 may be able to agree on steps to improve transparency as well as a way forward for comprehensive market access reforms post-MC12;
- On export restrictions, members may be able to reach an agreement that food bought by the World Food Programme (WFP) for its humanitarian food aid should be exempt from export restrictions. Trade negotiators might also be able to strike a deal on measures to improve transparency and clarify current rules, including through providing advance notice or by enhancing compliance with existing WTO requirements;
- On export competition, negotiators may be able to agree on some steps to improve compliance with existing transparency requirements, and also to enhance them;
- On cotton, the Chair agreed with facilitators that the focus for now should be on improving transparency, while continuing to seek ways to reduce trade-distorting domestic support on cotton after MC12. The development component of an outcome on cotton should be addressed through the Director General's Consultative Framework Mechanism on Cotton process;
- On public stockholding programmes for food security purposes, negotiators are looking for a permanent solution to the challenges some developing countries face when buying food at administered prices: here, the challenge is to find the right balance between enabling members to have access to flexibilities in this area while also establishing well-calibrated safeguards and transparency requirements;
- On the special safeguard mechanism, there is serious divergence “on some fundamental aspects”, with many agricultural exporting countries continuing to link progress on this topic to market access concessions, and proponents of the mechanism arguing it should be a stand-alone outcome.
Reactions to the report
Most members welcomed the Chair’s report and considered it represented an accurate assessment of the situation. Several delegations intervened to emphasise the urgency of achieving progress at MC12, and warning that failure could be costly for the ability of members to achieve their collective goals.
Improving transparency is a cross-cutting issue on which most members hope to make progress at MC12, although they have different views on how this should be done. While some members warned that discussions on transparency should not divert attention from substantive issues such as domestic support rules, others viewed transparency as both a procedural and substantive issue which is essential for future negotiations. The United States presented again its analysis of how different members were calculating and reporting domestic support, drawing on its paper JOB/AG/181 from February 2020.
Some members supported the idea of reaching consensus on a domestic support framework at MC12 but insisted that it should include certain parameters such as subsidy targets, principles and methodologies. Others, with a focus on development objectives, said that essential reforms on domestic support involved levelling the playing field and eliminating highly trade-distorting support that exceeds countries’ de minimis thresholds, defined as a share of the value of agricultural production. The same countries also argued in favour of developing countries retaining current flexibilities to provide input and investment subsidies under Article 6.2 of the WTO Agreement on Agriculture.
Food security and livelihoods remain top of the agenda for many members, especially in the context of the COVID-19 pandemic. Trade officials raised their concerns in these areas in connection with several topics, including public stockholding for food security purposes; humanitarian food aid purchased by the WFP, and other proposed measures on food export restrictions; domestic support; cotton; and the proposed new “special safeguard mechanism”.
Several members recognized public stockholding as a practical tool to address food security in the context of the current pandemic. Some proponents said that they are working together on an options paper (to be circulated before or immediately after the summer break), with an aim of achieving an agreement on this question. They indicated this would involve a stand-alone permanent solution with less burdensome transparency requirements. Other members suggested that a work plan in this area could form part of a holistic approach to outstanding domestic support questions.
Many members still considered that exempting WFP humanitarian food aid purchases from export restrictions could be a potential element of the MC12 outcome on agriculture if negotiators made collective efforts to nail down final compromise language. Several members also stressed again, in light of the experience from the COVID-19 pandemic, the need for an outcome on improving transparency of members' export restriction measures, as these may impede the ability of low-income consumers in net food importing countries to access food at affordable prices and increase price volatility.
The proponents of a “special safeguard mechanism” renewed their demand for an easy-to-use and comprehensive tool which would allow developing countries temporarily to raise tariffs to address the impact of import surges and price drops. Some said they were conducting ongoing work to prepare technical submissions on this topic by extracting useful elements from the WTO’s existing special agricultural safeguard, as well as from past submissions and draft blueprints for negotiating agreements.
Reiterating the importance of further opening global agricultural markets, some members shared the Chair's view that the inclusion of market access elements in an MC12 outcome could help negotiators to achieve an overall balance. Some proponents were of the view that a framework for future negotiations on market access, building on the joint submission in JOB/AG/198 should be achievable at MC12.
Several members supported an outcome that would improve transparency when applied tariffs affected the treatment of shipments en route, along the approach suggested in JOB/AG/185/Rev.2 . Members also expressed support for an outcome on the review of the 2013 Bali Decision on Tariff Quota Administration. However, some members said they considered the Chair’s assessment of the prospects for a possible MC12 outcome on market access to be overly optimistic.
The way forward
Noting the wide divergence in members' positions in all seven negotiating areas, the Chair asked members to redouble their efforts in the weeks ahead. Members should focus on how to bridge their differences with new ideas and solutions, she said, adding that she intends to circulate her first draft negotiating text in July to facilitate the process.
She also announced that the next agriculture negotiating meeting is scheduled for 19 July, with the sole purpose of presenting members' new submissions.
Background information on the work of the Committee on Agriculture is available here.
The agriculture glossary is available here.