Issues covered by the WTO’s committees and agreements
AGRICULTURE NEGOTIATIONS: BACKGROUNDER

Phase 1:

‘Non-trade’ concerns: agriculture can serve many purposes

The Agriculture Agreement provides significant scope for governments to pursue important “non-trade” concerns such as food security, the environment, structural adjustment, rural development, poverty alleviation, and so on. Article 20 says the negotiations have to take non-trade concerns into account.

A number of countries have produced studies to support their arguments, and these studies have also been debated — in particular, 38 countries submitted a note for the September 2000 meeting that includes their papers for a conference on non-trade concerns. Some other countries responded by agreeing that everyone has non-trade concerns and by calling for proposals for specific measures to be tabled so that the negotiations can move on to whether trade-distorting measures are really justified.

Most countries accept that agriculture is not only about producing food and fibre but also has other functions, including these non-trade objectives. The question debated in the WTO is whether “trade-distorting” subsidies, or subsidies outside the “green box”, are needed in order to help agriculture perform its many roles.

Some countries say all the objectives can and should be achieved more effectively through “green box” subsidies which are targeted directly at these objectives and by definition do not distort trade. Examples include food security stocks, direct payments to producers, structural adjustment assistance, safety-net programmes, environmental programmes, and regional assistance programmes which do not stimulate agricultural production or affect prices. These countries say the onus is on the proponents of non-trade concerns to show that the existing provisions, which were the subject of lengthy negotiations in the Uruguay Round, are inadequate for dealing with these concerns in targeted, non-trade distorting ways.

Other countries say the non-trade concerns are closely linked to production. They believe subsidies based on or related to production are needed for these purposes. For example, rice fields have to be promoted in order to prevent soil erosion, they say.

Countries such as Japan, Rep of Korea and Norway place a lot of emphasis on the need to tackle agriculture’s diversity as part of these non-trade concerns. The EU’s proposal says non-trade concerns should be targeted (e.g. environmental protection should be handled through environmental protection programmes), transparent and cause minimal trade distortion.

Many exporting developing countries say proposals to deal with non-trade concerns outside the “green box” of non-distorting domestic supports amount to a form of special and differential treatment for rich countries. Several even argue that any economic activity — industry, services and so on — have equal non-trade concerns, and therefore if the WTO is to address this issue, it has to do so in all areas of the negotiations, not only agriculture. Some others say agriculture is special..

 

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Proposals that include positions emphasizing non-trade concerns submitted in Phase 1 include:  

  • EU: comprehensive negotiating proposal G/AG/NG/W/90
  • Japan: proposal G/AG/NG/W/91
  • Switzerland: proposal G/AG/NG/W/94
  • Mauritius: proposal G/AG/NG/W96
  • Rep of Korea: proposal G/AG/NG/W/98
  • Norway: proposal G/AG/NG/W/101
  • Poland: proposal G/AG/NG/W/103
  • Congo, Dem Rep: proposal G/NG/W/135
  • Jordan: proposal G/AG/NG/W/140

 

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Submissions for discussion on non-trade concerns tabled so far  

  • 38 countries: non-trade concerns (conference papers) G/AG/NG/W/36/Rev.1
  • Argentina: technical submission on non-trade concerns G/AG/NG/W/88
  • Croatia: submission G/AG/NG/W/141

 

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