Pre-ministerial draft shows little to harvest in WTO farm talks
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By Peter Ungphakorn
POSTED DECEMBER 9, 2021 | UPDATED DECEMBER 9, 2021
Note: the official draft text is available as a public document here. It was circulated on November 23, 2021 by Ambassador Gloria Abraham Peralta of Costa Rica, the present chair of the negotiations. See the WTO news story of November 25 on the release and discussion. Links to all sections are here.
This page combines the two sections of the text on domestic support, the chair’s assessment, and her draft
2 DOMESTIC SUPPORT
2.1 The Domestic Support pillar has been at the heart of the agricultural negotiations since their commencement in 2000. Numerous submissions have been made on this subject by Members emphasizing the shared objective of addressing trade-distorting domestic support (TDDS). It is also the pillar of the negotiations that has been discussed the most in my consultations, and is the area where, for both developed and developing Members, the expectations for an outcome at MC12 have been the highest. Indeed, the two topics that are together seen as likely to set the overall level of ambition for an agricultural package at MC12 are domestic support and public stockholding.
2.2 Many calls have been made to strengthen the existing disciplines on TDDS while at the same time leaving sufficient space for Members to pursue legitimate policy objectives such as food security, supporting small scale and resource-poor farmers, and fostering a resilient agricultural sector. Members also need to address TDDS to ensure a “level playing field” and equitable trade, and to avoid costly competition between treasuries.
2.3 Despite the broad agreement on the need to address trade-distorting domestic support, the views of Members have continued to differ sharply on: how to achieve this objective; a numerical target (e.g., 50% reduction); the timeframe (e.g., agreed reduction to be made by 2030); the scope, and the potential of different support categories to distort trade (e.g., the determination of which categories of support should be included, along with the treatment of these categories); the sequencing of reform steps (e.g., whether AMS above de minimis should be addressed first, or whether all categories should instead be addressed in parallel); the level of ambition for MC12, and what is attainable, especially considering the wide divergence among positions and the limited time until MC12.
2.4 Members could not agree on a broad numerical target, nor on a pre-determined timeframe. With respect to the scope of the negotiations, several Members stressed that it should address all categories of support under Article 6, without any a priori exclusion of any category, while also recognizing that they would not be treated equally. This was considered unacceptable by many developing countries, which demanded the exclusion of Article 6.2 from reduction commitments.
2.5 There was also no convergence on addressing AMS beyond de minimis in the negotiations. Some Members held the view that this category of support should not be singled out since the negotiations would address all support that have the effect of distorting trade and production. The proponents insisted however that this issue should be given priority in order to “level the playing field”. There was also no convergence on the proportionality principle, as a number of Members stressed that there was no universal definition of this concept that was acceptable to all Members. Some Members opposed using the size of entitlements as the sole criterion. In that regard, some Members suggested amendments to the wording, while others wanted it to be dropped altogether. There was also disagreement over how to address Green Box support3 (which does not fall under Article 6). Several Members insisted on the need for Green Box criteria to be clarified, along with those in Articles 6.2 and 6.5 of the AoA.
3 Covered under Annex 2 of the Agreement on Agriculture.
2.6 Taking into account the limited time left until MC12, and the persistent differences over how to discipline TDDS, it is clear that Members will be unable to achieve a substantive outcome at the Conference involving agreement on concrete modalities for the reduction of TDDS entitlements. I continue to believe, however, that MC12 can benefit all Members by delivering a useful step forward in the domestic support reform process that would set the direction for work after the Conference. I also believe that it is our collective duty to make every effort to find a way forward in this important area where an outcome is long overdue. I therefore suggest Members establish modalities by MC13 to substantially reduce trade-distorting domestic support by the date to be agreed upon by Members, coupled with some guiding principles and improved transparency requirements.
2.7 I am aware that the suggested draft text will not reflect all Members’ views and that the level of ambition may not be what Members had in mind. But in my view, this text strikes a careful balance between the competing negotiating priorities and sensitivities of different Members and reflects the wide divergence among Members’ positions.
IN DRAFT MINISTERIAL DECISION
11. We agree to continue negotiations on domestic support after MC12 with a view to negotiating modalities by MC13 to reduce substantially trade-distorting domestic support [entitlements] [by 20XX] [within a timeframe to be determined by Members] in furtherance of the reform programme under Article 20 of the Agreement on Agriculture. The negotiations shall be based on submissions by Members and shall take into account and build on the progress made thus far in these negotiations.
12. We agree that special and differential treatment of developing countries, particularly the needs of low income or resource poor farmers, as well as the non-trade concerns of Members shall be taken into account in these negotiations.
13. We agree that contributions by Members to the objective of achieving a substantial reduction of global trade-distorting domestic support shall be fair and underpinned by the principle that Members who distort trade the most shall contribute more in the reform process. The individual circumstances and development needs of Members shall be taken into account.
14. We note the importance of the implementation of existing notification obligations under Article 18 of the Agreement on Agriculture and undertake to make the necessary efforts to provide outstanding domestic support notifications prioritizing as from the year 2010 to enhance transparency with respect to existing domestic support commitments. To this end, we agree to explore ways in the Committee on Agriculture to streamline and update the notification requirements related to domestic support, taking due account of the capacity constraints that some developing country Members including especially least developed among them are facing. Members undertake to provide the value of production data as part of their DS:1 notifications and to provide the required information in a complete and comprehensive manner.
15. We instruct the WTO Secretariat to maintain and update on a regular basis a domestic support analytical tool based on Members’ notifications or publicly available official information where necessary. Members’ past contributions can be used as examples for this tool with modifications to be made as necessary to ensure neutrality.
16. Acknowledging the importance of the Green Box in the reform process in assisting Members to address contemporary challenges, we agree to clarify the criteria and transparency-related requirements of Annex 2. Members shall also clarify the criteria in Articles 6.2 and 6.5 of the Agreement on Agriculture.