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1970-01-01 08:00
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2021年1月23日发(作者:男子110米栏)

The green barrier to free trade
C. P. Chandrasekhar

Jayati Ghosh


As the March 31 deadline for completing the
of negotiations on global agricultural trade nears, hopes of an agreement are increasingly waning.
In this edition of Macroscan, C. P. Chandrasekhar and Jayati Ghosh examine the factors and the
players constraining the realisation of such an agreement.

AT THE END of the latest round of meetings of the agricultural negotiations committee of
the
WTO,
the
optimism
that
negotiators
would
meet
the
March
31
deadline
for
working
out
numerical
targets,
formulas
and
other

through
which
countries
can
frame
their
liberalisation
commitments
in
a
new
full- fledged
round
of
trade
negotiations
has
almost
disappeared. That target was important for two reasons.

First,
it
is
now
becoming
clear,
that
even
more
than
was
true
during
the
Uruguay
Round,
forging an agreement in the agricultural area is bound to prove extremely difficult.

Progress in the agricultural negotiations was key to persuading the unconvinced that a new
`Doha Round' of trade negotiations is useful and feasible.

Second,
the
Doha
declaration
made
agricultural
negotiations
one
part
of
a
`single
undertaking'
to
be
completed
by
January
1,
2005.
That
is,
in
a
take
`all- or-nothing'
scheme,
countries had to arrive at, and be bound by, agreements in all areas in which negotiations were to
be
initiated
in
the
new
round.
This
means
that
if
agreement
is
not
worked
out
with
regard
to
agriculture, there would be no change in the multilateral trade regime governing industry, services
or related areas and no progress in new areas, such as competition policy, foreign investment and
public procurement, all of which are crucial to the economic agenda of the developed countries.

The factors making agriculture the sticking point on this occasion are numerous. As in the
last Round, there is little agreement among the developed countries themselves on the appropriate
shape of the global agricultural trade regime.

There are substantial differences in the agenda of the US, the EU and the developed countries
within
the
Cairns
group
of
agricultural
exporters.
When
the
rich
and
the
powerful
disagree,
a
global consensus is not easy to come by.

But
that
is
not
all.
Even
if
an
agreement
is
stitched
up
between
the
rich
nations,
through
manoeuvres such as the Blair House accord, getting the rest of the world to go along would be
more difficult this time.

This is because the outcomes in the agricultural trade area since the implementation of the
Uruguay Round (UR) Agreement on Agriculture (AoA) began have fallen far short of expectations.
In the course of Round, advocates of the UR regime had promised global production adjustments
that would increase the
value of world agricultural
trade and an increase in developing country
share of such trade.

As
Chart
1
shows,
global
production
volumes
continued
to
rise
after
1994
when
the
implementation of the Uruguay Round began, with signs of tapering off only in 2000 and 2001. As
is widely known, this increase in production occurred in the developed countries as well.

Not
surprisingly,
therefore,
the
volume
of
world
trade
continued
to
rise
as
well
after
1994
(Chart 2). The real shift occurred in agricultural prices which, after some buoyancy between 1993

and 1995, have declined thereafter, and particularly sharply after 1997. It
is this decline in unit
values that resulted in a situation where the value of world trade stagnated and then declined after
1995, when the implementation of the Uruguay Round began.

As Table
1
shows,
there
was
a
sharp
fall
in
the
rate
of growth
of
global
agricultural
trade
between the second half of the 1980s and the 1990s, with the decline in growth in the 1990s being
due to the particularly poor performance during the 1998 to 2001 period.

Price
declines
and
stagnation
in
agricultural
trade
values
in
the
wake
of
the
UR
Agreement
on
Agriculture
were
accompanied
and
partly
influenced
by
the
persisting
regionalisation
of
world
agricultural trade.

The foci of such regionalisation were Western Europe and Asia, with 32 and 11 per cent of
global agricultural trade being intra-Western European and intra-Asian trade respectively (Chart 3).
What
is
noteworthy,
however,
is
that
agricultural
exports
accounted
for
a
much higher
share of
both
merchandise
and
primary
products
trade
in
North
America
and
Western
Europe
(besides
Latin America and Africa) than it did for Asia.

Thus, despite being the developed regions of the world, agricultural production and exports
were important influences on the economic performance of North America and Western Europe.

It
is, therefore, not surprising that Europe is keen on maintaining its agricultural sector through
protection, while the US is keen on expanding its role in world agricultural markets by subsidising
its own farmers and forcing other countries to open up their markets. The problem is that the US
has been more successful in prising open developing country markets than the large EU market.

Thus, out of $$104 billion worth of exports from North America in 2001, $$34 billion went to
Asia and $$15 billion to Latin America, whereas exports to Europe amounted to $$14 billion.

The Cairns group of exporting countries (Argentina, Australia, Bolivia, Brazil, Canada, Chile,
Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Paraguay, the Philippines,
South
Africa,
Thailand
and
Uruguay),
for
some
of
whom
at
least
agricultural
exports
are
extremely
important,
want
world
market
to
be
freed
of
protection
as
well
as
the
surpluses
that
result from huge domestic support in the US and the EC.

We must note that $$35 billion of the $$63 billion of exports from Latin America went to the
US and the EU. More open markets and less domestic support in those destinations is, therefore,
crucial for the region.

The fact that Europe has been successful in its effort at retaining its agricultural space with
the
help
of
a
Common
Agricultural
Policy
that
both
supports
and
subsidises
its
agricultural
producers is clear from Chart 4, which shows that intra-EC trade which accounted for 74 per cent
of EU exports in 1990, continued to account for 73 per cent of total EU exports in 1995 and 2001.

But North America, with far fewer countries in its fold, has also been quite insular. Close to a
third of North American exports are inter-regional. Little has changed since the Uruguay Round
Agreement on Agriculture.

It is widely accepted that three sets of actors account for this failure of the AoA:

First, in order to push through an agreement when there were signs that the Uruguay Round
was faltering, the liberalisation of agricultural trade in the developed countries was not pushed far
enough;

Second,
is
the
ability
to
use

especially
those
in
the
form
of
inadequately
well- defined
Green
and
Blue
Box
measures,
in
the
AoA,
to
continue
to
support
and
protect
farmers on the grounds that such support was non-trade distorting; and

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