Main policy areas
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Remarks
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Tariff-rate-quota administration
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- about 17 countries have TRQs for wheat, and most do import more than
the in-quota level, due to relatively low applied above-quota tariffs
or due to preferential trade agreements;
- for coarse grains, most countries with TRQs have already met or exceeded
their minimum access;
- access commitments have been increased under TRQ schemes;- for example:-
Japan for maize and barley, the Republic of Korea for barley, the Republic
of South Africa, India and the Philippines for maize;
- quota fill rates are relative high for this sector, although the
method of TRQ administration varies among countries;
- some countries (e.g. China) have allocated specific quota amounts
to private sector importers;
- for the grains sector, increased market access can come from a tariff
only regime, non-discriminatory allocation and administration of tariff
quotas; disciplines which reduce the role of STEs, or by reduction in
quota tariff rates.
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Tariffs
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- for grains, the applied tariff rates are in general lower than bound
rates. This gives many countries the flexibility to increase them as
safeguard actions depending on the market situation and/or to sustain
policy goals;
- tariff peaks (tariffs greater then 15 percent) and tariff escalation
(tariff increases as degree of processing increases) posses serious
problems of market access in some countries.
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Amber box
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- some developing country producers/exporters object to trade distorting
domestic support in developed countries (e.g. United States, EU), where
(relatively high-cost) production and exports expanded aided by support
measures;
- support provided in most developing countries has been traditionally
low and under the 10 percent de minimis level and, hence, not
affected by reduction commitments.
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Export subsidies
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- export subsidies can displace exports of non-subsidizing competitive
exporters and they can depress market prices. In addition, they could
also create disincentives to domestic production in the recipient countries
if they result in import surges well above normal level of imports by
these countries and are imported at prices at which domestic producers
cannot compete;
- the use of export subsidy (both directly and indirectly) is more
widely spread among the developed major exporting countries;
- of the 25 countries that agreed to reduce the volume and value of
subsidized agricultural exports, 10 made specific commitments to reduce
subsidized wheat and flour exports and 12 made commitments to reduce
subsidize coarse grains exports.
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Export credits
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- used by a number of grain exporting countries;
- can have similar distortionary effect on trade as export subsidies.
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State trading enterprises
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- over one-third of world imports of wheat (and about 40 percent of
exports) are conducted by STEs. With the exception of barley, the role
of STEs are relatively insignificant for coarse grains, except in countries
with food security concerns;
- because they lack transparency in their operations, the behaviour
of STEs can be used to disguise trade distorting policies, and can therefore
circumvent URAA commitments on market access and export subsidies;
- some progress have made by some countries by allowing increased private
sector participation in grain trade.
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Export restrictions and prohibitions
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- used by a few countries especially during period of poor harvests
(e.g. Hungary for maize, in late 2000) but generally temporal in nature.
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Food security
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- because of financial constraints and increased dependency on imports,
most developing countries would prefer added flexibility to intervene
in their domestic markets to mitigate the negative effects of export
subsidies and market protection;
- a distinction should be made between short-term and long- term solutions
to food security problems. In the short-term, food security is best
served with targeted food aid and consumption smoothing policies under
the provisions of the Marrakech Ministerial decision,
but in the long-term the issue of raising income levels, which can be
enhanced by trade liberalization is best option for the grains sector;
- consumption policies (in developing countries): ad hoc market intervention
is continuing in a number of countries, especially those with food distribution
programmes (e.g. India).
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Food safety
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- of some relevance for the sector - concerns have been raised notably
by China, on wheat contaminated with TCK smut and Brazil for Karnal
bunt;
- several countries have set up regulatory framework for trade in grains
or other products containing GMOs grains. This and other issues related
to uncertainties about phytosanitary standards are among the issues
of concern during the on-going trade negotiations for both developing
and developed countries;
- precautionary principle adopted by some developed countries
has come under strong attack.
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Rural development
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- of significance for developing and transition countries in the area
of non-trade concerns;
- direct relationship between this and food security concerns in developing
countries with large numbers of small holders in rural areas;
- special provisions will be required to address this issue for the
developing countries, most probably within a development box.
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Green box
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- strengthening of the development box as part of green
box is highly desired by developing countries, especially those still
trying to achieve self-sufficiency in food production;
- most of the support provided by the developed countries fall under
this category;
- general disagreement related to the distortionary effects of most
grain support policies under the green box even when they are decoupled.
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Blue box
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- not particularly relevant as only a few countries are using it.
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Special agricultural safeguard
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- limited use made by developing countries as, normally, sector was
already well protected by high bound tariffs.
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