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Trade policy briefs

No. 20 - How can governance be improved for trade and food security?
Trade agreements are at the heart of the trade and food security debate as they set out the rules for national trade and agricultural policies, which play a key role in determining food security outcomes. 

No. 19 - How can trade and related policies be used to achieve food security objectives?
Trade and related policy measures are defined as those that affect trade flows, be they instruments of border protection or domestic market interventions. Trade-oriented measures (like import and export tariffs and quotas and non-tariff measures) are only one of the many categories of policies that can affect the flow of trade. 

No. 18 - How is agricultural trade evolving and what are the food security implications?
Trade in agricultural products has grown almost threefold in value over the past decade, driven by high demand, particularly in emerging economies. Among net importing regions, Asia has been the fastest growing, driven especially by China’s evolution to net-importing status in many commodities. 

No. 17 - How does agricultural trade impact food security?
The links between trade and food security are inherently complex, with several channels of interaction affecting the different dimensions of food security simultaneously. Trade, influenced by the economic context and sectoral composition of growth, directly affects key domestic variables like food production, prices, employment and government revenues.

No 16. The Bali Package – implications for trade and food security
This brief provides a concise explanation of the Bali package focusing on those elements which have direct implications for trade and related policies directed at improved food security. It also considers potential implications of trade and market policies more broadly for food security.

No 15. Import surges and the special safeguard mechanism revisited
This technical note revisits the analysis presented in technical note no. 9, updating data used in the identification of import surges to 2013 to capture recent changes in the global market context of higher and more volatile food prices and significant increases in volumes of imports to food deficit developing countries

No 14. Considerations in the reform of agricultural trade policy in low income developing countries.
Many developing countries are under pressure to reduce their trade barriers to the entry of agricultural products, both as a result of ongoing trade negotiations as well as due to policy advice from donors and international organizations. Much of this pressure is based on the notion that further agricultural trade liberalization is appropriate for all countries, regardless of their level of development or of their trading partners' trade policy stance.

No. 13. Global impacts of agricultural trade reforms. Why users need to be more vigilant when interpreting quantitative estimates.
Improved use of simulation models requires in addition to more transparency and better explanations of the model results, a better appreciation of the numerous technical difficulties and subjective assumptions that can confound the generation of realistic insights. Results of simulation models should not therefore be taken as the only, or even dominant, source of information. Alternatives exist in the form of other types of models and in reviews of similar experiences of trade policy reform, both of which can better reveal how countries may actually fare in a new global trade context.

No. 12. Rice liberalization: predicting trade and price impacts
Rice is a principal source of calorie intake for about half of the world's population and a mainstay for rural populations and food security in many low income countries. It is mainly cultivated by small farmers in holdings of less than one hectare. Rice also plays an important role as a "wage" commodity for workers in cash crop or non-agricultural sectors.

No. 11. Dairy and dairy products: Why is reform so difficult?
This Policy Brief examines the impact of dairy sector domestic and trade policies on international dairy markets, and addresses the question of what inhibits reform in this important agricultural sector. It outlines the difficulties in assessing the impacts of policy reform, and provides an overview of recent results from quantitative assessments of comprehensive policy reform, with particular attention to the consequences of reform for developing countries.

No. 10. Special and differential treatment in agriculture
Special and Differential Treatment (SDT) in the WTO is a response to the recognition that, due to structural problems, low levels of industrialization, limited access to advanced technologies and inadequate infrastructure, developing countries are often not able to take full advantage of emerging trading opportunities. SDT measures, therefore, recognize the interests of least-developed and developing countries by permitting fewer and different obligations over longer periods of time and provide for technical and financial assistance to these countries to facilitate greater participation in global trade. This brief reviews the current status of the SDT debate in the WTO, paying particular attention to the three broad areas which relate to the agriculture sector.

No. 9. A Special Safeguard Mechanism for developing countries
Negotiation of the Special Safeguard (SSG) during the Uruguay Round (UR) took place amid fears that tariffication could make countries more vulnerable to market instability, depressed import prices, and import surges that might damage agricultural production. In the current Doha Round, countries are negotiating to reduce bound tariff rates further, thus limiting the option that developing countries have to raise applied tariffs to prevent or offset the damage of sudden import increases or world price depressions.

No 8. Food aid in the context of international and domestic markets and the Doha Round.
Food aid has its origins is rooted firmly in the disposal of the food surpluses (mostly of cereals) that had accumulated in some developed countries by the early 1950s. This form of aRecognising the possibility that aid provided in this form can result in the displacement of commercial imports and/or discouragement of local production in the recipient countries. Recognizing this possibility, in 1954 the international community agreed to established the FAO Principles of Surplus Disposal (the Principles), an: a international code of international conduct to encourage the constructive use of disposal of surplus agricultural commodities, while at the same timewhile safeguarding the interests of commercial exporters and local producers.

No. 7. Non-reciprocal agricultural trade preferences.
Preferential trade programmes are either reciprocal or non-reciprocal. Reciprocal preferences occur when two countries offer each other trade concessions not offered to other countries. Non-reciprocal trade preferences are trade arrangements where a country unilaterally offers concessions to one or more other countries. This note focuses only on non-reciprocal preferences.

No. 6. Sugar: policy insights from analysis of sugar sector reform
Sugar cane or beet is produced in over 130 countries with sugar cane representing between 74 and 77 percent of global production. Developing countries currently account for about 67 percent of world production (in 1998-2000). Also production is becoming more concentrated among countries. In 1980, the top 10 producers accounted for 56 percent of global production; by 2004, they accounted for 69 percent. World sugar consumption is expanding, reflecting rising incomes and shifts in food consumption patterns. Developing countries account for more than 67 percent of current global sugar consumption, and these countries - particularly in Asia - are expected to be the primary source of future demand growth.

No. 5. Reducing the trade-distorting impact of agricultural support.
Since the mid 1990s, there has been a significant change in the type of support to developed country agricultural producers, with a shift towards categories of payment that are exempt (in WTO terms ) from reduction commitments. Between 1995 and 2001 the proportion of support in develo-ped countries, defined as production or trade-distorting (Amber Box), fell from 43 to 36 percent of total expenditure, while the proportion that could be termed Green Box policies (those with little or no trade-distorting effects, not subject to reduction commitment) increased from 42 to 50 percent.

No. 4. Export competition: appropriate disciplines for eliminating subsidies
The August 2004 World Trade Organization (WTO) Framework Agreement on agriculture calls for the establishment of "detailed modalities ensuring the parallel elimination of all forms of export subsidies and disciplines on all export measures with equivalent effect by a credible end date". Elimination includes: a) scheduled export subsidies, b) export credits, guarantees, and insurance programmes with repayment periods exceeding 180 days; c) trade distorting activities of State Trading Enterprises (STEs); and d) food aid not conforming to disciplines yet to be agreed. Other aspects to be further disciplined include: a) the terms and conditions of export credits, guarantees and insurance programmes with repayment periods under 180 days; b) other less trade distorting activities of STEs; and c) food aid transactions which may displace commercial imports.

No. 3. Bananas: Implications of EU tariff reform for producers
This Trade Policy Brief reviews key issues on the forthcoming change in the European Union (EU) banana import regime from a tariff rate quota (TRQ) to a tariff only regime. It discusses the extent of disagreement between different analyses on the likely impact of the policy changes and offers reasons why estimates of these impacts vary across the studies.

No. 2. Tariff reduction formulae: the importance of tariff profiles
This brief explains the implications of the approach taken to analysing the implications of the choice of tariff reduction formula against a set of objectives. It illustrates the importance of analysis at the disaggregated level and highlights some methodological issues that can affect the analysis. It concludes by reviewing insights from existing evidence.

No. 1. Cotton: impact of support policies on developing countries - why do the numbers vary?
This brief compares a number of analytical studies on the impact of developed country cotton support on developing countries, with the objective of determining the policy question that they seek to address, the extent of agreement on the impacts and, most importantly, the reasons that estimates of these impacts vary across the studies.

Trade Policy Briefs provide a succinct overview of key trade policy questions addressed in recent FAO studies with the view to broaden the understanding on such issues, especially in the context of the WTO negotiations on agriculture.


See also: Trade Policy Technical Notes which provide a more detailed discussion of the analytical approaches taken in these studies and provide suggestions for further work required to fill identified gaps in empirical work