Training Presentation on Modalities and Related Issues

1
Training Presentation on Modalities and Related
Issues
WTO Agriculture Negotiations
UNCTAD
Commercial Diplomacy Programme, UNCTAD
March 2003
2
Mandate for Negotiations
Article 20 Continuation of the reform process
Doha Mandate Single undertaking See Annex 1 fo
r extracts of Doha mandate and Article 20.

T

• Built-in Article 20 of the Uruguay Round
  Agreement on Agriculture.  
  
• Under single undertaking at Doha, Members agreed
  to negotiate
  
• substantial improvements in market access
  reductions of, with a view to phasing out, all
  forms of export subsidies and substantial
  reductions in trade-distorting domestic support
• special and differential treatment provisions as
  an integral part of all elements of the
  negotiations.

3
Modalities for further commitments
On 18-12-02 The Chair of Agriculture
Negotiations submitted an Overview Paper on
Modalities. In February 2003 the Chair distribut
ed the first draft Modalities paper.

• Members will set numerical targets, formulae and
  other modalities for further commitments .
  
• These modalities will serve as the basis for
  Members to produce and submit their comprehensive
  draft commitments by the Fifth Ministerial
  Conference in 2003.

4
A- Market Access Modalities
See Annex 2 for explanatory page on
abbreviations See Annex 3 for key words definin
g vocabulary.

• Tariffs
• TRQs Expansion
• TRQ Administration
• SSG
• STEs
• NTC

5
A. Market Access Modalities
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• In general, negotiations on Modalities for
  further commitments on Market Access should aim
  to
  
• elaborate a comprehensive approach to address
  tariff reductions and tariff quota expansion by
  building on existing rules and/or developing new
  ones.
• find non-trade distorting ways to administer
  tariff quotas.
  
• discuss approaches to special safeguards, STEs
  and NTC

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
6
A.1. Tariffs
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
Issues to be agreed upon A.1.1 Product coverage
A.1.2. Base rates A.1.3 Tariff
Structure A.1.4 Reduction method/target for fur
ther commitments A.1.5 Special and differential
treatment
4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
7
A.1.1. - Product Coverage
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
8
A.1.2 - Base Rates
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Bound duty levels
• Applied levels

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
9
A.1.3 - Tariff Structure
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Convert all non-ad-valorem (NAV) rates to
  ad-valorem rates
  
• Limit use of NAV tariffs to 3 of all tariff
  lines.
  
• Status quo
• Allow countries to use NAV tariffs to reflect
  product-specific non-trade concerns.
  

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
10
A.1.4. - Reduction Methods
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Deep cuts should be made to tariffs using a
  formula approach, which delivers greater
  reductions on higher level tariffs, including
  tariff peaks - i.e. reduces low tariffs by less
  than high tariffs.
• Uruguay Round (UR) methodology to tariff
  reductions.
  
• Reductions from the UR rates.

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
11
A.1.5. Special Differential Treatment
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG
Specific modalities for reduction commitments by
developing countries have been tabled by
proposing smaller cuts/extended implementation
periods for developing countries only.
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
12
A.2. TRQ Expansion
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Tariff quota volume
• Which is the best method to increase tariff quota
  volumes?
  
• Tariff Quota Rates

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
13
A.3. TRQ Administration
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• General principles
• Application of existing WTO rules
• Flexible approach
• "Negative list" approach
• Transparency/notification requirements

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
14
A.4 Special Safeguard (SSG)
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Eliminate?
• Status quo?
• Create a new mechanism for developing countries?

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
15
A.5. Importing State Trading Enterprises (ISTEs)
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG
5. STE
6.NTC
Maintain the status-quo?
B. Domestic Supp.
Creation of new disciplines for ISTEs?
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
16
A.6. Non-trade Concerns
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
Trade Preferences A familiar Issue for Dping Coun
tries
4. SSG
5. STE
6.NTC
Geographical Indications Food Safety SPS Labe
lling Packaging
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
Not such a familiar issue but equally important
for Dping Countries
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
17
B Domestic Support Modalities
See Annex 2 for explanatory page on
abbreviations See Annex 3 for key words definin
g vocabulary.

• Amber Box
• Blue Box
• Green Box

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B.1. Amber Box
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG
Status quo
Two-box approach
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
19
B.2. Blue Box
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.
4. SSG

• Maintain Blue Box (Article 6.5) as it is.
• or
• Shift all Blue Box measures to Amber Box, making
  them subject to reduction commitments.
  
• or
• Establish a new disciplines aiming at reducing
  the Blue Box spending (while maintaining this
  category).
  

5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
20
B.3. Green Box
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• Should the Green Box criteria be modified?
• Should some subsidies be withdrawn from the Green
  Box?
  
• Should there be a Green Food Security Box?

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.
21
C- Export Competition Modalities
See Annex 2 for explanatory page on abbreviations
used in this presentation. See Annex 3 for key
words defining vocabulary.

• Export Subsidies
• Export Credits
• Food Aid
• STEs Export Restrictions

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C.1. Export Subsidies
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• Coverage Article 9.1
• Product Specificity and Base Levels
• Formulae/targets for further commitments
• SD
• Definition of the phase out period
• Definition of targets for commitments

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
23
C.2. Export Credits
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• Measures to be covered
• Officially supported export credits
  illustrative list (j) and (k) SCM.
  
• Two main approaches
• Establish limits that would be reduced or
  eliminated over the implementation period
  
• Develop rules with which Members would comply

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
24
C.3. Food Aid
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• Objectives of WTO Disciplines in the Area of Food
  Aid
  
• To prevent circumvention of export subsidy
  commitments.
  
• General Principles of Food Aid
• It should be given in grant form only
• It should not be tied to commercial transactions

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
Export Restrict.
25
C.4. STE Export Restrictions
A. Market Access
1. Tariffs
2. TRQ Expansion
3. TRQ Adm.

• Main debate on STE
• They can distort trade given their exclusive
  privileges Rules are needed
  
• Do not automatically mean they subsidized
  exports.
  
• Main debate on Export Restrictions
• Conversion into taxes which in turn should be
  subject to reduction commitments
  
• Developing Countries make use of them to address
  food security concerns.

4. SSG
5. STE
6.NTC
B. Domestic Supp.
1. Amber Box
2. Blue Box
3. Green Box
C. Export Comp.
1 Export Sub.
2 Export Credits
3 Food Aid
4 STE
. Export Restrict.