The Contribution of Agriculture to the Economic Reforms of Syria NAPC Ministry of Agriculture and Agrarian reform Agriculture-related WTO Agreements: Opportunities and Challenges

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The Contribution of Agriculture to the Economic
Reforms of SyriaNAPCMinistry of Agriculture
and Agrarian reformAgriculture-related WTO
Agreements Opportunities and Challenges

• Nasredin Hag Elamin
• FAO Regional Office for the Near East, Cairo

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Requirement and Implications of Accession

• Policy - Rights
• Framework - Obligations
• Outcome - Potential gains
• - Potential
  risks
• Most risks are certain, but attaining gains
  requires a lot of effort in terms of negotiating
  capacity and enhanced supply-side capacities

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What does WTO offer?

• Access to a more transparent and predictable
  trading system
• Exporters receive MFN treatment in markets abroad
• A major improvement for those who face sanctions
  or unfair treatment in world markets
• Access to WTOs dispute settlement process
• Opportunity to bind tariff commitments so as to
  avoid future policy back-sliding
• Potential gains All of these reduce business
  uncertainty, encourage investment, increase
  exports and ultimately raise incomes

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Risks

• Reduced policy space to design domestic
  priorities
• Some of the emerging and growing
  sectors/sub-sectors may prematurely be exposed to
  unnecessary, and possibly unfair, external
  competition

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WTO Provision on Accession

• Article XII of the Marrakesh Agreement
  establishing the WTO deals with accession. It
  reads as follows
• Any State or separate customs territory
  possessing full autonomy in the conduct of its
  external commercial relations and of the other
  matters provided for in this Agreement and the
  Multilateral Trade Agreements may accede to this
  Agreement, on terms to be agreed between it and
  the WTO. Such accession shall apply to this
  Agreement and the Multilateral Trade Agreements
  annexed thereto.

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WTO Provision on Accession

• Thus, Article XII gives no guidance on
• o the terms to be agreed, these being left to
  negotiations between the WTO Members and the
  applicant or
• o the procedures to be used for negotiating these
  terms, these being left to individual Working
  Parties to agree.

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The Negotiation Drives

• WTO members ask for concessions from applicants
• o .. accession of new members should strengthen
  the system rather than weaken it.. e.g. they ask
  for meaningful market-access commitments".
• o "WTO-plus" obligations
• Applicants, on the other hand, look for
  flexibility
• - e.g. market access commitments appropriate to
  the level of economic development of the
  Applicant"

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WTO Agreements of direct relevance to agriculture

• Agreement on Agriculture
• Agreement on the Application of Sanitary and
  Phytosanitary Measures (SPS)
• Agreement on Technical Barriers to Trade (TBT)
• Agreement on Trade Related Aspects of
  Intellectual Property Rights (TRIPS)
• Ministerial Decision on Measures Concerning the
  Possible Negative Effects of the Reform Programme
  on Least-Developed and Net Food-Importing
  Developing Countries

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Agreement on Agriculture

• The three main provisions of the AoA aim at
• improving market access
• reducing domestic support
• reducing export subsidies

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SPS Agreement

• Basic right the right to take SPS measures
  necessary for the protection of human, animal or
  plant life or health
• Obligation ensure that any SPS measure is
  applied only to the extent necessary to protect
  human, animal or plant life or health based on
  scientific principles
• Key provisions
• Scientific Justification (risk assessment)
• Harmonization (CODEX, IPPC, OIE)
• Equivalence

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Experience with Implementation

• High compliance with the AoA
• Support to agriculture in the developed countries
  remains high (above 1986-88 levels)
• No clear improvement in border protection (with a
  few exceptions)
• Little reduction in export subsidies
• Developing countries face some difficulties in
  implementing their commitments

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Main features of commitments made by Near East
countries on AoA

• Tariffs
• Relatively high bound tariffs
• Significant overhangs
• No access to SSGs (apart from 2 countries) TRQs
  (only 2 countries)
• Domestic support
• Sufficient flexibility GB, Article 6.2 and
  de-minimis
• Sector-wide support is important (irrigation,
  fuel, transport) and much of it has not been
  reported in base years
• No export subsidies

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Bahrain Bahrain Egypt Egypt Jordan Jordan Morocco Morocco Oman Oman Tunisia Tunisia
BT AT BT AT BT AT BT AT BT AT BT AT
Wheat 35 5 5 1 0 0 170 56 5 0 98 66
Rice 35 5 30 20 5 5 155 91 5 60 35
Barley 35 5 10 5 9 0 50 27 5 75 73
Beef 35 5 10 5 16.4 17.4 239 189 5 0 75 73
Live sheep 35 5 10 5 7.2 5 62 329 5 na 180
Sheepmeat 35 5 5 5 5.5 5.1 289 7 0 100 115
Poultry meat 35 5 60 101 75
Tomatoes 35 5 20 0 30 34 40 64 5 150
Potatoes 35 3.8 10 5.3 30.8 17.9 34 50 54 5 150 69
Citrus fruit 35 5 60 40 32.4 32.1 34 15 5 200 200
Olive oil 35 5 20 12.5 30 na 34 14 8 120 115
Milk 35 5 60.3 25 20 30 87 109 75 0 180 180
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Major issues raised by developing countries

• Imbalance in commitments between the developed
  and developing countries
• The need for additional flexibility Improving
  agriculture development and food security
  requires domestic policy flexibility
• The need to operationalise the Marrakesh Decision
  on LDCs and NFIDCs
• Capacity building need for assistance

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Key Concerns of the NE Countries

1. Food imports (managing food imports)
2. Access to the developed country markets,
   particularly the EU

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Experience of the Recently Acceded Members (RAM)
major Concerns

• RAMs made more concessions compared with
  countries that joined before 1995
• Some countries could not get some of the
  essential special and differential treatments for
  developing countries
• Complications with the new Doha negotiations

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The Experience of RAMs Some cases of success

• Some countries succeeded in achieving some
  additional special treatment
• e.g. flexibility in terms of base period (Nepal
  and Taiwan)
• Seasonal tariffs for horticultural crops, e.g.
  Jordan
• Some countries bound a number of specific or
  compound rates (Bulgaria, Kyrgyz Republic,
  Latvia, Georgia and Croatia )
• Longer implementation period (China)

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Country Applied Acceded S D
Nepal 1999 2003 YES
Cambodia 1999 2003
Taiwan 1992 2002 YES
China 1987 2001 YES
Oman 1996 2000 YES
Jordan 1994 2000 YES
Panama 1991 1997 YES
Mongolia 1991 1997 YES
Ecuador 1992 1996 YES
Macedonia 1994 2003
Armenia 1993 2003 YES
Moldova 1993 2001
Lithuania 1994 2001
Croatia 1993 2000
Albania 1992 2000
Georgia 1996 2000
Estonia 1994 1999
Latvia 1993 1999
Kyrgyz Rep. 1996 1998
Bulgaria 1986 1996
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AOA Commitments made by RAMs
Member Year of accession Average tariff Final Total AMS (million US) de minimis Access to Art. 6.2 Bound export commitment

Albania 2000 11 0 5 5 0
Kyrgyzstan 1998 12 0 5 5 0
Oman 2000 31 0 10 yes 0
Jordan 2000 25 1.9 10 yes 0
Saudi A. 2005 12.2 858 na na na
Other developing countries Other developing countries Other developing countries Other developing countries Other developing countries Other developing countries Other developing countries
Nepal 2003 42 0 10 yes 0
Cambodia 2003 n.a. 0 10 yes 0
Taiwan 2002 18 14,165 5 0
China 2001 15 0 8.5 included as de minimis 0
Panama 1997 26-30 0 10 yes 0 from 2003
Mongolia 1997 18-20 0 10 yes 0
Ecuador 1996 26 0 10 yes 0
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What if Syria is treated, on average, liker other
RAMs?

• Domestic support sufficient flexibility
• Green Box measures
• De minimis (10)
• Article 6.2
• Support to inputs
• Support to agricultural credit and investment
• Total AMS
• Market access tighter commitments
• Binding tariffs at their applied levels
• But, Syria may consider asking for
• Seasonal tariffs for some products
• Access to special safeguards
• Export subsidies
• Possible access to the SDT for subsidising
  marketing and freight of agric exports

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Lessons

• Special and differential treatment for developing
  countries is not automatic and the acceding
  country has to ask for it
• Countries should avoid making any statement or
  commitment that prohibits any form of a measure
  other than those implied in the basic rules
• Logical justifications, existing legislations and
  programmes and proof of information and their
  sources are always critical in obtaining the
  required treatment
• Use of new forms of alternative trade measures,
  e.g. seasonal tariffs

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Recommendations

• Effective participation in the negotiations
• Continue to strengthen analytical capacity and
  access to information
• Conduct impact studies
• Develop negotiating strategy and fall-back
  positions
• Raising awareness and involving all stakeholders
  in the process
• Strengthening negotiating skill and tactics
• Taking advantage of existing and new trading
  opportunities
• Raising quality standards (regardless of WTO)
• Focusing in on products for which opportunities
  are relatively high, e.g. olive oil, sheep meat,
  fruit and vegetables

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Preparing for WTO negotiations a typical case of
a developing country
Developing negotiating position
Government Ministries

• Government Ministries
• Representatives of farmers and traders

Consultation

• Government
• Research institutions

Analysis
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Preparing for WTO negotiations a case of a
successful developing country
Government Ministries Farmers, Traders, backed by
universities and research inst.
Developing negotiating position

• Government Ministries
• Faculties of Agric.
• Farmer and Traders
• NGOs

Consultation

• Universities Lead by Faculty of Agriculture
• Research institutions
• NGOs
• Government Ministry

Analysis
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Thank you!
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SPS/TBT barriers to exports

• Widespread evidence of SPS barriers to exports,
  and that incidence of these barriers is
  increasing over time
• SPS standards becoming increasingly complex,
  products treated inconsistently in different
  markets
• Lack of resources and technical expertise a
  problem for many developing countries to meet SPS
  standards
• Private sector standards

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Reginal Trade Agreements
Range of bound tariffs in the NE region Range of bound tariffs in the NE region Range of bound tariffs in the NE region Range of bound tariffs in the NE region Range of bound tariffs in the NE region
Bound rates Bound rates Applied rates Applied rates
Wheat 0 170 1 66
Rice 5 155 5 91
Beef 5 239 0 27
Sheep and goat 5 289 5 115
Poultry 10 100 0 60
Potatoes 10 150 0 60
olive oil 20 120 5 115
Sugar 7 164 5 21

• The commitments made by individual countries in
  the context of the WTO limit the scope for
  deepening and expanding RTAs in the region

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Lessons

• S D treatment is not automatic and the acceding
  country has to ask for it
• Countries should avoid making any statement or
  commitment that prohibits any form of a measure
  other than those implied in the basic rules
• Logical justifications, existing legislations and
  programmes and proof of information and their
  sources are always critical in obtaining the
  required treatment
• Use of new forms of measures seasonal tariffs
  (e.g. for horticultural products)

example
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Need for Trade Policy Data and Analysis

• Accession to the WTO
• Preparing schedules of commitments
• Assessing impacts of accession on the economy
• - impact on agriculture, trade, food security
  and welfare
• Analyzing alternative policy scenarios to cope
  with WTO requirements both in the short and long
  terms
• Maintaining the necessary domestic policy
  flexibility
• Safeguarding the economy from world market
  hazards and unfair trade practices