WTO: Agriculture Divisions Persist

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Members of the World Trade Organization (WTO) remained sharply divided on key agricultural negotiation issues, casting doubts on the possibility of a resolution at the WTO's 13th ministerial conference in Abu Dhabi, February 2024. During the Doha negotiating body's recent two-day meeting, discussions focused on public stockholding programs, the special safeguard mechanism, reform of agricultural domestic support, and updating the fixed external reference price based on 1986-88 data. Similar divisions in the past have hindered substantial outcomes in Buenos Aires (2017) and Geneva (2022).

Brazil, formerly leading the Group of 20, warned that without progress on agriculture, no agreements could be expected at the MC13. This comes just a week before Director-General Ngozi Okonjo-Iweala's mini-ministerial meeting on agriculture, now covering all agricultural issues instead of focusing solely on public stockholding (PSH) due to pressure from the Cairns and Latin American Groups.

The Cairns Group's proposal, led by Australia, shifted focus from PSH to comprehensive domestic support reform, causing uproar. This proposal outlines commitments to equitable agriculture trade reform, a holistic approach to negotiations, and specific modalities for domestic support and PSH. The United States supported this view, emphasizing broader domestic support reform.

The Cairns Group, however, overlooked the need to reform Green Box subsidies, a contentious point for many developing countries. Nigeria, along with Indonesia, South Africa, Egypt, and China, criticized the Cairns Group's approach. India's presentation on updating the external reference price (ERP) clashed with the U.S. view, which sees ERP as a limit on trade-distorting subsidies. India argued that ERP reforms are necessary to address longstanding asymmetries in farm rules and promote agricultural development.

Mini-Ministerial Planned Nov 28

With deep divisions among WTO members regarding agricultural negotiations, and significant disagreements over domestic support, public stockholding, and ERP reforms, the upcoming ministerial conference faces challenges in achieving consensus, reflecting ongoing complexities in global agricultural trade negotiations.

Director-General Ngozi Okonjo-Iweala is organizing a virtual informal mini-ministerial meeting on November 28, shifting the focus from solely addressing a permanent solution for food security (PSH) to encompassing all agricultural issues. This change, reportedly influenced by the Cairns Group and the Latin American Group, diverges from India's earlier request for a meeting dedicated to PSH, a central concern for approximately 80 countries from various groups, including the G-33 led by Indonesia, the African Group, and the Africa, Caribbean and Pacific Group.

The Director-General, after consultations with multiple regional groups and key WTO members, including India, the United States, and the European Union, seems to have broadened the meeting's agenda. This development has disappointed many developing countries that had hoped to focus exclusively on PSH.

WTO spokesperson Ismaila Dieng confirmed the scheduled mini-ministerial meeting, emphasizing the need for ministerial guidance to revitalize agriculture negotiations. He stated that the meeting's agenda was never predetermined and has evolved through ongoing consultations with members.

Brazil's trade envoy, Ambassador Guilherme Patriota, supports the Director-General's decision to adopt a holistic approach to agriculture issues. He advocates for discussions on domestic support, cotton, and market access, in addition to PSH, within the limited time frame of the meeting.

The need for a permanent solution for PSH was initially mandated at the WTO’s 10th ministerial conference in Nairobi, Kenya, in December 2015. However, progress has been consistently impeded, notably at the MC11 in Buenos Aires and MC12 in Geneva, due to opposition from countries like the United States, European Union, and the Cairns Group. Despite the Director-General's draft decision to defer the PSH solution to the upcoming 13th ministerial conference, the majority of the Africa Group, ACP, and G-33, including populous countries like India, China, and Indonesia, continue to demand a resolution.

Brazil, having coordinated the G20 in past Doha agriculture negotiations, calls for a comprehensive approach that includes PSH, cotton, domestic support, and market access. Brazil's position on market access aligns with that of the United States, which has shown interest in market access discussions while opposing changes in domestic support.

Amid these developments, Brazil and the United States have expressed concerns over the impact of market price support policies on the international agricultural system, highlighting the complexity and potential distortiveness of these policies. This stance reflects ongoing challenges in balancing national interests and global trade imperatives in WTO negotiations.