Russia’s invasion of Ukraine led to a rise in trade-restrictive measures by World Trade Organization members, according to a note released by the WTO yesterday.
Immediately following the outbreak of the war, several export restrictions on wheat, barley, sugar and seeds from Ukraine and the Russian Federation were implemented.
The fear of severe domestic shortages of basic foodstuffs appears to have pushed other countries to also introduce export restrictions on these products or their close substitutes. The effect of these restrictions on food markets and consumers globally was almost immediate, according to the notes. This hit consumers globally, but especially those in developing and least developed countries in Africa, the Middle East, and parts of Asia.
Since the beginning of the war and up to February 28, 2023, 96 export restrictions on essential agricultural commodities were identified to have been applied by 29 WTO members and six observers. Of these, 88 applied to food and feed and eight specifically targeted fertilizer exports.
Over the past 12 months, some 28 measures were phased out, thus bringing to 68 the total number of measures currently applied (63 on food and five on fertilizers) by 27 WTO members and five observers, covering approximately $85 billion of total world exports, according to the WTO.
Once the global food and fertilizer markets began to stabilize in May 2022, the recourse to less
restrictive measures increased. Export restrictions started to include licensing requirements and duties. Additionally, some of the bans imposed earlier were removed or replaced by less restrictive measures. Nevertheless, export bans remained the most utilized form of export restrictions throughout the whole period.
The note underlines that while the initial implementation of export restrictions was often directly attributed to the war, subsequent measures were introduced with a reference to the need to ensure domestic supply and to contain inflationary pressures. In a sense, it would appear that the initial direct linkage between the war and the implementation of export restrictions is now less obvious, according to the note.
WTO members and observers have also introduced several import-facilitating measures for these products. As of February 28, 2023, WTO Trade Monitoring has identified 71 measures facilitating imports of food, feed and fertilizers, including 63 specifically on food/feed, seven combined on food/feed and fertilizers, and one purely on fertilizers. These measures were introduced by 62 WTO members and two observers. Twenty-five of these measures were phased out, bringing the total number of currently applied measures to 46 (39 on food/feed, six on food/feed and fertilizers, one purely on fertilizers), imposed by 59 WTO members and two observers.
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