December 23, 2015


New WTO deal removes export subsidies in agriculture


The 10th WTO Ministerial Conference, held last week in Nairobi, Kenya, has agreed on a global trade deal that will get rid of export subsidies in agriculture.

For EU producers, it would be the first time that they will see a level playing field in export competition, the European Commission (EC) said.


The EU negotiators in the Conference, led by Trade Commissioner Cecilia Malmström and Agriculture Commissioner Phil Hogan, were at the forefront of efforts to broker the deal.


"We've had some long days and nights of intense negotiations here in Nairobi, and our work has paid off….Today's (Dec. 19) decision opens real opportunities for more trade and investment and reinforces the global trading system", Malmström said.


Hogan, for his part, commented that "this is a square deal for EU agriculture, for farmers in the developing world, in particular for the least developed countries…. In recent years, the EU has led the way in agreeing to renounce the use of export subsidies. Now, for the first time, there are binding disciplines on subsidies such as export credits, where our competitors are subsidising trade worth billions every year".


He added, "These new binding controls will level the playing field for EU exporters. Also, our competitors will not be able to circumvent these rules through use of state trading enterprises-a key demand for the EU".


More opportunities for poor countries


The deal, building on the agreement reached in Bali two years ago, will:


Stop the use of subsidies and other schemes unfairly supporting agricultural exports. The elimination of export subsidies will protect vulnerable farmers in developing countries from the damaging effects of export subsidies. It will fast-track the removal of these subsidies in the case of cotton.


Ensure that food aid for developing countries is given in a way which does not distort local markets.


Simplify the conditions that exporters from the poorest countries have to meet, so that their products benefit from trade agreements (so-called rules of origin). It also gives more opportunities for businesses from the poorest countries to provide services in the WTO's 164 member countries.


These changes will be carried out gradually by phases. Developing and least developed countries will be given more time to adapt themselves to different aspects of the rules.


For European producers and exporters, the deal creates a more level playing field toward both developed and emerging economies, the EC said. EU farmers are ensured of an end to export subsidies in key sectors including dairy.-Rick Alberto

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