addressing outcome on PSH at MC11
Published in SUNS #8572 dated 10 November 2017
Geneva, 9 Nov (D. Ravi Kanth) - The United States has begun to address
an outcome for the permanent solution for public stockholding programs
for food security at the upcoming World Trade Organization ministerial
meeting in Buenos Aires (MC11).
While beginning to focus on PSH for food security, it however rejected
any deliverable at MC11 based on the Argentinean proposal on domestic
support reduction commitment, trade officials told SUNS.
On Tuesday (7 November), the chair for Doha agriculture negotiations,
Ambassador Stephen Karau of Kenya, held two separate meetings in different
configurations on the permanent solution for public stockholding (PSH)
programs for food security and domestic support respectively.
For the meeting on the permanent solution for PSH programs, Karau
invited trade envoys from around 10 countries such as the United States,
the European Union, China, India, Brazil, Australia, Norway, Argentina,
and Russia among others.
A day prior to the meeting, the chair had circulated pointed questions
on two issues - transparency and safeguards.
Until now, the US has either remained silent during most of the other
meetings of different negotiating groups or refused to engage on issues
such as transparency and due process to improve anti-dumping and countervailing
measures or trade-distorting domestic support.
However, at the 7 November meeting, the US engaged gingerly, but point
by point on the permanent solution for PSH programs, on both transparency
and safeguards. The US focused its comments more on safeguards than
transparency, said a trade official who asked not to be quoted.
Further, there is general understanding that any breach occurring
in the implementation of the permanent solution can be reported on
an ex-ante (post-breach) basis as demanded by India.
On the sensitive issue of safeguards, India maintained that while
the current language on safeguards in the interim Bali decision of
December 2013 is overarching, it doesn't have any political space
to accept any additional conditions beyond that in the interim decision.
The language on "anti-circumvention/safeguards" in the Bali
ministerial decision states that "any developing Member seeking
coverage of programmes" shall "ensure that stocks procured
under such programmes do not distort trade or adversely affect the
food security of other Members."
It also says the interim decision "shall not be used in a manner
that results in an increase of the support subject to the Member's
Bound Total AMS or the de minimis limits provided under programmes
other than those notified" for the PSH programs.
Over the past several weeks, Russia, Australia, Pakistan, the European
Union, and the US among others insisted on more conditions on the
safeguards (see SUNS #8565 dated 1 November 2017).
Therefore, the issue is what additional conditions will be attached
to anti-circumvention/safeguard provisions, said a trade official
who asked not to be quoted.
While participants at the meeting suggested strong safeguards, the
US said that the current language on the safeguards is already covered
in the interim decision.
The US maintained that it would prefer specific language to prevent
the likely leakages of PSH stocks into exports. The US wants language
that no direct export from the stocks shall occur upon the release
of products from the stocks.
The US said while it appreciates India's concerns, the language on
safeguards was negotiated very carefully at Bali. However, the US
still wants a fix on issues concerning the permanent solution and
Clearly, it has emerged that there will be additional language on
safeguards to satisfy the US concerns, said another trade official
who asked not to be quoted.
As regards India's demand for language on the coverage of production
in the permanent solution to be based on the Agreement on Agriculture,
Argentina suggested that the Bali agreement covers both grains and
Argentina said there is no room for expanding the language on the
coverage of products beyond food grains and cereals, the trade official
Brazil also suggested that some of the demands on the safeguards are
difficult to implement, pointing out that members should not be engaged
in over-engineering at this juncture.
More importantly, there is still no clarity on the issue of legal
guarantee or an amendment in the Agreement on Agriculture to ensure
its legal permanence like what was done on the Trade Facilitation
At the meeting on the permanent solution there was no specific discussion
on the legal/institutional provisions for the permanent solution and
it remains to be seen how the G33 group of developing countries will
deal with the issue, the trade official said.
After the meeting on the permanent solution, the chair held a meeting
with 40 countries to discuss finalizing an outcome on the domestic
support, particularly the Argentinean proposal.
The US said categorically that in the current climate they have no
option but to reject the Argentinean proposal because it omitted issues
concerning the elimination of Article 6.2 of the Agreement on Agriculture
which provides special and differential flexibilities for developing
countries, and de minimis where China is entitled to spend over US$100
Norway, Japan, and Switzerland also opposed the Argentinean proposal
because it is not proportional and raises the burden of reduction
commitments disproportionately on them.
The EU also did not support the Argentinean proposal while Brazil
raised specific concerns on the parameters.
China and India also opposed the Argentinean proposal because of its
specific failure to address product-specific support as well as on
aggregate measurement of support.
Meanwhile, in a restricted job document Job/Ag/122 circulated on 9
November, five countries - Argentina, Brazil, Paraguay, Thailand and
Uruguay - proposed a work program to discuss market access without
mentioning the Doha Development Agenda.
The one page proposal says the Buenos Aires ministerial meeting must
adopt a work program on market access for agricultural products based
on the following conditions:
a. Having regard to paragraph 2 of Article III and paragraph 1 of
Article IX of the Marrakesh Agreement Establishing the World Trade
b. Recognizing the long term objective of substantial progressive
reduction in support and protection resulting in fundamental reform
in Agriculture, as envisaged in Article 20 of the Agreement on Agriculture
c. Taking into account that the implementation period of the Uruguay
Round has ended in 2001;
d. Seeking to strengthen the negotiating function of the World Trade
[Art. III para 2 of WTO treaty requires WTO to be the forum among
its members on matters covered by WTO agreements. Art. IX para 1 provides
for decision-making by consensus, but also for voting where decision
cannot be arrived at by consensus. SUNS]
The five countries want that ministers must clinch a decision to direct
members "to reinvigorate negotiations on agricultural market
access in order to reduce the level of protection and create meaningful
market access opportunities."
The proposal says that "members shall strive towards achieving
tangible market access outcomes at MC12 and beyond through incremental
steps. Clear and measurable parameters for assessing progress in the
negotiations need to be agreed on."
It calls for enhancing "transparency and monitoring in the area
of agricultural market access. To this end, the Committee on Agriculture
shall examine developments in the field of agricultural market access
on a yearly basis."
The language on transparency is close to what the US demanded in its
proposal on transparency provisions.
The five countries want "negotiations on agricultural market
access in dedicated sessions of the Committee on Agriculture in Special
In short, Brazil which created the G20 developing country coalition
to rectify the historical imbalances in the global agriculture in
2003 is now calling for negotiations on market access without any
reference to the Doha Round. Effectively, the proposal amounts to
burying the Doha Round at Buenos Aires.