Introduction to the WTO

1

• Introduction to the WTO
• Agreement on Agriculture (AoA)
• Dubai, 20 - 21 May 2003

2
Agriculture in the GATT/WTO A Brief Overview

• Basic principles of GATT/WTO
• Agriculture has special character in the
  GATT/WTO, Why?
• The Final Act of the Uruguay Round
• Agreements of direct relevance to agriculture
• Some basics of the Uruguay Round Agreement on
  Agriculture (AoA)

3
The Basic Principles of GATT

• Most-Favoured Nation Treatment (MFN)
• Reciprocity - rights on MFN and obligations on
  MFN
• Transparency - tariff only regime
• Tariff binding and reduction

4
What is special about agriculture?

• Source of rural livelihood
• Major source of food
• Food security
• National security
• Highly linked to the Environment
• Land
• Water
• Sea coasts

5
Situation in the 1980s

• high level of domestic support by rich countries
• heavy export subsidies, mainly (US and EC)
• market access - no rules
• so, countries with comparative advantage were
  less able to produce and export
• tensions and disputes over agricultural trade
  arose with increasing frequency
• this had negative effects on non-subsidizing
  countries (incl. most developing countries)

6
The Uruguay Round of Negotiation 1986-1993

• the most comprehensive round ever
• concluded new major agreements, inter alia, in
  agriculture, SPS, textiles and clothing,
  services, investment and intellectual property
  rights
• created a predictable and strengthened Dispute
  Settlement Mechanism
• created the WTO which came into force in 1995
• today the WTO has 144 members and more than 25
  others are in the process of accession

7
The Final Act of the Uruguay Round

• The Final Act (just over one page), Agreement
  establishing the WTO and its three Annexes embody
  the entire results of the UR negotiations (558
  pages)
• Agreement Establishing the WTO and its Annexes
  containing the individual Agreements (the WTO
  Agreement)
• Ministerial Decisions and Declarations

8
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

9
Agreement on Agriculture

• The AoA has
• removed the special treatment of the sector in
  MTNs
• brought agriculture into mainstream of
  international trade rules
• The three main provisions of the AoA aim at
• improving market access
• reducing domestic support
• reducing export subsidies

10
Agreement on Agriculture

• A number of agricultural commodities are not
  covered by the AoA
• e.g. rubber, fish and fish products and forest
  products
• they fall under other provisions governing trade
  in goods