NFTC Comments on Harbinson Modalities Paper on Agriculture
Calls on U.S. to Push for More Ambitious Outcome in Doha Development Agenda Talks
Washington DC – In a letter to the U.S. Trade Representative, Ambassador Zoellick , the National Foreign Trade Council (NFTC) commented on the recently-released Harbinson Modalities Paper on Agriculture and called for the U.S. government to push for a more ambitious outcome in liberalizing and reforming agriculture trade in the Doha Round, in line with the U.S. agriculture proposal that was tabled in 2002.
The NFTC commented on five key areas of most concern and stressed the importance of achieving far-reaching liberalization of agriculture in the Doha Development Agenda negotiations. As NFTC President Bill Reinsch emphasized, “this goal is crucial not only for developing countries and reinforcing the strength of their commitment to the Doha process, but also for achieving fair market access for Unites States’ agriculture exporters.”
The NFTC letter included the following views on the modalities paper:
Market Access – Tariff Reductions: The Council fully endorses the US proposal of no tariff higher than 25% at the end of five years. While Chairman Harbinson’s draft is a major improvement over the Uruguay Round formula, the end result will in many cases be insufficient to open markets. For example, the tariff rates in some countries for highly protected commodities such as sugar, dairy, rice, and even some processed foods are 200%, 400%, and more. In these cases, a tariff reduction of the minimum 45% or even 60% will leave these tariffs at levels that continue to block imports.
Market Access -Tariff Rate Quotas: Chairman Harbinson has proposed a target for tariff rate quotas of 10% of domestic consumption using the base period 1999-2001. We understand countries would also have the option to choose 8% for some products provided there is a compensating expansion to 12% for another product. Once again, we see the stage inadvertently set for the few commodities most in need of liberalization to escape genuine reform. The ultimate goal must be to open new export opportunities for developing countries and for the United States farm community.
Special Safeguard Provisions: We welcome Chairman Harbinson’s recognition of the importance of eliminating the special safeguard clause in the Agreement on Agriculture. The special agricultural safeguard (SSG) can be identified as a mechanism that has perpetuated excessive levels of import protection, suppressed the motivation of protected domestic industries to become competitive and necessitated the use of trade distorting export subsidies to clear high-cost domestic stocks.
Export Subsidies and Domestic Support: No message has come through more clearly from developing countries than the need to eliminate export subsidies. We welcome the United States and Chairman Harbinson’s target date of elimination in five years. While we recognize the need for special and differential treatment, we believe that a 10-12 year phase-out period for developing countries proposed by the Chairman weakens the thrust of the reform effort. The proposal should be modified to reduce the phase-out period for developing countries to not more than eight years. Export subsidies are, in principle and in practice, damaging to developing countries and disruptive to international markets. Their use should be discontinued by all countries without exception.
Non-Trade Concerns: The NFTC commends the Harbinson paper for excluding the range of non-trade concerns that have been raised by certain WTO Members, including the EU. The negotiations on agriculture offer a unique opportunity to liberalize and reform agriculture trade to the great benefit of developing and developed countries. It would be an enormous step backward if meaningful liberalization and reform were replaced by so-called “non-trade” concerns, which would lead to the creation of new mechanisms to restrict trade in agriculture.
To view the NFTC letter to the U.S. Trade Representative, Ambassador Zoellick click on the link.
If you are unable to click on the link, copy and paste it into your browser.
http://www.nftc.org/default/nftc march 2003 letter on first harbinson paper1.pdf