Special and Differential Treatment in the WTO Agricultural Negotiations



Table 1. Flexibility provisions for developing country Members in the AoA

Article 6.2

Investment subsidies which are generally available to agriculture, agricultural input
subsidies generally available to low-income or resource-poor producers, and
support to encourage diversification from growing illicit narcotic crops, are exempt
from domestic support reduction commitments.

Article 6.4(b)

Higher de minimis percentage for AMS commitments under this paragraph of 10%
(as against 5% for other Members).

Article 9.2(b)

Lower rate of reduction for export subsidy commitments on budgetary expenditure
and quantities benefiting from such subsidies.

Article 9.4

Certain export subsidies are excluded from reduction commitments: subsidies to
reduce the costs of marketing exports of agricultural products, and providing
internal transport charges on export shipments more favourable than those for
domestic shipment.

Article 12.2

Exemption for developing country net food importers from the requirement to give
due consideration to the effects of export prohibitions and restrictions on other
importing Members’ food security and to give notice and to consult with other
importing Members on such measures.

Article 15.1

General requirement that S&D should be reflected in the commitments undertaken
under the AoA. This was implemented with respect to the market access, export
subsidy and domestic support commitments by mandating reduction commitments
two-thirds of those required of developed country Members.1

Article 15.2

Developing countries to have the flexibility to implement reduction commitments
over a period of up to 10 years. Least developed countries not required to undertake
reduction commitments.

Annex 2

Governmental stockholding programmes for food security purposes whose
operation is transparent and in accordance with officially published criteria, as well
as domestic food aid and subsidy programmes, are deemed to be Green Box
measures.

Annex 5          Exemption from tariffication for predominant staples provided certain minimum

access opportunities are provided.

1 The reduced level of commitments allowed to developing countries and reflected in their Schedules
of Commitments are not specifically spelled out in the AoA itself but were reflected in the Modalities
document on which commitments were based.

Applied tariffs are much lower than bound rates. For 32 developing countries, a simple
average of the applied rates is 20% versus the bound rate of 84% (Sharma, 2002). Matthews
(2003) found almost identical numbers for an overlapping sample of 23 developing countries
(18% as against 84%). Gibson
et al. (2001) reach the same conclusion. Examining a sample
of 12 Latin American countries with good data availability, they found that the average bound
tariff level was 45% while the average applied tariff in 1998 was 13%, or less than one-third
the bound level. They noted that applied tariff data were more difficult to source for other
developing countries, but for a small sample of seven other developing countries they found
applied rates averaged from one-quarter to about three-quarters of the bound rates.

This evidence suggests that developing countries, on average, have not been making use of
the flexibility they already have to raise tariffs on imported foods where they think this is
appropriate. One reason may be that countries have been forced to lower applied rates as part
of structural adjustment programmes. However, case study evidence suggests that low applied



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