escalation is still a long-term feature of agricultural and food-processing trade according to more
recent literature, (Gibson et al.; Lindland; and Rae and Josling). It continues to be so despite the
emergence of preferential agreements in the EU and the US (Gallezot). Rae and Josling find that
export of processed food from developing economies have been impeded by tariff escalation in
the industrialized countries but also within themselves. These finding are based on an older
dataset (GTAP 4). Aksoy, and Gibson et al. find similar patterns with much more recent data.

Telling examples of tariff escalation abound for a wide range of products. Current EU
tariffs on milled rice imports into the EU are 80% compared to only 46% for brown rice
(Wailes). Within the EU raw cocoa has a tariff of 0%. At its first processing stage (cocoa butter)
it is charged 9%, and at its second stage (cocoa paste) it attracts 21%. The figures for coffee are
4% for the raw product and 11% for its second processing stage, and for soybeans 0% and 6%
respectively (Aksoy). Japan and the US apply comparable tariff structures. Studies show that the
proportion of processed products to the LDCs' total agricultural produce exports dropped from
27% to 16.9% from 1964 to 1994, while that of the developing countries as a whole during the
same period increased from 41.7% to 54.1%. This, however, covers mostly only first-stage
processing. If a further processing stage is taken into account, the proportions are much lower at
8.4% and 16.6% respectively (Aksoy; Windfuhr). Wood products show similar patterns with
logs being traded at zero or very low tariff while processed wood products faced much higher
tariffs.

2.2. IS and associated externalities

The introduction of harmful exotic species into the non-native environments has received
heightened recognition because of the threats this biological pollution poses to agriculture,
ecosystem health, endangered species, economic interests, and even public health. In the US

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