Empirically Analyzing the Impacts of U.S. Export Credit Programs on U.S. Agricultural Export Competitiveness

export credit or line of export credits should not be fixed for a period exceeding six
months .

The member countries of the WTO’s Committee on Agriculture (CA) that are also
the member countries of the OECD were waiting and hoping for the Arrangement to
reach a consensus agreement on the use of officially supported export credits for
agricultural products. The outcome of the agreement could then be integrated into the
WTO system for implementing Article 10.2. Meanwhile, the non-member countries of
the OECD expressed their concerns. They contended that the guidelines on the use of
officially supported export credits for agricultural products should be negotiated and
established under the WTO’s negotiation forum. Their main reason for this view is that
the guidelines agreed on by the Arrangement are unlikely to reflect their concerns. In
addition, many developing countries who are net food importers expressed their concerns
in a fear of high import prices if export credits were to be faced out (WTO, 2000, 2001a,
and 2001b). In spite of different concerns, the Harbinson Text in which the July
Framework instructs the WTO CA to build on to discipline the use of officially supported
export credits outlines similar credit terms and conditions which the Arrangement of the
OECD drafted described above. Thus, when and how Article 10.2 will be finally
implemented hinges on an on-going-negotiation process of the WTO’s CA.

Theoretical Model

As mentioned above, the credit terms and conditions on the use of government-
supported export credits for agricultural goods are still under negotiation by the WTO
and the OECD. One question that needs to be addressed is how these credit terms and
conditions of export credit programs can be effectively assessed as subsidized elements in

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