Market Access Agreement On Agriculture

While the vast majority of agricultural tariff quotas originate in the Uruguay Round negotiations, some of these commitments have been the result of WTO accessions. Currently (July 1999), 37 members have tariff quotas set out in their schedules. In total, there are 1,374 individual tariff quotas. These tariff quotas are binding commitments, as opposed to the autonomous tariff quotas that members can set at any time, for example to stabilize the domestic price after a poor harvest. Article 4.2 of the Convention on Agriculture prohibits the application of non-tariff agricultural measures. These measures include quantitative import restrictions, variable import duties, minimum import prices, discretionary import authorization procedures, voluntary export restriction agreements and non-tariff measures maintained by state-owned commercial enterprises. All other similar border measures as normal tariffs are no longer permitted. Although Article XI, paragraph 2, point c) of the GATT [cross-reference] continues to authorize non-tariff restrictions on the import of fish products, it is now ineffective for agricultural products, as it is replaced by the agricultural agreement. The 1947 GATT initially applied to agriculture, but was incomplete, and the signatory states (or “contracting parties”) excluded this sector from the scope of the principles set out in the general agreement.

During the period 1947-1994, members were allowed to use export subsidies for primary agricultural products and to impose import restrictions under certain conditions, so that major agricultural raw materials faced trade barriers in unusual proportions in other sectors. The road to a fair, market-oriented agricultural trade system has therefore been difficult and time-consuming; and the negotiations were finally concluded during the Uruguay Round. Agriculture has a special status in WTO agreements and trade agreements (signed in 1994 and entered into force on 1 January 1995), with the sector having a specific agreement, the agriculture agreement, whose provisions prevail. In addition, some provisions of the agreement on the application of plant protection measures (SPS) also concern agricultural production and trade. The same applies to the agreement on trade-related aspects of intellectual property rights (TRIPS) with respect to the protection of geographical denominations. In addition, the provisions of the agreement on agriculture are complemented by the Agreement on Technical Barriers to Trade (OTC) and by technical assistance mechanisms. In the 1980s, public payments to agricultural producers in industrialized countries generated large crop surpluses, which were unloaded by export subsidies on the world market, causing food prices to fall. Tax pressure on safeguards has increased, due to both lower import duty revenues and increased domestic spending. Meanwhile, the global economy has entered a cycle of recession and the perception that market opening could improve economic conditions has led to calls for a new round of multilateral trade negotiations.

[2] The cycle would open up markets for high-tech services and goods and ultimately generate much-needed efficiency gains.