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IPC Position Paper No. 10

Agenda Options for Agricultural Policy Reform in the Seattle Round

An overview

To achieve an abundant and affordable food supply of increasing quality, variety and reliability will require ever greater efficiency in the world’s agri-food system. Yet this efficiency must be achieved while protecting the environment and building viable rural societies around the world. The challenge of the Seattle Round of WTO negotiations that is set to begin before the end of 1999 is to complete the agenda of the Uruguay Round while addressing the new requirements of the emerging global food system.

In this position paper, the International Food and Agricultural Trade Policy Council (IPC) analyzes the various methods which might be used to continue the reforms that were begun in the Uruguay Round, and concludes with policy recommendations based on that analysis that show the way forward regarding the variety of issues likely to come up in the Seattle Round. All signatories to the Uruguay Round accepted the built-in agenda to continue to reduce barriers to trade in agricultural products. The IPC endorses that goal and argues that the trade liberalization approach adopted by the Uruguay Round must continue and be expanded to include a simultaneous reform of state trading activities.

The IPC recognizes that the Seattle Round negotiations must also take into account other non-trade concerns—such as international development, rural development, consumer demands, food security and preservation of the environment—which will come into play in the negotiations. However, it is the IPC’s belief that these concerns can be addressed satisfactorily in ways that do not unduly distort global trade, nor undermine the drive towards a global food system. The paper supports for example the WTO’s approach to relying on sound science for decisions regarding food safety and the environment. The IPC suggests that any costs incurred due to environmental or other regulations should be reimbursed through direct payments from governments and not through border protection measures.

The paper also urges nations to work towards greater harmonization of divergent national standards and to implement increased transparency and labeling requirements to provide more information for consumers.

The Seattle Round negotiations must take into account the importance of trade to agriculture in the developing countries, as well as the importance of the agricultural sector to the economic development of these countries. Regarding special preferences for certain low-income countries, the paper argues that tariff preferences may be less relevant to economic development- today and may in fact cause more harm than good to the recipient countries. Other means of providing development assistance may be more effective and beneficial under current economic circumstances. The drive towards trade liberalization must therefore be balanced against the very real needs of developing countries.

FULL TEXT (.pdf format)

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