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OrganizationG/AG/NG/W/159
12 April 2001(01-1915)Committee on Agriculture
Special SessionOriginal: English
SIXTH SPECIAL SESSION OF THE COMMITTEE ON AGRICULTURE
22-23 MARCH 2001
Statements by Sri Lanka
G/AG/NG/W/101 (Proposal by Norway) and G/AG/NG/W/91 (Proposal by Japan)
At the outset, my delegation also wishes to extend our thanks to the delegation of Norway for submitting its proposal. With your indulgence, I would also like to offer our comments on some elements of the proposal submitted by Japan as well, contained in document G/AG/NG/W/91, both taken together during my intervention in order to take up some horizontal or cross-cutting issues.
The proposal of Norway highlights the fact that Article 20 only calls for continuation of the reform process. Further it emphasizes that when such reform process takes place, there has to be an equal treatment for all elements contained in Article 20, including non-trade concerns. It further argues that due to special nature of agriculture sector in countries, the one-size-fits-all approach can not be used in agriculture and that such unique characteristics across countries need to be accounted for in the negotiations. My delegation broadly shares this view and believes that Members, particularly the developing among them, should have sufficient flexibility within their domestic policies to encourage domestic production and to adequately address their non-trade concerns, in accordance with their policy objectives, unique to their developmental goals.
We accept the fundamental argument presented by Norway as to the nature of production conditions prevailed in countries, whether it is "less favourable production conditions" or "comparative disadvantage", and the situations that require countries to recourse to domestic policy measures that help to overcome such situations. My delegation, however, likes to differentiate the situations prevailed in developing countries from the ones prevailed in developed countries. While it may be true that a country like Norway does face incremental weather and to this extent has less than favourable production conditions, considering the options available to overcome such situations for developed and developing countries, it is evident that the latter is always at a disadvantaged position.
My delegation welcomes Norway's proposal on market access that Members should be allowed to make only limited MFN tariff reductions on their key agricultural products. While we believe that this may be appropriate and in fact even necessary in terms of safeguarding the food security situation in countries, availability of such flexibility should however be based on an objective criteria that takes into account the different measures already used by the countries. We also welcome Norway's proposal that tariff quota administration should be transparent and equitable, including preferential allocation of TRQs for developing countries.
Norway has proposed the continuation of the SSG in its present form with the addition that the SSG should also be made available to all developing countries, even if they do not have recourse to them presently. We welcome this proposal as it tries to address one of the imbalances existing in the current agreement. We also believe that this flexibility is made available to developing countries in the context of Special and Differential treatment.
Norway, under domestic support has proposed that AMS should be divided into two categories: one in which AMS would be for products destined for domestic markets and the second would consist of support for export oriented production. While the first category would have lesser reduction commitments, the second one would be subject to further reduction. We believe that such a mechanism would be advantageous for developing countries, which have been trying to differentiate between the trade distorting support being provided for export purposes and the non-trade distortive support often provided by developing countries for enhancing domestic production. This is also in line with the situation presently prevailed in the goods sector. We suggest that such a mechanism be provided as an S&D provision.
My delegation supports Norway's proposals regarding S&D treatment for developing countries, that those provisions should be further developed in the areas of market access, domestic support and export competition. My delegation wishes to highlight the proposals that Norway has proposed in its proposal for consideration under S&D, including the request for reviewing the Marrakech Decision on NFIDCs and LDCs in order to ensure its effective implementation.
In the context of its proposal to grant LDCs duty-free and quota-free market access, it could be stated that in providing such an access it must be ensured that this is not at the cost of the existing market share of other developing countries.
My delegation wishes to thank Japan for submitting its proposal contained in document G/AG/NG/W/91. At the outset, it may be mentioned that my delegation supports the two basic thrusts of the Japanese proposal that are positive, namely (i) that it is important to ensure a certain degree of self-sufficiency in domestic food production in countries; and (ii) that the negotiations would need to provide adequate flexibility to developing countries in order to enable them to address their specific and characteristic problems.
As for the proposals on Market Access, we also believe that having flexibility to bind the tariffs on certain sensitive products at suitably high levels for developing countries is of vital interest to them. In commenting Japan's proposal to ease the conditionalities of some of the provisions in the Green Box, we believe that such a review should provide necessary flexibility to developing countries in order to enable them to address their non-trade concerns, such as rural development, poverty alleviation and unemployment in the agricultural sector.
G/AG/NG/W/106 (Proposal by Turkey)
Like other delegations my delegation also wishes to thank the delegation of Turkey for submitting a negotiating proposal which not only contributes to the process but it also supports many of the issues raised in the three proposals submitted by Group of Developing Countries including Sri Lanka. Very importantly the proposal by Turkey states that a purely market-oriented approach may not be able to fully address the problems and existing constraints and conditions in this sector for the developing countries, with which we fully agree. Furthermore, the proposal draws the attention to a problem concerning small land holdings which is common to many developing countries; because of the holdings being small it is not realistic to expect short term improvements in the agricultural sector without resolving the structural problems first.
The proposal by Turkey also makes the important point that like in Sri Lanka, tariffs are the only instrument available to protect the agriculture sector against the considerable level of export subsidies and domestic support provided by developed countries which have significant financial resources. This justifies taking a cautious approach to tariff reduction and this is the very reason developing countries need flexibility in tariff reductions. Turkey has also stated in its proposal that it can consider tariff reductions only under circumstances in which export subsidies and domestic support are substantially reduced or eliminated by developed countries. Sri Lanka agrees with this view as many developing countries are not responsible for trade-distorting measures and therefore they could undertake tariff reductions only when these distortions are removed. Sri Lanka also supports the proposal that developing countries should be able to apply a lower level of tariff reduction and be allowed a longer period for implementation and in particular, especially in the context of food security concerns of developing countries, they should have the flexibility to identify some key products to be exempted from further reduction or at least be reduced at minimum rates. We also support the proposal by Turkey that tariff peaks and tariff escalation applied by developed countries should be eliminated.
On the proposal on the SSG provision that the existing SSG provision should be eliminated or a safety mechanism similar to that which exists should be allowed to other countries, we believe that not only the iniquitous provisions of the existing SSG should be eliminated but also that a safety mechanism should be allowed to developing countries as an S&D measure.
The proposal by Turkey, that the domestic support over de minimis level should be reduced substantially or eliminated, while de minimis level for developing countries should be increased to a mutually agreed level and that developing countries should be granted the flexibility to apply de minimis on an aggregate basis, instead of product basis, taking into consideration the change in production conditions, are important proposals which we endorse.
On the proposal on Food Aid, while we agree that the provisions of Article 10.4 of the Agreement on Agriculture set fourth the requirements for international food aid, we wish to stress the importance of operationalising of the Marrakech Decision on Possible Negative Effects of the Reform Programme on LDCs and NFIDCs to ensure that the reform process does not adversely affect the availability of food aid at a level sufficient to continue to provide assistance in meeting the food needs of LDCs and NFIDCs.
G/AG/NG/W/107 (Proposal by Arab Republic of Egypt)
1. My delegation also likes to join others in thanking the delegation of the Arab Republic of Egypt for submitting a proposal, which has positively contributed to the mandated negotiations on Agriculture. We agree with the fundamentals on which Egypt's negotiating proposal is based namely that any agreement reached within the АФУХСљКЯВЪЙйЭјзЪСЯ system should benefit all Members, and in particular, consideration should be made for the needs and aspiration of developing and least-developed countries. We also agree, that the main objectives of the negotiations should be to contribute to the further integration of agriculture into the multilateral trading system and to increase the market orientation of trade in agriculture products by removing the current distortions. Furthermore, operationalising previous commitments in particular undertaken in favour of developing countries are indeed important.
2. My delegation would like to thank the Egyptian delegation in particular for highlighting the need to operationalise the Marrakech Decision on measures concerning the possible negative effects of the reform programme on LDCs and Net Food-Importing Developing Countries. As stated in the proposal, the Marrakech Decision remains only a declaration of goodwill, as it did not establish a mechanism to operationalise it. There are ambiguities in the decision in the absence of precise definitions on terms such as "possible negative effects" and what "the normal level of commercial imports", are and "reasonable terms and conditions" etc.
According to data provided by FAO, the two groups of countries i.e. LDCs and NFIDCs are facing higher cereal import bills. If the main objective of the Agreement on Agriculture is to create a fair trading system by removal of trade distorting policies and if this fundamental objective of the AoA is successful, the structural surpluses will decrease and prices will firm up, the effect of which for the NFIDCs and LDCs will be an increase in the cost of their food imports. Furthermore, under the new Food Aid Convention, available volume of commodity commitments to LDCs and NFIDCs will also be less. Past experience has shown that this Group of Countries need access to food and concessionary finance at the time of supply shortages when prices are high. These countries also require financial assistance to increase productivity and infrastructure in agricultural sector. Due to conditionalities being attached, LDCs and NFIDCs have used less, current financing facilities available through multilateral agencies. In any event I believe current compensatory financing facility has been reviewed by the IMF and funds will not be available under this facility under the Marrakech Decision. It is in this context, the Egyptian proposal for the creation of a fund to support NFIDCs and LDCs to purchase their food requirements on the open market becomes significantly important. Therefore, my delegation fully supports the proposal for the creation of a fund.
3. On Market Access, we agree with Egypt that an agreement should be reached to substantially reduce tariff and other charges currently applicable to agricultural products and that tariff escalation, tariff peaks should be eliminated. However, we believe such reduction should be based on a formula approach with a view to harmonizing tariffs. We also agree that all tariff reduction by developed countries should be made from applied rates, rather than bound rates and developing countries reductions should be made on a basis consistent with their development needs. In this regard, limited flexibility available to countries whose bound and/or applied rates are already low should also be recognised.
4. With regard to the Egyptian proposal that a review of the special safeguard provision embodied in Article 5 must be undertaken with a view to its elimination, my delegation's view is that a simplified similar safeguard mechanism should be available to all developing countries in order to address specific problems of developing countries and of their food security concerns to protect resource-poor, small-scale subsistence farmers whose livelihood is entirely dependent on agriculture, to protect them from import surges. We disagree with Egypt that the provision of the Agreement on safeguards would satisfy the need of some Members to protect their local markets from sudden surge of imports, as application of such safeguard measures are subject to extensive procedural requirements and conditions. The kind of agriculture system in place in most developing countries is not amenable to the kind of procedural requirements that the general safeguard agreement prescribes and therefore, it is difficult for many developing countries in their current state of social economic development, having the necessary level of institutional and legal capability, to utilize these provisions. Therefore, we believe that "Agricultural Safeguard Mechanism" for developing countries should be developed, in the current negotiations.
5. On S&D Provision, we agree with Egypt that S&D provision in the AoA should be strengthened and expanded. In this regard we strongly believe that specific measures and instruments should be developed to address specific concerns and problems of developing countries in particular to provide greater flexibility in the use of domestic support measures to address non-trade concerns to developing countries, which are distinctly different from developed countries. In this regard we broadly support constructive proposals in paragraphs 1-6 under the S&D treatment, and in particular, that greater flexibility should be granted to developing country Members to increase their level of domestic support and all S&D provision should be discussed within the context of the three main pillars of trade liberalisation with the aim of concretising and specifying such S&D treatment.
G/AG/NG/W/130 (Proposal by Nigeria)
1. My delegation also wishes to thank the delegation of Nigeria for its proposal and wishes to state that broadly we share the views expressed in the proposal as the Nigerian proposal reiterates and supports proposals that have been submitted by many developing countries including Group of Eleven Developing Countries including Sri Lanka.
As stated in the proposal we share the view that the expectation of many developing countries consequent to the implementation of the Uruguay Round are yet to be fulfilled. There is also concern that Uruguay Round rules did not actually take into account the weaker position and specific constraints of developing countries in the new global economy.
2. Like Nigeria, in Sri Lanka too, agriculture plays an important role in that agriculture contributes 22% GDP and provides 45% of employment and 70% of the Sri Lanka population still lives in the rural areas. Therefore, similar to Nigeria, our expectations in the ongoing negotiations pursuant to Article 20 of the AoA is to ensure equity and fairness in international trade in agriculture by the elimination of trade distorting practices, while at the same time addressing development concerns of developing countries and the existing imbalances in the agreement. In this context as stated by Nigeria, agriculture policy objectives of Sri Lanka too include to increase of production of food, promote cash crop productions as a source of export diversification, enhance incomes of small farmers and households with a view to alleviate poverty and promoting rural development and employment.
3. On the specific proposal on Domestic Support Measures, we support that to ensure equity and balance of obligations developing countries should be allowed to take new measures for instance in the area of domestic support up to levels substantially higher than the de minimis level. In this connection, Group of Eleven Countries including Sri Lanka proposed that de minimis level should be increased from current 10% to 20% for developing countries.
4. We could also endorse the specific proposal under S&D treatment for developing countries that S&D measures should give realistic equity to developing countries taking into consideration factual development constraints mitigating against their active participation in world trade and that technical assistance to facilitate the full integration of developing countries into the system, as well as to support and sustain increased domestic production should become part of the provision of the Agreement on Agriculture. We further endorse the proposal that the negotiations should recognise the need for flexibility for developing countries particularly (a) in reducing tariffs on sensitive products, (b) flexibility on Domestic Support measures to be able to address the concerns of rural population in this sector for the sustenance of the livelihood and employment, and (c) flexibility to attain a certain degree of self sufficiency.
5. On proposals concerning food security, we agree with Nigeria that maintaining food security is of vital importance to most of the developing countries and therefore negotiations must focus on increased flexibility for developing countries to use domestic support measures that aim to maintain food security and to enhance the incomes of small farmers. In this regard we also agree with Nigeria that concrete action should be taken with respect to the problems of net food-importing countries, and increasing the level of commitments by developed countries to address concerns related to food aid, problems of NFIDCs and LDCs, are of particular importance. We also support that flexibility should be provided regarding import restraint and domestic subsidy for the production of and support to household, subsistence farming and small-scale farming in countries where such farming is important.
We believe the Nigerian proposal and the proposals submitted by many developing countries including that of the Group of Eleven Developing Countries including Sri Lanka and the comprehensive proposal by India will form the basis to address specific problems of developing countries.
G/AG/NG/W/136 (Proposal by Kenya)
1. My delegation would also like to thank the delegation of Kenya for submitting a negotiating proposal as it supports and expands proposals already submitted by a number of developing countries including Group of Eleven Developing Countries along with Sri Lanka.
Since you wished us to be brief in our statements my delegation wishes to make the following brief comments on the Kenyan proposal.
2. On specific recommendations made in the Kenyan proposal, we could broadly agree from proposal 1 to 8. As regards the proposal for substantial improvement in Market Access to products of export interest to developing countries, we agree with the proposal that АФУХСљКЯВЪЙйЭјзЪСЯ Members should clearly define the criteria of "products of interest to developing countries". In this respect, we agree that those products should be identified on exporting country-by-country basis.
3. We also agree with Kenya that to minimise adjustment costs to developing countries from the erosion of the values from preferential market access the current negotiations need to find ways and means to improve market access opportunities for developing countries; in this connection, making preferential arrangements predictable and binding them in the АФУХСљКЯВЪЙйЭјзЪСЯ and simplifying and harmonising the rules of origin are important proposals.
4. Regarding the establishment of a Development Box, a proposal has already been submitted by a Group of Eleven Developing Countries including Kenya and Sri Lanka. Hence, we totally agree with the proposal for the establishment of a Development Box as enumerated in the proposal.
5. We also endorse the proposal by Kenya for the establishment of a mechanism to ensure in a concrete way technical and financial assistance to developing countries to meet SPS standards and regulations in developed country markets. On the proposal for non-extension of the Peace Clause beyond 2003, we agree that domestic support measures provided by developing countries within the framework of food security or development box and those under Article 6.2 should be made totally non-actionable.
6. Finally, we also endorse that measures and policy instruments in favour of NFIDCs should be part of the Agreement translated into concrete commitments by Members and subject to the АФУХСљКЯВЪЙйЭјзЪСЯ monitoring and enforcement mechanisms.
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