Agriculture in Regional Trade Agreements
Frank van TongerenOECD Trade and Agriculture
OECD Trade & Agriculture 2
•How much additional market access is provided through RTAs?
•How much is ‘WTO-plus’?
•Tariffs, ROOs, SPS/TBT
•Transparency
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More RTAs and evolving provisionsMore RTAs and evolving provisions
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Regional trade agreements: aggregatesRegional trade agreements: aggregates
•Asia-Pacific:
•Inter-regional: agreements between countries of different continents, Europe-Africa, Europe-Latin America, Latin America-Asia-Pacific, North America and Latin America
•Latin America
•Over 50 agreements and 158 tariff concessions examined
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Conforming to GATT Article XXIV Conforming to GATT Article XXIV •T
ariff and 'restrictive regulations of commerce' non tariff barrier elimination on substantially all trade(SAT) in a reasonable length of time.
– SAT not well-defined, but no significant sector excluded
– Reasonable length of time: 10 years for developed countries
– Restrictive regulations ~~ trade barriers
•Liberalisation of agricultural trade in regional trade agreements~~conforming to Article XXIV
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Measuring liberalisation in regional trade Measuring liberalisation in regional trade agreementsagreements
•Tariff elimination measure: percentage of tariff lines 0
• Exceptions to complete liberalisation
– tariff lines
– TRQs
• Non-tariff measures: going beyond WTO requirements WTO plus– SPS/TBT/Anti-dumping/SS/
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Tariff elimination by region and yearTariff elimination by region and year
0
20
40
60
80
100
120
total
Latin America
Inter-regional
Asia Pacific
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Not all products equally fast (I)Not all products equally fast (I)
0
20
40
60
80
100
120
yr1
yr2
yr3
yr4
yr5
yr6
yr7
yr8
yr9
yr10
yr11
yr12
yr13
yr14
yr15
yr16
yr17
yr18
yr19
yr20
yr21
yr22
yr23
yr24
yr25
Asia-Pacific
dairytobacco
sugar
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Not all products equally fast (II)Not all products equally fast (II)
0
20
40
60
80
100
120yr
1yr
2yr
3yr
4yr
5yr
6yr
7yr
8yr
9yr
10yr
11yr
12yr
13yr
14yr
15yr
16yr
17yr
18yr
19yr
20yr
21yr
22yr
23yr
24yr
25
Latin America
dairysugar
veg.plaiting and gums and resins
cereals
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Not all products equally fast (III)Not all products equally fast (III)
0
20
40
60
80
100
yr1
yr2
yr3
yr4
yr5
yr6
yr7
yr8
yr9
yr10
yr11
yr12 y2
…yr
14yr
15yr
16yr
17yr
18yr
19yr
20yr
21yr
22yr
23yr
24yr
25
Inter-regional
dairy
sugar
cereals
veg.plaiting ,gums and resins
tobacco
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South-South moves faster and furtherSouth-South moves faster and further
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Rules of Origin(ROOS): determining product Rules of Origin(ROOS): determining product eligibilityeligibility
•wholly originating
•non-originating undergo substantial transformation
– Change of tariff classification
– Value added-regional value content
•Leniency in rules of Origin(ROOS)
– de minimis
– Cumulation (bilateral cumulation in almost all RTAs)
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Example of ROO requirements Example of ROO requirements
•Japan-Thailand: 0710.22-0710.29 A change to subheading 0710.33 through 0710.29 from any other heading provided that, where non-originating materials of heading .07.09 are used each of the non-originating materials is harvested, picked or gathered in a non-Party which is a member of ASEAN.
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Behind the Border measures: SPS Behind the Border measures: SPS
•Usually re-affirm WTO SPS agreement
•Often go beyond WTO agreement requirements with respect to one or more requirements
•… but not enforceable (excluded from DSU)
•MOUs, Annexes and Ad-hoc agreements provide product specific details on commitments
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Behind the Border Measures: TBT Behind the Border Measures: TBT
•Most RTAs do not provide a food related chapter but agreement wide rules are applied to food and agriculture
– 4 inter-regional, 3 Latin American and 3 Asia Pacific RTAs contain specific paragraphs for Food/agriculture, i.e
• Latin America-principle of national treatment of marketing arrangements
• US-Chile, Australia- Chile provide for mutual recognition of beef grading systems
• New Zealand Thailand recognize equivalence and mutual recognition in food regulations as per Apec
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Agricultural SubsidiesAgricultural Subsidies
•Export Subsidies: 60% prohibit their use
– 100 % of Asia Pacific agreements and 66% of those among Latin American and between Latin America and North American countries
– countervailing measures apply in case of non-compliance
•Domestic Support to Agriculture:
– most do not limit support
– emphasize the need to make support measures WTO consistent
• Mexico's agreements with Costa Rica, Nicaragua, Northern Triangle, Bolivia, Uruguay restrict support to producers
• New Zealand -China: not maintain subsidies destined to the other but not agriculture specific
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Taxonomy of TransparencyTaxonomy of Transparency
• Review and Appeal• Tribunals • Anti-corruption• Review Mechanism
• Consultations• Prior Comment • Public Hearings• Cooperation
• Publication• Notification• Enquiry Points• Translation
WHAT?
WHO?
HOW?
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•Transparency is the only ‘WTO – beyond’ provision in RTAs
•Guidelines for transparency notifications: not binding at multilateral level, but included in many RTAs
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ConclusionsConclusions
•Significant tariff elimination commitments in RTAs
•South-South agreements make the greatest effort to eliminate tariffs
•Exemptions and TRQs continue to characterise tariff schedules. Especially in traditionally sensitive sectors: dairy, meat, sugar and cereals.
•Rules of origin appear to be quite restrictive; but unclear if this is a constraint to trade in agricultural products.
• Prohibition on agricultural export subsidies in over half of the agreements
• Little concrete progress have been made in the SPS and TBT areas
• Transparency provisions are promising way ahead, WTO+, WTO beyond
• New institutional framework of SPS joint committees
– => ongoing OECD work.
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OECD RTA workOECD RTA work
•Linda Fulponi, with Matthew Shearer, Juliana Almeida (IADB): ‘Regional Trade agreements – treatment of agriculture’, working paper 2011
•Iza Lejarraga, ‘Multilateralising regionalism – transparency’
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Thank you for your attention
Comments and suggestions
OECD Trade and AgricultureOECD Trade and Agriculture