WORLD TRADE
ORGANIZATIONG/AG/NG/W/166
6 April 2001
(01-1773)
Committee on Agriculture
Special SessionOriginal:  English
SIXTH SPECIAL SESSION OF THE COMMITTEE ON AGRICULTURE
22-23 MARCH 2001
Statements by Australia
G/AG/NG/W/99  (Proposal by Mali)
Australia welcomes the proposal by Mali.   Mali's objectives sit very comfortably with the
long-term objective of the negotiations to establish a fair and market-oriented agricultural trading
system.   Fundamental reform of agricultural trade, su ch as proposed by the Cairns Group in our
proposals on the three pillars, would play an important role in assisting Mali to achieve its objectives.
On the specific ideas outlined in Mali's proposal, we believe these will need to be examined
closely in the broader context of what will be the appropriate form of special and differentialtreatment for all developing countries.
We note that Mali has also proposed the abolition of export subsidies for rice, as a leading
export commodity of least developing countries (LDCs).  As Members of this Committee will be well
aware, the Cairns Group has proposed the elimination of all forms of export subsidies.  This would
assist all exports from LDCs, not just rice.
But the example of rice also highlights the inter-relationship between the different elements of
the Agreement on Agriculture - rice is one of the most heavily protected and subsidised of agricultural
products.  Reflecting this situation the opportunities for rice exporters are extremely constrained.
Mali - and other current and potential rice exporters - would benefit from a significant reduction inmarket access barriers and domestic and export subsidies applied to rice.
We have to say we find Mali's approach to the very real circumstances outlined to be straight-
forward and thoughtful.  We feel that Mali's approach is more consistent with the overall goals of the
organization than some other proposals which seek to entrench discriminatory preferential
arrangements.  In this regard we understand and support the comments of the delegate from Brazil,
made in the February Special Session, to the effect that discriminatory preferential arrangements may
benefit some developing countries but to the detriment of all.  Preferences should be non-
discriminatory.
G/AG/NG/W/101  (Proposal by Norway)
Australia has listened to Members' comments on the Norwegian submission to the agricultural
negotiations with interest.  Our own reaction to this submission is one of deep disappointment.
Norway has based its proposal on a "principle" that the reform process in agriculture should
not be based on uniform rules in agricultural trade.  In essence, Norway's position is simple.  Norway
is not a competitive agricultural producer so it wants to exclude agriculture, once again, from the rules
of the WTO.G/AG/NG/W/166
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This proposal suggests that it should be open to any country wishing to make the case that its
agriculture is different to exempt itself from reform.  In Norway's vision of reform, this includes all
countries that do not have the conditions for competitive agriculture but can afford to provide billions
of dollars of support and protection to their farmers, at the expense of farmers in poorer countries.
Under this approach, rich countries win.  Poor countries lose.
Norway's paper makes the claim that there is no other way of addressing its non-trade
concerns but to maintain or increase its agricultural production.  To support this claim, Norway offers
a set of imprecise, general, and selective assertions about the "jointness" between non-trade outputs
and agricultural production.
We support the legitimacy of many non-trade objectives that all countries have.  However, we
call for countries to examine ways in which they can be achieved that are effective and minimise
distortions to production and trade.  Norway has not yet done this.  We have yet to see an objective
investigation into the range of policy options available in relation to any specific non-trade concern
that Norway has.
We agree with Norway that special attention should be paid to the interests of developing
countries.  However, suggestions for particular consideration to developing countries cannot
compensate for an overall stand that effectively aims to overturn the long-term global goal envisioned
for agriculture of substantial and progressive reform.
We understand that Norway faces particular pressures domestically and that it cannot be
expected to be at the forefront of agricultural trade reform.  However, Australia does not consider this
proposal to reflect a serious or constructive engagement with the current negotiations.
G/AG/NG/W/102
Australia welcomes India's proposal on food security, market access, domestic support and
export competition.
In particular, we welcome India's broad reforming approach and the attention India has given
to articulating the special needs of developing countries in terms of rural development and food
security.
India's proposal highlights the importance of agriculture trade to developing country
economies.  It articulates the frustration of many developing countries with the failure of Uruguay
Round reforms to provide the increased participation in trade expected by developing countries.  It
ties this failure to the unacceptably high levels of support and protection in some developed countriesthat continue to distort world agriculture markets.
There is much in India's proposal that is similar to Cairns Group positions.  To select a few
examples, we support India's calls for the early elimination of export subsidies.  We support its
proposal for developing countries to be exempt from reduction commitments on measures relating to
poverty alleviation, rural development and diversification of agriculture.  In relation to market access,the Cairns Group has also called for deep cuts in tariff peaks and tariff escalation.
We agree with India that down-payments on reforms under all three pillars should be made
early in the implementation period.
We also see in this proposal, as we have seen in Geneva over the past year, a sharp and
realistic distinction being drawn between the "multi functional concerns of Europe and Japan and the
legitimate non-trade concerns of developing countries" such as India - particularly in relation to food
security.G/AG/NG/W/166
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We recognise the link India draws between the ongoing highly trade-distorting policies
practised in some developed countries, and the reluctance of developing countries to implement
further reform.  The Cairns Group's proposal on market access, also recognises that highly-distorted
world markets penalise countries that have themselves liberalised.  Naturally, this discourages
countries from implementing further domestic reforms.   The majority of the population in developing
countries that is employed in agriculture are, however, also consumers.  We must therefore recognise
that high tariffs and other import restrictions in these same developing countries will harm efforts to
make food more accessible and affordable for their populations.
Developing countries are justified in their frustration with many developed countries over the
lack of progress in lowering trade barriers.  Members of the Cairns Group share these frustrations.
Nevertheless, we believe that moving forward to achieve further substantial reform is the best way topromote economic development.
International reform in agriculture offers developing countries the strongest prospects for
improving the prosperity of rural societies, and reducing the threat of hunger and malnutrition.  Withdeveloping countries increasingly trading with each other - roughly half of exports from developing
countries go to other developing countries - dismantling trade barriers will contribute to food security
and economic development throughout the developing world.
G/AG/NG/W/103  (Proposal by Poland)
We have read Poland's negotiating proposal for continuing the agricultural reform process
with interest.  It is important in the agriculture negotiations not to lose sight of the "bigger picture"which is to make progress on substantial progressive reductions in agricultural support and protection.
Poland's proposal calls for tighter disciplines on export subsidies.  While we agree with the
direction of the proposal, the Cairns Group proposal on export competition is more ambitious, calling
for WTO Members to agree to the elimination and prohibition of all forms of export subsidies for allagricultural products.
We are pleased that Poland is prepared to undertake negotiations for further reductions of
Total Aggregate Measure of Support (AMS) levels.  However, "assuring" the right of Members to
introduce and maintain "blue box" payments perpetuates a form of support that is both production-
and trade-distorting.  We oppose the continuation of production limiting and/or trade distorting
domestic support.
We welcome Poland's commitment to undertake negotiations to improve access to tariff rate
quotas and the call for further reductions of final bound tariffs.  Two aspects to improving market
access under tariff rate quotas (TRQs) are the better administration of TRQs and the expansion of
TRQ levels.
We are opposed to the retention of Article 5 (Special Safeguard Provisions) of the AoA for
developed countries, although we believe that the special safeguard mechanism should be preserved
for developing countries to assist with agricultu ral reform efforts and to counter the impact of
subsidised competition.
We recognise that countries have their own non-tr ade concerns in relation to agriculture and
do not question the right of any country to pursue these concerns.  However, we believe that it is
possible to pursue non-trade concerns with measures that minimally distort trade and production.
We welcome Poland's view on least-developed and developing countries.  All developing
countries stand to benefit from reduced support and protection in developed countries and this is theG/AG/NG/W/166
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best way to deal with the improved market access in developed countries and in other developing
countries.
That is why all the four Cairns Group proposals propose concrete and operational special and
differential treatment provisions, to bolster developing countries' ability to harness agriculture tradereform for their economic development.
G/AG/NG/W/104  (Proposal by MERCOSUR, Bolivia, Chile and Colombia)
• Article XVII of GATT 1994 and the Marrakesh Understanding on this Article already establish
guidelines and requirements with respect to the activities of state trading enterprises (STEs).
• Australia believes that the extent to which an STE may, or may not, distort trade depends on the
particular activities and measures undertaken by the STE concerned.
• Therefore it is most important that we consider the trade effects of STEs on a case-by-case basis.
Any additional disciplines should target these trade effects.
G/AG/NG/W/105  (Proposal by Morocco)
We welcome Morocco's forward-looking negotiating proposal, which adds to the strong
contribution of developing countries that has been a feature of these negotiations.
To a large extent, Morocco's proposed reforms coincide with those of the Cairns Group.  For
example, we agree on the need to substantially reduce tariff barriers and on the need to simplify tariff
regimes.  We agree that a safeguard mechanism should be preserved for developing countries to assist
with agricultural reform efforts and to counter the impact of subsidised competition.  Indeed, the
Cairns Group has gone further and called for the Article 5 Special Safeguard to be eliminated for all
but developing countries.
Morocco has joined other Members, including the Cairns Group, in calling for a redefinition
of Green Box measures to eliminate those that are trade-distorting.   We also believe that a review of
these measures is necessary to ensure that they have no, or at most minimal, trade-distorting effects on
production, particularly in light of widely-held suspicions that this fundamental requirement relatingto Green Box programmes is not actually being observed.
Any re-evaluation of Green Box criteria would need to make appropriate allowances for
policies that address genuine non-trade concerns of developing countries or legitimate environmental
policies.
We also support Morocco's calls for reductions in AMS leading to the eventual elimination of
all forms of trade and production-distorting support, and for differentiated commitments for
developing countries.
We agree with Morocco that export subsidies should be eliminated.
We look forward to discussing Morocco's cons tructive suggestion in relation to a framework
for special and differential treatment in the next phase of the negotiations.
Morocco's proposal draws attention to the fact that the non-trade concerns some country
Members are seeking to address under the rubric of "multifunctionality" are, in reality, moreapplicable to developing countries than their developed proponents.   In doing so, this proposal is
further evidence that an increasing number of developing countries - particularly those not party toG/AG/NG/W/166
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discriminatory preferential trading arrangements with the EU - recognise the need for Members to
distinguish between the legitimate non-trade concerns of developing countries and efforts by
protectionists to use multifunctionality as an excuse to avoid reform.
Australia believes that it is not sufficient to design interim measures to compensate
developing and least-developed countries for continuing the damage done to their economies by the
distortionary policies of a small number of rich countries.  Temporary measures in agricultural trade
have a history of becoming entrenched.    We strongly believe that we need to combine our energies
in these negotiations to find ways of implementing genuine, substantial and rapid reform that will
allow developing countries to improve their economic sustainability and relieve poverty through fair
and equitable trade.
G/AG/NG/W/106  (Proposal by Turkey)
We welcome Turkey's clear and progressive proposal.  There is much in the proposal we
support.
We see two main themes in the proposal.  First, the need for fundamental reform of
agriculture and second, the importance of appropriately targeted Special and Differential Treatment
(S&D) for developing countries.
On market access, the proposal makes clear the difficulties developing countries have in
developing their agriculture sectors in the face of highly subsidised competition.  We agree that these
subsidies have to be addressed as part of a balanced package of reform.
Turkey's suggestions that tariff peaks and escalation be addressed and that tariff structures be
simplified are also welcome.  Similarly, the proposal to free up the administration of tariff rate quotas
would contribute to genuine market access improvements.
As would be expected, we agree with Turkey's call for the substantial reduction or elimination
of export subsidies and domestic support, recognising that these subsidies hinder the ability of
developing countries to compete internationally and equally.
On domestic support Turkey rightly identifies that its difficulties are caused largely by the
subsidies employed in developed countries.  The answer to many of the problems facing the
agriculture sectors of developing countries is to  bring down the subsidies of developed countries.
Turkey suggests increasing the de minimis  level for developing countries.  But, it needs to be
remembered that, in many cases, developing countries cannot currently fund the full amount ofsubsidies up to the de minimis  limit because of inadequate budgetary resources.  Additionally,
increased support levels will only reinforce subsidy problems for the future.
We note that Turkey equates food security with self-sufficiency.  But it is important to keep in
mind that pursuing food self-sufficiency as the answer to food security has been a disastrouslyexpensive and unsuccessful policy for countries that have followed it.
We agree with Turkey that when it comes to agricultural reform, a piecemeal approach that
addresses only selected areas must not be used as a substitute for overall reform.  However, while we
agree that the credibility of the reform process hinges on how seriously the high protectionistdeveloped countries are about genuine liberalisation, we strongly believe that real progress will only
be made with the full participation of the WTO Membership.  It is important to keep in mind that
roughly half of all agricultural exports of devel oping countries go to developing country markets.
That said, the Cairns Group, like Turkey, believes that special and differential provisions for
developing countries are an integral part of the negotiations.  All four Cairns Group proposals proposeG/AG/NG/W/166
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concrete and operational special and differential treatment provisions, to bolster the ability of
developing countries to harness agriculture trade reform for their economic development.
Importantly, the proposal highlights the fact that some developed countries are trying to use
the "multifunctionality" of the agriculture sector as an excuse to avoid liberalisation.  Turkey makesthe point that the negotiations should not result in the introduction of any measures that can be used as
an escape clause to avoid further liberalisation under the three pillars, whether these relate to selective
reductions of tariffs or measures to address non-trade concerns.  We strongly agree with this element
of the proposal.
G/AG/NG/W/107  (Proposal by Egypt)
We welcome Egypt's negotiating proposal.  We agree with many of the elements it contains.
Export Subsidies
Egypt's proposal calls for the phasing out of all forms of export subsidisation over an agreed
period of time.  Australia strongly supports the call for the abolition of export subsidies.
It also calls for additional strengthened rules and disciplines to prevent the circumvention of
the elimination of export subsidies.
Domestic Support
On domestic support we recognise the attractions of the proposal that reductions be made
across the range of boxes, including with a substa ntial up-front downpayment.  This is all the more
attractive when we are seeing a rapid growth in Green Box support much of which is arguably having
a distorting effect on production and trade.  For the same reason we are also attracted to the idea that
measures allowed under Annex 2 should be reviewed for their compatibility with non-trade
distortions.
We strongly support Egypt's proposal that countries should reduce production distorting
domestic support, and that this support should be granted on a disaggregated basis.
Market Access
On market access, we share common goals with Egypt in seeking the elimination of all tariffs,
the elimination of other trade-distorting measures and agree that tariff quota administration disciplinesshould be strengthened.
We note, however, that Egypt is seeking tariff reductions by developed country Members
from applied rates, rather than bound rates.  We understand the reason for this proposal but are
concerned that such a departure from the accepted GATT/WTO practice of negotiating on the basis ofbound rates would in a  sense unfairly punish those countries which have unilaterally liberalised.
NFIDCs and LDCs
On the issue of the creation of a Fund for th e Support of NFIDCs and LDCs, we will be
seeking further information from Egypt on exactly what they have in mind.  We thank Egypt for the
clarification of how it intends the fund should be financed.
We seek further information on the call for an increased level of technical and financial
assistance for NFIDCs and LDCs.  For example, who it is that should provide this assistance.G/AG/NG/W/166
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S&D
We share Egypt's view that the S&D provisions in the AoA for developing countries should
be strengthened and expanded in a manner that would be the least trade-distorting, while affording
them more flexibility to assist their agricultural sectors to compete actively in the globalising worldeconomy.
G/AG/NG/W/130  (Proposal by Nigeria)
Australia thanks Nigeria for its negotiating proposal.  Nigeria's proposal articulates the
widely-felt frustration of many countries, particularly developing countries, at the apparent failure ofthe Agreement on Agriculture to deliver the expected benefits of agricultural trade liberalisation since
the Uruguay Round.
It highlights the continued heavy subsidisation of farmers in some developed countries which
the previous negotiations had failed to address.  We share Nigeria's determination that thesenegotiations should eliminate the highly trade-distorting practices that continue to shield so many
farmers from fair market competition and, in turn, discriminate against the large portion of the world's
population that depends on agriculture for its welfare.
Australia strongly supports developing countries in their pursuit of growth and poverty
reduction through trade.  We reiterate points made in earlier interventions that effective special and
differential treatment provisions that address the concerns of developing countries are central to these
negotiations.
We view with interest Nigeria's proposal for the transparency and provision of information
about the world agricultural market, in particular, the operations of international multinational
companies .  We would like to hear further from Nigeria on what this idea encompasses.
G/AG/NG/W/135  (Proposal by the Democratic Republic of the Congo)
We thank the Democratic Republic of the Congo for its negotiating proposal.  There is much
in the proposal on which we share common views.
We agree with elements of the Democratic Republic of the Congo's proposal on market
access such as the need to simplify tariffs and to address tariff peaks and escalation.
On domestic support, we seek further information on what the Democratic Republic of the
Congo means when it calls for the improvement of the Green Box.  The Cairns Group has proposed a
review of the Green Box to ensure all such domes tic support meets the fundamental requirements of
being non, or at most minimally, trade-distorting.
Regarding the call for an improvement to Amber Box, we clearly oppose the retention of
Amber Box measures for all WTO Members.  It needs to be kept in mind that it is the rich developed
countries which have the ability to subsidise and indeed their use of subsidies has been extremelydamaging.  Loosening current restrictions is not the answer to this problem.
Our views converge closely on the elements of the Democratic Republic of the Congo's
proposal dealing with export subsidies.
Like the Democratic Republic of the Congo, the Cairns Group has called for the elimination
and prohibition of all forms of export subsidies for all agricultural products.  We are seeking to agree
on a date for elimination of the remaining export subsidies in the negotiations.  And we too want aG/AG/NG/W/166
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substantial downpayment during the first year of the implementation period, to be followed by an
accelerated process of reduction leading to zero of the residual subsidies.
Regarding non-trade concerns, the Cairns Group believes that Members have every right to
pursue their non-trade concerns through policies that have no or only minimal effects on trade andproduction.  We welcome the Democratic Republic of the Congo's recognition that the non-trade
concerns of developing countries and developed countries are different.  This needs to be reflected in
the policies which are used.
Australia strongly supports developing countries in their pursuit of growth and poverty
reduction through trade.  We reiterate points made in earlier interventions that effective special and
differential treatment provisions that address the concerns of developing countries are central to these
negotiations.
G/AG/NG/W/136  (Proposal by Kenya)
We thank Kenya for its constructive proposal that calls for reform to improve the ability of
developing countries to compete internationally and equally.
We share Kenya's disappointment with the results of the implementation of the Agreement on
Agriculture since the Uruguay Round.  We also support Kenya's position that these negotiations must
begin to tackle the highly trade-distorti ng practices of some developed countries.
Australia believes that we should facilitate the efforts of developing countries to achieve
growth and poverty reduction through trade.  We also agree that special and differential treatment
provisions that address the concerns of developing countries are central to these negotiations.  Kenya
has emphasised that the current S&D provisions fall short of enabling it to balance its development
objectives and its commitments on liberalisation.  We would welcome a further dialogue on S&Dprovisions with Kenya.
Market Access
Regarding preferential market access arrangements, we accept that where tariffs are high
preferences can play a significant role in providing market access opportunities for developing
countries.
However, we do not see preferential market access arrangements as a key instrument in
achieving the long-term objective of establishing "a fair and market oriented agricultural trading
system".  The root of the problem remains the high levels of support and protection mainly provided
by rich developed countries.  We believe that lower levels of protection in many developed countrymarkets would significantly increase the range of opportunities for developing countries thus reducing
the reliance of developing countries on preferential arrangements.  Reduced distortions through
reduced subsidies would also lead to higher world prices for the limited exports referred to in the
proposals.
Trade-distorting Subsidies
We agree with Kenya that all trade-distorting subsidies must be eliminated by developed
countries and it is clear also that the great bulk of these subsidies are in fact used by developed
countries.  We nonetheless believe that reform of trade-distorting practices should not becompartmentalised or made specific to developed countries.G/AG/NG/W/166
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Domestic Support
We understand that food security is of paramount importance to Kenya and welcome its call
for the establishment of a "Development Box".  We would be happy to discuss further with Kenya
what a "Development Box" might contain.
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