World Trade Organization announces deal on farming subsidies

The Doha goals include increased duty-free access for developing countries; lower tariffs on agricultural products, textiles and clothing; and the reduction of trade-distorting subsidies from developed countries.

Negotiations at the World Trade Organisation’s (WTO) ministerial conference in Nairobi agreed to end direct export subsidies on farm produce even as 14 year-old talks on trade development remain unresolved.

Kenya’s Foreign Minister Amina Mohamed, who had described the WTO’s negotiating function as broken at the summit’s opening, said she was confident that the Nairobi talks had actually “strengthened” the body over the week.

In addition, more countries signed on to the Trade Facilitation Agreement, which eases the passage of goods between countries.

“Developing country Members shall eliminate their export subsidy entitlements by the end of 2018”, the declaration said.

Graziano da Silva also referred to FAO’s recently released The State of Agricultural Commodity Markets (SOCO) 2015-16, which stresses how trade affects all four dimensions of food security: food availability, access, utilization and stability. Now, for the first time, there are binding disciplines on subsidies such as export credits, where our competitors are subsidizing trade worth billions every year.

Negotiations on the Doha deals have stalled since 2009 due to differences between developed and developing nations, mainly over the lowering of trade barriers worldwide.

India has registered its “strong disappointment” over non-reaffirmation of the Doha Development Agenda and “concern” over a few amendments made in the draft decision and declarations on cotton, according to an agency report.

“Other members do not reaffirm the Doha mandates, as they believe new approaches are necessary to achieve meaningful outcomes in multilateral negotiations”.

Frustration had reached a boiling point, and many nations began to push for regional trade agreements and organizations as a means of bypassing the ineffectual WTO.

Pimonwan Mahujchariyawong, deputy managing director of KResearch, said the developing countries receiving subsidies would be affected but the deal would open up more competition, and Thailand was well placed to compete for greater market shares.

While agreeing to continue deliberations on the Doha agenda along established lines, the declaration indicated that not everyone was willing to do so.

Members said the Nairobi deal had drawn a line under years of stalemate over the direction of global trade negotiations. Six countries assented to the accord last week, bringing the total to 63 out of the required 108.

The agreement removed export subsidies but not production subsidies for farmers, nor did it do away with tariffs or quotas for agricultural goods.