Agriculture in the GATT PDF
Preview Agriculture in the GATT
AGRICULTURE IN THE GATT Agriculture in the GATT Timothy E. Josling Professor Food Research Institute Stanford University Stefan Tangermann Professor of Agricultural Economics University ofGottingen Germany and T. K. Warley formerly Professor of Agricultural Economics University ofGuelph Canada $£ First published in Great Britain 1996 by « MACMILLAN PRESS LTD Houndmills, Basingstoke, Hampshire RG21 6XS and London Companies and representatives throughout the world A catalogue record for this book is available from the British Library. ISBN 0-333-65819-1 as First published in the United States of America 1996 by ST. MARTIN'S PRESS, INC., Scholarly and Reference Division, 175 Fifth Avenue, New York, N.Y. 10010 ISBN 0-312-16237-5 Library of Congress Cataloging-in-Publication Data Josling, Timothy Edward. Agriculture in the GATT / Timothy E. Josling, Stefan Tangermann, and T. K. Warley p. cm. Includes bibliographical references and index. ISBN 0-312-16237-5 1. Tariff on farm produce. 2. Produce trade—Government policy. 3. Agriculture and state. General Agreement on Tariffs and Trade (Organization). I. Tangermann, Stefan. II. Warley, T. K. (Thorald Keith), 1930- . III. Title. HF2651.F27A244 1996 382'.41—dc20 96-2814 CIP © Timothy E. Josling, Stefan Tangermann and Thorald K. Warley 1996 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P9HE. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. 10 9 8 7 6 54 3 21 05 04 03 02 01 00 99 98 97 96 Printed and bound in Great Britain by Antony Rowe Ltd, Chippenham, Wiltshire Contents Preface vii List of Abbreviations ix 1 The GATT's Origins and Early Years 1 1 Planning for Postwar Economic Cooperation 1 2 The Havana Charter 4 3 The General Agreement on Tariffs and Trade 6 4 The Essentials of the Agreement 8 5 Agriculture in the Havana Charter and the General Agreement 11 2 Early Encounters: 1948-60 21 1 Introduction 21 2 The Early Rounds 22 3 The Rules Revisited: The 1954-:5 Review of the GATT 25 4 The Haberler Report 35 5 Committee II 38 The Dillon Round 42 1 Background 42 2 The Tariff Negotiations 45 3 Agriculture 46 4 Simultaneous Developments 48 5 Conclusion 50 The Kennedy Round 52 1 The Setting 52 2 Preparations and Prenegotiations 54 3 The Chicken War 57 4 The Round Delayed 58 5 Substantive Offers 60 6 Resolution 66 7 Overview 69 v VI Contents 5 The Tokyo Round 72 1 Introduction 72 2 Overview of the Tokyo Round 76 3 Tasks and Proposals in Agriculture 86 4 The Results for Agriculture 89 5 Conclusions 98 6 Markets, Policies, and Trade Rules in Crisis: 1979-86 101 1 Markets in Crisis 102 2 Farm Policies in Crisis: The OECD Trade Mandate 105 3 Trade Rules in Crisis: The GATT Committee on Trade in Agriculture 111 7 The Uruguay Round Negotiations 133 1 Background to the Uruguay Round 133 2 The Agricultural Negotiations 139 3 The Significance of the Agricultural Negotiations 162 8 The Uruguay Round Agreement on Agriculture 175 1 Structure of the Agreement 175 2 Market Access 179 3 Export Competition 194 4 Domestic Support 202 5 Sanitary and Phytosanitary Measures 208 6 Remaining Differences Between Agriculture and Industry 214 9 The Future for Agriculture in the GATT 217 1 Assessment of the Post-Uruguay Round Situation 217 2 Continuation of the Process of Agricultural Trade Reform 223 3 New Issues Facing the Trade System 232 4 Conclusion 242 Notes 244 References 275 Index 286 Preface For many years, the three of us have shared a common interest in the agricultural policies of the major developed countries and in the ef fects of these policies on world agricultural trade. We have met often at conferences, symposia and workshops on international agricultural trade and policy, and have followed as analysts, commentators and observers each of the three major GATT negotiations in which agri cultural issues have been addressed - the Kennedy, Tokyo, and Uru guay Rounds. The original motivation for this book was to chronicle the story of the agricultural negotiations in these successive rounds and thereby to trace the evolution of the treatment of agricultural trade in the GATT. We felt that the story of repeated attempts to bring trade in agricul tural products more surely into a rule-based international trading system should be recorded, not only for those who work in the area of agri cultural trade but also for those with interests in international econ omic and political relations, international business, and economic history. In the summer of 1990, we journeyed to Geneva to meet with GATT officials and members of national delegations to learn more about the status of the negotiations on agriculture in the Uruguay Round. At that time there was still the possibility of an agreement by the end of De cember 1990, with an agricultural component which would have pro vided the final chapter to the story. In the event the writing of that chapter had to wait until the negotiations had concluded, over three years later. Meanwhile it became increasingly clear that the Uruguay Round would so radically change the rules under which agricultural trade takes place that it could not be treated as just another 'round' of negotiations. Trade in agricultural goods would indeed - for the first time since the inception of the GATT - be brought fully within a system of multilat eral rules and disciplines. Accordingly, the scope of the book was expanded to allow the resulting new rules to be discussed in more detail and their implications to be explored. In structuring the book we have followed a chronological sequence - beginning with the creation of the GATT, continuing through the 1954-5 review of the General Agreement and the Haberler Report, and dealing in turn with the Dillon, Kennedy, and Tokyo Rounds and vn Vlll Preface the period following that, when the agricultural trade situation deterio rated sharply. We devote separate chapters to the negotiations in the Uruguay Round and the results for agriculture embedded in the Uru guay Round Agreement. A final chapter ventures a look ahead at some emerging issues and at the completion of the reforms initiated by the Uruguay Round. The perspective that we have taken is largely descriptive, avoiding both quantitative analysis and censorious judgements, though undoubt edly our own opinions on these issues are apparent. The reader, and the passage of time, will have to judge whether our enthusiasm for what has now been accomplished in bringing trade in agricultural products into the rule-based GATT/WTO system is justified. Writing the book was professionally satisfying and as close to fun as a serious endeavour can be. Each author contributed both substan tive chapters and a different perspective. All parts of the book were collectively revised and harmonized, though some stylistic differences undoubtedly remain. Senior authorship is not assigned, and our names are listed in alphabetical order. Throughout the gestation period of this book, we have worked with colleagues in the International Agricultural Trade Research Consortium - an organization that brings together economists interested in interna tional agricultural trade matters - in various study groups and meetings. Our appreciation is extended to these colleagues for the long and fruitful discussions we have shared over the years of the issues surrounding the GATT negotiations on agriculture. We view the book as a contri bution to the mission of the Consortium, and we hope that it will sti mulate studies on other aspects of trade policy in agricultural goods. During the preparation of the book we have been supported and encouraged by many people to whom we are deeply grateful. In par ticular, David Blandford, William J. Davey and Robert E. Hudec each read parts of an early draft and provided helpful comments. If we still managed to smuggle some errors into the manuscript, they should not be held responsible. In the final stages Harald Grethe provided invaluable technical support, Henning Twesten proficiently worked on the index, and Petra Geile skilfully brought the final manuscript into a proper order and acceptable format. Part of Stefan Tangermann's work on the book was generously supported by the Deutsche Forschungsgemeinschaft. Finally, to our wives Anthea, Gabi, and Anita who sacrificed many weekends and evenings of our company to the completion of the book, we owe our lasting gratitude. To them we dedicate this, the fruit of our labours. List of Abbreviations AMS Aggregate Measurement of Support AoA Agreement on Agriculture APEC Asian-Pacific Economic Cooperation Process CAP Common Agricultural Policy CCC Commodity Credit Corporation CSE Consumer Subsidy Equivalent CET common external tariff CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora CoA Committee on Agriculture CSD Consultative Subcommittee on Surplus Disposal CTA Committee on Trade in Agriculture EAI Enterprise for the Americas Initiative EC European Community ECOSOC Economic and Social Council of the United Nations EEA European Economic Area EEC European Economic Community EEP Export Enhancement Program EFTA European Free Trade Association EU European Union FAC Food Aid Convention FAO United Nations Food and Agriculture Organization FOGS Functioning of the GATT System FTAA Free-Trade Area of the Americas GNG Group of Negotiations on Goods GNG5 Negotiating Group on Agriculture GNS Group of Negotiations on Services HS Harmonized System ICA Intergovernmental Commodity Agreement ICCICA Interim Coordinating Committee for International Commodity Arrangements IDA International Dairy Arrangement IDPC International Dairy Products Council IGA International Grains Arrangement IMC International Meat Council IMF International Monetary Fund IX
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