RESTRICTEDWORLD TRADE
ORGANIZATIONG/AG/NG/R/4
24 January 2001
(01-0372)
Committee on Agriculture
Special Session
SUMMARY REPORT ON THE FOURTH MEETING OF THE SPECIAL SESSION
HELD ON 15–17 NOVEMBER 2000
Note by the Secretariat
1. As agreed by the General Council at its meeting of 7–8 February 2000 the negotiations under
Article 20 of the Agreement on Agriculture on continui ng the reform process of agriculture trade were
conducted in a Special Session of the Committee on Agriculture (WT/GC/M/53 paragraph 3.28
refers).  The fourth such meeting took place on 15–17 November 2000 under the Chairmanship of
Ambassador Jorge Voto-Bernales of Peru.
2. The present report provides a detailed summary of the Committee's discussions on substantive
matters under the relevant agenda items and should be read in conjunction with the short factual
report to the General Council on the meeting as a whole by the Chairman (G/AG/NG/4, copy
attached).  Unless otherwise stated, all references to documents refer to the G/AG/NG/- series.
3. The agenda as contained in WTO/AIR/1428 was adopted.
ITEM A:  S UBMISSIONS OUTSTANDING FROM THE THIRD SPECIAL SESSION
(a) Barbados, Burundi, Cyprus, Czech Republic, Dominica, Estonia, the European
Communities, Fiji, Iceland, Israel, Japan, Korea, Latvia, Liechtenstein, Madagascar,
Malta, Mauritania, Mauritius, Mongolia, Norway, Poland, Romania, Saint Lucia,Slovak Republic, Slovenia, Switzerland and Tr inidad and Tobago:  Note on Non-Trade
Concerns (NG/W/36/Rev.1)
4. Norway's general introduction to the note on non-trade concerns is contained in NG/W/77.  It
stated that the European Commission and the Governments of Japan, Mauritius, Norway, the
Republic of Korea and Switzerland organized a co nference on non-trade concerns that was held in
Norway earlier in the year  The conference was attended by 34 countries, including developing
countries, economies in transition and developed countries.  Each of the organizers contributed to the
discussion with papers covering a wide array of issues and concerns.  Switzerland continued the
introduction noting that the conference had covered a number of issues including land use, supply anddemand and the contribution of agriculture to positive externalities, public goods, food as an essential
good and agriculture as a key factor in development, especially in developing countries.  Switzerland
stressed the importance of preserving production potential in less favourable conditions as the
population of the world increased and opportunities for increasing production declined. Switzerland
stated that it was not opposed to progressive liberalization, but both GATT 1994 and the Agreementon Agriculture recognized the different situations facing different countries and the right for each
country to preserve its agricultural sector as well as the need for special and differential treatment for
developing countries.  The question for these negotiations was if the Agreement offered enough
flexibility.
5. The representative of the EC (NG/W/66) note d that the European Commission's contributions
to the conference highlighted certain non-trade concerns associated with agriculture.  For the EC, non-G/AG/NG/R/4
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trade concerns were a key part of the negotiations along with market access, domestic support, export
competition and special and differential treatment.  Agriculture was vital for the economic and social
infrastructure of rural areas where it was the main activity, especially in developing countries.  The
rural environment depended on farming and WTO rules should allow non-trade concerns to be met.
He stated that the measures taken to address these concerns should be targeted and should interfere
with trade as little as possible.  The objective was not to prevent trade but to prevent trade fromdestroying the vital contribution of agriculture to meeting non-trade concerns.
6. Japan (NG/W/73) and Korea (NG/W/74) introduced their joint paper on food security.  Their
representatives noted the vital importance of food security to all countries and they stated that food
security concerns had to be addressed by the optimum combination of domestic production, imports
and stockpiling of food.  The optimum point was reached when the cost was lowest taking account of
risk, external effects and the public goods characteristics of the food sector.  The right combination of
policies varied from one country to another and each country should be able to choose their optimumlevel of production.  Beyond its primary function of producing food and fibre, agriculture was also
essential to food security, social and economic development, employment, the maintenance of the
countryside, conservation of land and natural resources and it contributed to sustaining rural life and
land.  Market mechanisms alone could not give an optimum solution.
7. Mauritius (NG/W/75) stated that they had prepared their paper from the perspective of a small
island developing state.  It was noted that Article 20 of the Agreement on Agriculture required that
non-trade concerns be taken into account in the process of progressive liberalization.  In addition,
Mauritius believed that Article 20 had to be considered along with other parts of the Agreement on
Agriculture and other international commitments , especially the International Convention on
Economic and Social Rights and the World Food Summit.  For small island developing states theissue of low potential areas was very important as agriculture was not limited to the production of
food and fibre.  It also supported the social fabric of rural areas and a number of other public goods.
Agriculture was important for all countries, especially net food-importing developing countries, and it
was essential for both developed and developing countries that non-trade concerns were addressed.
While Annex 2 of the Agreement on Agriculture did list some policy measures these were inadequateand unaffordable for many Members.
8. The representative of Norway (NG/W/77) stated that flexibility was needed to enable
Members to address non-trade concerns.  Although the negotiations aimed to achieve substantial
progressive reductions in support and protection a number of factors, such as non-trade concerns and
special and differential treatment, had to be taken into account.  Amongst other things, the processneeded to acknowledge that different forms of agriculture existed in different countries and it had to
take account of other multilateral commitments, such as the right to food.  He stated that countries
wanted different goods or services from their agriculture sectors and thus attached different weights to
different non-trade concerns.  At the same time supply side factors, due to differences in climatic and
cultural conditions, varied between countries.  Developing countries' requests for market access
needed to be addressed and they, and transition economies, also needed to have room to manoeuvre.
However, flexibility needed to be subjected to  mutually agreed rules and should not be a carte
blanche  in national policy design.  The existing Green Box was not sufficient to address non-trade
concerns in low potential areas.  Members needed fl exibility to ensure that their agriculture sectors
remained viable and to enable them to address their non-trade concerns while specific proposals from
developing countries also needed to be considered.
9. A number of delegations supported various aspects of the Note on Non-Trade Concerns and
noted that Article 20 stated that they should be taken into account in the negotiations.  They went on
to outline specific non-trade concerns of particular interest to their countries or specific situations
which made some concerns important.G/AG/NG/R/4
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10. Among those that supported the Note a number of countries with economies in transition
from central planning to market orientation including Hungary, the Czech Republic, the Slovak
Republic, Poland, Slovenia, Estonia, Mongolia and Romania highlighted certain concerns of theirs,
including the problems associated with transition.  Hungary (NG/W/69) stated that for it rural
development was very important and it shared the view put forward that agriculture was a vital
element of rural development policies.  While other economic activities could be important, and eventake over from agriculture eventually, agriculture would remain the main vehicle for rural
development in most rural areas in many countries for the foreseeable future.  In some regions in
Hungary alternative employment opportunities did not exist as, for example, industry and mining had
suffered from competition from abroad or because they were not amenable to tourism.  In other
regions soil fertility, topographic conditions and the principle of efficient resource allocation meant
agriculture should be maintained and developed.  Thus progress in the development of rural areas was
linked to the viability of the agricultural sector.  Liberalization of trade should not prevent policiesthat were aimed at restoring the viability of rural areas.  However, Hungary also agreed with the EC
that the least trade-distorting policies available should be used to address non-trade concerns.
11. The representative of the Czech Republic (NG/W/65) noted that the countries that had
sponsored the Note believed that they should have the right, in accordance with mutually agreed rules,
to address non-trade concerns.  In concentrating his remarks on environmental issues related to non-trade concerns he noted that the Czech Republic was a small and landlocked country with a wide
variety of landscapes and, in addition, it had to address the problems associated with the former
centrally planned model of agriculture.  The protection of natural resources was in the public interest
and covered the maintenance and support of biodiversity, the preservation of soil fertility, appropriate
water policies and the functional use of land area all contributed to the conservation of natural andcultural values of the landscape for which the government was responsible.  In the Czech Republic
former policies under the centrally planned economic model had caused significant problems,
including in the mining and farming areas.  In the past ten years not all problems had been rectified,
although some progress had been made.  However, agriculture was inseparable from the environment
and could not be addressed in purely economic terms.  The reform process had to continue withfarmers as providers of environmental services.
12. The Slovak Republic attached great importance to a number of non-trade concerns such as
rural development, the social and cultural functions of agriculture, food security, poverty alleviation
and the co-existence of different types of agriculture.  In Slovakia, agricultural policies had to take
account of aspects such as protection from natural disasters, food security, rural development, ruralemployment, historic and cultural factors and the landscape and environmental activities.  For
example, farmers had to take measures to minimize the risk of flooding, but this had an impact on
costs and competition on international and domestic markets.  Similarly, farming in mountainous
areas was influenced by policies to maintain production in these regions and it needed policy
intervention to ensure production continued in less favourable areas.  Issues concerning rural
development were linked to maintenance of the landscape and the preservation of cultural and social
activities related to agriculture.  It was essential to maintain rural employment when loss ofproduction would increase unemployment, particularly in less favoured areas.  The possibility of a
decline in food availability or a rise in food prices influenced agricultural policies in most countries
and included local production, stockpiling and other measures in response.  The Slovak Republic
supported the concept of food security in the reform process.  In summary, in the context of reform
WTO Members needed the flexibility to be able to pursue non-trade concerns.
13. Poland (NG/W/81) noted that views on the multifunctional role of agriculture differed as did
approaches to address non-trade concerns and a better understanding of the issues was needed.
Poland supported the Swiss paper on preserving the special treatment for agriculture in the WTO and
agreed with the EC concerning agriculture and rural development and its link to social development,
especially in areas of high unemployment.  Agriculture development was needed not only in its ownright but also for the development of services and industry as it contributed to stability and towardsG/AG/NG/R/4
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achieving a good climate for investment.  Different models of agricultural production should be
allowed to continue to exist and each country had the right to pursue different rural development
policies.  Food security was the basic function of  agriculture.  An unstable food supply or sudden
price changes could lead to social unrest the consequences of which were impossible to foresee.
Therefore, it was necessary for countries to maintain the potential for agricultural production and to
try to create diversified trade flows.  Poland also supported the view that the optimum level of foodsecurity was obtained by having the right combination of domestic production, trade and stockpiling.
Poland felt that the biggest threat to rural commun ities was from unemployment, especially in less
favoured areas where farmers were more likely to abandon their holdings.  At the same time
increasing intensity of production, industrialization of agriculture and the transfer to urban living also
caused environmental problems such as water pollution.  Poland shared the view put forward in the
summary by Norway that Members needed to have fl exibility to be able to use different policies to
face the very different situations that existed in different countries.  The reform process would requiresome Members to make bigger adjustments than others and it was necessary that Members considered
the implications for those countries that would not increase their production or exports.
14. The representative of Slovenia stated that his country had a dispersed pattern of population
density with most of its land areas classified by legislation as being in less favoured areas.  It had to
be acknowledged that in market economies agriculture had a number of non-marketable roles such aspreservation of the cultural landscape.  For Slovenia that meant preventing overgrowth of forests that
resulted from abandoned farms.  Slovenia supported the European model of agriculture which, for
Slovenia, meant supporting the development of the economies of rural areas, environmental
protection, food safety, the supply of good quality f ood and the preservation of the population of rural
areas.  This raised the practical question of how appropriate were Green and Blue Box measures foraddressing non-trade concerns.  Slovenia had recently shifted its agricultural policies to direct
payments based on land area which, it believed, had only a small affect on trade.  Significant
administrative and inspection problems had had to be overcome in doing this.  Furthermore, transition
economies, like Slovenia, needed the flexibility of a longer transition period for these Blue Box
payments although fully decoupled payments under the Green Box might be an ultimate goal.
15. Estonia was another co-sponsor of the Note on Non-Trade Concerns and supported the
suggestion that agriculture should get special treatment within the WTO and Members should have
flexibility in designing their agricultural policies.  In Estonia two specific features of agriculture stood
out;  first, as a Nordic country Estonian agriculture had to be carried out in harsh conditions;  and
second, the process of transition to a market orientated economy had caused severe pressure onagriculture and related activities.  These concerns should be taken into account in the continuing
liberalization of agriculture.  In the nineties Estonia had completely liberalized its trade regime,
including tariff free market access for agricultural goods and self sufficiency had fallen from 125 per
cent to 75 per cent.  Only in the past few years had modest support and protection for agriculture been
introduced but despite this a lot of agricultural land was still abandoned, rural living remained non-
viable and agricultural employment continued to fall.  If this process was to continue Estonia wanted
to ensure that it was less difficult.  In addition to producing food and fibre, agriculture also producedother public goods such as populated rural areas, cultural heritage and landscape.  It was noted that
most of the countries that supported non-trade concerns were at the end of the list of countries ordered
by their agricultural trade balance.
16. The representative of Mongolia stressed the importance of taking non-trade concerns into
account in the negotiations.  Mongolia depended on agriculture which was important for political,social and economic reasons.  As a landlocked country it was difficult to market its products.  Non-
trade concerns should be considered in the negotiations and reflected in the WTO rules.
17. Romania noted that non-trade concerns were important for a large number of WTO Members
including developed, developing, least-developed and transition countries.  Not all, however, were
faced with the same type of non-trade concerns.  No t all the six concerns in the submission were ofG/AG/NG/R/4
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the same importance to Romania and Romania did not share the reasoning in all cases.  However, this
showed the relevance of non-trade concerns to the negotiations and the need for better understanding
of them and to search for multilateral solutions.  For Romania food security, environmental
protection, sustainable rural development and maintenance of rural communities were relevant non-
trade concerns while the reasons were similar to those already presented by other transition
economies.  It was necessary to concentrate first on understanding each non-trade concern identifiedand then to consider ways each Member could take them into account in the future.  Some Members
had pointed out that the final objective of the reform process was to achieve a high level of trade
liberalization and, in this context, non-trade concer ns were to be taken into account.  Romania wanted
agreement on the measures by which non-trade concerns could be addressed.  An equitable result for
the negotiations meant grouping different countries by different criteria.
18. In addition to Mauritius, that had introduced  part of the Note on Non-Trade Concerns, a
number of other small island developing states, including Barbados, Fiji, Jamaica, Trinidad andTobago, St. Lucia and Grenada (on behalf of so me CARICOM members) also highlighted specific
issues of concern to them.  For Barbados food security and rural development were particular
concerns and it emphasized the need for flexibility in implementation, especially for border measures,
to address non-trade concerns.  It was suggested that this area could be the subject of further
background work by the Secretariat and that Barbados would be submitting more detailed proposalslater.
19. Fiji stated that agriculture should be treated differently to trade in other products.  It felt that
all Members seemed to accept this specificity - although to different degrees.  For Fiji the aim of the
negotiations should be to achieve a fair and equitable outcome that would assist the incorporation of
developing and least-developed countries into the global economy.  In Fiji, despite somediversification into services, agriculture was the basis of the economy.  Agriculture played an
important role in food security, poverty alleviation and employment creation.  It also assisted
democratization by giving the rural poor incomes and involvement in politics, environmental
conservation, soil preservation, enabling people to live in rural areas, and enhancing the role of
women in rural development.  Small island developing states were especially vulnerable and non-trade concerns could not be separated from agriculture which was the only way for many of them to
begin integration into the global economy.
20. The representative of Jamaica (NG/W/86) not ed that although no definition of non-trade
concerns was given in the Note it was essential that the elements identified be taken into account in
the negotiations.  The issues of most importance to Jamaica were food security, rural development,employment and land use.  The European Commission's contribution on rural development captured
some of the concerns of small island economies which had few crops and limited opportunities for
diversification.  Developing countries needed flexibility for their rural development policies and for
economic and social stability.  The link between food security and trade concerns had been
highlighted by the paper by Japan and Korea.  Jamaica noted that food security could be affected by
conflicts of interest on non-trade concerns between importing and exporting countries and suggested
that an international framework for food security could be a subject for consideration in theagriculture negotiations.  The paper on developing countries by Mauritius stressed the role of
agriculture in developing countries' economies and the need for the process of liberalization to
achieve an equitable outcome.  For Jamaica the challenge was to match the development objectives
with trade liberalization.  It was noted that the Norwegian paper on flexibility raised a number of
issues that were similar to some touched on already by the Cairns Group;  however, Jamaica believedthat the concept of flexibility should be defined carefully so that it could not be used as a tool for
protectionism or using trade-distorting measures.  On e aspect that was not fully reflected in the papers
was the vulnerability of agriculture in some countries as a result of unilateral liberalization undertaken
under structural adjustment programmes.  Furthe r liberalization could aggravate the situation.G/AG/NG/R/4
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21. Trinidad and Tobago stated that it was essential that non-trade concerns be taken into account
in the negotiations as required by Article 20 of the Agreement on Agriculture.  Agriculture was very
important to Trinidad and Tobago's economic and social development and trade liberalization could
have a damaging effect, especially on rural communities and social stability.  Unemployment in
Trinidad and Tobago led to squatting and harmful ag ricultural activities such as forest removal that
damaged the landscape and the ecology both on the islands and in surrounding waters which affectedtourism.  Trinidad and Tobago needed programmes for sustainable management of forests and
watersheds and special and differential treatm ent for food security, rural development and
environmental issues.
22. St. Lucia stated that the importance of non-trade concerns in the process of liberalization was
underlined in the Preamble and in Article 20(c) of the Agreement on Agriculture.  She stated that
some economists had said that small economies should be more interested in liberalization, due to the
expected gains from trade, than others but that liberalization in agriculture was exposing some morevulnerable small island states to greater competition on terms with which they could not compete.
Limited land resources and plantation productions meant they could not achieve economies of scale.
From the environmental perspective it was better that people remain in bananas until an alternative
could be found to offer incomes for farmers that was compatible with the topography and
environmental needs.  Bananas were very important to the economies and to employment and playeda vital role in diversification as they were the only reason ships visited the islands.  For vulnerable
small island states like St. Lucia to achieve economic sustainability meant that they had to reform but
it took some time to reach this goal.  Trade liberalization meant countries had to increase market
access opportunities, there was no corresponding immediate increase in market penetration.  While
St. Lucia noted that some countries felt that the non-trade concerns of some countries should notbecome the trade concerns of others, she claimed that her country's small impact on the world market
made it unlikely that addressing its non-trade concerns would affect any other country, although she
did support the idea that, in addressing non-trade concerns, the least trade-distorting alternative should
be used.  However, further liberalization should address the concerns of small island developing
countries and net food-importing developing countries and take account of work done by otherinstitutes such as the UNCTAD, the World Bank and the Commonwealth Secretariat.
23. On behalf of a number of CARICOM countri es Grenada (NG/W/67) supported the Note on
Non-Trade Concerns.  CARICOM was especially interested in the section on food security, especially
for those countries in transition from preferential trading arrangements.  It was also concerned with
regional development, ecology and the environment as well as others.  Flexibility was needed beyondthat already provided in the Green Box for developing and least-developed countries to address
particular non-trade concerns.  The negotiations had to take account of developing countries' abilities
to apply these measures while at the same time advancing the process of reform.  CARICOM was
looking forward to working with others in defining  measures that could meet the specific needs of
small island developing states, net food-importing developing countries and countries in transition
from preferential arrangements and it would be putting forward its own proposals.  CARICOM also
asked the WTO Secretariat for assistance to identify the non-trade concerns raised by Members, toidentify the provisions of the Agreement on Agriculture and associated Agreements that addressed
non-trade concerns, and to provide a summary of non-trade concerns not presently covered by the
provisions.
24. Other countries that supported different aspects of the Note on Non-Trade concerns included
Cyprus, Malta, Iceland, Madagascar, Sri Lanka, Isr ael and Ghana.  Cyprus noted that non-trade
concerns were important to all countries often for different reasons.  Cyprus was committed to the
international trading system but believed that governments had an obligation to ensure that public
goods were preserved and that they should be able to address non-trade concerns through mutually
agreed rules, and in their own best interests.  For Cyprus land abandonment was of particular concern,
especially given the shortage of water on the island and because abandoned farms meantG/AG/NG/R/4
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environmental degradation and concerns like this could not be left to market forces.  Flexibility in the
rules was needed to allow preservation of the environment.
25. The representative of Malta stated that social and economic development had to be balanced
between different sectors, including agriculture.  However, on an island such as Malta, agriculture
was particularly difficult but it was an important activity and was part of the island's culture, history
and landscape.  For this reason Malta supported the European Commission's papers on ruraldevelopment and the environment and he suggested that the WTO should establish rules that enabled
non-trade concerns to be addressed.  He noted the support among different Members for this proposal.
26. Iceland stated that Members had to have the scope to pursue non-trade concerns in order to
make progress in the negotiations.  It claimed that the special nature of agriculture and the policy
objectives of non-trade concerns meant the sector needed special treatment within the WTO.  Due to
its geographic location, difficult agricultural conditions and scarcity of natural resources, Iceland had
relied for a long time on domestic production to the extent that this was possible.  In addition itsisolation meant livestock had not developed immunity to disease making SPS measures and food
safety very important.  However, Iceland still depended on imports for half its domestic food
requirements.  In addition to food security and safety, environment concerns were also important due
to deforestation, soil erosion and desertification.  These problems were being tackled with policies on
land reclamation, reforestation and revegetation and some farmers were now engaged in theseprogrammes in parallel to the declining number involved in traditional farming activities.  The
viability of rural areas was of particular concern to Iceland given its very low density of population
and its role as one of the pillars of rural habitation.  Iceland stated that the reform process should
safeguard the rights of all Members, developed as well as developing, and sufficient flexibility had to
be given to pursue national policies to addre ss non-trade concerns.  The measures should not be
limited to the Green Box either but appropriate mutually agreed disciplines should be worked out to
achieve a balanced outcome.
27. The representative of Madagascar noted that agriculture was very important to Madagascar
with its many subsistence farmers and non-trade concerns, such as rural development, were important
for the country's culture.  It was important that th e negotiations find a balance between the trade and
non-trade aspects in the continuing reforms taking account of the situation of developing countries,
especially the least-developed.
28. The representative of Sri Lanka recognized that agriculture had a role beyond the production
of food and fibre and included other functions that  underpinned the social and economic development
of the rural sector.  Each country had its own priority concerns and in Sri Lanka agriculture was veryimportant to the economy and employment in rural areas.  The public goods produced by agriculture
included its services to society such as rural development, food security, employment opportunities
and poverty alleviation and all these had to be analysed and taken into account in the negotiations as
required by Article 20(c).
29. The representative of Israel stressed the importance of certain non-trade concerns to his
country, particularly its role in maintaining a reasonable distribution of population, providing the
economic basis for small remote rural communities, it s role in the environment both for the present
and for the future and for food safety.  Members should consider the unique problems caused by water
shortages which required special attention and support.  He stated that farmers should be supported in
times of severe market disturbances, or when local or export market prices fell, to enable them to
survive and start another season as farmers if they so wished.  The basic objective of agriculture
policies should be to minimize market intervention and let the farmer manage but to provideassistance in times of need.  Israel also agreed with the points raised in the submission on food
security especially at a time of rising world population and falling area of agricultural land although
these considerations should not impede trade.  There appeared to be a consensus that the process of
trade liberalization should continue and it was clear that all Members had some non-trade concerns.G/AG/NG/R/4
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What was now needed was to try to create an acceptable framework of international rules within
which Members could formulate their agricultural policies.
30. Ghana noted that, by definition, non-trade concerns were not related to trade and therefore
measures to address them should not be related to trade and should not distort trade.  The negotiations
should take them into account as required by Article 20(c) but Ghana wanted to see the proposals on
how they were to be addressed to ensure they were not trade distorting.
31. The representative of Venezuela noted that Article 20 required that non-trade concerns be
taken into account in the reform process - the long-term objective of which was a fair and market
orientated agriculture trading system.  Venezuela was concerned about the rural development,
agricultural development and food security and these should be taken into account in the negotiations
the outcome of which should ensure flexibility for developing countries to use effective provisions on
special and differential treatment to promote their agricultural development and rural areas.
32. A number of countries, including New Zeala nd, Thailand, Colombia, Argentina, South
Africa, India, Brazil, Bolivia, Namibia, Chile, the United States, Australia, Guatemala, Morocco,
Canada, Pakistan, Mexico, Nigeria, Egypt and Uruguay, noted that the issues raised as non-trade
concerns were important for trade negotiations but it was more relevant to discuss the measures used
to address those concerns.  Trade-distorting policies should not be used to address non-trade concerns.
Furthermore, the difference between the non-trade concerns of developed and developing countrieswas noted as well as the flexibility developed countries had in addressing these concerns as a result of
their greater financial resources.
33. New Zealand noted that it, like other developed countries, was fortunate in having a broad
range of policy options from which it could afford to choose.  It believed that the debate on non-trade
concerns should focus on developing countries.  As part of the Cairns Group, it had submittedproposals on non-trade concerns in developing countries covering rural development, food security
and environmental protection.  There was little point in continuing a general discussion of non-trade
concerns or making vague references to flexibility when it was the specific policy instruments that
mattered.  What was needed was a discussion of specific issues that might arise from the elimination
of export subsidies and trade-distorting domestic supports, or from major improvements in marketaccess.  New Zealand had yet to see convincing evidence that maintaining support and protection was
necessary to attain non-trade concerns, nor did it accept that non-trade concerns were limited to
agriculture or that all the claimed benefits were public goods that required public intervention.  It was
not convinced that developed countries with high levels of protection and support needed special
treatment when the Agreement on Agriculture already offered enough scope for non- or minimallydistorting supports, a point which appeared to be acknowledged by the papers on rural development
and the environment.  New Zealand hoped to see specific proposals on specific ways non-trade
concerns could be addressed, especially from developing countries.
34. Thailand agreed with Mauritius that developing countries did not have the resources to use
the Green Box and it needed to be reviewed to take into account their concerns.  However, the real
solution to food security was to allow least-developed and net food-importing developing countries to
develop their own domestic production but this was difficult when they had to compete in theirdomestic markets, and in their export markets, with subsidized exports from other countries.  The
problem did not lie with those countries that had the ability to fund non-distorting supports but with
those countries that could not afford such supports and which had to compete with subsidized
production and exports.
35. Colombia (NG/W/64), supported by Argentina, stated that the policy and the economic
concept of food security had to be separated.  From the economic view, the arguments of wealthy
countries concerning domestic production and food security were very weak as they had convertible
currencies and diversified trade, and food was only a small part of household budgets. For poorerG/AG/NG/R/4
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countries that depended on selling commodities and that had to contend with price fluctuations, it was
a different matter.  For these countries problems with production or prices had a much worse effect
than in richer countries.  Colombia had non-trade co ncerns such as unemployment, especially in rural
areas, and extreme poverty and Colombia was looking for development alternatives to let its rural
dwellers find work.  However, it did not accept that developed countries could not address their non-
trade concerns using the Green Box.  It was vital that the non-trade concerns of wealthy countries didnot become the trade concerns of poorer countries.
36. Argentina was concerned with those non-trade concerns that were badly affected by
distortions in international trade such as rural poverty, unemployment and the environment.  Rural
poverty was at the root of migration from rural areas to overcrowded cities and to rising
unemployment.  It pointed out that support in OECD  countries had increased dramatically since the
start of the Asian financial crises and this effectively transferred the adjustment costs to third markets.
These supports had further depressed prices and damaged economic activity in other countries.  Inaddition, diversification and production of value-added products was hampered by tariff escalation in
developed countries which forced developing countries to rely on commodity production at the lowest
possible cost. This affected not only industrial production but also the environment and
unemployment as producers were forced to increase production and reduce costs, often in ways that
did not favour the environment.  In addition, environmental policies were long term by nature but thedistortions in the international market caused by some developed countries sent the wrong signals to
investors and farmers.  Argentina could not use subsidies and it needed stable outlets for its
production without competition from subsidized production and exports to enable it to take a longer
term view of environmental policies.
37. In noting that non-trade concerns were a factor to be taken into account in the negotiations
while the objective remained the establishment of a fair and market orientated agricultural trading
system, South Africa (NG/W/82) did not suggest that  non-trade concerns were not important.  In fact
South Africa attached great importance to the two non-trade concerns listed in the Preamble, food
security and the need to protect the environment.   What was important, however, to the continuation
of reform, was the way in which non-trade concerns were addressed.  In its opinion few wouldcomplain if non-trade concerns were addressed with targeted and non-trade distorting measures and it
was important that the non-trade concerns of other countries did not become South Africa's trade
concerns.
38. India noted that it had already submitted a note to the process of Analysis and Information
Exchange on non-trade concerns and developing countries.  While it was pleased to see non-tradeconcerns were being recognized as important issues to be dealt with, it was concerned that the
distinction between the non-trade concerns of developed and developing countries were being
somewhat lost in the debate and it emphasized that non-trade concerns were not the same for different
Members.  Since there were differences of connotation, of perception and with the different problems
covered by the heading non-trade concerns, India emphasized that the important point was to ensure
that the measures used to address them must not impose a burden on developing countries and
whatever flexibility was suggested it should be as  much as possible non-trade distorting.  For India,
food security was the principal non-trade concern and in defining it India had built upon the FAO's
World Food Summit definition of physical and economic access to food.  It meant not only a
minimum level of self-sufficiency but also preservation of farmers' livelihoods.  Similarly, rural
development was not just about rural infrastructure but also poverty alleviation.  India hoped that
increasing agricultural production would raise incomes and living standards in developing countries,which would in turn improve access to food.
39. Brazil (NG/W/62) noted that while it was each government's right to decide on policy
objectives, the instruments they could use to achieve these objectives were the subject of the
negotiations.  In order to avoid a situation where only the interests of the strongest prevailed it was
necessary to put limits on these right to use differen t policy instruments.  It was unfortunate that theG/AG/NG/R/4
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Note on Non-Trade Concerns did not clarify what instruments were being proposed.  Brazil was a
developing country with major environmental concerns and a vast rural population that faced
financial, technical and infrastructural constraints yet Brazil had addressed its non-trade concerns
either through the special and differential treatment provisions or the Green Box.  Brazil noted that
some changes to the Green Box might be necessary in  order to take account of the specific situations
of developing countries.  Protection of the environment was one non-trade concern and Brazilianfarmers practised crop rotation to prevent soil erosion and reduce the risk of disease.  This production
pattern did not require financial assistance and actually reduced the costs of production.  It was noted
that the three elements of food security were imports, stockholding and domestic production but
domestic production had to be sustainable and could not rely on subsidies.  In Brazil a combination of
these policies was pursued and Brazil was the biggest importer of wheat in the world, maintained
stockpiles and sought to improve production and di d this without using trade-distorting measures.
While each Member had the right to pursue its pr eferred combination of these three elements they
also needed to allow the free flow of food in order to achieve true food security.  Brazil noted that rice
had been raised as an example of the low volume of trade relative to domestic demand in some
countries and pointed out that the low volume of trade was a direct result of a highly regulated and
protected market.  If the rice market was liberalized, trade volumes would increase which would
contribute to food security.  It was noted that most of the policies of interest to developing countriescould be taken into account by special and differential treatment provisions without weakening the
reform process for agriculture and Brazil did not accept that there was any contradiction between
taking non-trade concerns into account and continuing the process of trade liberalization.  Developing
countries were being misled to believe that non-trade concern policies were needed to help them
achieve their development goals.  Non-trade concerns, especially those of developed countries, shouldnot be identified with the justified exceptions from the general rules that developing countries might
need.  The solutions to these exceptions would be addressed in the negotiations through special and
differential treatment while non-trade concerns would be taken into account as Article 20 required.
As a developing country Brazil would be arguing in favour of those exceptions that developing
countries needed to address their non-trade concerns by differential treatment.  Dividing the WTOMembership up into a plethora of little groups, such as small island developing states, emerging
economies, net food-importing countries, large agrarian economies, etc., and taking account of a
myriad of specific interests such as rural development, landscape, the role of women in rural
development, rural poverty alleviation, etc., would result in weak and unenforceable rules.  The
wealthiest and strongest countries would be able to do as they wished and the different groups ofpoorer, less powerful countries, would suffer.  A fragmented and divided set of rules would be much
worse than a single set of understandable enforceable rules.
40. Bolivia (NG/W/61) stressed the difference in non-trade concerns between developed and
developing countries and the way in which trade-distorting policies in other countries damaged the
non-trade concerns in Bolivia.  It noted that food security did not require countries to be self-sufficient
and that the specific features of each country dete rmined the extent to which this was feasible.  Food
security should not be an excuse to permit countries to use trade-distorting supports.  Bolivia notedthat not only did developing countries have smaller economies but the agricultural sector was also a
far bigger part of the economy.  Production and export subsidies abroad affected their food security
and damaged their political and social stability by increasing poverty, especially in rural areas.  This
led to migration to urban centres and consequently to an increase in urban poverty.  The fight against
poverty was the main objective of developing countries' policies.  In the agriculture negotiations, foodsecurity as a non-trade concern could not be addressed in a general way.  Guaranteeing food security
for all Members meant developing specific commitments and avoiding the use of trade-distorting
subsidies.  Bolivia also questioned the need to use trade distorting supports in order to protect the
environment and noted that developed countries tended to use high levels of environmentally
damaging pesticides and other inputs.  In addition, the greatest sources of pollution were in the mainindustrial centres and Bolivia noted the paradox that those industrial countries with high levels of
pollution also used the environment to justify subsidies for agriculture.  Developing country farmers
had to have low cost products to be able to compete with subsidized production in some developedG/AG/NG/R/4
Page 11
countries and these methods of farming were not always compatible with environmental protection.
In Bolivia, where agriculture was vital to the economy and with high levels of rural poverty, it was
accepted that non-trade concerns were real concerns that must be taken into account, but they should
not become excuses for not giving better market access or used arbitrarily by those that wanted to
continue to use trade-distorting practices.
41. Namibia (NG/W/76) pointed out that the Note on Non-Trade Concerns appeared to try to use
Article 20 to legitimize all forms of support to agriculture, by classifying them as land functions based
on tradition and culture, supply functions based on countries' abilities to respond to market forces,
characteristics external to economic measurement, su ch as the beauty of the landscape, and countries'
rights to provide their own food requirements.  Namibia had a relatively liberal agriculture system and
used hardly any trade-distorting measures.  While the land use function of the countryside was high
the government's scope to intervene was limited by low income and distorted income distribution.  In
addition, low rainfall, poor infrastructure, low capital accumulation and history of under-investmentmeant agriculture could not respond quickly to price changes.  Arguments based on positive
externalities were noted with concern by Namibia, especially given its harsh farming conditions.
Namibia also noted that food self-sufficiency was contrary to the negotiations whose objective was
greater freedom of trade and its own policies c oncentrated on promoting national and household food
security.  Namibia was concerned that the concept of multifunctionality could be used to hidemeasures that distorted trade in agriculture and it was reluctant to accept a broad definition of the
term.  However, it was recognized that some non-trade concerns had to be taken into account in the
negotiations.  For Namibia, these included food security, rural poverty, unemployment and
environmental degradation.  Namibia noted that non-trade concerns were covered by Article 20 in a
vague way that could be abused and contrasted this with special and differential treatment that wasspecifically for developing countries.  Namibia also noted that concerns such as food security and
poverty alleviation were not the same as concerns  such as landscape which was a luxury for food
insecure people.  Namibia could sympathize wit h, understand and support those Members that had
legitimate non-trade concerns but the concerns, their scope, their value and the implications of the
support had to be clearly defined.  Finally, Namibia repeated the concern of India and South Africathat the non-trade concerns of one country should not be allowed to become the trade concerns of
other countries.
42. The representative of Chile noted that the Marrakesh Agreement itself recognized the
importance of non-trade concerns and that non-discriminatory trade was not a goal in itself but a
means to reach another end.  In his opinion non-trade concerns were a euphemism and it was morepositive to speak of social, environmental and economic concerns.  It was not just a matter of having
the right to address them, as Korea had said, it was in fact an obligation.  However, what needed to be
known was how non-trade concerns were to be addressed and what policy instruments were to be
used because these factors affected the welfare of other societies.  Supports to production in other
countries meant higher poverty for Chilean farmers.   Each society assigned different priorities to
different non-trade concerns but as India, Bolivia , New Zealand and Namibia and others had noted
non-trade concerns differed widely between developed and developing countries.  For Chile, povertyeradication was the priority.  This required better education and health and therefore better incomes
which meant, because poverty was concentrated in  rural areas, better and more stable commodity
prices.  To achieve this aim required the elimination of trade-distorting subsidies and improving
market access and in doing so Chile could preserve its landscape.  Agriculture trade liberalization was
central to addressing Chile's non-trade concerns.  Studies by the Economic Commission for LatinAmerica and the Caribbean had shown that many countries in Latin America had very high levels of
poverty and extreme poverty and only opening markets and eliminating subsidies could improve
production, food security and create reasonable incomes and there was no comparison between these
needs and those of countries that were very wealthy in comparison.  He suspected that some of these
countries wanted poorer countries to continue to pay the bill for their non-trade concerns.  Non-tradeconcerns had to be addressed through instruments that did not distort trade or close markets.  It was
time to stop talking about generalities and concepts and to produce concrete proposals based on theG/AG/NG/R/4
Page 12
mandate of Article 20 of the Agreement on Agriculture.  Finally, he noted that the Egyptian Minister
for External Affairs at the Cairns Group Minister s meeting in Canada had said it was a myth that
multifunctionality was a concept unique to agriculture and that it needed to be addressed with
instruments that distorted fundamental economic relations.  He had pointed out that the developing
world had been called on to make hard political and economic choices when joining global economy
and that it was only fair that developed countries should not be spared similar choices.
43. The United States agreed with many of the points made by Chile.  The United States was
aware of the special role of agriculture in society.  The view that the continuation of the reform
process should take account of non-trade concerns and special and differential treatment for
developing countries, as required by Article 20, was supported by the United States.  They looked
forward to seeing specific reform proposals to address these concerns in a manner that did not distort
trade and to working on non-trade distorting approaches to addressing non-trade concerns as part of
the technical discussions on domestic support that would take place in 2001.
44. The representative of Australia (NG/W/59) noted that all countries acknowledged that
Article 20 required that the negotiations should take account of non-trade concerns and all countries
acknowledged that non-trade concerns were importa nt.  The submission did not contain anything new
compared to the AIE process and the preparations fo r the Seattle Ministerial Meeting.  However, the
Members of the WTO were now in negotiations which meant specific proposals for policyinstruments were needed not broad political statements.  The WTO did not deal with what were
legitimate non-trade concerns but with how they were addressed.  The negotiations should move
forward bearing in mind that Article 20 said that non-trade concerns were to be taken into account in
the negotiations but they were not the objective of the negotiations.  He noted that, for developing
countries with an interest in non-trade concerns, especially food security and rural development, thesewere addressed in the Cairns Group's proposals.
45. Guatemala agreed that non-trade concerns were to be taken into account but were not the
focus of the negotiations.  Guatemala would lose market opportunities if instruments that distorted
trade were used in other countries which would damage its economy.  Therefore, non-trade concerns
should be reflected in a Green Box after careful review to see that it catered for non-trade concerns byinstruments that were non-trade distorting.
46. Morocco noted that the documents raised a number of questions concerning the development
of trade and economies.  Agriculture was an essential economic activity and a major source of
employment in Morocco where it contributed to general stability, both economic and political.  In
Morocco migration to urban areas was a particular problem and rural development the solution.Investment in rural infrastructure was a necessity as this could be a motor for rural development as it
could end the isolation of rural communities and make  it possible for them to market their products
and to provide them with the technology to impr ove production.  Food security was also vital and
production problems prevented access to adequate food both physically and economically.  The
factors that determined physical access were partly wars and conflicts, problems shared by both
developed and developing countries but much more common in poorer countries.  In addition,
economic access was determined by factors linked to finance that were more critical in developingcountries.  While purchasing power was a critical factor it could, to some extent, be improved by
structural reform which could increase production and improve living standards but it was stressed
that these reforms would only be successful if the output could be sold which required market access
opportunities.  Developing countries had little m oney available for developing production compared
to the supports given to agriculture in developed countries which showed that any decision allowingsupport to agriculture would benefit developed countries that had the resources to provide such
support.  The question raised by the submission was how strengthening support for agriculture in
developed countries could make it possible for developing countries to improve their situation,
especially their standard of living.G/AG/NG/R/4
Page 13
47. Canada noted that it, like others, had non-trade concerns and had policy objectives concerning
a viable rural community, protection of the environment and access and availability of safe nutritious
food.  The problem was not the non-trade concerns themselves but how to achieve them in non-trade
distorting ways.  Some interesting points had been made in the discussion and Canada could agree
with the point made by Japan and Korea that adequate disciplines on export restraints were lacking.
In fact, in addition to seeking the elimination of export subsidies, Canada was also seeking rules todiscipline export taxes and restraints, including a ban on the inclusion of food and feedstuffs in
national security trade embargoes.  It also supported the proposal by Norway that developing
countries, especially least-developed countries and net food-importing developing countries, be given
improved market access not only to developed, but also to developing countries.  Canada also noted
the call for flexibility in national policy design an d the need to give due consideration to the diversity
of situations in different countries, but it noted that this should not be a  carte blanche for any kind of
policy.  Canada was open to discuss measures to address non-trade concerns but these should be under
the principle that they should not result in exporting problems to other countries.  Canada did not
agree that policies that restricted market access, supported production and distorted trade were
consistent with the objective of establishing a fair and market orientated agricultural trading system.
While the Green Box might not be perfect it did allow issues not related to the market to be addressed,
such as food security and the need to protect the environment.  Canada was open to discussion on howto accommodate developing and least-developed countries' concerns under the Green Box, but
measures favouring producers in one country at the expense of those in other countries needed to be
eliminated and replaced with non-distorting measures.
48. Pakistan noted that non-trade concerns were an element of Article 20 and that some of the
issues raised in the submission were important to its economic and development interests.  Howevernon-trade concerns should not mitigate against further liberalization.  Agriculture was at the centre of
Pakistan's economy and played a vital role in rural development, employment creation, providing an
income for the majority of the population, as an economic cushion for many economic problems and
for food security.  However, Pakistan noted that food security appeared to have different meanings for
developed and developing countries, particularly for least-developed and net food-importingdeveloping countries.  Like India, Pakistan stat ed that, in addressing non-trade concerns, Members
should consider which measures were trade dist orting and which were not.  Proposals were now
needed on specific measures so that the trade implications could be assessed.  Such a step would help
Members to work out solutions while ensuring that non-trade concerns did not cause further
distortions.
49. Mexico stated that it had listened with interest to the interventions by developing countries.
The issues raised by them included employment, measures to fight poverty, policies to promote rural
development, policies for the use of new technologies and measures on investment in infrastructure.
All these were legitimate concerns that could be addressed and solutions found in the concept of
special and differential treatment currently in the Agreement on Agriculture or that could be
developed in the negotiations.  Other concerns raised by other countries could find solutions in the
current Green Box.  However, Mexico was concerned that in the search for solutions to non-tradeconcerns attempts would be made to create barriers to trade, especially for imports from developing
countries, or it could lead to an increase or maintenance of trade-distorting domestic support or export
subsidies.  Any measure to address non-trade concerns should be non-trade distorting.
50. Nigeria supported the statements made by Ne w Zealand, India, Brazil and Namibia.  The
objective of the Article 20 was the continuation of the reform process.  While all Members had non-trade concerns it was surprising to see developed countries pushing these issues when they could
already address their concerns through the existing provisions and commitments under the Agreement
on Agriculture.  In addition, developed countries' rural areas were better developed than the towns and
cities of Nigeria and did not suffer recurring problems with their food supply.  In contrast, agrarian
communities in developing countries, in the absence of any poverty alleviation programmes, werestruggling to survive in current difficult situations.  As a result productivity and food security oftenG/AG/NG/R/4
Page 14
declined and developing countries should be able to employ specific measures to address these non-
trade concerns.  It was necessary that the negotiations did not lose their focus on the objective of
Article 20 which was the continuation of the reform programme on agricultural trade.
51. For Egypt, agriculture was a key sector in the economy as it provided a high proportion of
income and employment.  The majority of agriculture workers were small family farmers and a fall in
income resulting from trade liberalization also af fected rural employment, rural development, food
security and economic and social stability.  Although Egypt was currently a net food-importing
country, it had good prospects in the long term.  Balancing short- and long-term objectives was a
challenge for the country but it had made some progress towards liberalization.  However, the
commitments in the Agreement on Agriculture had done little to liberalize trade in agriculture or to
improve market access for developing countries.  The reform process should now take into account
legitimate considerations such as food security, special and differential treatment for developing
countries, the possible negative affects for least-developed and net food-importing developingcountries and the protection of the environment.  The concept of non-trade concerns should not be
expanded to include other elements or policy objectives for other sets of countries.  The Egyptian
Minister for Economy and Trade had said in Banff at the Cairns Group Ministerial meeting that since
the developing world had been called upon to make hard political and economic choices when joining
the global economy, and that Egypt was still facing this challenge, then it was only fair that thedeveloped world should not be spared similar choices.
52. The representative of Uruguay noted that all Members had legitimate non-trade concerns just
as they had legitimate trade concerns.  For trade concerns the Uruguay Round Agreements helped to
define what measures were legitimate and which were unacceptable.  Similarly, measures to address
non-trade concerns could be either legitimate or unacceptable.  For Uruguay, measures to address anyconcern, trade or non-trade, should not distort or restrict trade.  For developing countries special and
differential treatment provisions could be used.  Article 20 required that non-trade concerns be taken
into account in the negotiations in pursuit of the objective of having a fair and market orientated
agricultural trading system but they could not be taken into account unless progress was made in the
negotiations.  Finally, Uruguay noted that some Members had noted that agriculture was effectivelyleft outside the GATT for 40 years.  This was because the two largest trading powers had insisted on
discriminating against agriculture in the same way as they had discriminated against textiles.  This
had nothing to do with agriculture as a special activity but only reflected the politics of an
organization dominated by the special interests of the largest Members.  However, this had now
changed.
53. For Indonesia (NG/W/71) food security was an  important non-trade concern which was not
only about accessibility or availability of foodstuffs but also about the ability to produce domestically.
For Indonesia imports could only contribute to food security by making up the difference between
national production and national consumption.  For its basic needs Indonesia could not rely on
imports because the volume of rice traded internationally was less than Indonesia's domestic needs.
With limited foreign exchange Indonesia could not take the risk of relying on imports.  Furthermore,
imports could be disrupted due to political crises leading to embargoes on exports to Indonesia.Indonesia had to be self-sufficient especially for rice.  While Indonesia was committed to the
liberalization of agricultural trade, it was of the opinion that developing countries should not be
restricted in pursuing their food security policies and flexibility was needed in market access,
domestic support and export competition.  Another non-trade concern of interest to Indonesia was
rural development and employment.  The majority of Indonesians depended on agriculture for theirlivelihoods, especially in rural areas.  Since Indonesia started developing in the sixties, the number of
people employed in agriculture had increased and during the economic crises agriculture had absorbed
many people who lost their jobs in other sectors of the economy which implied that the sector needed
more attention particularly for poverty alleviation and food security for small farmers and landless
workers.  The sector also had an important role in increasing foreign exchange and reducingdependence on foreign sources.  It was important for Indonesia to adopt policies that protected itsG/AG/NG/R/4
Page 15
farmers and their families from the adverse affects of trade liberalization in agriculture and the WTO
Agreement on Agriculture should have provisions to allow developing countries to develop
agricultural policies to eradicate poverty.
54. The representative of Turkey also noted that agriculture had a specific characteristics in all
countries and the long and difficult negotiations that produced the Agreement on Agriculture testified
to this.  Turkish agriculture was no exemption and he pointed out that developing countries were stillimplementing their schedules of commitments.  This ongoing implementation made it hard for
developing countries to assess the process.  Turkey was of the opinion that, having regard to the spirit
of the Agreement on Agriculture and to Article 20 on continuing the reform process, the measures that
were to be adopted should not be escape clauses from commitments, especially for developed
countries to reduce their willingness to create better market access opportunities for developing
countries.  The concept of non-trade concerns should be a an instrument for further improvement and
viability of agriculture world wide.  Finally he poi nted out that Turkey was studying the matter and
would appreciate it if more concrete formulas and instruments that could be used under this concept
could be put forward.
55. In response Norway, Switzerland, the EC and Mauritius noted the wide range of participants
in the discussion of the Note on Non-Trade Concer ns and the variety of views expressed on how non-
trade concerns should be addressed.  Norway (NG/ W/77) felt that the debate showed that non-trade
concerns were an integral part of the negotiations and had to be addressed as part of the reform
process.  It also noted that opinions seemed to differ on the type of instruments that should be used to
address non-trade concerns and, with Mauritius, stated that for low potential countries the Green Box
was not likely to be sufficient to cover the necessary measures, nor could they be limited to measures
with no impact on trade.  Maximizing welfare required that both trade and non-trade concerns betaken into account.  Norway, supported by Hungary, al so felt that a "one size fits all" approach would
not work.  However, in response to Uruguay that pointed out that the basis of the WTO was rules
applicable to all Members, Norway stressed that it  meant flexibility within agreed multilateral rules.
56. Switzerland stated that full liberalization would not benefit all developing countries but only
those with certain advantages.  While Switzerland  understood the concerns of  South Africa, Namibia
and India, that non-trade concerns should not create trade concerns for other countries, it noted that
while the least trade-distortive measure should be used it was possible that, in some cases, other
measures could be taken that were compatible with WTO rules, such as measures concerning health.
Concerning the statements from Members about the measures that could be taken to address non-trade
concerns Switzerland felt that the discussions on the Note on Non-Trade Concerns could be used toformulate a proposal which could become the basis for negotiations on the instruments to be used.
57. The representative of the EC (NG/W/66) stated that although some Members had asked for
details about the measures needed to address non-trade concerns he felt that it was first necessary to
understand the key concerns of other countries in order to find an acceptable solution.  In his opinion
the debate had shown that the vitality of rural areas was a concern for all countries, although the way
it was addressed differed considerably from one country to another.  The approach to the negotiations
in Article 20 set out the long-term objective, the necessity to consider the commitments needed to
achieve that objective and, in doing so, to take account of a number of factors including non-trade
concerns.
58. Japan (NG/W/73) and Korea (NG/W/74) noted that  other countries were also concerned about
food security and reiterated that they felt this was best approached through a combination of domestic
production, imports and stockpiling.  Furthermore, food security was not only about accessibility butalso included sustainable utilization of domestic reso urces.  In addition, other issues raised in the Note
on Non-Trade Concerns, such as rural development and employment in rural areas, were concerns of
all countries, whether developed or developing.  Concerning the policy implications of non-trade
concerns Japan underlined the points raised in paragraphs 38 to 40 and 50 to 55 of the paper it hadG/AG/NG/R/4
Page 16
prepared along with Korea.  Korea and Mauritius noted the comments made by Indonesia concerning
its experience during the financial crises in 1997 and 1998 and the role of agriculture as a social safety
net in some countries.  Korea noted that in developing countries, where expenditure on food was high
relative to household incomes, food security was more serious and the role of domestic production as
a tool for food security varied from one country to another and each country had the right to pursue
their optimum solution.
59. Mauritius (NG/W/75) noted the comments made by other small island developing states and
felt that these underlined the role of agriculture in their economies.  Concerning the comments made
on Article 20 and the Preamble to the Agreement on Agriculture Mauritius, like Switzerland, felt that
the discussion showed the importance of understanding the problems facing different countries before
proceeding with the negotiations.  It felt that this meant paragraphs (a) to (c) of Article 20 had first to
be addressed before proceeding with paragraph (d).  Furthermore, equitable treatment only meant that
the specific situations of all countries had to be taken into account.
60. Argentina noted that there were considerable differences between the countries that made the
proposals and the contrast in their views concerning  production and exports of agricultural products
and other sectors of their economies.  While he accepted that all reasonable views had to be taken into
account in the negotiations he questioned the reasonableness of the trade restrictions applied by some
countries to certain imports compared to the economic liberalization imposed on other countries andhe contrasted the attitudes of some countries to trade in agriculture to trade in other products in which
they had some advantage.  He also questioned the claim that non-trade concerns were the same for
developed and developing countries noting that wealthy countries with large balance-of-payments
surpluses could afford to import food and this would benefit exporting countries as well.  It did not
seem reasonable that many developing countries and countries with economies in transition had to gothrough painful economic restructuring while other countries were protecting their agricultural sectors
from restructuring and, by doing so, reducing the development opportunities for the others.
61. Australia pointed out that the Cairns Group proposals already addressed a number of issues
raised in the Note on Non-Trade Concerns and contrasted the statement made by some developing
countries with those made by some smaller and wealthier countries.  Along with Chile and Uruguay,Australia also pointed out that the issue of concern for other countries was not policy objectives under
the heading of non-trade concerns but the measures taken to address those policy objectives.  Chile
noted that they would be curious to see how welf are could be maximized by distorting trade and
damaging other countries' interests in pursuit of non-trade concerns.
(b) Discussion paper from Argentina, Brazil, Paraguay, Uruguay (MERCOSUR) Chile,
Bolivia and Costa Rica:  Export Subsidies – Food Security or Food Dependency
(NG/W/38)
62. The representative of Brazil introduced the discussion paper on export subsidies.  She noted
that at the Cairns Group Ministerial Meeting in Canada in October a representative of a leading
developing country had said that his country was a net food-importing developing country because of
other countries' export subsidies.  This view summ arized the idea put forward in the submission that
export subsidies were no solution to the food security concerns of net food-importing countries andleast-developed countries.  Export subsidies were, in fact, an instrument of dependency that prevented
economic development and perpetuated poverty.  She noted that some Members had said that export
subsidies benefited net food-importing countries by lowering prices.  However, export subsidies made
domestic production less competitive, meant scarce economic resources were used for imports,
compromised the development of domestic agriculture, reduced the balance of payments andincreased dependence on the supplier.  The result was increased poverty and debt.  The sponsors of
the paper were aware that certain situations could not be addressed by market forces alone but
believed that solutions were best found in the implementation of the Decision on Net Food-Importing
Developing Countries, especially the provisions on technical and financial assistance to improveG/AG/NG/R/4
Page 17
agricultural productivity and infrastructure and by providing food aid in fully grant form.
Furthermore, these measures should be coupled with the elimination of trade-distorting practices that
caused food security problems.
63. Some of the other sponsors of the paper supported the statement made by Brazil and stressed
that export subsidies reduced food security by depressing domestic production.  Bolivia (NG/W/61)
presented its experience of food aid.  This aid had had a number of negative effects, such as thehaving created a fragile system of food availability, acted as a disincentive to domestic agricultural
production, reduced local production and effective domestic demand and changed the diet of many
Bolivians as consumption had shifted to wheat and wheat flour and away from better local grains.  In
1992, following an agreement betwee n the interested sectors that prices should reflect production
costs, domestic production had increased.  However, Bolivia still depended heavily on imports of
wheat, both commercial and food aid.  Despite the increase in production, Bolivia still used only a
small proportion of its agricultural land for cereals, mainly because of the distortions in internationalagricultural trade.  Food aid should be used in real emergency cases and not as an instrument of
dependency.
64. Costa Rica said that export subsidies depressed production in net food-importing countries by
artificially increasing competition in both their home and potential export markets.  The result
exacerbated their balance-of-payments problems.  Effectively, export subsidies caused a transfer ofresources from poorer countries to farmers in countries with larger treasuries and increased
dependency on subsidized imports in developing countries.
65. Paraguay noted that food security was of particular concern for some developing and least-
developed countries and that export subsidies continued to distort competition.  The argument that net
food-importing countries might benefit from subsidies did not agree with the statements made bymany of these countries as well as with the studies done by international organizations which stated
that the elimination of these and other export aids would lead to substantial improvements in food
security.  In addition, the agriculture sector of many developing countries was still under-developed,
and was unable to meet domestic demands or to export.  Support in these countries should be
concentrated on improving infrastructure and technological capacity.
66. Argentina, supported by Mexico, noted that some countries had suggested that markets alone
could not ensure food security and pointed out that markets were badly affected by export and
production subsidies and other distortions that depressed prices and increased price instability.  The
Asian crises had shown this effect as it had reduced demand, which reduced prices and should have
led to reduced supply.  However, some developed countries had insulated their agricultural sectorsfrom prices and had increased production subsidies and disposed of the surplus on the world market
with export subsidies.  As a result, and as the OECD  had shown, prices had fallen further.  This meant
producers in countries that could not afford subsidies had to suffer the loss of markets and the decline
in prices.  It seemed that it was producers in de veloping countries with balance-of-payments problems
that did not always have access to international markets that suffered.  Furthermore, other work by the
OECD had shown that export subsidies were concentrated in bulk commodities exported to non-
OECD countries, that is in products, developing countries had an advantage in producing to marketsthat could not afford subsidies forcing prices lower and increasing price-volatility.
67. A number of other countries, including the Philippines, Thailand, Australia, New Zealand,
Mexico, Colombia, South Africa, Canada, India an d the United States supported the submission by
the group of Latin American countries.  They noted the importance of food security as a non-trade
concern and the negative effects of export subsidies on domestic production, price volatility, and pricelevels.  The Philippines stated that while export subsidies might help ease some food security
problems in the short term in the long term they only let developing countries postpone necessary
structural issues that could provide effective support for small producers.  Although domestic
production would always have an important role in ensuring food security it was important that theG/AG/NG/R/4
Page 18
trading system should be free of export subsidies.   Thailand felt that the best way to improve food
security was to enable least developed and net food-importing developing countries develop their own
agricultural sectors by removing subsidized export subsidies and improving technical and financial
assistance for agricultural infrastructure and productivity.  Together with imports and public
stockholding this would improve food security.  Thailand noted the wide spread support for the
elimination of all forms of export subsidies and hoped that this support could be translated into action.
68. Australia added that the elimination of export subsidies could have immediate benefits as
evidence from various sources showed that reducing export subsidies could result in rapid increases in
domestic and regional production.  It was unacceptable that some of the main supporters of non-trade
concerns should also have been the main users of export subsidies.  Along with New Zealand,
Australia pointed out that the Cairns Group's first proposal had called for the elimination of export
subsidies and noted there was wide ranging support for this goal from a many inter-governmental
organizations.
69. New Zealand, supported by Mexico, noted that subsidized exports could replace domestic
production in importing developing countries thus damaging domestic production and making it very
unlikely that it could export.  New Zealand also noted that export subsidies had a broad definition and
could cover subsidized export credits and some types of food aid - in particular if the donor country's
primary intention was to dispose of surpluses.  Ne w Zealand did not accept the view that nothing had
been done on food aid but it agreed that the De cision on Net Food-Importing Countries had to be
implemented fully.  New Zealand noted that the Cairns Group had submitted a proposal calling for the
abolition of export subsidies.
70. Colombia (NG/W/64) noted that countries that did not have the resources could not compete
with subsidized production and exports from other countries.  Export subsidies could not provide foodsecurity to developing countries because the support given to production and export by wealthier
countries prevented poorer countries from developing a competitive agricultural system to the extent
that they were often unable to feed their own population and making it practically impossible to find
export markets.  This had created a vicious circle by increasing the import bill, adding to balance-of-
payments problems and increasing dependence on aid.  At the same time market access restrictions indeveloped countries prevented any access to their markets.
71. The representative of South Africa noted that his country had presented a paper to the process
of Analysis and Information Exchange on export subsidies and food security.  This paper had
concluded that export subsidies only benefited the subsidized producer and, in the short term only, the
importer while everyone else was penalized.  In the longer term, the importing country would sufferas production shifted to the subsidizing region and away from areas that had a comparative advantage
resulting in damage not only to farmers but also to related industries as well.  Trade liberalization, and
removal of export subsidies in particular, would help increase agricultural production, increase rural
employments and income growth and improve the purchasing power of developing countries.  In turn
this would increase demand for non-food products from the developed and newly industrialized
countries so that all countries would benefit.  While trade liberalization alone would not result in
improved welfare it was an essential element in development.
72. Canada noted that the main beneficiaries of export subsidies were the producers in the
countries that could afford to use them and at the expense of all other producers who are faced with
low commodity prices and unstable markets, whether they produced for export or for local or regional
markets.  The WTO needed to work towards the elimination of trade practices that damaged food
security, including measures such as export subsidies that reduced farm incomes in other exportingcountries and harmed local farm production in importing countries.  While food aid also played an
important role it should be provided in fully-grant form on the basis of need and should not be tied to
market development or disposal of surpluses.G/AG/NG/R/4
Page 19
73. The representative of India stated that his country could fully associate itself with the paper
for two principal reasons.  First, it focussed attention on the trade distortions caused by export
subsidies and secondly the impact of these trade distortions on food security.  The submission had
shown that the domestic policies of other countries was having a serious effect on food security,
which the discussion of the Note on Non-Trade Concerns had shown to be a very important non-trade
concern.  Export subsidies affected markets by limiting market access opportunities and increasingcompetition and depressing prices on the domestic market leading in turn to lower incomes and
reduced food security.  Furthermore, export subsidies actually increased imports in net food-importing
developing countries by suppressing domestic prod uction.  India favoured strong implementation of
the existing Marrakesh Decision and other measures necessary to reduce the problems facing net
food-importing developing countries.  For those countries that believed that there were positive
aspects to export subsidies India noted that in its experience the shift away from dependence on
subsidized imports had been a difficult decision but it had resulted in positive changes in Indianagriculture and had greatly increased domestic production.  While India could not recommend a
course of action for any particular country it noted that it was very difficult for a developing country
to undertake domestic reform and to liberalize its markets when other countries were using export
subsidies.
74. The United States welcomed the paper from its partners in the negotiations on the Free-Trade
Area of the Americas.  It felt that the paper clearly set out the case against direct export subsidies and
noted that the process of addressing food security required a comprehensive approach covering trade
liberalization, technical assistance and food aid.  The US believed that WTO Members needed to co-
ordinate their efforts in appropriate international organizations to expand technical assistance,
increase the effectiveness of food aid and agree to disciplines to prevent trade reforms agreed in theWTO from being undermined.  The submission effectively made the point that the liberalization of
trade in agriculture and the elimination of export subsidies were part of the solution to food security.
75. A number of other countries, including Indonesia, Mauritius, Japan,  Namibia, Switzerland
and the EC welcomed the paper but expressed some doubts about certain aspects.  Indonesia agreed
with many of the points made in the submission but stated that trade liberalization was not the onlyway to achieve food security for the reasons outl ined in its statement on the Note on Non-Trade
Concerns.
76. Mauritius (NG/W/75) noted th e importance of food security, particularly to net food-
importing developing countries and the recognition of this in Article 16 of the Agreement on
Agriculture and the Marrakesh Decision on least-developed and net food-importing developingcountries.  It also noted that its intervention included export credits as well as direct forms of export
subsidies.  Mauritius suggested that the definition of food security set out in the World Food Summit
in 1996 was more relevant as it included issues such as food preferences showing that food security
was not just a monetary issue.  Some countries were able to cultivate only a small range of crops on a
commercial scale which meant imports were needed while food preferences restricted the choice and
financial resources the ability to buy food.  In addition, stable and predictable trading arrangements
were crucial to ensuring stable earnings and those small island developing states that relied on tradingpreferences had specific requirements as outlined in the Rome Summit.  Domestic food production
required a number of protective measures as set out  in NG/W/13 and no single solution could meet the
needs of all countries.  Nor did Mauritius accept that low international prices could be blamed entirely
on export subsidies, in fact despite low world prices reports from some international organizations
suggested that the food import bills of NFIDCs and least-developed countries had not declined by thesame amount as the drop in agricultural prices due, partly, to the fall in the available level of food aid
and price concessions and discounts.  It claimed that since the entry into force of the Uruguay Round
in 1995 no concrete measures had been taken in favour of net food-importing or least-developed
countries in the context of Article 16 which made them cautious about any proposals which referred
to its provisions.  Food security required a global and comprehensive approach and a narrow approachG/AG/NG/R/4
Page 20
which dealt only with trade liberalization and export subsidies addressed the concerns of only multi-
commodity exporting nations and not those of net food-importing countries.
77. The representative of Japan (NG/W/73) supported  two points in the submission, that domestic
agricultural production is necessary to secure food security and that concentrating agricultural
production in a small number of countries could threaten food security.  Food security required
agricultural trade rules that allowed agricultural production to continue in different countries and itwas important to promote agricultural production.  For this reason Japan actively promoted technical
and financial assistance to developing countries and believed that the optimum level of food security
was achieved by a combination of domestic production, imports and stockpiling.  Japan, stressed that
all export measures needed to be addressed, including export restrictions and export state trading
enterprises, with a view to strengthening the prov isions covering exports.  Japan did not share the
views put forward in the submission that agriculture should be under the same rules as trade in
industrial products, that food aid should be given only in grant form or that agricultural tradeliberalization was a solution to food security and referred to the points raised in NG/W/36.
78. The representative of Namibia (NG/W/76) shared the overall objective outlined in the paper
that export subsidies should be eliminated and agricultural trade brought into the general rules of the
multilateral trading system.  However, he also stated that export subsidies could benefit some drought
prone least-developed countries and net food-importing developing countries.  Therefore, a time-frame should be established for reductions in export subsidies.  This transitional period would be used
to let importing countries adapt and to put in place mechanisms to address any negative affects.
Elimination of export subsidies may not help food security in those countries that were unable to
produce enough for their domestic markets due to production constraints.  Therefore, during the
transitional period special and differential treatment measures such as infrastructure and access tocredit should be enhanced to improve these countries' production ability.
79. Switzerland stated that it had noted the arguments concerning food aid and food security.
However, they felt that the paper failed to take account of other forms of export supports such as
export credits and state export monopolies.  Nor did Switzerland believe that the removal of export
subsidies would significantly change domestic production or food security in many countries as manyother factors had to be taken into account.  The paper was a useful contribution but somewhat
simplistic in its approach to a very complex issue.
80. The representative of the EC (NG/W/66) stated that he felt that the paper placed undue
emphasis on export subsidies.  The EC was prepared to negotiate reductions in export subsidies
provided all forms of export assistance were subject to equivalent disciplines.  The disciplines onexport subsidies agreed in the Uruguay Round meant that the EC could not expand market share or
undermine international prices as subsidized exports were limited in both value and volume terms.  In
contrast to the transparency of direct export subsidies used by the EC, that were notified to the WTO,
there was no information available on other forms of support used in other countries, such as
advantages given for exports or differential prices by state trade enterprises.  He also noted that food
aid could assist exports and could only contribute to food security if it was given in emergency cases
and not as a means of disposing of surpluses.  Furthermore, he noted the instability of prices for anumber of products that the EC either did not subsidize or did not produce.  Food security in
developing countries depended on agricultural development, which was not the direct responsibility of
the WTO, and on improving incomes and reducing poverty, where trade liberalization could be a
powerful instrument in raising incomes.  He noted  that the EC was the main export market for
developing countries' products.  He also pointed out that trade liberalization and food security also
meant imports, provided the pace of liberalization was commensurate with an economies ability to
adapt.
81. The representative of Brazil noted the points made concerning the impact of trade distortive
practices on other countries' non-trade concerns, especially food security.  She also pointed out thatG/AG/NG/R/4
Page 21
her definition of export subsidies included all forms of assistance to exports and that they inhibited the
development of domestic agriculture, depressed prices, restricted export opportunities and
concentrated production in a few countries as others could not compete.
ITEM B :  PRESENTATION AND CONSIDERATION OF NEGOTIATING PROPOSALS SUBMITTED SINCE THE
THIRD SPECIAL SESSION
(a) Cairns Group1:  Negotiating Proposal on Market Access (NG/W/54)
82. Australia (NG/W/60) introduced the Cairns Group proposal on market access the aim of
which was to reduce the discrimination between access conditions for agriculture and other goods.
The Uruguay Round had made only limited progress towards reducing restrictions to world
agricultural trade as it allowed countries to convert non-tariff measures into inflated tariffs and to use
the vague disciplines on administration of tariff quotas to restrict access to them.  The proposal
addressed a number of issues raised in the submission by the group of developing countries inNG/W/37.  In addition to very high tariffs, ta riff escalation prevented developing countries from
moving into production of higher value-added products, even though their low input and labour costs
suggested they should have a comparative advantage.  The proposal addressed these issues by
suggesting a formula should be used with would reduce tariffs considerably, eliminate tariff
escalation, reduce high tariffs by a greater amount and set a maximum level for all tariffs.  Thesubmission also proposed reducing the scope for complex tariff systems, increasing the number of ad
valorem  tariffs, increasing tariff quotas volumes and improving the rules on administration and
elimination of the special safeguard for developed countries.
83. A number of other members of the Cairns Gro up, including Costa Rica, Paraguay, Colombia,
Brazil, Malaysia, Indonesia, the Philippines, Thailand, Uruguay, Bolivia, Guatemala, South Africaand New Zealand, supported the statement made by Australia and noted that current market access
was limited by high tariffs, tariff peaks, tariff escalation, the ways in which tariff quotas were
allocated to supplying countries and other aspects of tariff quotas administration.  Their proposal dealt
with these issues by calling for significant reductions  in tariffs, the elimination of tariff escalation and
improved rules on tariff quota administration.
84. Some sponsors of the proposal, including Costa Rica, Paraguay, Malaysia, Indonesia,
Philippines, Thailand, Bolivia and Guatemala also stated that the improvement in market access
should be accompanied by reductions in export subsidies and trade distorting domestic supports.  At
the moment they had to compete with products produced or exported with subsidies, mostly from
developed countries so, while all Members should offer improved market access, their own offerswould depend on the extent to which other countries reduced their export subsidies and trade
distorting domestic supports.  The proposal included modifications to the existing special and
differential treatment provisions to make them more real and effective.
85. Costa Rica noted that poor market access for agriculture and fisheries products meant that
efficient producers of these products, especially t hose in developing countries, were penalized.  As
part of the reform the rules on tariff quota administra tion also needed to be examined to ensure their
administration did not reduce the opportunities they were supposed to present.  Given the distortionsin the international agricultural market Costa Rica believed that special and differential treatment
could cover conditions of fair access for products from developing countries and faster and larger
tariff reductions, or elimination, for products, including value added products, from developing
countries.
                                                     
1Canada's proposal to improve market access for all agriculture and food products is set out in
G/AG/NG/W/12.G/AG/NG/R/4
Page 22
86. Paraguay also stressed the needs of developing countries and noted the importance of
agriculture in its economy and the fact that it did not use any forms of trade distorting supports.
Improved market access would lead to a significant improvement in socio-economic conditions.
Better market access could be achieved without linking it to non-trade issues or to a broad round of
trade negotiations and that this would reduce some of the inequalities suffered by developing
countries.  While special and differential treatment was important for many developing countriesParaguay noted that it should not cause distortions between developing countries, for example,
through preferential access.
87. On behalf of the ASEAN members of the Cairns Group the representative of Malaysia
(NG/W/80) noted that the flexibility given in the Uruguay Round had allowed countries to make
minimal reductions to sensitive products which had actually increased the differences between tariff
rates and had reduced the number of meaningful market access opportunities created.  Tariff peaks
and tariff escalation were common.  Tariff quotas had to be substantially increased, particularly forhigh value added products from developing countries, and improved disciplines for their
administration were needed.  While market access was the principal element of the reform process
Malaysia believed that the objective of a fair and market oriented agricultural trading system would
not be achieved by tariff cuts alone but, more importantly, by reducing the differences in trade
distortions and protection between different members.
88. Indonesia (NG/W/71) supported Malaysia and went on to stress the importance of special and
differential treatment for developing countries especially for small scale and subsistence farmers.
Indonesia believed that developing countries needed to be able to protect these farmers through lower
levels of reduction commitments, flexible implementation periods and preservation of the special
safeguard, irrespective of whether or not tariffication had been undertaken in the Uruguay Round.  Itwas felt that the special safeguard for developing countries was necessary as small farmers could be at
risk from import surges and ordinary safeguards were often too technically difficult to apply.
Concerning exports, in addition to the points made my Malaysia, Indonesia also stated that developing
countries were also facing difficulties due to SPS and TBT measures and non- ad valorem  tariffs in
certain developed countries which gave higher rates of protection at lower prices.
89. The representative of Bolivia (NG/W/61) noted that, in addition to competition from
subsidized producers and exporters on its domestic market and high tariffs and tariff escalation for its
exports, it faced SPS measures in some export markets. In order to prevent improved market access
opportunities being lost to countries that did use high levels of trade distorting subsidies Bolivia
believed that new market openings should benefit thos e countries that did not distort trade.  Non-trade
distorting countries should be defined as those that did not use export subsidies, trade distorting
domestic supports, preferential export credits, the special safeguard and did not have tariff quotas.  In
this way the benefits of free trade would go to those countries that actually practised free trade and not
to those that spoke about its benefits while using trade distorting policies.
90. Guatemala (NG/W/68) noted that market access improvements and agricultural trade reform
generally were important elements in the development of small developing countries' economies.
Therefore, it considered it important that the reform process mandated by Article 20 of the Agreementon Agriculture should be concluded by the end of 2003 at the latest.  Special and differential treatment
provisions should continue in this reform and Members should abide by the rules and disciplines and
their commitments until new ones were agreed as a result of the negotiations.
91. The representative of Colombia (NG/W/54) noted that even with the removal of trade
distorting supports and reduced protection of domestic markets developing countries would still faceserious challenges.  The high levels of support and protection in developed countries meant that
agriculture in developing countries was still underdeveloped for the challenge of meeting the specific
demands and consumer preferences of developed countries' consumers.  However, to be able to
address this challenge required the elimination of trade distorting supports and improvements inG/AG/NG/R/4
Page 23
market access opportunities.  The negotiations would have to deal with tariff escalation which limited
developing countries' abilities to develop value added industries and escape from the problems
associated with price instability in commodity ma rkets.  Special and differential treatment should
involve greater and faster access to markets and access to the special safeguard, especially as lower
levels of protection increased the risk of subsidized imports from developed countries.
92. Brazil noted that during the Trade Policy Review Body's examination of Brazil some WTO
Members had suggested its tariff rates on agricultural products were high.  However, in comparison
with tariff rates in other countries, Brazil considered its rates to be low and they were simple and
transparent ad valorem  tariffs.  Brazilian exports on the other hand, often faced high tariffs and its
exports of value added goods faced tariff escalation.  Tariff quota administration also often meant that
imports were limited to below the tariff quota volume while, in Brazil, the one remaining tariff quota
was not used because the applied tariff was below the in-quota tariff rate.  In summary, Brazil was the
eighth largest importer in the world of agricultural products but its exports faced unfair competition.That was why it wanted steep cuts in all tariff lines, tariffs to expressed as simple ad  valorem  rates
only, tariff quotas to be eliminated and the special safeguard to eliminated.
93. Uruguay stated that its objective for market access was to put trade in agricultural products on
the same basis as trade in other products, just as this was its objective for domestic support and export
subsidies.  This meant that the negotiations result in  agricultural tariffs at the same level as tariffs on
industrial goods.  Uruguay recognized that this could not be achieved immediately and was prepared
to negotiate a reasonable period.  Uruguay favoured using a formula which would concentrate on
reducing the differences in tariffs rates between Members and then a general formula which would
have the effect of reducing higher tariffs by greater amounts.  In addition the volume of all tariff
quotas should be increased, although the reduction in the out-of-quota tariff rates should reach thepoint where it was lower than the in-quota rate at which point the tariff quota could be abolished.
94. Thailand noted that the proposal recognized that developing countries should be able to apply
different modalities in market access.  During the Asian financial crises Thailand's agricultural sector
had helped control the high level of unemployment and Thailand believed that developing countries
with limited resources should be allowed to devel op their agricultural sectors free from competition
from subsidized products.  Finally the proposal sought better market access for exports from
developing countries.  Like Bolivia, Thailand stated  that at present imports from developing countries
faced not only tariff escalation but also SPS measures that were sometimes little more than disguised
trade restrictions as it was impossible to meet their requirements and still be commercially viable.
95. South Africa (NG/W/82) stated th at the proposal recognized the importance of market access
as a stimulus for growth in developing countries.  He noted that South Africa's policy reforms in the
past few years had meant support and protection for the agricultural sector had been significantly
reduced.  This had resulted in increases in imports and, to a lesser extent, in exports.  These reforms
had led South Africa to agree with others that tariff policies were the main trade instrument left to
counter other countries' export subsidies and trade distorting domestic supports.  However, raising
tariffs raised unnecessary barriers for non-subsidising countries as well as imports from countries that
used production and export subsidies.  These difficulties were addressed in the Cairns Group proposalas it stated that it was necessary to address export subsidies and trade distorting domestic supports if
developing countries were to participate in market access reform.
96. New Zealand noted that the market access issues under discussion had a real impact on the
lives and livelihoods of many people.  High tariffs, tariff escalation and restrictive quotas meant
consumers were denied access to products and farmers were denied the opportunity to sell.  Majorimprovements in market access opportunities were needed as soon as possible and the proposal set out
a way to achieve this goal.  New Zealand noted that, in many respects, the proposals from the Cairns
Group, the United States and the group of developing countries complemented each other which
showed the support that existed for improvements in market access.G/AG/NG/R/4
Page 24
97. A number of countries supported certain aspects of the Cairns Group proposal, including
Morocco, India, Pakistan, the Dominican Republic and Honduras.  The representative of Morocco
stated that agriculture in his country could be divided into two sectors, one producing only for the
internal domestic market and the other producing for both the domestic market and for export.
However, its producers were facing competition from heavily subsidized producers and exporters
which meant they could undercut Moroccan producers.  For this reason Morocco fully supported theCairns Group proposal.  Ecuador stated that it too had experienced serious limitations to gaining
market access to developed countries' markets and supported the proposals made by the Cairns Group
concerning special and differential treatment.
98. The representative of India also welcomed many aspects of the proposal, in particular the
suggestions concerning tariff peaks and tariff escalation, simplification of tariffs, increases in tariff
quotas and improved tariff quota administration.  India also supported the proposal that tariff
reductions should be from bound tariff rates as this had been the practice in earlier rounds of tradenegotiations.  India agreed with the Cairns Group's statement that developing countries would find it
difficult to improve access to their markets without corresponding reductions in export subsidies and
trade-distorting domestic support.  Although India noted that the Cairns Group included a large
number of developing countries it still had some concerns regarding the suggestions on special and
differential treatment.  The agriculture sector in developing countries was made up of small farmersoften working at subsistence level whose needs could not be addressed by proposals for longer
transition periods or greater flexibility within a common structure.  Greater recognition was needed
for the internal constraints faced by rural agrarian developing countries like India.
99. Pakistan stated that it had implemented the results of the Uruguay Round faithfully and had
seen imports rise considerably but there had been no corresponding rise in exports.  In fact exportscontinued to face barriers of tariff peaks, tariff escalation, difficult tariff quota administration and high
technical barriers and SPS measures.  The result had been a declining balance of trade and balance of
payments.  Pakistan, therefore, supported a number of elements of the Cairns Group proposal
including those on tariff peaks, tariff escalation, tariff quotas and guidelines for their administration.
It also welcomed the proposals on special and differ ential treatment including the elimination of the
special safeguard for developed countries and its extension to developing countries.  Pakistan hoped
that in working out the modalities for market access the concerns expressed by India would be taken
into account.
100. On behalf of the delegations of the Dominican Republic and Honduras, the representative of
Honduras supported some aspects of the Cairns Group's proposal, such as the elimination of tariffpeaks and tariff escalation, tariff reductions to be based on bound tariffs and not applied rates,
developed countries' tariff regimes to be more transparent, that tariff quotas should be increased and
for the liberalization of trade in tropical products.  However, he also felt that many developing
countries had bound their tariffs at low levels and should not have to further reduce rates while the
agriculture sector remained distorted and that the special safeguard should be available to developing
countries until export subsidies were considerably reduced.
101. The United States and Canada welcomed the submission but considered that some aspects of
their own market access proposals were preferable.  The United States would prefer that tariff
reductions should be from applied, rather than bound, tariff rates.  It recognized the importance of
special and differential treatment for developing countries but would prefer to concentrate on
opportunities for exports from developing countries rather than on giving developing countries special
protection for their own markets.
102. Canada (NG/W/63) felt that the best way to improve market access quickly, and reduce
disparities in access for different products and in different markets, was by the series of techniques put
forward in its proposal.  While others had also proposed an ambitious approach to tariff reductions the
Canadian proposal took account of the fact that there were very different tariff regimes for differentG/AG/NG/R/4
Page 25
products.  The methods outlined in its proposal would result in reductions of single-stage tariffs,
further harmonization of tariff levels, elimination of tariff escalation and the opening of duty free
quotas where the formula did not result in real market access opportunities.  In addition its proposal
had put forward the idea that tariff quotas should offer market access based on a minimum percentage
of current consumption and strengthening disciplines so that tariff quotas resulted in useable market
access.  Canada had also put forward the idea that sectoral initiatives could be pursued to hastenliberalization in some sectors.  The objective of the negotiations should be to develop a more open
multilateral trading system with uniform rules applying to all countries.  However, Canada recognized
that it would be necessary to have special and differential treatment provisions to assist developing
countries to take advantage of such as system, which would be beneficial to all.  The Secretariat
background paper on the trade performance of developing countries (NG/S/6)  had shown that much
more needed to be done to open up export markets for developing countries.  However, Canada had
noted in the Secretariat background paper on tariffs on products of interest to developing countries(NG/S/14) that most of the export markets identified by developing countries for their exports were in
other developing countries.  This meant that the negotiations had to result in improved market access
for agricultural products for all markets.  For least-developed countries Canada believed that a stable
and predictable preference regime would allow them to improve their market access and would
complement technical assistance and capacity building initiatives.  Canada had already established apreference regime for developing countries, and particularly for least-developed countries, which gave
duty free access for most agricultural products.  In summary, Canada believed that improving market
access for all agricultural products for all markets would benefit all Members and, in recognising the
special and differential treatment needs of developing countries with technical assistance and capacity
strengthening measures to help them adapt to a more open multilateral trading system.
103. Mauritius (NG/W/75), supported by CARICOM and Fiji, welcomed the approach taken by
the Cairns Group in recognising the needs of developing countries.  It noted that the proposal
suggested that that the market access negotiations should not undermine existing access conditions.
However, Mauritius did not agree that trade in agricultural products should be on the same bases as
trade in other goods and it felt that some of the proposals might undermine existing market accessconditions for some countries.  On special and differential treatment Mauritius welcomed the
proposal's suggestion that market access should be commercially viable for least-developed and net
food-importing developing countries.  However, as Mauritius had indicated under earlier Cairns
Group proposals, special and differential treatment could not be addressed only through modalities.
For small island developing states in particular, special and differential treatment provisions alonewere not sufficient.  For example, the proposal could have referred to the importance of maintaining
existing market access conditions for vulnerable developing countries, the concept of products
produced in, or exported from, developing countries could have been clarified, the need to protect the
environment could have been given a higher profile and the special safeguard should not have been
limited but opened to all developing countries.  In addition, Mauritius had some difficulties with the
idea of a down-payment and noted that no reference had been made to excluding certain products
from disciplines or to the peace clause, which developing countries in particular needed.
104. On behalf of CARICOM the representative of Jamaica (NG/W/72) noted that the proposal
stated that existing market access conditions should not be undermined.  However, the proposal failed
to give full consideration to the differences that existed in market access.  Clearer recognition was
needed of the implications of reforms in countries that were in transition from preferential
arrangements.  It was also felt that the role of non-tariff barriers and measures that were equivalent toexport subsidies, such as export credits, also needed to be considered.  Furthermore, some aspects of
the proposal could be contrary to the interests of some developing countries such as the limits
suggested to the scope of the special safeguard.  However, CARICOM was pleased to see the
recognition given to the need for special and differential treatment for developing countries and to
countries adjusting to change.G/AG/NG/R/4
Page 26
105. Fiji stated that the preferential access it enjoyed under the Cotoneau Agreement was vital to
its interests which meant they could not support the proposal, although the statement in the proposal
that existing market access arrangements should not be undermined was welcomed.  Fiji needed the
transition provided by the Agreement to complete its diversification and investment programmes
which would give then the chance to compete in the world market.  The special conditions facing Fiji
as a small island developing state had to be recognized.
106. The representative of Trinidad and Tobago stated that agricultural products would always
require special treatment relative to industrial products.  While market access was necessary for
exports Trinidad and Tobago had found that opportunities were often cancelled by other factors such
as high transport costs, geographic location and SPS measures.  While the proposal did highlight the
problems of high tariffs and tariff quotas in limiting market access it was felt that the benefits of tariff
quotas for Trinidad and Tobago's main exports could not be ignored.  The proposal, despite the
attention it gave to special and differential treatment for developing countries, would badly affectTrinidad and Tobago's agriculture which was dominated by the sugar sector.
107. Turkey noted that its imports had increased since the implementation of the Agreement on
Agriculture and, therefore, it felt that developing countries should not have to undertake further tariff
reductions although comprehensive reductions should be considered by developed countries.  On
tariff quotas, however, Turkey had similar views to those of the Cairns Group believing thatmodalities for tariff quota administration should be developed to make them more transparent and
predictable and to ensure quota allocation was made in a non-discriminatory manner.  In addition,
Turkey believed that in-quota tariff rates should be reduced by developed countries.  In the Uruguay
Round the special safeguard had been made available for those products that countries had tariffied,
however, what was now needed was a similar mechanism for other countries that had not undertakentariffication.  Overall, Turkey agreed with a number of elements of the proposal including the
suggestions concerning the simplification of tariffs, increases in tariff quota volumes and elimination
of the special safeguard.
108. The representative of Hungary (NG/W/54) noted that the proposal was still under
consideration in his country and commented only on the proposal for a down payment of tariffreductions.  While he understood the reasons for the suggestion he felt that this could be counter-
productive as it could encourage prolonged negotiations.  It would be better to try to broaden the
coverage of the negotiations in the WTO as this would improve the chances for early conclusion and
meaningful results.
109. Mexico noted the similarity between the Cairns Group's proposal and others on market
access.  It particularly supported the proposal that tariff reductions should be based on bound tariffs.
However, Mexico also noted that there were different methods of tariff reduction such as request and
offer.  Furthermore, many countries had had problems meeting their Uruguay Round commitments
and some developing countries had bound their tariffs at low levels while export subsidies remained
high.  Therefore, each Member should be free to decide on how to continue liberalization.  Finally,
Mexico would have preferred to see more explicit special and differential treatment terms spelt out in
the proposal.
110. Japan, Korea, Switzerland, Norway felt that the different situations facing different products
in different countries had to be taken into account in the negotiations along with non-trade concerns
associated with agriculture.  Japan (NG/W/73) stated that agriculture had certain special
characteristics which meant tariffs on agricultural products could not be compared to those on
industrial products. Concerning special and differential treatment Japan noted the wide difference inthe needs of developing countries and stated that it was prepared to examine individual countries
programmes in detail in the course of the negotiations.G/AG/NG/R/4
Page 27
111. Korea, Switzerland, Norway and the EC stated that the proposal was not consistent with the
longer term objective of progressive liberalization as set out in Article 20 of the Agreement on
Agriculture.  Korea (NG/W/74) also felt that the proposal only took account of the special and
differential needs of exporting developing countries.  It stated that there were many different types of
agriculture used in different types of developing countries and it was necessary to review the needs of
these different types of countries, such as net food-importing developing countries, least developedcountries, small island developing states and so on.  Overall Korea felt that market access reform
should be consistent with Article 20 and should allow different types of agriculture to exist.
112. Switzerland noted industrial tariffs had been progressively reduced by over 50 years of
negotiations in the GATT while agricultural tariffs had only been subject to five years of reductions.
Therefore, it was not surprising that tariff rates between industrial and agricultural tariffs should be
different.  It also pointed out that specific duties had been used for a long time in Switzerland and that
they had some advantages over ad volorem duties, such as the absence of any protection against
inflation.  Switzerland disagreed with the call for a down payment and felt that the special safeguard
was needed for the reform process.  It also expressed some concern that the proposal might raise high
expectations for developing countries with its suggestions on special and differential treatment and
large tariff reductions and asked if competitive large exporting countries would agree to voluntary
export restrictions to ensure that less competitive developing countries could also increase theirmarket share.  Finally Switzerland noted that it supported improved market access for developing
countries and was discussing internally the question of market access for least-developed countries.
113. Norway (NG/W/77) felt that the Cairns Group proposal was ambitious and stated that a
balanced outcome was necessary and the proposal went beyond Article 20.  Agricultural production
conditions varied considerable from one country to another and support and protection levels reflectedthis.  However, such variations, and non-trade concerns, had not been taken into account in the
proposal.
114. The EC (NG/W/66) felt that the proposal was too ambitious to be realistic and that there were
inconsistencies between some of its suggestions.  He pointed out that some members of the Cairns
Group benefitted from access to the stable EC market for some of their products, a benefit whichcould be undermined by the tariff quota reforms suggested.  In making its preliminary comments the
EC asked how the deep cuts envisaged by the proposal conformed to the progressive reductions
required by Article 20 of the Agreement on Agricultur e.  It also asked how the proposal could benefit
developing and least-developed countries when th e general reductions proposed would favour the
most competitive.
115. In making some preliminary comments Poland stated that future reform should be based on
the results of the Uruguay Round which meant it co uld not support the proposal.  For example, the
elimination of the special safeguard, a down payment on tariff reductions or tariff reductions that led
to unbalanced commitments.  It did note though that the Cairns Group had accepted that there could
be negative consequences from reform and, therefore, special and differential treatment was required.
116. Argentina responded to some of the points made.  It pointed out that the World Bank had
stated that developing countries had been prevented from getting benefits from their liberalization andeconomic reforms by the trade barriers of developed countries.  Barriers to trade in agricultural
products were particularly important given the size of agriculture in the economies of developing
countries.  In response to those Members that had claimed that the call for a down payment was not
compatible with Article 20 Argentina noted that Article 20 called for substantial progressive
reductions in support and protection.  Progressive meant continuous so one implementation periodshould be immediately followed by another one and, as developed countries were near the end of their
implementation period, the negotiations should take this into account by agreeing to a down payment
to make up for any pause in progression.  Argentina pointed out as well that there were other legal
implications to the end of the implementation period as the special safeguard was only operableG/AG/NG/R/4
Page 28
during the reform process.  On the benefits of preferential access regimes Argentina pointed out that it
was prepared to work out any short term difficulties that might result from general tariff reductions
but in the long term these regimes had not benefited developing countries.  In fact, the OECD had
shown that as world trade in agriculture had increased trade in processed products had taken an
increasing share but the preferential agreements ef fectively prevented countries from participating in
this area and their market share had actually declined over the past twenty-five years.
117. Chile agreed with the points made by Argentina.  It also pointed out that the market access
proposal had to be considered in the context of th e other Cairns Group proposals on domestic support
and export subsidies and underlined the point made by the Dominican Republic and Honduras that
countries that had reduced their tariffs had found their markets penetrated with products whose
production or export had been subsidized.  Simplified tariff structures were an essential element of the
proposal and Chile noted that some countries included a minimum price element in their tariffs for
fruits and vegetables which it considered contrary to the goal of a fair and market oriented tradingsystem.  It also questioned the need for extremely high tariffs to take account of the specificity of
agricultural production in some countries.  In support of this statement Paraguay also noted that
preferential trading arrangements for some developing countries meant discrimination against other
developing countries.
(b) ASEAN:  Submission on Special and Differential Treatment for Developing Countries in
World Agricultural Trade (NG/W/55)
118. In introducing the proposal on behalf of ASEAN, the Philippines noted that the submission
suggested a comprehensive approach to special and differential treatment (for full statement, see
NG/W/79).   ASEAN remained firmly committed to the continuation of the reform process, provided
this process served development objectives.
119. Thailand stated that the key objective of the proposal was to level the playing field between
developed and developing countries.  While devel oped countries had the resources to provide Amber
Box, Blue Box and de minimis  supports to their farmers, developing countries were not allowed, or
could not afford, to provide such supports in significant amounts.  Moreover, prohibitive tariffs, tariff
peaks and escalation, tariff quotas and special safeguards had been applied by many developedcountries to protect their markets.   Levelling the playing field with developed countries required the
elimination of export subsidies and substantial reduction of all trade-distorting domestic supports.  To
achieve fair competition, developing countries needed special and differential treatment to cushion the
negative impact of the reform process, especially on small-scale and subsistence farmers.  Developing
countries needed the opportunity to develop their domestic agriculture and to increase domesticproduction.  The proposal called for the fullest liberalization of trade in tropical products, including
the elimination of non-tariff barriers, especially disguised trade-restrictions in the form of SPS
measures that were used by some countries to block market access.  Indonesia added that any
strengthened special and differential provisions must address the fundamental problems of
development and growth in developing countries.
120. A number of the developing countries that had submitted proposals to earlier Special Sessions
(in submissions NG/W/13, 14 and 37/Rev.1) supporte d the proposal including Sri Lanka, Cuba, the
Dominican Republic, Haiti and Honduras.  Sri Lank a (NG/W/83) drew attention to the proposal on
special and differential treatment and a development box (NG/W/13) and supported the proposals
made in the Cairns Group market access proposal with respect to special and differential treatment
(NG/W/54).  Cuba considered that special and differential treatment in the framework of domestic
support should provide developing countries with the necessary flexibility to use policies andstrategies that gave sufficient incentives to develop agricultural production and to confront problems
of national security.  It noted that ASEAN had similar ideas and pursued many of the same objectives
to the proposals in NG/W/13 and NG/W/14.  The Dominican Republic and Honduras considered that
special and differential for developing countries should be an integral part of the process of reformG/AG/NG/R/4
Page 29
and should, inter alia , provide for longer periods for implementation of commitments, as well as more
flexibility in the use of non-distorting domestic support to prevent small subsistence farmers from
being displaced.  They also supported the suggestion that the future programme of reform should
include the full liberalization of trade in tropical products.  While distortions in trade remained the
special safeguard should be allowed only to developing countries.
121. Colombia (NG/W/64) expressed support for all elements in the ASEAN negotiating proposal.
Special and differential treatment should be operational and should enable developing countries to
receive the benefits which they had been promised at the end of the Uruguay Round.   However, on its
own special and differential treatment for developing countries was not sufficient to better integrate
developing countries into the multilateral trade system as the privileges open to developed countries,
such as the Blue Box, were also important.   Ther efore, Colombia felt that the submission was a good
compliment to the Cairns Group's proposals concerning special and differential treatment.
122. Paraguay stated that it fully supported the proposal, including the element with respect to the
Generalized System of Preferences.   Paraguay stressed that special and differential treatment should
take into account the specific situations of different types of developing countries such as landlocked
countries as well as small island developing states.
123. Peru (NG/W/78) shared the concerns expres sed in the ASEAN proposal and supported
strengthened and more effective special and differential provisions and full implementation of theMarrakesh NFIDC Decision.  In addition, tariff peaks and escalation should be eliminated, although
tariff reductions should give flexibility to developing countries to deal with problems of food
insecurity and rural poverty.  Peru also supported the complete liberalization of the markets for
tropical products, substantial reductions in domestic support by developed countries, a simplification
of domestic support provisions and elimination of export subsidies by developed countries, whilemaintaining flexibility for developing countries.
124. Venezuela noted that the proposal also covered the issue of export credits, export credit
guarantees or insurance programmes.  It had sympathy for the suggestion that developing countries
should have a certain degree of autonomy in the choice of policies to ensure food security.
Venezuela supported the liberalization of trade in tropical products and noted that the market accessproposal submitted by a group of developing countries (NG/W/37/Rev.1) could serve as a basis for
progress in this area.
125. Brazil shared ASEAN's concerns with respect to the aggregate measure of AMS reductions
which contributed to undermine the commitment to reduce support policies in some sectors.  These
were usually the sectors where developing countries were most competitive.  Brazil also endorsedASEAN's view on the Blue Box and agreed that Article 6.2 of the Agreement on Agriculture should
be retained.  Food security concerns should be dealt with adequately and not through distorting
practices of developed countries, such as export subsidies.
126. Australia agreed that the negotiations had to address the general difficulties and the specific
problems facing the agricultural sectors in developing countries.  The proposal made the  important
point that special and differential treatment was not just a matter of providing additional flexibility to
developing countries but also about removing the market access barriers along with price and exportsubsidies that prevented developing countries from fully participating in international agricultural
trade.  The proposal to limit Green Box expenditures did not cause any concerns for Australia since
this would help to cap Green Box measures that were more than minimally distorting.
127. Mexico noted that the proposal suggested that "the nature, the depth and the substance of the
commitments should also be different" and stated that this idea should be further explored.G/AG/NG/R/4
Page 30
128. Turkey supported a number of aspects of the s ubmission including the proposal that export
subsidies in developed countries should be substantially reduced and a set of rules on export credits
should be developed and integrated in the Agreement on Agriculture.  It also agreed that trade-
distorting domestic supports in developed countries over and above the de minimis  level should be
eliminated, although Turkey believed that the Blue Box and the exemptions under Article 6.2 of the
Agreement on Agriculture for developing countries should be retained.
129. Swaziland supported the general direction of the proposal but noted that several aspects
needed careful consideration (NG/W/84).  Swaziland would have preferred a gradual rather than
immediate elimination of export subsidies due to the potential negative welfare effects on some
developing countries.   It also favoured gradual reductions in the Amber Box rather than a substantial
down-payment due the negative effects on developing countries that benefited from domestic support
measures in developed countries through preferential arrangements.  Consideration was also needed
of the effects of market access initiatives on preferential trade agreements.
130. Mauritius (NG/W/75) considered that special and differential treatment was an integral part of
the reform process and should not be limited to longer implementation periods for developing
countries.  Mauritius endorsed the suggestion that the nature, depth and substance of commitments
should be different for developing countries.  However, it felt that the proposal was too restrictive and
suggested that developing countries should be exem pted from restrictions on a wider range of export
subsidies and domestic support than suggested and that on market access developing countries should
also have greater freedom to restrict imports.  On export subsidy disciplines generally, Mauritius felt
that the needs of net food-importing countries and least-developed countries needed to be taken into
account in any reform.
131. Uruguay and Chile considered this to be a constructive proposal and noted that the necessity
of special and differential had been reflected in  the three proposals  from the Cairns Group (NG/W/11,
35 and 54).  Effective special and differential treatment required the elimination of all trade
distortions caused by subsidies and improvements in market access.   Uruguay and Chile noted that
the ASEAN proposal was devoted to the interests of  developing countries as a whole, without making
any distinctions and creating new categories of countries.
132. Norway, Japan, the EC, the United States, New Zealand, Canada, South Africa and
Switzerland recognized the importance of special and differential treatment for developing countries
but stressed the importance of general rules.  Argentina, the United States, New Zealand, Canada and
South Africa also noted that levelling the playing field or achieving a fairer agricultural trading
system required all countries to participate in reducing support and protection.
133. The representative for Norway (NG/W/77) stated that special and differential treatment
should complement, but not substitute, refined general rules of the agricultural trading system in ways
that met the long-term needs of developing countries.  In addition the general rules and should enable
all countries to properly address their concerns, including those relating to non-trade objectives.
134. Japan recognized the necessity to give developing countries special consideration (NG/W/73)
and stressed the need to take a global approach, taking into account the specific situation of the
developing countries, non-trade-concerns and the importance of capacity-building in developingcountries.
135. The EC  (NG/W/66) noted that several points made by ASEAN would find support in its own
forthcoming comprehensive negotiating proposal.  While the EC supported the Generalized System of
Preferences which had been referred to in the ASEAN proposal, it had certain concerns on the
suggestions concerning domestic support and export subsidies.G/AG/NG/R/4
Page 31
136. Argentina noted that, although trade liberalization increased global welfare, it involved
adjustment and developing countries had limited resources to assist the process.  This justified longer
periods for the implementation of the commitments and more modest reductions in tariffs and
subsidies.  However, Argentina warned against levelling the playing field between developed and
developing countries by allowing more flexibility to developing countries to provide subsidies.
Developing countries did not have the resources to exploit any additional scope in this area.Therefore, it was better to level the playing field through reductions of subsidies by those countries
that used them.  Argentina also had some reservations against the special emphasis on liberalization of
trade in tropical products and believed that temperate zone crops should enjoy the same treatment.
137. The United States was fully committed to addres sing special and differential treatment and
supporting specific provisions in these negotiations to better integrate least-developed and developing
countries into the WTO system.  However, the objective of long-term substantial progressive
reductions in support and protection applied to all countries and all countries needed to participateactively in the reform process, which included  making meaningful reform commitments on all
products.  The United States had attempted in its own proposal to address the concerns of developing
countries through increased flexibility in the reform process.
138. New Zealand agreed that special and differential for developing countries was an essential
issue in these negotiations and agreed that levelling the playing field involved elimination ofdistortions that were in place in a number of developed countries.   New Zealand was prepared to
examine suggestions concerning the de minimis clause on domestic support in relation to developing
countries and to examine the suggestion to integrate principles of the Generalized System of
Preferences into the Agreement.
139. Canada recognized that the need for special and differential provisions to help developing
countries adjust to, and to take advantage of, the multilateral trading system.  However, Canada
believed that the objective of the negotiations was a more open and rules-based trading system, where
the same rules applied to all Members.  Such an inclusive approach would benefit everyone.  Canada
had concerns about the proposal to have an open-ended continuation of flexibility provided to
developing countries for export subsidies under Article 9.4, not least because they adversely affectedfood security.  In the area of domestic support, Canada favoured levelling the playing field through
the reduction and eventual elimination of trade- distorting support instead of increasing trade-
distorting subsidies for some countries, while reducing them for others.  The objective should be to
reduce trade-distorting support to de minimis  levels for all Members.  One of the best ways to ensure
that support moved in the right direction was to negotiate an overall limit on support of all types,Green, Amber and Blue.  This would encourage a move towards Green Box programmes without
increasing overall levels of support to agriculture.
140. South Africa stated that there many similarities between its development objectives and those
presented by the proposal (NG/W/82).  While an outcome in favour of development was a key
expectation of South Africa in these negotiations, it was questionable whether special and differential
was sufficient, or even the most important vehicle, for achieving its expectations.   Existing
imbalances between developing and developed countries could be corrected by greater flexibility fordeveloping countries, given their resource constraints, but what would make a difference was greater
liberalization and structural adjustments by those a pplying high levels of support.   South Africa was
also interested in better market access, not only in developed countries but also in other developing
countries where tariffs were often much higher than in developed countries.  Developing countries
should participate in the reform process while taking into account their special and differential needs.The crucial question for South Africa was the appropriate balance between improved special and
differential provisions and progress with respect to the areas of market access, domestic support and
export subsidies.G/AG/NG/R/4
Page 32
141. Switzerland considered special and differential treatment to be one of the pillars of the
negotiations and was ready to accommodate the specific situations of developing countries.  However,
it pointed out that special and differential treatment would not solve all the problems facing
developing countries.  There was the danger that some elements of the proposal could raise
expectations which could not be fulfilled.  Switzerland considered that placing operational aspects at
the level of schedules and commitments was a pragmatic and reasonable approach.   This was anavenue to be further explored since the more self-restraint powerful exporting countries accepted, the
easier it would be to accommodate the developing countries in need of special treatment.  With regard
to export subsidies, Switzerland could not unde rstand why ASEAN wanted flexibility for developing
countries with respect to the use of export subsidies which were normally considered to be so harmful
to other countries.   Switzerland also pointed out that a ceiling on developed countries' Green Box
expenditures could make them rely more on border protection which would reduce the scope for
improvements in market access opportunities.
142. India, which had co-sponsored the proposal on market access (W/37) with the other
developing countries, expressed support for a ll aspects of the ASEAN proposal and supported Sri
Lanka's statement.  India agreed with the suggestion that special and differential treatment should be
achieved through mandatory and binding provisions which would avoid the problems caused by best-
endeavour clauses.  It also agreed that the export problems of developing due were due to policiespursued by developed countries.   India was disappoint ed that some Members felt that the elements in
this proposal were dangerous.  If Members really wanted to get developing countries into the
mainstream of trade liberalization, they would have  to seriously consider the sort of proposals that
ASEAN had made.
143. The Philippines, on behalf of ASEAN, stated that they would take into account the many
constructive comments made by delegations, especially when elaborating and formulating the
modalities of its proposals.   However, ASEAN was disappointed about the comment that their
proposals posed some danger to the reform process and that the necessity of special and differential
treatment seemed to be questioned by some Members.   Although the circumstances and priorities
varied among the developing countries, they had a common interest in development.  For developingcountries, agriculture was not only important for international trade but also for their development
objectives.  The negotiations must therefore reinforce rather than weaken development policies.
(c) Albania, Bulgaria, Croatia, the Czech Republic, Georgia, Hungary, the Kyrgyz
Republic, Latvia, Lithuania, Mongolia, Slovak Republic and Slovenia:  Domestic
Support – Additional Flexibility for Transition Economies (NG/W/56)
144. Hungary introduced the joint proposal on be half of twelve economies in transition
(NG/W/85). It was argued in the proposal that  the current domestic support provisions were
inadequate for addressing the unique circumstances of the economies in transition and a number of
specific instruments were proposed which were required to achieve policy objectives.  The Members
concerned believed that the proposed flexibility provisions were fully compatible with the long-term
objective of the reform process since the objective was to allocate scarce resources in the most
efficient way in order to restore the viability of agricultural production and not to increase the level ofoverall subsidization and not to encourage inefficient agricultural production.
145. Estonia noted that its experience was similar to that described in the proposal.   Estonia
supported the call for specific flexibility provisions in the Agreement which would address the
common needs with respect to domestic support measures in countries that were in the process of
transformation to a fully-fledged market economy.
146. Switzerland, Norway, Korea, Japan and the EC welcomed the paper and noted the specific
problems facing economies in transition.  Switzerland expressed sympathy for the proposal and noted
that it highlighted the heterogeneity of agricultural sectors among Members.  Norway (NG/W/77) andG/AG/NG/R/4
Page 33
Korea considered that the proposal illustrated the need to take account of the specificity of country
situations and that a uniform approach in the continuation of the reform process was inappropriate.
Japan (NG/W/73) stated that the problems and difficulties in the economies in transition should be
addressed in the current negotiations and shared th e view that these negotiations should allow the
coexistence of various types of agriculture and promote domestic agricultural policy reform.  The EC
recognized that transition economies faced specific problems in the agricultural sector and that they
might have particular difficulties with regard to base periods (NG/W/66).
147. Grenada and Mauritius also supported the proposal.  Grenada, on behalf on CARICOM,
stated that it was sensitive to the need to address the specific circumstances of the economies in
transition.  It also noted that CARICOM Member coun tries were also in a process of transition (from
preferential arrangements) and looked forward to collaborating with the economies in transition from
central planning, and other Members, to ensure that the special, temporary or transitional phases of
agricultural sectors were properly accommodated in any future agreement.  Mauritius (NG/W/75)supported the statements by Switzerland and Grenada.  India stated that the proposal showed the
existence of characteristic problems which may require flexibility and specific solutions.
148. Canada, New Zealand, the United States, Argentina and Australia noted that the direction of
the negotiations was towards reduced support and protection.  Canada welcomed the efforts by the
sponsors to identify problems and to put forward ideas on how to address them.   However, Canadawas not convinced that these problems could not be  accommodated within negotiations aiming at a
common set of trade rules applying to all Members.  Canada was working towards a system of fair
rules that reduced or eliminated trade-distorting subsidies and improved market access and this was
compatible with social, environmental, and any other objectives that could be addressed in non-trade
distorting ways.  Canada, therefore, encouraged the economies in transition to work towards definingan inclusive system rather than looking for exceptions.
149. New Zealand noted that, although it was not yet convinced that the Agreement did not already
contain adequate scope and flexibility to address the needs of countries in the process of economic
transformation, it was prepared to examine the specific measures for dealing with the individual issues
that arose.  The United States appreciated the situation facing countries in transition but wished toguard against moving backwards in these negotiations.  The objective was to create a more fair and
market-oriented trading system and not to increase protection and trade-distorting support.
Consequently, productive work should focus on supporting agriculture in non-trade distorting ways.
The United States believed that it should be possible to develop among Members very specific,
targeted and effective criteria that would address the concerns of economies in transition in a non-trade distorting manner.  Argentina noted that it appeared to be inconsistent for countries that were in
the process of transition to a market economy to propose measures that would have the effect of
isolating agricultural producers from market signals.   Australia noted that it would be willing to
address the concrete suggestions once the negotiations had moved from the first phase into a more
substantive second phase.
150. In concluding the preliminary discussion of the proposal, Hungary, on behalf of the twelve
proponents, thanked delegations that had been willing to look sympathetically at the proposal, andindicated that the sponsoring Members would reciprocate by showing understanding for other
Members' concerns.  The fact that twelve Members with ten years of experience in the process of
economic transformation had jointly put forward common concerns should clearly indicate that
changes were required.   The sponsoring Members were convinced that the existing instruments
available in the Green Box were inappropriate to address their specific difficulties.   Finally, theproponents hoped that these negotiations would contribute to achieving not only freer, but also fairer
trade in agriculture.G/AG/NG/R/4
Page 34
(d) Albania, Bulgaria, Croatia, the Czech Republic, Georgia, Hungary, the Kyrgyz
Republic, Latvia, Lithuania, Mongolia, Slovak Republic and Slovenia:  Market Access
(NG/W/57)
151. The Czech Republic introduced the second proposal on behalf of the twelve economies in
transition which have jointly submitted the paper.  The proposal called for flexibility in the market
access negotiations to support the process of transformation and also addressed the issue of non-tariffmeasures, where they continued to exist.  The full text of the Czech Republic's presentation is
contained in NG/W/87.
152. Poland and Romania commented on both the proposals (NG/W/56 and 57) made by countries
that were, like them, in the process of transition.  Poland stated that the two proposals provided an
opportunity to examine more closely the specific situation of the economies in transition.  These
countries faced a unique situation due to a rapid change in foreign trade instruments and a rapid
restructuring of the economy and these factors should be taken into account in the negotiations.  Theprocess of economic transformation had positive effects but also given rise to some specific problems,
which Poland had referred to during the discussion of the Note on Non-Trade Concerns
(NG/W/36/Rev.1).   Romania shared the argument s made in both proposals by other economies in
transition.  Although Romania had different views on how to address the problems it believed, like the
sponsors of the proposals, that these difficulties should be taken into account in the negotiations.
153. Switzerland considered that the proposal was in the spirit of the Agreement in terms of
flexibility and that it was equitable to take into account the needs of the transition economies.  The
markets of some countries were closed because they were not yet Members of the WTO.  The EC
noted that the economies in transition faced unique problems in their agricultural sectors and had
implemented wide-ranging liberalization schemes over a short time-period.  The EC also indicatedthat it was ready to give appropriate consideration to this proposal.
154. The United States, New Zealand and Australia pointed out that all countries had to participate
in improving market access.  This would also be in the interests of transition economies as the
proposal itself pointed out that market access for their exports was restricted.  The United States noted
that all countries had import sensitive sectors and domestic circumstances varied and these factorswould be taken into account in the negotiations, howev er, the best way to address the situation was for
all countries to move forward on liberalization.  Th e United States looked forward to working on this
issues as part of technical discussion on market acc ess in the next phase of the negotiations.  New
Zealand noted that the crux of the matter appeared to be contained in the statement that "in many
instances the transitional economies' export markets re main closed".   This central problem needed to
be addressed by opening markets, not be seeking specific exemptions from market opening.  New
Zealand supported the call to address all non-tariff measures and in this regard commended the Cairns
Group proposal on market access which sought to ensure real and effective access to all market for all
agricultural products.  Australia noted that the proposal appeared to be more about exempting the
economies in transition from market access rather moving towards it and facing it.  It also noted that if
low tariffs were to be exempted from reductions and with little ambition for reductions in high tariffs
there would be little scope for any tariff reductions.
155. In concluding the preliminary discussion of th is proposal, the Czech Republic, on behalf of
the eleven proponents, thanked delegations for the in terest they had shown and looked forward to a
more detailed discussion at the next Special Session, at which would be willing to respond to present
statements and queries.
 (e) The United States:  Proposal on Tariff Rate Quota Reform (NG/W/58)
156. In introducing its proposal, the United States noted that it was  a further elaboration of the
comprehensive proposal it had submitted in June (NG/W/15).  Although tariff quotas had created newG/AG/NG/R/4
Page 35
opportunities the experience had shown that in too many cases trade in products covered by tariff
quotas was frustrated by restrictive administrative requirements, limited quota quantities and high
tariffs, both within and outside the tariff quota.  With reference to its submission in the AIE Process
(AIE/7), the United States noted that there were many tariff quota systems with unjustifiable and
arbitrary restrictions that denied buyers and sellers a reasonable chance to conduct business and
dampened the effect of market forces.  All Members needed to be prepared for serious reform in this
area, with the long-term solution being the elimination of tariffs - the end result of the reform process.
The US proposed four initiatives:  (i) develop additional disciplines for tariff quotas; (ii) reduce in-
quota duties based on the historical performance of tariff quota fill rates - the lower the fill rate, the
deeper the cut; (iii) reduce out-of-quota tariffs using an approach that reduced disparities across
countries and progressively increased tariff quota quantities, and (iv) establish trigger mechanisms to
lower in-quota duties when tariff quota fill was low.  The United States had also taken into account
some of the factors covered in discussions on non-trade concerns.  Tariff quota expansion should notbe for historical suppliers only, but should ensure export opportunities for  new suppliers, in particular
from developing countries.  To minimize disruptions  on trade created by quota rents, the United States
suggested an approach which was different from simply eliminating in-quota duties.  Ultimately, tariff
quota reform addressed other key non-trade concerns of the United States: reducing administrative
discretion, increasing transparency and cutting the quota rents for vested interests would contribute togood governance in all Members, and expanding the influence of market forces would have positive
effects on environmental quality and labour conditions.
157. A number of countries supported many aspects of the proposal, including New Zealand,
Brazil and Argentina.  New Zealand supported the goal for substantial increases in tariff quota
volumes and the call for substantial reductions in over-quota tariffs and significant improvements intariff quota administration.  Brazil expressed support for the proposal as a means to an end, which,
like Australia and Argentina, Brazil believed should be the complete elimination of tariff quotas
leaving low tariffs as the only mechanism restricting imports.  Brazil also felt that the proposal
contained some innovative ideas concerning administration and low tariff quota fill which it
considered to be the main problems with tariff qu otas.  Argentina had doubts with respect to lowering
in-quota tariffs since this would increase quota rents and be contrary to the final aim of a single-tariff
regime.  It suggested that instead the use of the special safeguard be prohibited when tariff quotas
were not filled or that there be an automatic trigger mechanism for out-of-quota tariffs.  Australia also
expressed interest in the quantitative trigger mechanism.
158. Some other countries, including Colombia, Bolivia and Canada felt that the United States'
proposal should have been more ambitious.  Colombia, like Brazil and others, sought the elimination
of tariff quotas via increases of the tariff quota volumes.  Under-utilization of tariff quotas fill was
mainly due to the way in which tariff quotas were administered rather than the level of in-quota tariffs
and the proposal highlighted some instances where quot a fill rates were low despite low in-quota tariff
rates.  Bolivia would have preferred if the proposal had called for the elimination of tariff quotas, but
welcomed any initiative aimed at the goal of liberalization of trade in agriculture.  Canada welcomed
the US proposal as a valuable contribution.  Whil e it offered some suggestions on how to deal with
tariff quota administration, it was not very ambitious concerning in-quota tariffs compared with
Canada's proposal that in-quota tariff bi ndings be reduced to zero (NG/W/12).
159. The EC, the Dominican Republic, Honduras, Hung ary and Malaysia agreed that the issue of
tariff quota administration had to be clarified.  The EC (NG/W/66) welcomed the US initiative in
introducing the issue of tariff quota reform and noted that it had consistently called for a transparent
and non-discriminatory administration of tariff quotas and the need to have legal security with regard
to tariff quota administration methods.  The EC considered that clarification of tariff quota
administration rules should have priority over the issue of in-quota tariffs.  The Dominican Republic
and Honduras agreed that disciplines for the administration of tariff quotas should be improved.
However, they expressed some doubts concerning the suggestion that in-quota tariffs be furtherreduced and an automatic trigger mechanism be intr oduced since, in their view, in-quota tariffs wereG/AG/NG/R/4
Page 36
already quite low.  What was more important for market access, were the quota volumes.  Hungary
(NG/W/69) supported the proposal for additional disciplines on the administration of tariff quotas but
had strong reservations concerning the trigger mechanism.  Malaysia agreed to the principles of
transparency, non-restrictiveness and reallocation which should form the basis for improved
disciplines in tariff quota administration.  Malaysia had concerns with regard to the proposal for a
quantitative trigger mechanism since it put the burden on the importing Member to ensure that therewas a high tariff quota fill.  This, in fact, introduced a new principle into the international trading
system.  With respect to the proposal to establish in-quota duties based on historical tariff quota fill,
Malaysia considered that a proper examination of the reasons for low historical tariff quota fill had to
be undertaken prior to any agreement on this modality.
160. Japan and Mexico did not consider tariff quotas to be a transitional mechanism towards the
goal of low tariff regimes.  Japan had a number reservations regarding the US proposal (NG/W/73).
Tariff quota commitments were access opportunities and fill rates varied depending on marketsituations.  Nor did Japan consider tariff quotas to be a transitional measure towards a single-tariff
regime.  Mexico stated that tariff quotas were part of the exercise that began in the Uruguay Round,
they were a legal instrument and therefore there was no reason why they should disappear.
161. Korea considered that credit should be given in these negotiations for high tariff quota fill
rates which was the result of faithful implementation of commitments, and that the tariff quota systemshould be developed in a way which did not increase burden for importing countries (NG/W/74).
162. Poland noted that the US proposal introduced a mechanism to establish new commitments
with relation to the results of the existing ones.  This was an interesting idea which deserved further
examination, in particular how it might be used in  relation to other elements of the market access
negotiations.  In this regard, it would perhaps be useful to extend the assessment of the effects of theUruguay Round.  The effects of the reduction commitment on world trade in agriculture should also
be taken into account during the market access negotiations.
163. In the view of Switzerland, the obligations with respect to tariff quotas were clear: the
possibility of market access had to be guaranteed up to the last kilogram.  The chosen administration
method had to respect this basic obligation, but beyond that each Member should be free to choosewhat was best in the circumstances.  Switzerland noted that it would be interesting to see whether
criteria could be developed for the transition to a single-tariff regime without the obligation of
compensation under Article XXVIII of GATT.
164. United States noted that some Members felt that the proposal was not ambitious enough and
take this into account in future proposals.  In  response to the comment by Malaysia that the
quantitative trigger mechanism would be a burden for authorities, the United States responded that
Members were committed to full tariff quota access.  The issue which the United States was trying to
address was to ensure that there were opportunities to fill those tariff quotas through appropriate
mechanisms.
ITEM C :  W ORK WITHIN THE FRAMEWORK OF PARAGRAPHS (A), (B), (C) AND (D) OF ARTICLE 20 OF
THE AGREEMENT ON AGRICULTURE
165. After the Secretariat introduced the background papers made available since the last Special
Session in June, a number of Members commented  on these and other papers.  Hungary made a
number of technical points concerning the background paper on the effect of inflation and exchange
rates on domestic support commitments which are reflected in document NG/W/69.  It felt that the
paper failed to bring out a fundamental point concerning inflation and domestic support commitments.
Unless the applied administered prices or the fixed external reference prices were adjusted forinflation the calculation of the value of market price support was flawed and could lead to a possible
breach of commitments.  Hungary also stated that on the Green Box it was widely accepted that itG/AG/NG/R/4
Page 37
should be reviewed in the light of experience and ad justed as appropriate.  However, there were two
sets of views on the Green Box, one set considered it to be too restrictive and the other set that it was
not restrictive enough.  Hungary, along with other transition economies, felt it was too restrictive as it
did not reflect the diversity of agricultural conditions in various parts of the world.
166. South Africa also commented on the background document on the effect of inflation and
exchange rates on domestic support commitments (NG/S/19) and stated that their own paper, that theyhad submitted to the process of Analysis and Info rmation Exchange (AIE/33), had tried to show that
higher inflation rates made domestic support reduction commitments more onerous and developing
countries tended to have higher inflation rates than developed countries which meant they had more
severe reduction commitments.
167. Switzerland referred to the paper on the relationship between tariff quota fill and changes in
tariff quota administration (NG/S/20).  It noted that the paper pointed out the difficulty in attributing
changes in quota fill rates to specific causes wh en so many factors influenced fill rates.  To
Switzerland this meant it was impossible to dete rmine any link between administration method and
quota fill.
168. Japan (NG/W/73) commented on a number of background papers.  On the paper on the
studies on the impact of the Uruguay Round (NG/S/16) , Japan was pleased to see that it included case
studies on the impact on developed countries as well as developing.  It noted that there had beennegative impacts in some areas and some products and suggested that this needed further study and
analysis so it could be taken into account in the negotiations as required by Article 20.  On the paper
on non-trade concerns (NG/S/17), Japan made a number of points which they felt could be taken into
account in any revision of the paper including the issue of multifunctionality and the classification of
certain issues.  Concerning the paper on the Green Box (NG/S/18), Japan noted that the Memberscould reform their policies from Amber Box to the Green Box and that the discussions should take
account of the need for different countries to reform their policies smoothly.  Japan felt that rules
should be established so that inflation and exchange rate movements (NG/S/19) did not affect
Members' positions with respect to their domestic support commitments.  On the issue of tariff quota
fill rates and changes in administration (NG/S/20) Japan noted that different administration methodssuited different quotas and that a low fill rate was not always caused by restrictive administration.
169. In response to Hungary's statement Australia pointed out that in its view the Green Box
should be examined to ensure that countries had the flexibility to address their policy goals and to
ensure that the measures used were, at most, mi nimally trade distorting.  On Japan's suggestion on
multinfunctionality Australia pointed out that, while  they recognized legitimate non-trade concerns,
many countries did not recognize the concept of multifunctionality of agriculture.
170. India examined the Secretariat paper on the trade performance of developing countries
(NG/S/6) and came to a set of conclusions that are set out in their statement NG/W/70.  On the paper
on inflation and exchange rate changes (NG/S/19) India shared the concerns raised by Hungary.
171. The representative of Norway (NG/W/77) noted that the paper on non-trade concerns
(NG/S/17) raised the question of what policy measures were necessary to address them, including in
those countries with adverse production conditions.  This issue would have to be addressed in thenegotiations.  He also noted that from the paper on the Green Box (NG/S/18) that some of the criteria
in Annex 2 required clarification.  Regarding the paper on inflation and exchange rate changes
(NG/S/19), he noted that the value of Norway's AMS commitment had been reduced by 27 per cent in
value since 1988 despite low levels of inflation (not counting the 20 per cent AMS reduction
commitment agreed in the Uruguay Round).  This erosion of the value of commitments had to be
taken into account in the negotiations.G/AG/NG/R/4
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172. The EC (NG/W/66) noted that the paper on tariff quota and administration methods showed
the need for more practical work on administration and noted that Members did not have clear rules
for guidance and ran the risk of relying increasingly on dispute settlement to define them.
173. Korea (NG/W/74) noted that the paper on non-trade concerns (NG/S/17) showed the different
views held by Members on non-trade concerns and multifunctionality, how these objectives could be
addressed and if the current Green Box was sufficient.  Korea also noted that the paper on the GreenBox (NG/S/18) showed that some Members had had difficulties using it and that it might be too
restrictive for some needs and therefore flexibility was needed to allow different forms of agriculture
to continue.  On the paper on inflation and exchange rate changes Korea showed the current
commitments were unfavourable for developing countries with high inflation rates and the need to
find a reasonable solution.
174. The Committee agreed that the Secretariat prepare additional background papers, or to
follow-up as appropriate, on GSP treatment of agricultural products, non-trade concerns identified bydeveloping countries and relevant provisions of  the Agreement on Agriculture, and a revision of
G/AG/NG/S/6 in line with the definition of agricu ltural products under the Agreement on Agriculture.
ITEM D :  OTHER BUSINESS
175. Switzerland recalled that it had made a proposal to General Council that the Special Sessions
should be informed about negotiations in the TRIPS Council on geographical indications and askedthat Members show flexibility to this request.  New Zealand noted that no consensus had been reached
on this matter in the General Council and that some Members had reservations.G/AG/NG/R/4
Page 39
ANNEX
FOURTH SPECIAL SESSION OF THE COMMITTEE ON AGRICULTURE
(G/AG/NG/4)
Report by the Chairman, Ambassador Jorge Voto-Bernales, to the General Council
1. The Special Session of the Committee on Agriculture, which was established by the General
Council to conduct the negotiations for continuing the reform process under Article 20 of the
Agreement on Agriculture (WT/GC/M/53, paragraph 39 refers), held its fourth meeting on
15-17 November 2000.
2. The agenda as set out in WTO/AIR/1428 was adopted.
3. The following submissions were presented and considered under the programme for the first
phase of the negotiations as it relates to work within  the framework of paragraphs (a), (b), (c) and (d)
of Article 20:  (i) a note on "Non-Trade Concerns" submitted by Barbados, Burundi, Cyprus, Czech
Republic, Dominica, Estonia, the European Communities, Fiji, Iceland, Israel, Japan, Korea, Latvia,Liechtenstein, Madagascar, Malta, Mauritania, Mauritius, Mongolia, Norway, Poland, Romania, Saint
Lucia, Slovak Republic, Slovenia, Switzerland, and Trinidad and Tobago (NG/W/36/Rev.1);  and (ii)
a discussion paper by Argentina, Brazil, Paraguay and Uruguay (Mercosur), Bolivia, Chile, and Costa
Rica on "Export Subsidies – Food Security or Food Dependence?" (NG/W/38).
4. The following new or additional proposals for continuing the reform process were presented
and examined at the meeting:  (i) a Cairns Gr oup proposal on "Market Access" (NG/W/54);  (ii) a
proposal on "Domestic Support" by Albania, Bulgaria, Croatia, the Czech Republic, Georgia,
Hungary, the Kyrgyz Republic, Latvia, Lithuania, Mongolia, Slovak Republic and Slovenia
(NG/W/56);  (iii) a proposal on "Market Access" by Albania, Bulgaria, Croatia, the Czech Republic,
Estonia, Georgia, Hungary, the Kyrgyz Republic, Latvia, Lithuania, Slovak Republic and Slovenia
(NG/W/57);  (iv) a proposal by ASEAN on "Special and Differential Treatment for Developing
Countries in World Agricultural Trade" (NG/W/55);  and (v) a proposal by the United States on
"Tariff Rate Quota Reform" (NG/W/58).
5. As requested by the participants concerned, the following statements made at the meeting are
being circulated:  Australia (NG/W/59 and NG/W/60);  Bolivia (NG/W/61);  Brazil (NG/W/62);Canada (NG/W/63);  Colomb ia (NG/W/64);  Czech Republic (NG/W/65);  the European
Communities (NG/W/66);  Grenada (NG/W/67);  Guatemala (NG/W/68);  Hungary (NG/W/69);
India (NG/W/70);  Indonesia ( NG/W/71);  Jamaica (NG/W/72);   Japan (NG/W/73);  Korea
(NG/W/74);  Mauritius (NG/W/75);  Namibia (NG/W/76);  Norway (NG/W/77);  Peru (NG/W/78);
the Philippines (NG/W/79 and NG/W/80); Poland (NG/ W/81);  South Africa (NG/W/82);  Sri Lanka
(NG/W/83);  and Swaziland (NG/W/84).  (Statements made at the third Special Session but circulated
after the appearance of the Chairman's report on that meeting are:  Norway (NG/W/50);  Hungary(NG/W/51);  Mauritius (NG/W/52); and  Bulgaria, the Czech Republic, Estonia, Latvia, Hungary, the
Slovak Republic and Slovenia (NG/W/53).
Note:  "NG/W/-" refers to documents in the series:  "G/AG/NG/W/-".G/AG/NG/R/4
Page 40
6. The Secretariat was requested to prepare additional background papers, or to follow-up as
appropriate, on the following subjects:
(a) GSP treatment of agricultural products;
(b) non-trade concerns identified by developing countries and relevant provisions of the
Agreement on Agriculture;
(c) revision of G/AG/NG/S/6 in line with the definition of agricultural products under the
Agreement on Agriculture.
7. It was agreed that, as envisaged under the programme and arrangements for the first phase of
the negotiations (G/AG/NG/1, paragraph 6(d), refers), an additional Special Session meeting would be
held in advance of the March 2001 stock-taking meeting. The meeting would take place from 5 to
7 February 2001.
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