RESTRICTEDWORLD TRADE
ORGANIZATIONG/AG/R/16
28 October 1998
(98-4219)
Committee on Agriculture
SUMMARY REPORT OF THE MEETING HELD ON 30 SEPTEMBER-1 OCTOBER 1998
Note by the Secretariat
1. The Committee on Agriculture held its sixteenth meeting on 30 September-1 October 1998
under the Chairmanship of Ambassador Nestor Osorio Londoño of Colombia.  The agenda of the
meeting as contained in WTO/AIR/922 was adopted.
Part I:  The Review Process
Matters Relevant to the Implementation of Commitments under the Reform Programme:  Article 18.6
(a) Hungary:  Import measures introduced by the Slovak Republic on wheat originating in
Hungary
2. The representative of Hungary informed the Committee that on 18 September 1998 Hungary
had requested urgent consultations with regard to import duties, in excess of the respective tariff
bindings, imposed by the Slovak Republic on wheat imports from Hungary, which in Hungary's view
constituted a violation of Articles I and II of the GATT.  Hungary was concerned that the measure in
question came at a time when protectionist pressures were mounting in many parts of the world and
that such measures, without appropriate response, could damage the integrity of the disciplines of the
Agreement on Agriculture as well as the multilateral trading system itself.  Hungary and the Slovak
Republic had held consultations pursuant to Article XXIII of GATT as the result of which Hungaryhoped that the Slovak Republic would in the near future bring the measure at issue back into
conformity with its WTO obligations.
3. The representative of the Slovak Republic stated that the measure in question was adopted in
accordance with Article 14 of the Central European Free Trade Agreement (CEFTA) and confirmed
that bilateral consultations regarding the disputed measure had recently been held, in light of whichthe Slovak Republic had undertaken to adjust the measure in question.
(b) New Zealand:  Mexico – Replies to questions on milk powder import arrangements
4. The representative of New Zealand sought clarification from Mexico regarding the status of
the response which Mexico had undertaken to provide at the Committee's June meeting concerningchanges in the administration of Mexico's tariff quo ta for milk powder.  The arrangements regarding
milk powder imports were of considerable commercial interest and New Zealand therefore looked
forward to receiving the answers as quickly as possible.  The representative of Mexico responded that
the replies to New Zealand's questions would be provided as soon as possible.G/AG/R/16
Page 2
(c) United States:  Romania – Minimum and maximum reference prices and related procedures
for calculating import duties on poultry
5. The United States sought clarification from Romania concerning a General Customs Directive
issued by Romania's Ministry of Finance on  4 August 1998 which established minimum and
maximum reference prices for imported poultry and a procedure for calculating import duties on
shipments whose c.i.f. prices fell below the refere nce prices.  According to this procedure, import
duties for poultry were based on a maximum reference price which was significantly higher than
prevailing market prices.  United States exporters  had indicated that the process by which poultry
import prices were verified was lengthy and caused unnecessary delays in reimbursement.  The
representative of the United States indicated that the United States intended to discuss this issue on a
bilateral basis and did not currently wish to pursue it under Article 18.6 of the Agreement.
(d) United States:  Turkey – Subsidization of sugar exports through the Turkey Sugar
Corporation
6. The United States reverted to the issue of subsidized sugar exports through the Turkey Sugar
Corporation (G/AG/R/15, paragraphs 42-43).  In light of the fact that sugar was not included in
Turkey's Uruguay Round Schedule of export subsidy commitments, the United States sought
clarification with regard to the Turkish Sugar Corporation's procurement and export marketing
activities, in particular with regard to how the Corporation was able to sell sugar in international
markets given that procurement prices were substantially higher than export prices.
7. The representative of Turkey responded that Turkey had not provided export subsidies for
sugar in 1997 nor was sugar an eligible product under Turkey's Schedule of commitments.  Some of
the main factors affecting the level of exports were market trends, stock levels and the cost of holding
stocks, domestic interest rates, as well as the corporation's cash flow.   In 1997, Turkey had imported
65,000 tonnes and exported 172,000 tonnes of sugar.  Companies traded at their own risk and werefree to set the prices.  Up to 1996, sugar prices had shown an upward trend in international markets
and producers, in anticipation of higher profits, had increased their sugar beet production.
Subsequently, the international price for sugar had dropped from US$383 per tonne in January 1996
to US$255 in August 1998, primarily due to weak demand.  This situation had given rise to
financially unsustainable stock levels.  In these circumstances, the management of the Corporationhad decided to dispose of excess stocks at prevailing international prices which were indeed lower
than the cost price.  It was Turkey's understanding that the management of the Turkish Sugar
Corporation had acted with a view to minimizing financial losses while at the same time improving
the cash flow of the Corporation.
8. The representative of the United States provided the following data on export and
procurement prices which had given rise to the US concerns.  According to information released by
the Turkish government, average export prices dur ing 1997 were roughly equivalent to world prices,
i.e. US$0.36 per kg. (US$0.16 per pound) while ex-factory procurement prices that were established
by the Turkish government for refined sugar averaged approximately US$1.08 per kg. (US$0.49 per
pound).  Unofficial export volumes in 1997 totalled some 172,000 tonnes while, according to official
estimates by the Turkish Ministry of Trade, exports totalled approximately 76,800 tonnes. The
representative of Turkey noted that he was unable  at the current stage to confirm the information
provided by the United States but undertook to provide a response.G/AG/R/16
Page 3
(e) Argentina, Australia, Brazil, Canada, Chile, Colombia, Indonesia, Malaysia, New Zealand,
Paraguay, Philippines, South Africa, Thailand and Uruguay:  Concerns regarding the use of
export subsidies
9. The representative of Australia stated that Australia and a number of other WTO Members
were concerned about developments with regard to the use of export subsidies as reflected in the
Cairns Group statement at the Special Session of the General Council on 24 September 1998(WT/GC/12).  These concerns included:  the prospect of a return to the export subsidy wars of the
1980s;  that countries accumulating subsidies from previous years might not be able to meet their
commitments in the final implementation year of th e Agreement and thereafter;  and the devastating
impact that an increase in subsidies could have on markets where prices were already weak.  It was
noted in the case of the European Communities:  that export subsidies on wheat had increased by one-
third in the past two months;  that the volume subject to export subsidies in the 1998 marketing year
was four times higher than in the 1997 marketing year;  that on flour, export subsidies had increasedfrom negligible levels in 1997 to 48.5 ECU per tonne;  and that on barley, 1997-98 export subsidy
levels had increased more than threefold compared to 1996-97 levels and continued to increase.
While acknowledging that despite these recent incr eases the European Communities remained within
its Uruguay Round export subsidy commitments, Australia urged the European Communities not to
further increase its restitutions or to broaden the geographical coverage of subsidies.  In Australia'sview, such a move could prompt a negative and disproportionate response from the United States
which would have serious consequences for global grains market.  Expected large wheat harvests and
a deterioration in world market conditions were placing downward pressure on prices and increasing
political pressure in the United States to reactivate the Export Enhancement Program.  The Members
raising this matter also considered that this was as an important leadership issue in a time of difficultinternational economic circumstances and called on the European Communities and the United States
to demonstrate leadership by avoiding further destabilization of world markets.
10. The representative of Argentina stressed that in raising this matter the intention was not to
dispute the legality of the use of cumulated export subsidies but to draw attention to the negative
economic impact of such subsidies on developing countries during the current international financialcrisis.  For developing countries, most of whom were highly dependent on commodity exports, export
growth was a fundamental requirement to attract capital for their development programmes.
However, as export prices were currently in many cases lower than at the end of the Uruguay Round,
it was difficult to maintain capital investment in developing countries.  While developed countries
were, on the one hand, attempting to assist developing countries through the international financialinstitutions, their agricultural export subsidies, on the other hand, aggravated their balance-of-
payments problems and created a need to solicit further financial aid to contain the current crisis.
Argentina called on developed countries to pursue a coherent policy vis-à-vis  developing countries in
the face of the current financial crisis.
11. The representative of Brazil stated that export subsidies should be abolished since they were
trade-distorting and an unfair trade practice reflecting a country's capacity to subsidize rather than its
efficiency and level of productivity.  Moreover, Brazil could not subscribe to the view that subsidiescould be justified in light of specific non-trade concerns, such as the environment, food security and
socio-economic problems.  Brazil called for the elimination of all forms of export subsidies, including
subsidized export credits.  The issue of export credits was of particular concern to Brazil since the
OECD negotiations on this subject appeared to have come to a standstill.  Brazil was also concerned
about some Members' use of roll-over flexibility for export subsidies.
12. The representative of Canada stated that Canada remained concerned that the use of
previously unused export subsidies set an unfortunate example which provided an excuse for others to
increase subsidization of exports, contrary to the progressive sustained decrease envisaged by the
commitments that all Members had undertaken.  In Canada's view it was important to remember that
agricultural export subsidies were an exception to a general prohibition.  Canada could provideG/AG/R/16
Page 4
specific examples of the harmful effects that the high level of export subsidies were currently having
on its producers:   the European Communities' subsidized sales of oats to the United States had a
severe impact on the prices received by Canadian producers and, in the case of malt, Canada had
evidence that the European Communities would be fully competitive on world market without any
export subsidies, a fact which contradicted the European Communities' assurances of restraint and
responsible behaviour.  Canada urged all Members to live within their annual export subsidyreduction commitments and to consider how to eliminate such trade-distorting policies and replace
them with others that did not shift the burden of over-production onto producers in other countries.
Canada was very concerned at the increasing prospect of a tit-for-tat acceleration in the use of
agricultural export subsidies which depressed world market prices and increased the pressure on some
governments to use export subsidies in a vicious downward price spiral.  Canada called on Members
to show collective leadership so that there was no sliding back into the disastrous export subsidy wars
of the past.
13. The representative of South Africa drew attention to the statement by the Heads of State and
Government of the Non-Aligned Movement represen ting some 60 per cent of WTO Members at their
recent Summit meeting in Durban.  This statement noted "with concern that agricultural export
subsidies, market price support schemes and direct payments paid by major developed countries have
had a serious negative impact on prices and trade in agricultural products of developing countries."South Africa encouraged countries which were under domestic pressure to increase the use of export
subsidies to show restraint in the use of such subsidies and leadership in educating their domestic
constituencies on the negative effects on others and about the costly zero-sum game that a tit-for-tat
subsidy war would engender.
14. The representative of the Philippines, speaking on behalf of Indonesia, Malaysia and
Thailand, noted that the Cairns Group statement referred to above highlighted the problems
confronting developing countries on the subject of export subsidies.  In particular, the comparative
advantage of efficient developing country producers was being eroded by the continued use of export
subsidies by developed countries, and real market access was being denied to developing countries as
long as they were faced with the unfair disadvantage of having to compete with subsidized productsfrom developed countries.  Members' export subsidy restraint in the past years was a welcome step
towards reforms envisaged in the Uruguay Round but concerns remained that some Members' actions
might prompt a return to the pre-Uruguay Round situation.   It was also noted that, in anticipation of
the forthcoming negotiations, Members concerned should introduce further market-orientated policies
to stimulate competitiveness of their producers and to better prepare them for the further reforms.This would shield them from the burden of adjustments that would otherwise accompany deeper cuts
in subsidies.
15. The representative of New Zealand expressed New Zealand's particular concerns about the
situation in international dairy markets.  Prices for skimmed milk powder had fallen by US$300 per
tonne to below US$1,400 within the past year due to weak demand in key markets in South Asia and,
more importantly, due to the competitive subsidization of exports from the United States and the
European Communities.   The European Communities and the United States currently provided per
unit subsidies at a level equivalent to two-thirds of the international market price of skimmed milk
powder.  The aggressive use of ever higher subsidies to retain or gain sales had the inevitable result of
forcing down prices across the board and forcin g non-subsidized but normally highly competitive
New Zealand product out of some markets.  This situation had strengthened New Zealand's resolve to
ensure that the forthcoming negotiations on agricult ure result in the early elimination of all export
subsidies and strong disciplines to prevent the circumvention of those commitments.  In the
meantime, New Zealand called on all countries providin g export subsidies to exercise restraint in the
use of such subsidies.G/AG/R/16
Page 5
16. The representative of the European Communities stated that the EC was respecting its export
subsidy reduction commitments and had used export s ubsidies with restraint, including with regard to
the use of roll-over flexibility.  The European Communities also had no intention of starting an export
subsidy war.  Moreover, in the OECD negotiations on export credits the European Communities had
actively sought and encouraged participants to come to a satisfactory conclusion of these negotiations.
With regard to developments in the dairy sector, the point was made that European Communities hadsupported the continuation of the International Dairy Agreement (IDA) while New Zealand had called
for its termination.  While the European Communities would continue to exert restraint in the use of
export subsidies, it was its expectations that ot her countries would likewise show due restraint in
terms of the provisions of Article 13 of the Agreement.
17. Concerns were also expressed by Chile, Co lombia, India, Mexico and Uruguay concerning
the negative effects of export subsidies, in particular for developing countries, on trade and
investment, as well as market access opportunities.
18. The representative of Japan stated that Japan shared the concerns expressed and welcomed
any voluntary restraint initiative.  However, Japan would be opposed to any proposals concerning
substantive modification of the Agreement on Agriculture, including export subsidy commitments,
during the implementation period.
19. The representative of the United States stated that the United States was concerned about the
use of export subsidies and increased export subsidy use by some Members.  The United States
supported the complete elimination of export subsidies.  While 25 Members had export subsidy
reduction commitments, 80 per cent of all export subsidies in 1995 and 1996 were provided by the
European Communities.   The forthcoming export subsidy notification by the United States would
show that for 8 out of 13 eligible products no export subsidies had been provided.  The United Statesaccounted for less than 2 per cent of Members' total use of export subsidies in 1996.   In the United
States, the domestic pressure for export market assistance was considerable but the United States had
acted responsibly and with restraint regarding such assistance.
20. The representative of New Zealand expressed disappointment about the European
Communities' failure to recognize in its response that the message of other Members was not aboutthe legality of the provision of export subsidies.   With regard to the IDA, the representative noted that
its minimum price provisions would be consigned to history as another failed attempt to deal with a
problem that needed to be attacked at its source, namely the elimination of export subsidies.  With
regard to export credits, the representative sugge sted that the European Communities should make an
offer to eliminate export subsidies in re turn for the elimination of export credits.
21. The representative of  Poland noted that the reform process, including with regard to export
subsidies, was to be carried out in accordance with the Agreement.  Poland endorsed the European
Communities' view that roll-over flexibility was in full conformity with its provisions.
22. The representative of the European Communitie s, in response to the intervention by the
United States, invited the United States to provide the Committee with information concerning the
coverage of products exported with export credits and related expenditures.  The European
Communities had also taken note that the United States had purchased agricultural products on thedomestic market for purposes of food aid.  There was also the question of state trading to which the
Committee might revert in the context of the discussion of export subsidies.
(f) United States – Egypt's tariffs on imports of dairy products
23. The United States stated that it had evidence to the effect that Egypt had applied tariffs on
imports of dairy products from the United States in excess of its bindings.   The United States sought
clarification as to when Egypt intended to bring th ese applied tariff rates into conformity with itsG/AG/R/16
Page 6
WTO commitments.  The representative of Egypt sought additional information from the United
States with regard to tariff items subject to the US  complaint in order to look into this matter and
undertook to provide a response to the Committee.
(g) United States – Turkey's tariffs on cotton imports
24. The United States sought clarification from Turkey with regard to a recently imposed
surcharge of 25 per cent on cotton imports which appeared to exceed Turkey's tariff binding of 8 per
cent. The representative of Turkey undertook to provide a response as soon as possible.
Review of Notifications
25. The Committee reviewed the following notifications as listed on the agenda:
(i) on the administration of tariff and other quota commitments (Table MA:1):  from
Ecuador (G/AG/N/ECU/5), Guatemala (G/AG/N/GTM/6),  Poland
(G/AG/N/POL/21), Thailand (G/AG/N/THA/26 and THA/28), and the United States
(G/AG/N/USA/15);
(ii) relating to imports under tariff and other quota commitments (Table MA:2):  from
Brazil (G/AG/N/BRA/11), Colombia (G/AG/N/COL/10 and Corr.1), El Salvador
(G/AG/N/SLV/6), Guatemala (G/AG/N/GTM/9), Israel (G/AG/N/ISR/7), Morocco
(G/AG/N/MAR/13), Norway (G/AG/N/NOR/17), Philippines (G/AG/N/PHL/16),
Slovenia (G/AG/N/SVN/9), Switzerland (G/AG/N/CHE/14), Thailand
(G/AG/N/THA/27) and the United States (G/AG/N/USA/16/Corr.1);
(iii) in the context of the special safeguard (Tables MA:3 to MA:5): from Colombia
(G/AG/N/COL/9), El Salvador (G/AG/N/SLV/5), Guatemala (G/AG/N/GTM/8),
Japan (G/AG/N/JPN/30), Morocco (G/AG/N/MAR/12), Philippines
(G/AG/N/PHL/18), Poland (G/AG/N/POL/20) , South Africa (G/AG/N/ZAF/16), and
the United States (G/AG/N/USA/18);
(iv) relating to domestic support commitments (Table DS:1): from Chile
(G/AG/N/CHL/8/Corr.1), Colombia (G/AG/N/COL/8), Czech Republic
(G/AG/N/CZE/17), Ec uador (G/AG/N/ECU/ 4), El Salvador (G/AG/N/SLV/4),
European Communities (G/AG/N/EEC/12/Corr.2), Hong Kong, China
(G/AG/N/HKG/4), Iceland (G/AG/N/ISL/11), India (G/AG/N/IND/1), Israel
(G/AG/N/ISR/8), Jamaica (G/AG/N/JAM/2), Korea (G/AG/N/KOR/18), Mongolia
(G/AG/N/MNG/2), Morocco (G/AG/N/MAR/11), Philippines (G/AG/N/PHL/14 andPHL/15), Singapore (G/AG/N/ SGP/2), Slovak Republic (G/AG/N/SVK/14), Slovenia
(G/AG/N/SVN/8), Switzerland (G/AG/ N/CHE/15). Trinidad and Tobago
(G(AG(N/TTO/2), the United States (G/AG/N/USA/17), and Uruguay
(G/AG/N/URY/13);
(v) relating to new or modified domestic support measures exempt from reduction
(Table DS:2):  from Korea (G/AG/N/KO R/19) and Switzerland (G/AG/N/CHE/16);
andG/AG/R/16
Page 7
(vi) relating to export subsidy commitments (Tables ES:1 to ES:3): from Brazil
(G/AG/N/BRA/12), Guatemala (G/AG/N/GTM/7), Hong Kong, China
(G/AG/N/HKG/5), Hungary (G/AG/N/HUN/14), Korea (G/AG/N/KOR/20),
Mongolia (G/AG/N/MNG/1), Morocco (G/AG/N/MAR/10), Norway
(G/AG/N/NOR/18), Philippines (G/AG/N/ PHL/17), Singapore (G/AG/N/SGP/3),
South Africa (G/AG/N/ZA F/18), Switzerland (G/ AG/N/CHE/17), Turkey
(G/AG/N/TUR/7) and Uruguay (G/AG/N/URY/14).
26. Specific points raised with respect to the notifications listed above and the responses thereto
are summarized in Part I of the Annex to this report.
27. The following notifications were subject to prelim inary review and are to be reverted to at the
next meeting in accordance with paragraph 9 of the Committee's Working Procedures:
(i) in the context of the special safeguard (Tables MA:3 to MA:5): from Panama
(G/AG/N/PAN/1);
(ii) relating to domestic support commitments (Table DS:1):  from Guyana
(G/AG/N/GUY/1);  and
(iii) relating to export subsidy commitments (Tables ES:1 to ES:3):  from  Australia
(G/AG/N/AUS/19), Canada (G/AG/N/CAN/22), and Guyana (G/AG/N/GUY/2).
28. Preliminary points raised with respect to Australia's notification G/AG/N/AUS/19 are
summarized in Part I of the Annex to this report.
29. The Committee took note that no counter-notifications had been received under Article 18.7
of the Agreement.
Other Matters Relating to the Review Process
(a) Deferred replies to questions raised under the reform process
30. The deferred replies to questions raised at previous meetings are summarized in Part II of the
Annex to this report.
31. The representative of Thailand stated in response to an Article 18.6 matter raised by the
United States at the June meeting concerning imports of corn from China (G/AG/R/15, page 10), that
Thailand's tariff quota commitment for maize was 52,964 tonnes in 1998.  Due to high demand,
especially from the animal feed manufacturing sector, Thailand had increased the tariff quota to
300,000 tonnes in 1998, with non-Members eligible as suppliers.  However, so far Thailand had not
imported any maize from non-Members this year.
(b) Overdue notifications
32. With regard to the question of overdue notifications, the Committee took note that, as
requested at the March 1997 meeting, the Secretariat had made available a Room Document dated30 September 1998 showing the current status of compliance with the Committee's notification
requirements.
33. The representative of Switzerland reiterated Switzerland's view that the situation regarding
compliance with notification requirements was most unsatisfactory.   The seriousness of the matter
was illustrated by the fact that only 17 Members were in full compliance with their notificationobligations.G/AG/R/16
Page 8
34. The Committee took note that the Secretariat intended to follow-up on this matter by offering
additional assistance to Members whose notifications were overdue.
(c) Domestic support implementation issues
35. The Committee took note that, with regard to the discussion paper on domestic support
implementation issues by New Zealand (G/AG/W/34), a large number of Members had expressed an
interest at the June meeting in further explorin g the issues raised in that paper in informal
consultations and that the United States' paper on Equivalent Measurement of Support (G/AG/W/35)
would also be relevant in this context.  It was agreed that the Chairman would continue his contacts
with Members regarding the scope of, and arrangements for holding, informal consultations ontechnical issues related to domestic support.
Part II:  Other Matters within the Purview of the Committee
Decision on Measures Concerning the Possible Negative Effects of the Reform Programme on Least-
Developed and Net Food-Impor ting Developing Countries
36. In the context of the Committee's follow-up to the Singapore Ministerial recommendations
with regard to food aid matters (G/L/125, paragraph 18(i)), the Committee noted that Members of the
Food Aid Committee envisaged holding a further dialogue meeting, possibly in November, with netfood-importing developing countries and other food aid recipients, as appropriate, prior to the
conclusion of the substantive negotiations on a new Food Aid Convention envisaged for the end of
1998.
37. The representative of the United States stated that at the September 1998 session of the
Working Group of the Food Aid Committee most Committee members had made considerable
progress towards completing a new Food Aid Convention that would strengthen donor nations'
commitments to provide food aid to recipient countries.  The forthcoming negotiating sessionscheduled for mid-October was crucial in terms of meeting the target date of 1 July 1999 for entry
into force of a new Convention.  The United States hoped that all Food Aid Committee members, in
particular the European Communities, would approach these negotiations with the flexibility needed
to resolve all outstanding issues so that donors would be in a position to fulfil their commitments
made at Marrakesh and Singapore.
38. The representative of Canada stated that Canada remained committed to completing the
negotiations by the end of November 1998 but this objective would not be achieved if the European
Communities and its members States continued to show a lack of negotiating flexibility on a number
of fundamental issues, in which event questions with  regard to the future of the Food Aid Convention
would emerge.  Canada invited the European Commun ities to confirm that significant progress could
be expected at the next meeting of the Working Group in October.
39. The representative of Australia stated that Australia shared the concerns of some other Food
Aid Convention members regarding prospects for a satisfactory and timely conclusion of the
negotiations on a new Food Aid Convention.  Though progress had been made some fundamental
issues remained outstanding, including the extent to which a new Convention would provide assuredquantities of food aid to developing countries.  This was a fundamental element of the existing
Convention to which Australia remained committed.  Australia was also committed to achieving the
objective of having a new Convention in place by July 1999.G/AG/R/16
Page 9
40. The representative of Japan stated that Japan, in keeping with the Marrakesh and Singapore
commitments with regard to food aid matters, was an active participant in the negotiations on a new
Food Aid Convention and hoped that the negotiations could be concluded before the expiry of the
current Convention.
41. The Chairman recalled that the annual monitoring  exercise in respect of the follow-up to the
Marrakesh  Ministerial Decision  concerning net food-importing developing countries wasautomatically on the agenda of the November meeting under the Committee's Working Procedures
(G/AG/1, paragraph 18).  He noted that since the la st annual monitoring exercise five donor Members
had submitted notifications in the NF:1 series.  The Chairman urged other Members to also submit
their NF:1 notifications well in advance of the November meeting to ensure that the annual review
would be a comprehensive and productive one.
42. The Committee agreed that the Secretariat should invite the observer international
organizations in the Committee, as part of their contribution to the November monitoring exercise, toprovide, as appropriate, having regard to their respective areas of competence or specialization, an
updated assessment of the impacts of the implementation of the Uruguay Round on developing
countries generally, including on the least-developed and net food-importing developing countries.
Where these were available, summaries of any recent studies that had been undertaken by these
organizations in this general area could also be requested.
Chairman's Report on the Process of Analysis  and Information Exchange (AIE process)
43. The Committee took note of the following report by the Chairman on the meeting of the AIE
process held on  28-29 September 1998:
"(i) In line with paragraph 36 of G/AG/R/10, the following is my summary report
as Chairman on the meeting of the AIE process held on 28-29 September 1998.
"(ii) The first subject considered at this meeting was non-trade concerns.  As well
as the informal papers by Norway (AIE/22) and by Japan (AIE/25) which were discussed
at the previous session in June, four new informal papers were presented for substantive
consideration:  AIE/28 by New Zealand on "The Side Effects of Agricultural Policies and
Production";  AIE/32 by Argentina on "Non-Trade Concerns in the Next Agricultural
Negotiations";  AIE/34 by the United States on "Non-Trade Concerns and Agriculture";
and AIE/36 by Australia on "Non-Trade Concerns".  In addition two recently submitted
papers by Korea (AIE/39) on "Non-Trade Co ncerns in Net Food-Importing Countries"
and by the European Communities (AIE/40) on "The Multifunctional Character ofAgriculture", were for preliminary consideration and are to be taken up for more
substantive consideration at the November AIE session.
"(iii) First of all it is worth noting that the range of policy objectives and factors
considered relevant in the further analysis and exchange of information on non-trade
concerns is very wide ranging.  In addition to such factors as food security and the need
to protect the environment, which are exp licitly referred to in the Agreement on
Agriculture, reference was made in the contributions to:  the viability of rural areas;  themaintenance of rural employment generally, as well as in the specific regions;  ensuring
balanced territorial and socio-economic development;  preservation of the landscape;
protection from natural hazards and disasters;  biodiversity and ecological issues;
ensuring safe and high quality food products;  consumer concerns;  and even cultural
factors and concerns.  It was pointed out th at many of these factors and concerns were
inter-related.  A number of suggestions were made regarding the need to define these
concerns and the concepts involved more precisely, as well as the need to provide
concrete examples in order to facilitate more systematic discussion and analysis.G/AG/R/16
Page 10
"(iv) A range of concerns were expressed about the negative impacts on world
market prices and access opportunities arising from protectionist or distortive measures
maintained on the basis of non-trade concerns in the agricultural sector.  A particular
concern was that these non-trade related issues could become an obstacle to achieving
further substantial liberalization of trade in agriculture.  In this regard it was pointed out
that, while many of the non-trade concerns enunciated were legitimate objectives ofdomestic policies and that the social, geographical and economic circumstances in which
non-trade concerns arose might vary according to individual countries, methods of
addressing these non-trade concerns should be pursued which minimized their adverse
impacts on trade.  Some of the specific sugges tions made in this regard were to explore
in more detail in the AIE process whether the specific non-trade concerns that had been
mentioned could not be covered by the existing  provisions of the Green Box.  It was also
suggested that any such examination should include related issues of interests todeveloping countries, including net food-importing developing countries, and issues
relating to food security.
"(v) These are suggestions that it would be worthwhile to follow up on.
"(vi) The AIE paper by Canada on "Expo rt Restrictions and Taxes" (AIE/24)
provided a useful basis for introducing discussion on a topic which, inter alia , has
important implications for the increasingly vital role which the WTO trading system will
have to continue to play in helping to ensure global food security.
"(vii) A number of observations were made about the adequacy of the existing
disciplines on export restrictions under the GATT and the Agreement on Agriculture.
The point was made that these disciplines were relatively modest and unbalancedcompared to the stricter obligations relating to import measures.  In this  regard it was
pointed out that an important objective of the existing disciplines, and one that needed to
be re-inforced, was to ensure that there was non-discrimination between foreign and
domestic purchasers in relation to available supplies of foodstuffs in periods of high
world prices and short supplies.
"(viii) Amongst other points made it was noted,  in relation to export taxes, that
such taxes were considered to be necessary to offset the adverse effects of tariff
escalation on more processed products.  The possibility of negotiating binding
commitments on the level of export taxes was also raised.
"(ix) In the area of domestic support, we had the benefit of informal papers on
various topics by the United States, South Africa, the European Communities and
Australia which allowed us to cover new ground in the AIE discussions in this area.
"(x) The United States' informal paper on "Annex 4:  Equivalent Measurement of
Support" (AIE/26) raised the issue of the circumstances under which the Equivalent
Measurement of Support (EMS) methodology as set out in Annex 4 of the Agreement,
should be used in the calculation of Current Total AMS.  The suggestion was made that
there might be a need in the future to develop a more precise methodology.  To improvethe transparency of notifications, it was suggested that EMS calculation details should be
provided. The proposal was also made to further explore the use being made of the EMS
in the framework of informal consultations on domestic support implementation issues
generally.
"(xi) In South Africa's informal paper on "The Effect of Inflation on Reduction
Commitments" (AIE/33), it was noted that c ountries with AMS reduction could be facing
undue constraints in maintaining the real value of price support measures in the event ofG/AG/R/16
Page 11
high rates of inflation, and that the countries most likely to be affected by this situation
were developing countries. It was noted that this problem was not confined to Members
with domestic support reduction commitments but could also be relevant for the many
developing countries with trade-distorting support within de minimis  levels.  On the other
hand, the point was made that it was an intended outcome of the Uruguay Round
negotiations that countries should not be allowed to maintain the real value of trade-distorting domestic support.  It was suggested that caution should be exercised in
reopening the complex issues involved. The view was expressed that the Agreement
afforded sufficient flexibility to take account of inflation-related implementation
difficulties, including through the following provisions:  Article 18.4 of the Agreement
on Agriculture; the in-built infl ation adjustment mechanism of de minimis  provisions by
virtue of the fact that support was calculated as a percentage of the current value of
production; a higher de minimis  10 per cent ceiling for developing countries; external
reference prices specified in other than the domestic currency, such as the US dollar;  and
the possibility of shifting domestic support towards the exempt categories, such as the
Green Box.  It was also noted that Article 18.4 of the Agreement had yet to be put into
practice and that there might be a need to develop operational guidelines as to what
constituted "excessive rates of inflation".
"(xii) In the course of the discussion of the paper by the European Communities on
"Domestic Support Policy Reform: the Role of Article 6.5 Direct Payments" (AIE/29).  It
was stated that the move from price support towards direct payments was a step in the
right direction and that the Blue Box was a policy instrument necessary to facilitate the
adjustment towards less trade distorting support, and there was no basis in the Agreementfor the suggestion made for eliminating Article 6.5.  Some deficient features of the Blue
Box were also noted:  these included, in particular, the lack of a ceiling for Blue Box
expenditures and the trade-distorting effects resulting from such direct payments being
contingent on production.
"(xiii) The informal paper by Australia on "Decoupling Domestic Support"
(AIE/35), presented a case for strengthening the Green Box disciplines and criteria.  One
argument was that Green Box accommodated measures that could cause distortions and
that such exempt policies needed to be revi ewed to ensure that the reform process was
not undermined by policies which were not truly decoupled from current production and
prices.  It was suggested that proposed candidates for such review would be decoupledincome support, resource retirement programmes and investment aids.  There were also
concerns raised regarding the considerable increase in Green Box expenditures on
measures which, according to this view, had distorting effects.  In other views expressed
it was considered that the experience with Green Box to date was positive and that there
was no need to tighten the Green Box eligibility requirements, since to do so could
discourage further policy shifts towards less trade distorting measures.  It was also
suggested that any future review should focus on the issue of whether the Green Box wassufficiently adapted to accommodate policies designed to pursue non-trade objectives
and the multifunctional role of agriculture.
"(xiv) In the preliminary discussion on the United States' paper on "Domestic
Support" (AIE/38) one observation made was that any fine-tuning of the criteria should
impart predictability and stability to the Green Box policy framework and that theultimate objective should be to ensure that the Green Box could not be applied so as to
circumvent domestic support reduction commitments.
"(xv) We will have an opportunity to pursue our discussion on the Green Box and
other domestic support issues when this informal paper by the United States is up for
substantive consideration at our November meeting.G/AG/R/16
Page 12
"(xvi) We had a brief exchange a views on a recently circulated informal paper by
the United States on "Article 13:  Due Restraint Provisions" (AIE/37) which covers
issues relating to the actionability of both domestic support and export subsidies. The
importance of the expiry date of the Peace Clause at the end of 2003 and its implications
for domestic support and export subsidies was highlighted in a number of the views
expressed.  This informal paper by the United States will likewise be up for furtherdiscussion at our November meeting.
"(xvii) The informal paper by Brazil on "Trade Liberalization:  sectoral and 'across
the Board'" initiatives (AIE/31) was the subject of a further exchange of views on the
relative advantages of sectoral or "zero for zero" negotiating techniques and the
relationship of any such approach with a comprehensive horizontal approach for
achieving further substantial reductions in agricultural support and protection.  Amongst
the points made in this regard it was pointed out that the future reduction modalities assuch would be a matter to be determined exclusively in the further negotiations and could
not be pre-determined in the AIE process.  Nevertheless, what measures "zero for zero"
might or might not cover in addition to tariffs could be explored in general terms, for
example, in the light of previous initiatives , but without attempts to identify specific
products.  The suggestion was also made that sectoral approaches could constitute auseful technique, as a complement to global reduction modalities, for dealing with tariff
peaks and escalation, including on products of interest to developing countries.
"(xviii) In the discussion on the informal paper by India on "Issues of Interest to
Developing Countries" (AIE/30), a number of issues were raised and elaborated.
Specifically it was suggested that the principal areas in which a checklist of issues is to
be developed should be extended to include, in addition to food security, other non-trade
concerns of interest to developing countries.
"(xix) It was noted that food security was a matter which needed to be addressed in
a balanced manner in order to underpin the social and political stability that was
necessary to ensure the fuller participation of developing countries in international trade.It was also noted that trade distorting subsidies and high levels of border protection in
some developed countries had disproportionately negative effects on trade in the many
agricultural products on which developing country exporters were more highly
dependent.  On export subsidies it was pointed out that developing countries were
particularly disadvantaged when it came to competing with exporting countries thatcould afford to deploy large financial resources in favour of their exporters.
"(xx) In this general context one of the views expressed was that as export
subsidies should be eliminated completely, export subsidization was not an area in which
continuation of special and differential treatment could be justified.  On the other hand it
was considered that special and differential treatment in the area of market access, both
in terms of commitments and their implementati on, would continue to be essential.  Such
treatment was considered to be particularly important in order to improve the generalparticipation of developing countries in world agricultural trade and to reverse the
growing tendency for many developing countries to become net importers.  Particular
importance was attached, in a number of the views expressed, to issues relating to net
food-importing developing countries being effectively addressed.  Technical assistance
issues were also raised in this general context.
"(xxi) In the course of this discussion points were also raised concerning the need
for all countries to contribute to the liberalization process, as an integral element of
broader policies that were conducive to promoting economic growth and development,
thus alleviating rural poverty and improving food security generally.  It was suggestedG/AG/R/16
Page 13
that some clarification was required regarding the extent to which non-trade concerns
involved specific issues in relation to deve loping countries and that informal papers by
developing countries outlining concrete examples would be a useful contribution to the
further AIE analysis in this area.
"(xxii) There was further discussion on the possibility of relevant international
organizations being invited to participate in an ad hoc meeting to present their updatedassessments of the impact of the implementation of the results of the Uruguay Round,
with particular focus on the impact of the implementation of the Agreement on
Agriculture for developing countries.  The suggestion was made that, in a first stage,
consideration might be given to the observer international organizations being invited to
make a contribution along these lines in the context of the annual monitoring exercise on
the Net Food-Importing Decision at the regular November 1998 meeting of the
Committee on Agriculture.
"(xxiii) The Secretariat informed the meeting that Secretariat background papers
would continue to be revised and up-dated as appropriate.  It was noted that the informal
Secretariat background paper on the special agricultural safeguard (AIE/S12) would be
distributed to Members in the near future.
"(xxiv) The next AIE meeting will take place on Monday 16 November 1998."
Requests for Observer Status by International Intergovernmental Organizations
44. The Committee noted that there were outstanding requests for observer status in the
Committee from three regional international organizations, i.e., the ACP Secretariat, the Inter-
American Development Bank and the Inter-American Institute for Agricultural Cooperation(G/AG/W/29/Rev.1).  The Chairman informed the Committee that, having consulted among Members
since March 1997, the position remained that there was no consensus on this matter.  The
representatives of Mauritius and Uruguay expressed disappointment that no progress had been made.
With regard to the application of the ACP Secretariat, the representative of Mauritius recalled the fact
that nearly 40 per cent of Members of the WTO were ACP states.  The Chairman indicated that hewould raise the matter with the Chairmen of the General Council and the Council for Trade in Goods
and would revert to this matter as appropriate.
Other Business
(a) Annual Report of the Committee on Agriculture to the Council for Trade in Goods
45. The Committee agreed that the Chairman would prepare a short and factual report for the
Council for Trade in Goods (CTG) for consideration by the Committee at its November meeting and
that the Chairman would submit the report to the CTG on his responsibility as Chairman.
(b) Schedule of meetings for 1999
46. The Committee took note of the following schedule of regular meetings in 1999 (namely,
meetings in March, September and November, as provided for in the Committee's Working
Procedures, plus an additional regular meeting in June).  Provision was also made for informal
meetings of the Committee under the AIE process:G/AG/R/16
Page 14
18-19 March 1999 (informal meeting: 17 March 1999)
24-25 June 1999 (informal meeting: 23 June 1999)
29-30 September 1999 (informal meeting: 28 September 1999)
17-18 November 1999 (informal meeting: 16 November 1999).
(c) Canada -  Certain measures taken by the State of South Dakota and others affecting Canadian
exports destined for, or in transit, through that State
47. The representative of Canada stated that on 16 September 1998 the State of South Dakota had
started blockading shipments of Canadian grains, cattle and hogs on the basis of alleged health and
phytosanitary concerns.  Four other States, Idaho, North Dakota, Wyoming and Montana, had also
harassed Canadian trucks bringing into or through these States shipments of grain, cattle and hogs.
The Canadian products in question were of the highest quality and met all federal requirements of theUnited States.  Canada was very concerned about this situation as Canadian producers had invested in
the hog and cattle sectors on the basis of transparent and predictable trading rules and now found their
businesses negatively affected by State measures that were inconsistent with the international trade
obligations of the United States. Canada had requested consultations under Article XXIII of the
GATT 1994 in the hope of being able to resolve this  issue in the near future (G/AG/GEN/27 refers).
Canada trusted that it would be able to report a satisfactory solution to this situation to the next
meeting of the Committee.
48. The representative of the United States responded that the United States recognized the
seriousness of this matter and was closely engaged with the Canadian and State authorities in an effort
to resolve this matter and address the factors that gave rise to the dispute.  The United States did notcondone any precipitous action by any party involved.
49. The representative of Switzerland noted Switzerland's interest in the outcome of this matter.
(d) Chile – Request for a further meeting with the the European Communities on the issue of
subsidies in the European Communities canned fruit sector
50. The representative of Chile stated that Chil e wished to inform the Committee that Chile
together with Argentina, Australia, Brazil, Canada, Costa Rica, New Zealand, the Philippines, South
Africa, Thailand, the United States and Uruguay had availed themselves of the offer by the European
Communities to continue the dialogue on the matt er of subsidies in the European Communities'
canned fruit sector.  Accordingly, a communication had been submitted to the European Communitiesrequesting another information meeting in Geneva on the margins of the Committee's November
meeting so as to continue the process of inform ation exchange (G/AG/R/15, paragraphs 70-75 refer).
It was the understanding that the objective of this type of meeting was to clarify issues, in a spirit of
transparency, which were related to the provision of subsidies by the European Communities to its
processed fruit and vegetable sector in order to come to a better understanding of the implementation
of commitments undertaken at Marrakesh.
51. The representative of the European Communitie s confirmed its willingness to continue the
dialogue with the parties involved at a time to be agreed close to the Committee's November meeting.
The representatives of Australia, Argentina and the United States reaffirmed their governments'
interest in this matter.
(e) European Communities – Annual consultation under the provision of Article 18.5 of the
Agreement on Agriculture
52. The representative of European Communities noted that Article 18.5 of the Agreement on
Agriculture provided for annual consultations with respect to Members' participation in the normal
growth of world trade in agricultural produc ts which, according to the Committee's WorkingG/AG/R/16
Page 15
Procedures, were scheduled to be held at the November meetings.  The European Communities
requested the Secretariat to prepare, for the purpos es of these consultations, a background note for the
consultations by Members at the next meeting of the Committee.  The Secretariat took note of this
request.
Date of Next Meeting
53. The next regular meeting of the Committee on Agriculture will be held on 17-18 November
1998, and the airgram convening the meeting and containing the draft agenda will be issued on
6 November 1998.G/AG/R/16
Page 16
ANNEX
Page
Part I Summary of specific points raised on  notifications and responses thereto
(30 September - 1 October 1998 meeting)17
(i) on the administration of tariff and other quota commitments (Table MA:1) :
Ecuador (ECU/5), Guatemala (GTM /6), Thailand (THA/26), Thailand
(THA/28), and United States (USA/15);17
(ii) relating to imports under tariff and other quota commitments (Table MA:2) :
Brazil (BRA/11), Colombia (COL/10 and Corr.1), El Salvador (SLV/6),
Guatemala (GTM/9), Israel (ISR/7) , Morocco (MAR/13), Norway (NOR/17),
Slovenia (SVN/9), Switzerland (CHE /14), Thailand (THA/27) and United
States (USA/16 and Corr.1);24
(iii) relating to the use of the special sa feguard (Table MA:3 to MA:5) :  Japan
(JPN/30) and Poland (POL/20); United  States (USA/18 for preliminary
review)31
(iv) relating to domestic support commitmen ts (Table DS:1) :  Chile (CHL/8 and
Corr.1), Colombia (COL/8), Cz ech Republic (CZE/17), European
Communities (EEC/12, Corr.1 and Corr.2) , Iceland (ISL/11), India (IND/1),
Jamaica (JAM/2), Morocco (MAR/ 11), Philippines (PHL/15), Slovak
Republic (SVK/14), Slovenia (SVN/8),  Switzerland (CHE/15), Trinidad and
Tobago (TTO/2), the United States  (USA/17) and Ur uguay (URY/13);33
(v) relating to new or modified domestic support measures exempt from
reduction (Table DS:2) :  Switzerland (CHE/16);53
(vi) relating to export subsidy commitme nts (Tables ES:1 to ES:3) :  Australia
(AUS/19) for preliminary review; Hungary (HUN/14), Morocco (MAR/10),
Norway (NOR/18) and Switzerland (CHE/17).54
Part II Deferred replies to questions on notifi cations raised at previous meetings 57
(i)
(ii)relating to domestic support commitments (Table DS:1) :  European
Communities (EEC/12, Corr.1 and Corr.2);
relating to export subsidy commitment s (Tables ES:1 to ES:3) :  European
Communities (EEC/11).57
59
Attachments
1. Guatemala -  Tariffs applied to tariff quota products not subject to tariff quota
arrangements in 199860
2. Guatemala –  Import arrangements for wheat and meslin flour 61
3. Guatemala -  Import data for all tariff quota products, calendar year 1997 62
4. Israel -  Yearly increase of market access opportunities, 1995-2000 63
5. Jamaica -  Supplementary information on "green box" programmes 64
6. United States -  Alternative methods used to calculate irrigation subsidies 67G/AG/R/16
Page 17
ANNEX – Part I
Review of Notifications by the Committee on Agriculture on 30 September-1 October 1998
Summary of Specific Points Ra ised and Responses Thereto
Table MA:1 Notifications
Ecuador   G/AG/N/ECU/5   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
United States:  Whether all the tariff quotas listed in Annex
1 of the notification are being implemented.Ecuador has designed and implemented a regulatory
framework to administer its tariff quotas for which therewas no provision in its legislation prior to its adherence tothe WTO. Product-specific provisions concerning the
allocation of tariff quotas are still under elaboration.  In the
case of wheat, sorghum and yellow maize, it has alreadybeen possible to establish specific rules, allocate the tariffquotas and import the goods.
United States:  Explanation of the tariff system described inAnnex 1 of the notification; whether the "maximum tariff"can be assimilated to the in-quota rate.The purpose of Annex 1 is to provide information on the
annual quota volumes and maximum duties applicable tothe products subject to the tariff quota regime during the
implementation period.  Ecuador confirms that the in-quota
rate is the "maximum tariff" for the quota.
United States:  Whether it can be assumed that out-of-quota
rates are above the maximum rate; details on the appliedout-of-quota rates.This concerns products which are imported under the
Andean System of Price Bands (SAFP), for which duties
are published in the Official Register.  For those products
which are not covered by the SAFP, the tariff applied is theAndean Common External Tariff.
Australia/Canada/New Zealand: Auction system used toallocate licences for certain tariff quotas (in particular forturkeys and fowls; milk powder; wheat and maize starch,glucose); experience gained by Ecuador in administeringthe auction system.The Interministerial Agreement No. 063 (IA 063) lays
down the general parameters for the administration of tariffquotas.  However, additional product-specific provisionsare necessary, matching each met hod of allocation.  The
auction system is not operational yet as these product-
specific regulations are, as mentioned above, still underelaboration.
New Zealand:   Whether alternative methods of allocation,
i.e. other than auctioning, have been considered for the
three tariff quotas concerned.The principal method of allocation is the historical
allocation, the simplest from an administrative point-of-
view, and the most widely used by the internationalcommunity. However, in the case of three tariff-quotaproducts, the number of tr aditional importers is large
relative to the available volumes.  For those three tariff
quotas, the auction method was given preference b ecause it
allows the allocation to take place on the basis ofcompetitive tenders.
Australia:  Explanation of the legal consistency of auctionsystems with WTO rules.Ecuador believes that the auctioning method used to
administer its tariff quotas is consistent with WTO rules.
Australia/Brazil: Meaning of Article 1 of the
Interministerial Agreement No. 063 (IA 063) regarding the
triggering of the tariff quota mechanism.For each of the fifteen tariff quotas, the tariff quota
mechanism is triggered only when the customs tariffs
applied on each product concerned exceed the maximumbound in-quota tariff rate during the tariff quota period.Upon adhering to the WTO, Ecuador undertook to comply
with all of its market access commitments.  The objective
of Article 1 of IA 063 is to ensure that the total tariffcharges do not exceed the maximum bound WTO tariffsand tariff quotas.G/AG/R/16
Page 18
Ecuador   G/AG/N/ECU/5   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
Brazil:  In the case of poultry, for instance, whether the
tariff quota mechanism only applies when the import dutyexceeds 40 per cent.For poultry cuts, for example, the tariff quota mechanism is
triggered only when the import duty exceeds 40 per cent.
The criteria used to determine the duty for each tariff quota
is the maximum bound tariff rate applicable to each tariff
quota, as established in the List of Ecuador, Section 1-B.
Brazil:  How can exporters know  if their transactions fall
within, or out of, the quota?Exporters know whether thei r shipments fall within the
tariff quota through the corresponding importers byrequesting a copy of the Documento Único de Importación,
"DUI "  (import licence) which duly indicates such
information.
Australia:  Meaning of Article 7 of IA 063, regarding thetreatment of preferential trade in the allocation of m.f.n.-based tariff quotas.When Ecuador joined the WTO, it undertook not to exceed
its market-access commitments which include both boundtariffs and tariff quotas.  The purpose of Article 7 of IA No.
063 is to prevent the operation of the SAFP from violating
those commitments since the mechanism establishes thatthe tariff charges may not exceed the bound WTO tariffs.Ecuador does not grant any preferential treatment to any
country or group of countries within the framework of  its
tariff quota administration system. All WTO Membercountries have equal access rights to the tariff quotas
opened by Ecuador.
Australia: Whether lower tariff rates are applied to importsfrom Andean Pact countries under the established tariffquotas.The Andean Community is a customs union within which a
free trade zone was established.  Consequently, there is nojustification for granting minimum access opportunities toAndean Pact countries through the tariff quotas.
Brazil:  Import licences for soya oilcake and poultry meatare valid for three months.  Considering Article 5 of IA063, whether the Committee on Tariff Quotas (CTQ) wouldhave the authority to modify this validity period.The DUI (import licence) is valid for three months
irrespective of the type of import régime applicable to thetariff quota whereas the "tariff quota period" which is
determined by the CTQ, is exclusively applicable to tariff
quotas. The "validity period" of the DUI and the "tariffquota period" are thus of a distinct nature, the former beinga general administrative requirement while the latter is
inherent to the import regime effectively applied to the
tariff quota. There is no contradiction between the twoprovisions.
Australia: For turkeys and fowls, soya oilcake and oilcakeor rape-seed, wheat, barley and malt, flint maize andsorghum, the effective quota period is to be notified at thebeginning of each year.  Reason why the quota period is not
pre-determined for such products.The seasonal nature of several of the tariff quota products
may change due to varying climatic conditions.  El Niño ,
for instance, had a major impact on Ecuador's agriculturalproduction.  For this reason, the tariff quota period cannotbe pre-determined for certain more than one year in
advance.  The present system is transparent.  It provides
predictability to trade operators who, through theirparticipation in the CTQ, are fully aware of all the pertinentdetails about the administration of tariff quotas.
New Zealand:  Membership of the CTQ: implications ofthe presence of delegates of trade associations in view ofthe need to ensure a fair and transparent allocation of alltariff quotas.The presence of a trade association delegate in the CTQ
aims precisely at ensuring a fair and transparent allocationprocess.  This member is appointed by consensus r eached
among all the importers of the products concerned.  In
addition, this member is required to inform the importers,whom he represents, of all the resolutions adopted by theCTQ.
United States: In case of under-utilization of importlicences within the required three-month period, whethernew licences issued and nature of requirements.Unused import licences for which the three-month validity
period has elapsed cannot be renewed for the sameimporter.  However, the unused quantity can be allocated toanother importer trading in the same product.G/AG/R/16
Page 19
Ecuador   G/AG/N/ECU/5   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
United States:  Meaning of the phrase "tariff quotas which
were used without any justification during the period of
validity … for timely reallocation ." (Article 6 of IA 063
refers).  How are these tariff quotas reallocated?The objective of Article 6 of IA 063 is to prevent the waste
of unused tariff quota quantities unless a justification of
force majeure  is invoked by the importer.  Such
justification would have to be presented to the CTQ for itsconsideration.  Equally, the CTQ will decide on the mostappropriate method to reallocate the unused tariff quotavolumes.
New Zealand:  Confirmation that no restrictions are placedon the volumes of the different types of milk powdergrouped by Ecuador in "a single quota".
Reasons for not extending a similar treatment to other tariff
quotas which cover more than one line.Ecuador confirms that there is just one single tariff quota
for the three types of milk powders mentioned in its List.
Within this single tariff quota, the volume shares are pre-
determined and distributed equitably among the three dairyproducts involved.
Where the distribution modalities of other single tariff
quotas were not notified, it is understood that there are no
restrictions on the proportions of each product within thesingle tariff quotas concerned.
Australia:  Provisions for new importers; basis on which
they will have access to tariff quotas that are distributed
using historical allocations.The average imports of the five previous years is a criterion
applicable to traditional importers only.  New importers are
defined as being those who do not have an import recordduring the last five consecutive years, or who have norecord of imports at all.
New Zealand/United States: Provisions for new entrants.In particular, reason why 10 per cent of the tariff quota forwheat/barley/malt is reserved for new entrants, whereas for
other tariff quotas allocated on the basis of historical
shares, 20 per cent is reserved for newcomers.In applying the historical method of allocation, the
proportion between traditional and new importers wasestablished on the basis of (a) the structure of Ecuador's
external trade in the products concerned and (b) the number
of importers and their effective import potential.  Under theauctioning method, new importers would have free accessto participate in acquiring a share of the tariff quota.
Follow-up remarks : In Australia 's view, Ecuador's system of tariff quota administration is complicated, provides no
certainty for exporters and is likely to generate low quota fill rates - New Zealand and Uruguay  expressed doubts about
the consistency of the auctioning system with WTO rules and requested Ecuador to reassess alternative methods of
allocation - Norway and Switzerland , as users of auctioning, defended the system's compatibility with multilateral rules
and offered to share their countries' exper iences within the most appropriate forum.
Guatemala   G/AG/N/GTM/6   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
Japan:  Absence of notification for the calendar year 1996. The corresponding notification will be submitted as soon as
possible.
Australia:  Reasons why Guatemala introduced tariff quotaarrangements for apples.This tariff quota for apples was activated in response to
Guatemala's plans to pursue its expansion and
modernization plans in areas suitable for the developmentof deciduous fruit trees, and in accordance with thegovernment's overall strategy to generate employment
opportunities and increase rural incomes, as well as
improve the competitiveness of the product sector.
Australia/Japan:  Confirmation sought that the commodities
listed in Section I-B which were not subject to tariff quota
arrangements remain subject to tariffs only.Confirmed. Such products are subject to the tariffs which
correspond to the Central American Tariff, as indicated in
Attachment no. 1 to the present report.G/AG/R/16
Page 20
Guatemala   G/AG/N/GTM/6   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
United States:  Consequences of the under-utilization of a
licence below the required 90 per cent level (for meat andedible offal of poultry).Article 18 of the Ministerial Decree no. 8-97 stipulates that
"the applicant cannot use the licence for a quantity below
90 per cent of the allocated volume": the Directorate-
General of Customs would reject the licence and wouldapply the 45 per cent out-of-quota import duty on all theimported volume.  On the other hand, if imports exceed the
allocated amount indicated on the certificate, the out-of-
quota tariff rate would only apply to the quantities in excessof the allocated amount.
Brazil:  Relationship between the monthly allocation of583.33 tonnes (tariff quota of meat and edible offal ofpoultry) and the annual in-quota volume notified inG/AG/N/GTM/9, i.e. 5,834 tonnes.The monthly allocation of 583.33 tonnes results from the
division into 12 equal shares of the volume of 5,834 tonnes(commitment undertaken in List LXXXVIII) increased(autonomous market access increment) by 1,166 tonnes.
Brazil/European Communities: Reason why, for the tariffquota for meat and edible offal of poultry, licences arevalid for only one month; and calculation method ofmonthly allocations.The one-month validity period is due to the manner in
which the tariff quota is distributed.  The annual quotavolume for meat and edible offal of poultry under heading0105 (fresh, chilled or frozen) is 7,000 tonnes.  The
monthly volume allocation of 583.33 tonnes is derived by
dividing the annual volume into 12 equal shares, to bedistributed according to the procedure outlined in point (b),page 2 of the notification.
Brazil/United States:  Government action envisaged if thelicence is not used within the required one-month period;re-allocation possibilities for meat and edible offal ofpoultry.
Follow-up remarks :  Uruguay raised concerns regarding
(a) the limited period of the validity of import licences for
certain tariff quota products which will severely constrainmarket access opportunities of distant suppliers; and (b)
the apparent lack of justification for applying the higher,
out-of-quota duty on imports, simply because the actualvolume imported under the in-tariff quota arrangementfalls below a 90 per cent threshold of the amount indicated
on the import certificate.  Matter to be followed-up in
writing.Article 17 of the relevant regulations provides that import
licences for meat and edible offal of poultry shall be validfor one month. Article 22 provides that importers facing
unexpected circumstances on duly established grounds of
force majeure  may request, in writing, the Commission to
either (a) replace their licence with a new licence valid forthe following calendar month; (b) split the assigned volumeinto several new licences; (c) cancel the licence. This
implies that except in cases of force majeure duly
recognized by the Ad Hoc Commission, the import licence
loses its validity with immediate effect 30 days after theissue date.
Thailand   G/AG/N/THA/26   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
New Zealand/South Africa: Reasons for generally imposing
short validity period for import permits, putting distant
suppliers at a disadvantage.Thailand wants to encourage the importers who have been
allocated a share of the tariff quota to pro ceed with the
importation as soon as possible so that the competentauthorities know the balance of the quota.  The permitsmay be extended but no later than 31 December of eachimport year.
Australia/Hungary/New Zealand/Switzerland:  Coconut  -
Legal basis for splitting unevenly the tariff quota into three-monthly allocations; whether the system involves localpurchase requirements.The allocation measures are designed in relation to the
nature of each pr oduct and considering different yield
periods. The import quota for coconut is allocated on a
four-monthly basis to match the seasonal pattern of
domestic production and in order to stabilize the localprice.  The import quota is allocated on a pro rata  basis to
any juristic persons operating a factory which uses coconut
as a production input. There is no obligation to buy locally-
produced coconut (the same holds true for coconut oil).G/AG/R/16
Page 21
Thailand   G/AG/N/THA/26   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
Australia: Coconut  and Rice  - Whether any flexibility in
imports for products subject to seasonal restrictions could
be allowed and whether permitted imports could possibly
be reallocated if warranted by market conditions.At present, Thailand does not plan to change the allocation
measures applied to these tariff quota products.
New Zealand:  Copra  - Reason why the import timing for
copra is restricted to November and December 1998;
whether Thailand plans to introduce any changes to thispractice (also in relation to other tariff quota products),especially in view of the very low fill rates registered for1997.The domestic production of copra takes place throughout
the year except in November and December.  Copra
imports are allowed during those two months in order toavoid supply shortages as well as to minimize theadministrative cost and burden associated with the import
procedures.  However, importers can apply for the tariff
quota in advance and import promptly at the beginning ofthe allocation period.  Thailand does not intend to changeits allocation method for coconut, coconut oil nor copra.
Hungary/South Africa/Switzerland:  Onions  - Reason why
the quota is entirely allocated to the Onion GrowersCooperative Federation (OGCF); membership of the OGCFand share of national production represented; whether theresulting price is a producer subsidy.The OGCF is located in the northern part of the country
where onions are extensively grown. It represents alldomestic onion growers.  Thailand believes that there is nojustification to allocate the import quota to other parties,
namely those who act as middlemen or other importers of
onions.  An influx of imports would provoke a highvolatility on the domestic price level, which wouldadversely affect a large number of small, low-income,
onion growers.  The allocation to the OGCF was deemed
appropriate to ensure a level of certainty to farmers' meagreincomes as well as to ma intain market stability.
Hungary/South Africa/Switzerland:  Onions and Garlic  -
Since the tariff quotas are uniquely allocated to OGCF andPWO respectively, how do these organizations allocateimport permits?  Whether this involves state trading;whether permits are restricted in any way.
South Africa notes that the two tariff quotas were not filled
as shown by Thailand's MA:2 notification .The Public Warehouse Organization (PWO) operates on a
commercial basis in line with Article XVII of GATT 1994and has attempted to allocate the import quota to juristicpersons.  To date, there has been no request from juristicpersons because the domestic price of garlic is very low.
New Zealand/Switzerland:  Soya Bean Oil  - Conditions for
membership in the Thai Food Processors' Association
(TFPA) and restriction of import licences to end users;local purchasing requirements; method of allocation of theshares.Membership to the TFPA is not conditional upon local
purchase requirements. The Government is not involved in
the activities of the Association.  The tariff quota for soyaoil imports in 1998 is allocated to members of the TFPA ona pro rata  basis.
Canada/New Zealand:  Soya Bean  -  Terms of access
applied in 1998 and those foreseen in 1999, in view of dutyfree imports which took place in 1997.The import quota for soya bean was not implemented in
1998.  Unlimited quantities are allowed to be imported dutyfree, due to increased domestic demand.  Thailand does not,at present, have any plans to change the system for 1999.
European Communities:  Tea - Reason for sub-dividing the
tariff quota for tea between green and black tea, when suchsub-division is not foreseen in Thailand's Schedule.Tea falls under HS 0902 which covers all types of tea,
including green and black tea.  Thailand therefore does notsee any inconsistency in th e manner in which its tariff
quota commitments are being applied.G/AG/R/16
Page 22
Thailand   G/AG/N/THA/28   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
European Communities / Japan / Hungary / New Zealand :
Maize  -  Basis for allocation of shares to importers and
allowance for newcomers; substantial shift in the allocation
to certain end-users compared to 1997 (poultry and swinefarms as well as factories were then eligible); criteria usedto determine end-users; reasons for introducing a 15 July1998 import deadline.Allocation is made on a pro rata  basis to six associations
(THA/28 refers) regardless of their historical performance.
These associations are the users of maize for feedstuffs.
Poultry and swine farms are also members of one of theseassociations.   In 1998, up to 300,000 tonnes of maize areto be imported, or six times more than Thailand's scheduled
commitment.  This volume must be imported before the
first half of the year because the local supply is expected tobe marketed during the second half of the year.
New Zealand:  Onion seeds  - Reason why import licences
are being allocated only to the Onion Growers' CooperativeFederation; whether Thailand plans to change this practice.Please refer to the above reply on onions in connection
with THA/26 .  At present, Thailand does not plan to change
the allocation method applied to this product.
Japan:  Potato  - Reason for the substantial change in the
allocation of the tariff quota to "juristic persons" in 1998
(page 4, HS 0701, item b, (ii) refers) instead of the PWO.This reflects Thailand's intention to improve the tariff quota
administration method.  The quota is now allocated to any
juristic person on a pro-rata  basis.
Switzerland:  Raw silk  - Sub-quota allocated to "any
juristic person having production plan on silk fabric or raw
silk import arrangement":  whether production plans aresubject to government approval; whether local purchasesare involved; meaning of "import arrangement".No government approval of importers' production plans is
needed.  This entirely depends on the private sector. No
local purchase requirements are placed on raw silk, nor onany other tariff quota products.  "Import arrangements"means that importers should present their production plans
for silk fabric as well as import plans for raw silk. In
addition, if the total volume of the desired imports exceedsthe total quota quantity, the allocation will be made on apro-rata  basis.
European Communities:  Skim milk powder  - Reason why
a tariff quota of only 78,000 tonnes was opened in 1998,compared to 88,000 tonnes in 1997 (THA/22 refers.);reason for allocating the tariff quota to different end users
instead of opening it for global allocation, thereby allowing
importers themselves to determine the final use of theirimports.In 1998, Thailand opened an import quota totalling
48,333.33 tonnes.  Due to domestic demand, this importquota was increased to 78,000 tonnes, representing a levelof imports which is 60 per cent higher than scheduled
commitments. The allocation of the quota to importers is
made on a pro rata  basis taking into account the demand of
each different category of end users.  Newcomers are alsowelcome to apply for the tariff quota.
Argentina/Brazil/Hungary:  Soya bean cake  - Clarification
of access terms in 1998; whether allocation to end usersother than those listed is foreseen; criteria used to allocatethe tariff quota among the various Associations.The tariff quota is allocated on a pro rata basis to those end
users that are the major consumers of the productconcerned in order to avoid unnecessary importation costs
or quota rents.  The applied in-quota tariff rate is zero.  This
system is maintained for the time being.
United States   G/AG/N/USA/15   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
Bolivia/Mauritius:  Criteria used to assign sugar quotas. The raw cane sugar tariff quotas are allocated according to
Article XIII of GATT 1994.  In accordance with this
Article, allocations for the raw cane sugar tariff rate quota
are based upon the proportions supplied during therepresentative period of 1975-1981.  This period was thelast period wherein US trade in raw cane sugar wasrelatively unrestricted.
Bolivia:  Reason why a 0.752 per cent share was assignedto Bolivia when historically the share has been 0.8 per cent,and that such allocation was underestimated by 33 per centdue to a statistical error in the period 1975-1981.Bolivia's individual allocation has remained unchanged
since its establishment.  This amount is still 0.81 per centrather than 0.752 per cent.  The allocations for the nine
minimum quota countries in the amount of 7,258 tonnes
each, and Mexico's NAFTA allocation of 25,000 tonnes, donot count in calculating a country's percentage share.G/AG/R/16
Page 23
United States   G/AG/N/USA/15   Tariff Quota Administration (Table MA:1)
Points raised by other Member s Response by Notifying Member
Follow-up: Colombia: Whether Colombia's understanding
of the above answer is correct, i.e. that the allocations to
small country suppliers and Mexico are made separately
from the tariff rate quota included in the US Schedule, andas such, that they are not credited to the volume of the tariffquota.The United States provided clarification that the allocation
to small country suppliers is credited to the tariff rate quota
bound in the US Schedule. At this time, a separate
allocation is made for Mexico.
European Communities:  Method to be used by USTR to
allocate the balance of 200,000 tonnes (footnote (1),USA/15 refers)The balance of 200,000 tonnes depends on the stocks-to-
use ratio registered at various times throughout the year.If and when the additional allocation is announced,  it willbe done on the basis of each country's percentage share.G/AG/R/16
Page 24
Table MA:2 Notifications
Brazil   G/AG/N/BRA/11   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Japan: Confirmation sought that access for apples and
pears  is not subject to any restriction as regards the
importation period.The tariff quota for apples and pears was not opened
because the applied rate, i.e. the MERCOSUR CommonExternal Tariff, is 13 per cent, which is below the 15 per
cent bound in-quota rate.  No restriction was placed on the
imports of apples and pears during that period.
United States:  Request for missing import data for wheat ;
whether Brazil could submit Table MA:2 notificationsusing the format specified in G/AG/2.In September 1997, Brazil notified its intention to withdraw
its tariff rate quota for wheat.  Since then, Brazil has been
in Article XXVIII negotiations with two Members.   In
1997, approximately 4,859,000 tonnes of wheat wereimported.
Colombia   G/AG/N/COL/10 and Corr.1   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia: Beef, frozen - Reason why this tariff quota is
consistently under-filled.This must be due to a misunderstanding.  On the contrary,
the in-quota imports registered in 1997 for this productcategory are well above the tariff quota quantity for theperiod in question (page 2 of the notification refers).
New Zealand: Beef, fresh -  Reason for low level of
imports;  tariff applied.This product is subject to a tariff-only regime. The low
level of imports may be due to the lack of interest shown bypotential importers.  The tariff rate applied is 20 per cent.
During 1997, Colombia applied a single tariff to imports ofmeat, i.e. 20 per cent which is substantially below thecommitted bound levels (i.e., 108 per cent for currentaccess, and 80 per cent for minimum access).  The tariffs
applied to dairy products in 1997, which were substantially
lower than the bound tariffs, are provided below.
Product Applied rate
(%)Bound  in-quota
rate (%)
0401 25 159
0402 28 151
0403 21.5 90
0404 28 136
0405 28 115Australia :  Beef and dairy  -  Whether Colombia continued
to apply a tariff-only regime in 1997;  if so, applied tariffrates for 1997.
0406 28 141
Australia:  Milk and cream  (not concentrated) -
Explanation of the large drop of imports in 1997.Ample market access opportunities were granted.  The
absence of imports is merely due to the lack of demand.
Australia: Oils and oilseeds  - Reason why tariff quota is
consistently under-filled.Imports under tariff items 1508, 1511, 1513 and 1514
register levels below the commitments due to changes inimport demand and a shift in importers' preferences forsoya beans, sunflower or soya bean oil (tariff items 1201,
1507 and 1512).  It is also important to note that domestic
production of African palm oil is increasing, not onlysatisfying internal market n eeds but also generating excess
supply for export.G/AG/R/16
Page 25
Colombia   G/AG/N/COL/10 and Corr.1   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
European Communities:  Some tariff quotas appear to have
been merged with different in-quota tariff rates.  Request
that Colombia indicates imports under each relevant tariff
quota.Colombia did not implement tariff quota arrangements for
some products since the applied tariff rate was below the
bound in-quota tariff rate.   For this reason, import data
were reported on the basis of the tariff item numbersinstead of differentiating between minimum and currentaccess tariff quotas.
Japan:  Industrial monocarboxylic fatty acids - The tariff
item number was changed to 3823 while in the Schedulethe number is 1519.This modification arises from the updating of the tariff
nomenclature adopted by the Government in D ecember
1995 in accordance with the Decision taken by the
Commission of the Cartagena Agreement endorsing a
common nomenclature to be adopted by the signatories.This modification also reflects changes introduced in theharmonized system adopted in 1996.
Japan:  Lard stearin HS 1503  - Reason for zero imports. Market access opportunities were fully granted since the
product can be freely imported.  Importers did not showinterest in this product and no import request wassubmitted.
El Salvador   G/AG/N/SLV/6   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Canada:  Import data for all of the tariff quota products,
whether or not these have been implemented.This question was not received within the required
deadlines indicated in the airgram convening this meeting.The answer will be provided upon receipt of the importdata from the capital.
Japan: Whether a tariff-only regime will continue to applyfor all the tariff quota products.Up to the present date, El Salvador has not decided to
implement any tariff quota. This Committee will benotified accordingly as s oon as El Salvador decides to
activate any tariff quotas.
European Communities:  App lied import duties for tariff
quota products; whether these duties have been applied toall imports of the product concerned.Regarding the applied duties, El Salvador undertook to
provide a response in writing.  These duties are applied onan m.f.n. basis.
Guatemala   G/AG/N/GTM/9   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/Japan:  Reason for low fill rate registered for the
tariff quota wheat and meslin flour .Since adequate supply is available domestically, there is no
strong incentive to import these products.  However, if thetotal tariff quota volume is not allocated by the end of the
year, an equivalent volume of wheat of the balance is added
to the tariff quota for wheat in the proportion of 100 kgs. ofwheat for 72 pounds of flour, as provided for in Article 2 ofthe Acuerdo Gubernativo  No. 152-96, the full text of which
is provided in Attachment 2.
Japan:  Reason for absence of notification for calendar year1996.Guatemala takes note of this observation. The relevant
notification will be submitted shortly.
Canada/Japan/United States:  Confirmation sought thatonly applied tariffs were imposed on those tariff quotaproducts omitted from the 1997 notification; that betteraccess c onditions were offered than those established in
Guatemala's Schedule; details on import data for all tariff
quota products together with the applicable tariffs in 1997.Confirmed.  The Common External Central American
Tariff (Attachment 1 refers) is applied to tariffied products.These rates are lower than those bound and, contrary to thelimitation established for the amounts to which the
preferential in-quota tariff is applied, are applied to any
imported volume. Attachment 3 contains evidence that theapplication of the tariffs in force for the tariffied productsreflects a greater opening up than the WTO commitments.G/AG/R/16
Page 26
Israel   G/AG/N/ISR/7   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Japan:  Reason why the tariff quota quantities shown in the
notification for 1995 differ from the committed volumes.Israel has implemented an autonomous increase for the first
year of implementation as shown in Attachment no. 4.
Japan:  Whether Israel could submit a Table MA:1notification for 1996 and 1997.Israel has not introduced any change in its import regime
since G/AG/N/ISR/1 (circulated in 20 September 1996).For this reason, Israel sees no reason why a notification
containing the same information should be presented again
to this Committee.
Japan:  Bovine-related items  - Whether conversion rates
used could be provided since Israel's commitments are
expressed on a metric ton basis, and not on a per head
basis, as shown in the notification.The conversion rates for live bovine animals are as follows:
(a) pure-bred breeding bovine: 500 kg. per head, and (b)other live bovine: 400 kg. per head.
Canada:  Wheat and meslin  -  Whether Israel could
provide the source of imports counted as in-quota imports
for 1995, 1996 and 1997;  whether any of these in-quotaimports benefitted from a tariff rate lower than the m.f.n.tariff; if so, information is requested on the tariffs actuallyapplied within the tariff quota.
Follow-up:  Mauritius sought confirmation that the
753,732 tonnes mentioned as "in-quota imports" are
actually broken down between 450,000 tonnes (committed
quantities), the remainder pertaining to FTA imports .
Israel indicated that the Customs Service could notdifferentiate between those two quotas.  Access termsapplied to both regimes were on duty-free basis.Overlapping FTA imports may be included under tariff
quota as provided in G/AG/N/ISR/1. The relevant
information is contained in the related notifications.
Morocco   G/AG/N/MAR/13   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Canada:  Whether the reported in-quota imports reflect
actual imports, in cases where the tariff quota is reported asbeing exactly filled; or whether there have been imports inexcess of the tariff quota.The data shown only reflects imports up to the respective
tariff quota limits.  Actual imports are often above thelevels reported in the notification.
Australia/Japan/New Zealand: Colza seeds  - Reason for
large drop in tariff quota fill in 1997.As explained on earlier occasions (for 1996 and 1997),
there is a high degree of substitutability between colzaseeds and other oilseeds, which may be the reason why thetariff quota was not filled.
Canada:  Milk   and Sugar  - According to Morocco's
Schedule, these two tariff quotas apply only to HS 0401.20and 1701 respectively.  Reasons for widening the productcoverage in the notification.
Follow-up:  Canada
: Since imports under tariff item 1701
were well above the committed level, why merge those data
with imports realized unde r tariff item 1702?  Morocco
undertook to provide responses on a bilateral basis.Imports of milk under tariff item HS 040120 were
negligible during the base period 1986-88.  Morocco is a
structural importer of milk powder.  Undertook to provide aresponse on the reasons for widening the product coverage.
Morocco is a structural importer of sugar.  Imports realized
under HS 1701 are well above those established under the
tariff quota.
Japan:  Oilcake  of cotton seeds, sunflower seeds and
colza seeds  - Request that data be provided separately for
each type of oilcake ( 1996 and 1997) in line with
Morocco's Schedule.There is a high price elasticity of demand between the
various types of oilcakes, and therefore a high degree of
substitutability.  Taking into account their respective
nutritional value, importers invariably opt for the leastexpensive type of oilcake.  In accordance with theprescriptions relating to the establishment of individualcommitments, countries were allowed to open their market
access commitments at the four-digit level of the
Harmonized System.G/AG/R/16
Page 27
Morocco   G/AG/N/MAR/13   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Brazil/New Zealand:  Poultry meat  - Reason for low tariff
quota fill rate, especially in light of the full utilization ofthe quota for other products.This may be due to domestic consumption patterns.
Consumption of meat in Morocco is oriented towards fresh
poultry meat.  The quantities imported reflect very specific,
particular and limited needs.
United States:  Peanuts, Sunflower seed, Cottonseed -
Reason why import data are missing although
commitments were undertaken for these three tariff quotaproducts.These products are not subject to tariff quota commitments.
Australia/Japan/New Zealand: Rice - Reason for large drop
in tariff quota fill in 1997.Despite opening the tariff quota for rice at reduced rates for
1997, import demand remained weak. Improved climatic
conditions favoured an increase of the internal supply ofrice which satisfied domestic market needs.
New Zealand:  Sheepmeat  - Reason for low tariff quota fill
rate.This may be due to domestic consumption patterns.
Consumption of ovine meat in Morocco is oriented towardsfresh meat.  The limited quantities that were importedrespond to very specific needs.
Argentina/Australia/Brazil/Japan/New Zealand:  Sorghum
- Reason for low tariff quota fill rate.As explained on earlier occasions (for 1996 and 1997),
there is a high degree of substitutability between maize andsorghum in Morocco which may be the reason why thistariff quota was not filled.
Norway   G/AG/N/NOR/17   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/Brazil/New Zealand/United States: Sheepmeat,
bovine meat, meat of swine, fowls, turkeys, turkey roll,
poultry, ducks, cereals, concentrated milk and cream,
butter and cabbages  - Reasons for the persisting zero or
low fill rates of several tariff quotas, in particular minimumaccess quotas.
Follow-up :  The MA:1 notification provides that a share of
certain tariff quotas may be reserved for the food
processing industry.  New Zealand wondered whether this
had been the case in 1997.  Norway confirmed that no
share of those tariff quotas were reserved for food
processing industries, but that these entities, if they so
wished, could participate in the auctioning.As explained previously, Norway's auctioning system is
transparent and predictable.  The importers' interest hasincreased every year and a number of them have bought
parts of tariff quotas at the annual auction.  To stimulate
imports, the auctioning fee is not reimbursable. The actualimport figures reflect the commercial interest of importersin the different products.  It appears that price and marketconditions in 1997 did not favour quota use.
Japan:  Whether the tariff quota for sauerkraut  was
abolished in 1997.This product is not mentioned in the notification due to
changes in the Harmonized System in 1996.  As stated in
footnote 2 to tariff heading 20.05 in G/AG/N/NOR/15
which covers the year 1996, the former split subheading30.00 sauerkraut was eliminated in the HS 1996 revisionand the quota is since included in the split subheading
20.05.9009.  Footnotes regarding the HS 96 changes are not
included in the 1997 notification.  A tariff-only regime isapplied to this product.
Brazil:  Whether the low fill rates for meat products are dueto problems in demand, sanitary conditions or in theadministration of the tariff quotas.See other replies as regards demand for products or tariff
quota administration. As regards sanitary conditions,Norway is not aware of any such problems.  Should suchissues arise, they would be more appropriately addressedwithin the framework of the SPS Committee.G/AG/R/16
Page 28
Norway   G/AG/N/NOR/17   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States:  Norway's administrative tariff reduction
scheme sometimes offers tariffs lower than bound in-quota
duties.  It would appear that this unpredictable scheme may
be discouraging importers from bidding for tariff quotas atauctions -   Whether Norway has taken steps to reduce theuncertainty of quota auctions since administrative tariffs
appear to inhibit rather than improve market access,
according to the United States.
Follow-up: Recalling that in 1996, the share of the tariff
quota product that was allocated by auctioning differed
from the volume of actual imports, New Zealand requested
an update for 1997.  Norway confirmed that almost all the
1997 tariff quotas were fully allocated through theauctioning held in October 1996.  However, as reflected byactual import figures, importers who bought shares did not
find it commercially interesting to engage in imports.  This
reinforced New Zealand's belief that the current tariffquota system forces business operators to bid for quotas,pay a rent, only to forego this cost later when they find out
that the import transaction lacks commercial
attractiveness.  New Zealand wondered whether otherimpediments, such as high import tariffs, rendered importsso expensive that they no longer represented commercially-
viable opportunities and asked Norway whether any
consideration had been given to lowering such tariffs so
that WTO market access opportunities could be restored.Administrative tariff reduction scheme for agricultural
products:  Prices of most agricultural products are target
prices resulting from annual negotiations between the
Government and the farmers' associations.  The targetprices are the maximum average market prices during themarket year.  Accordingly, they are not guaranteed
minimum prices, but rather maximum prices.  Tariffs are
used to ensure that domestic prices do not exceed thesemaximum levels.  If domestic prices exceed the targetprices by 10 per cent (12 per cent for horticultural products)
for two consecutive weeks, tariffs are reduced for a certain
period.  The tariff reductions are general and noquantitative limits apply for import during this period.
The scheme is not unpredictable as specific criteria for the
tariff reductions are laid down in a regulation, which in
Norway's view, secures a transparent and uniform system.
The tariff levels that are set administratively may or may
not be lower than in-quota duties - their actual level
depends on price and market c onditions.   It is incorrect to
assume that administrative reductions are made frequentlyfor the products covered by minimum access quotas.  In
1997, there were only two reduction periods totalling sixweeks, both relating to white cabbage.
Norway's experience of the auctioning system has been
satisfactory as the participation rate is increasing.  As of thelast marketing year, the auctioning took place in October
1996 and not in January of the marketing year.  This
change was intended to allow importers to plan theirimports before the start of the marketing year.  The system,like any other administrative system, is under continuousevaluation.  So far, no other change is foreseen at present.
New Zealand:  Apparent discrepancies in reportingscheduled tariff quota quantities for tariff items HS0812.20.00 and HS 0713.33.00.The correct scheduled volumes for the tariff quotas in
questions are 27 and 85 tonnes respectively.  Acorrigendum will be circulated shortly. The in-quota and
out-of-quota tariff levels are equal for almost all current
access quotas and a tariff-only regime is applied to these
products.  The notification accordingly reflects totalimports.  The misprint does not reflect any actual reduction
in market access to Norway in 1997 for the products
mentioned.G/AG/R/16
Page 29
Slovenia   G/AG/N/SVN/9   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia:  Confirmation that "more favourable out-of-
quota import conditions" means that the applied tariff rateis lower than the in-quota tariff rate.Confirmed.
Australia:  Whether consideration has been given to
operating a tariff-only regime given that most trade isoccurring outside the tariff quota arrangements.Slovenia is giving serious consideration to the introduction
of a tariff-only regime to all of its tariff quota products,
when feasible.  Contacts were established with theauthority responsible for the administration of tariff quotaswithin the Ministry of Economic Relations andDevelopment regarding an initiative to adapt to a tariff-
only, or a first-come first-served regime, where appropriate.
Any developments will be reported in due course.
New Zealand:  Meat and dairy  - Reason why most of the
tariff quotas are significantly underfilled.Although they were allocated, the meat tariff quotas
remained underfilled due to insufficient market demand for
the type of meat offered.  Frozen meat is exclusively used
to meet specific processing needs and is imported duty free.It is worth noting that while market preferences are forfresh meat, there is also an oversupply of fresh meat in thedomestic market.
Due to considerable oversupply of milk and dairy products
the level of domestic production ex ceeded the level of self-
sufficiency by 20-30 per cent.  However, Slovenia
continued to import substan tial quantities of processed
products such as cheeses and spreads, ice-cream.
Switzerland   G/AG/N/CHE/14   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand:  Caseins  -  Explanation of the substantial
underfill of the tariff quota for caseins.This is due to the lack of demand for the specific product
under quota.  This quota is fully allocated and available to
eligible importers.  The market demands mainly caseins
classified under HS 3501.9090 and requests for this productare granted without any restriction. In addition, Switzerlandhas reduced the applicable out-of-quota rate to 10 francs
per 100 kg. against the bound rate of 909 francs per 100
kg..  Imports under this heading amounted during the sameperiod to about 367 tonnes.  The bound tariff rate for thequota product is 4 francs per 100 kg..
United States:  Potatoes and potato products  -  Noting
that the allocation to individual companies is based onprevious year's purchases of seed, fresh potatoes and
potatoes for processing, details sought on provisions and
criteria for new entrants; reallocation of unused quotashares.Tariff rate quota shares are allocated on the basis of
purchases in the previous year.  For new entrants, federalauthorities accept purchases in the same year as criteria for
the allocation of shares.  Allocated quota shares are valid
for a maximum period of six months, after which unusedshares are available for reallocation.  The tariff quota sharesare generally allocated during the first semester of the year.G/AG/R/16
Page 30
Thailand   G/AG/N/THA/27   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia/Brazil: Whether Thailand would consider either
applying a lower in-quota tariff rate, a tariff-only regime, or
a modified administration system to products subject to low
fill rates.No changes are considered for the time being.
Australia/New Zealand : Coconut, coconut oil, copra,
rice, coffee, longans, tea, garlic - Reasons for tariff quota
underfill.The low fill rates registered for coconut, coconut oil and
copra are due to high domestic production and low internal
prices, which in turn led to no import demand. Thailand is
one of the major producers and exporters of rice.  However,
imports of Japonica rice totalling 177.44 tonnes were
registered to accommodate the demand by restaurants and
foreigners.
Australia/European Communities:  Milk and cream , not
concentrated  - Reasons for the persistent low tariff quotafill rates.In 1997, a large amount of concentrated milk and cream
was imported (55,838 tonnes out of a committed volume of
47,222.22 tonnes) some of which was used as input for
non-concentrated milk and cream products. Therefore,there was no import demand for non-concentrated milk andcream.
Australia/New Zealand:  Onions and shallots  -  Reasons
for the large fall in tariff quota fill in 1997.In this regard, Thailand updated the data concerning the in-
quota imports, which were around 344.14 tonnes out of acommitment of 351.8 tonnes.  A corrigendum to its firstsubmission will be circulated shortly.
Australia/Brazil:  Pepper and silk  - Reasons for the
persistent low tariff quota fill rates.This was largely due to high domestic production of both
pepper and silk, and thus very low import demand.
New Zealand:   Soyabean oil -  Reason why there were not
imports in 1997.Unlimited imports of soya bean were permitted with duty
free access to Thailand, largely satisfying the needs forsoya bean inputs of soyabean oil manufacturers.  Thereforethere was no import demand for soyabean oil.  The
devaluation of the Thai Baht was another factor which
contributed to lowering the domestic price of soyabean oilcompared with the international price, and thus preventingimport demand.
Australia/ Brazil/European Communities/ New Zealand :Sugar   - Reasons for persisting low tariff quota fill rates.Thailand is one of the major producers and exporters of
sugar.  However, 4 tonnes of candy sugar were imported.
United States   G/AG/N/USA/16 and Corr.1   Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Thailand:  Reason why tariff quota periods vary from
product to product and from year to year, which generates
confusion when monitoring the implementation of thecommitments undertaken by the United States.In the Uruguay Round, the United States established WTO
tariff quota periods based on traditional import patterns
and US marketing years. The United States in its ScheduleXX, under "Additional US Notes" to the respectivechapters, clearly provided information on quota quantity
and period of coverage (calendar and marketing years).
The United States' notifications of imports under tariffquotas have consistently reflected these periods.G/AG/N/USA/3 (28 March 1996) reflected data available
at that time for calendar year 1995. Subsequently,
G/AG/N/USA/9 (11 March 1997) and G/AG/N/USA/16
(28 May 1998) reflected both marketing and calendar yeardata as specified in the US Schedule XX.G/AG/R/16
Page 31
Tables MA:3 to MA:5 Notifications
Japan    G/AG/N/JPN/30   Volume-Based Special Safeguard (Table MA:3)
Points raised by other Member s Response by Notifying Member
Australia:  Confirmation that imports of condensed milk
within tariff quota are not subject to the special safeguardduty.Confirmed.
New Zealand:  Breakdown of the 10.28 tonnes imported
during the period covered into (a) imports within the tariffquota and (b) imports outside the tariff quota.The entire volume of 10.28 tonnes was imported outside
the tariff quota.
Follow-up to above question:  New Zealand: Whether any
imports took place inside the tariff quota and how much ofthe tariff quota was actually filled at that time.This particular tariff rate q uota covers, and was filled, by
several other products like skim milk powder and whey.There was no room for condensed milk to be importedwithin the tariff rate quota.
Follow-up to above intervention: Australia reiterated concerns regarding the application of the special agricultural
safeguard on an individual product within a "basket TRQ".  Japan took note of the statement and indicated that thesafeguard action had been taken in full cons istency with the Agreement on Agriculture.
Tariff item
covered by
SSG actionTariff rate before
SSG actionTariff rate after SSG
action
0402.99.129 27% + 539 Yen/kg. 36% + 718.67
Yen/kg.
0402.99.290 27% + 269 Yen/kg. 36% + 358.67
Yen/kg.New Zealand:  Tariff rates applied to each of the tariff lines
covered by the SSG action (a) before, and (b) after , SSG
action.
The tariffs after SSG action were calculated on the basis of
the relevant provisions of the Agreement on Agriculture.
Poland    G/AG/N/POL/20   Volume-Based Special Safeguard (Table MA:3)
Points raised by other Members Response by Notifying Member
Australia:  Whether any trade in the three products
concerned has taken place at all.The volume of imports of common wheat, CN Code 1001.
90. 91.1 was as follows:  (a) from 1 January 1998 to 20
September 1998:  635,388 tonnes (b) from 6 August 1998
to 29 September 1998: 28,089 tonnes.
The volume of cut flowers imports for the first six months
of 1998 is as follows:  (a) Roses, from  1 June to 31
October (0603.10.110): 412.20 tonnes - (b)Chrysanthemums, from 1 June to 31 October
(0603.10.250): 441.95 tonnes - and  (c) Roses, from 1
November to 31 May (0603.10.510): 1,957.46 tonnes.
The data on flower imports after the implementation of the
SSG action will be available at the end of 1998.
Australia: Whether any imports have been subject to
additional duties.Complying with provisions of Article 5 of the Agreement
on Agriculture, products import within market access
quota are exempted from additional duties.  As of 6
August 1998, additional duties were charged on everyshipment of the products in question that were notimported within market access tariff quotas, with a price
10 per cent or more lower than the trigger level.  Poland
will provide the data on the volume of imported productson which additional duties were applied at the end of1998.G/AG/R/16
Page 32
United States   G/AG/N/USA/18  (Preliminary review)  Volume-Based Special Safeguard (Table MA:3)
Points raised by other Member s Response by Notifying Member
Australia doubted whether the application of the SSG
action was in the spirit of Article 5 of the Agreement on
Agriculture. It had no real protective effect for the US
sheepmeat industry since the duty on sheepmeat was onlyincreased from 3 cents/kg. to 4 cents/kg..  Exchange ratefluctuations during 1998 between the US dollar and the
currencies of the main international suppliers of sheepmeat
to the United States would have had a far greater impactthan the imposition of a fairly meaningless additional duty.
Australia/New Zealand:  View this action with concern,
since it happens to have been initiated by the United Statesin response to domestic politi cal pressure rather than on
purely objective economic grounds.In a preliminary reply, the United States took note of the
statements made by Australia and New Zealand and agreed
that the imposition of this duty was probably not trade
constraining.
European Communities:  Deta ils sought on the automatic
mechanism used by US customs authorities to implement
the price-based special safeguard on sheepmeat.To the knowledge of the US Delegation, only a volume-
based special safeguard is operational in the United States.The United States offered to provide a more detailed replyat a later stage.G/AG/R/16
Page 33
Table DS:1 Notifications
Chile   G/AG/N/CHL/8/Corr.1   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada/United States:  Whether Chile intends to submit a
complete Table DS:1  notification providing information on
Chile's AMS commitments, current AMS, together with all
supporting tables.Chile has never completed a Table DS:1 since Chile does
not have any AMS reduction commitments shown inSection I, Part IV of its Schedule.  Consequently, Chile isnot required, and does not see the necessity, to notify an
AMS that does not exist.  All domestic support measures
applied by Chile are duly listed in the relevant supportingtables of  the notification.  Nevertheless, for the sake oftransparency, the Chilean authorities have decided tosubmit a Table DS:1 to the Committee.
Supporting Table DS:1
Canada:  Whether the irrigation programmes that are under
item (g) refer to "infrastructure services for on-farm
initiatives" or "basic" infrastructure.This is a comprehensive irrigation programme which
includes off-farm and on-farm infrastructure. This question
will be transmitted to the Chilean authorities for aneventual revision of  ST/DS:1 and for additional details.
Canada:  Whether the activities of the Institute for Export
Development (PROCHILE) have been included in this
notification and where.PROCHILE is a unit of the General Direction of
International Economic Relations, under the Ministry of
External Relations.  Its activities are not included in this
notification since they fall within the purview of Article
9:1(d) of the Agreement on Agriculture.  PROCHILE
provides export promotion services such as: commercial
consultancy services abroad; dissemination of information
and campaigns to promote the image of the country;
coordination of private sector participation in international
trade fairs; assistance to foreign delegations visiting the
country. These services are neither directly or indirectly
contingent upon export performance.
PROCHILE, in collaboration with the Ministry of
Agriculture, administers the Agricultural Export Promotion
Fund (AEPF) whose functions are similar to those
described above, albeit specific to the agricultural sector.
The AEPF co-finances, together with interested private
sector parties, widely-available projects aiming at
stimulating agricultural exports and supporting the process
of internationalization of firms in that sector.  Access to
financial resources is not conditional upon export
performance.  In 1997, the Fund's budget amounted to
Million US$ 10, representing less than 0.4 per cent of total
Chilean agricultural exports for that year.
United States:  Apparent discrepancy between the footnote
in CHL/8 which provides the exchange rate of US dollars
to Chilean pesos and CHL/8/Corr.1 indicating that figures
are expressed only in Chilean pesos.  Confirmation sought
that all values provided in CHL/8 are expressed in Chilean
pesos.The purpose of CHL/8/Corr.1 was to modify the
denomination of the currency indicated in column 3 of page
2 from "thousand US$" to "thousand Ch.$".   The purpose
of the footnote in CHL/8 giving the exchange rate of US
dollars to Chilean pesos was to provide a reference for the
evaluation of Chile's disbursements on domestic support
programmes.
Colombia   G/AG/N/COL/8   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
European Communities/United States: Table DS:1  -
Noting that the current total AMS is comparatively low in
relation to the committed level for 1997, whether this is dueto changes in agricultural po licy; with changes relating to
the absorption agreements issued in 1997 for corn.No change in agricultural policy was introduced since the
last notification was issued.
(See reply given in relation to ST/DS:5 below.)G/AG/R/16
Page 34
Colombia   G/AG/N/COL/8   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Supporting Table DS:1
General services
United States: Operation of the Promotion programme
(PROFO) and its conformity with criteria of Annex 2, para2 (f).This programme entails commercialization services as well
as a price and market information system designed toimprove the efficiency of market operations involving
agricultural products. The dissemination of information is
made through daily, weekly or monthly bulletins, as well asvia the Internet. Useful business indicators guidingpurchasing and selling decisions are generated by this
system, thereby improving marketing efficiency and
mitigating the potential risks facing marketing agents. The
Colombia International Corp., a private entity, is in chargeof the administration of this system. under contractual
terms with the Ministry of Agriculture and Rural
Development.
United States:  Confirmation sought that "irrigation
services" do not involve subsidization of water or other
inputs (in other words, expenditures only cover provisionor construction of capital works)Confirmed.  This type of support refers to the construction,
improvement and maintenance of the irrigation systems.
Regional assistance
Canada:  Whether the programme is new since it was notlisted in Colombia's notifications for 1995 and 1996; if so,whether more information could be provided using a TableDS:2 notification; conformity with Annex 2 criteria.This programme meets the criteria laid down in Annex 2,
para 13 (a), as Article 10 of Colombian Regulation no. 188concerning the National Development and Investment Plan
1995-98, stipulates that support should be provided to
indigenous communities located in forest areas, savannah,and tropical deserts through support programmes orientedtowards the development of housing activities, horticulture,and rural activities.
Colombia undertook to notify shortly this new programme
using a Table DS:2 format.
Brazil:  Supporting Table DS:2  -  Nature of products
benefitting from the support programme to encourage the
diversification from growing illicit narcotic crops.Cold zone fruits such as lulo, blackberries, curuba, organic
coffee, cane panela, beans, etc.  In addition, the programme
includes social infrastructural services, technical assistance,marketing and conservation of watersheds.
United States:  Supporting Table DS:4  - Whether
Colombia intends to submit ST/DS:4 summarizing total
product-specific and non-product-specific support.Colombia undertook to submit ST/DS:4 for 1995, 1996,
1997.  Colombia did not grant any non-product-specificdomestic support during 1995-97.
Canada/European Communities/Korea/United States :Supporting Table DS:5  - Reason why ST/DS:5 was not
included; confirmation sought that no market price supportwas provided in 1997; whether all minimum guaranteedand intervention prices have been abolished.Although the Government established minimum guaranteed
prices for maize, yellow maize, rice, beans, sesame andsoya beans, no government budget expenditures wereincurred to support domestic prices since the private sectoracquired the respective harvests at higher prices.
Consequently, Colombia confirms that there were no
market price support measures in 1997, hence the absenceof ST/DS:5.  However, should this be n ecessary, a ST/DS:5
could be submitted.
Brazil/Canada:  Supporting Table DS:6  - Details sought
on (a) the programme "incentives and direct support toproducers" of wheat, barley, cotton;  (b) payments for rice,maize and beans which had not be previously reported.(a) This programme entails go vernment payments to those
agricultural producers affected by extremely unfavourableclimatic conditions or by commercialization problems. (b)
In pursuance of its policy of minimum state intervention,
support mechanisms to marketing activities were set up toreduce storage costs resulting from the seasonal oversupplyof selected products and transportation costs.  The storage
system promotes the interaction between different operators
through their participation in public auctions.G/AG/R/16
Page 35
Colombia   G/AG/N/COL/8   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Brazil:  Supporting Table DS:7  - Whether the credit to
coffee growers is linked to production or alternatively tocommercialization.This programme involves credit granted for the support to
production,  seeds renovation, and phytosanitary control.
Czech Republic   G/AG/N/CZE/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Supporting Table DS:1
Canada: Nature of the structural disadvantage being
addressed in programmes listed under Item (i); base period
for each listed measure; met hod of calculation of domestic
support; expected duration of each of the programmes.The measures listed under item (i) are separate programmes
designed to assist the agricultural sector in its structural
adjustment efforts in the context of the transition of thecountry into a market-based economy. The structuraldisadvantages being addressed are marginal conditions in
mountainous and highland areas; a dramatic change in the
structure of ownership and related land restitution claimscaused by the dissolution of cooperative farms andprivatization of state-owned farms.  The duration of each
programme is limited to one calendar year.  The level of
support is related to production costs and is dependent onthe nature of the individual programmes.
Canada:  Item (j):  Conformity of "support for bee-keeping"
with criteria related to payments under environmentalprogrammes, Annex 2, para 12.This programme meets the criteria in para 12, Annex 2 as
well as the fundamental requirements for "green box"policies since support is provided through a publicly-funded government agency. The objective of the
programme is purely environmental since it aims to
preserve a sufficient number of bee colonies which is vitalfor the pollination of a large variety of plants and not toprovide support to the production of honey. It wasintroduced in response to the continuous decline in the
number of bee colonies in recent years.  While 807,000 bee
colonies were reported in 1990, their overall number fell to537,000 only in 1996. The situation was aggravated in thewinter of 1997/98 due to the extremely cold weather, whichcaused the death of a large number of bee colonies.
European Communities   G/AG/N/EEC/12, Corr. 1, and Corr. 2   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Japan: Reason why, in calculating the total support for
some products (tob acco and grapes for processing), the
AMS is used while during the base period the EMS was
applied.This is due to policy changes for the products concerned.
Instead of channelling support via the processor of the
product, the aid is now paid to the producer.  Radical
modifications were introduced in the system regulating thetobacco sector.  Similarly, premiums are now directly paidto the producers of grapes for processing.
Venezuela: Definitions of "p rice support", "guide price",
"minimum price"; ( question raised at June 1998 meeting ).Undertook to provide a response in writing to Venezuela,
Uruguay, and the Secretariat.G/AG/R/16
Page 36
Iceland    G/AG/N/ISL/11   Domestic Support (Table DS:1)
Points raised by other Members Response by Notifying Member
Australia/Canada/Korea/New Zealand/United States:
Reason why the external reference prices listed in the baseperiod documentation (G/AG/AGST/ISL) were not used.
Follow-up remarks: In a preliminary examination of
Iceland's notification, Australia queried the recourse to
alternative reference prices.  If Iceland had continued to
use the base period external reference prices,  it would stillhave been within its AMS commitments.Referring to the explanations given at the meeting of the
Committee in November 1997, Iceland r ecalled that due to
a fundamental error during the preparation of the AGSTsupporting table, the figures were mistakenly presented in
Icelandic kronor instead of foreign currency, and preferably
SDRs.  In this respect, it should be noted that all Iceland's
obligations are expressed in SDRs.
From 1986 and well into the early 1990s, the Icelandic
currency was devaluated and the country experienced a
high inflation rate.  Accumulated inflation measured interms of the Consumer Price Index from 1986-1996 was252 per cent.  For most other OECD Members, this figure
would be between 30-40 per cent. This inflationary
pressure was regrettably not taken into account whenIceland prepared its Table DS:1 notification in 1995.
Recalling that Article 18:4 did not specifically prohibit an
adjustment to the base period external reference prices but
rather allowed Members to give "due consideration to the
influence of excessive rates of inflation on the ability ofany Member to abide by its domestic supportcommitments", Iceland availed itself of this provision to
express its total AMS commitments in terms of SDRs.
Total AMS commitments are expressed in terms of SDRs
while other entries are in Icelandic kronors, includingexternal reference prices.  These were converted from other
currencies when the AGST tables were prepared at the
1986-88 average exchange rates.  Measured against theIcelandic Krona, the exchange rate of the SDR has changedroughly 200 per cent since the base period.
Australia/Canada/Korea/New Zealand/United States :Source of external reference prices used to calculate thelevel of market price support.Undertook to provide a reply.
Canada:  Request that a new notification be submitted
using base period external reference prices.
Follow-up: - First, Canada  did not accept the approach
which consisted in expressing domestic support
commitments in real (consta nt) as opposed to nominal
(current) terms.  Secondly, the nature of the debate duringthe AIE process was that it is precisely because the AMS isexpressed in nominal terms and causes certain problems
for some Members, that the Committee should look at how
to accommodate the inflation issue through the collective
mechanism foreseen in Article 18:4 of the Agreement onAgriculture.  Equally, New Zealand expressed concern over
unilateral changes to external reference prices and over themanner in which inflation adjustments are reflected in thenotifications.  Thirdly, referring to Iceland's  "remainingtwo years" of notification, Canada pointed out that neither
the notifications nor the obligations themselves lapse, i.e.
notification obligations and the underlying commitmentsare on-going.Iceland believes that the Committee has been already
provided with a clear basis on which to weight thecountry's current total AMS against its total AMScommitment levels for 1996 and 1997.  This would not
have been the case, had external reference prices been
taken directly from the AGST supporting table without anadjustment for inflation or exchange rate evolution.  Therelevant notifications clearly show that the current total
aggregate AMS is not increasing in real terms during the
last three years, and that it is  well below the respective total
AMS commitment levels.  A breakdown of the figures inIcelandic kronors showing increasing support would be
irrational because they would capture inflation over the last
10-12 years. On this basis and for the sake of continuity, itis Iceland's intention to continue notifying, for theremaining two years, using the method described above.
Follow-up remarks : Iceland  offered to contribute to the discussion on inflation adjustments, a topic already touched upon
during the AIE process, on the basis of a paper outlining Iceland's experience in this area.  In view of the forthcoming
negotiations, there was general agreement on the need to pursue the debate either through the consultation process on
notification requirements, or through the AIE process.G/AG/R/16
Page 37
Iceland    G/AG/N/ISL/11   Domestic Support (Table DS:1)
Points raised by other Members Response by Notifying Member
Supporting Table DS:1
Canada:  Item (b):  "The accumulation and holding of
stocks of sheepmeat between slaughter periods":
Justification for now classifying this measure as public
stockholding for food security purposes;
Pre-determined targets required for food security purposes
and basis for determination of such targets.This programme had been previously notified as "other
domestic support" for the 1995 and 1996 years.  In October
1996, it was New Zealand's suggestion that it would be
more appropriate to classify this programme in the category
"public stockholding for food security purposes", a
suggestion which was followed by Iceland.
The stockpiling of sheepmeat is for domestic consumption
only.  Considering that the slaughter period of the sheep is
very short in Iceland, i.e. from mid-September to the end of
October, it is necessary to constitute stocks that will secure
the availability of supply to the consumers all year round.
The decisions regarding overall production, stockpiling and
distribution of agricultural goods, particularly sheepmeat
and dairy products, are made by the Agricultural
Production Board.  Fourteen out of fifteen Board Members
are appointed by the producers and one Member is
appointed by the Minister of Agriculture.  The Board is
bound by, and operates according to, Act no. 99/1993 on
production, pricing and distribution of agricultural goods.
New Zealand:  Details sought on "direct payments to sheep
farmers" ; conformity with Annex 2 criteria.In 1995, an Agreement was signed between the
Government of Iceland and the Icelandic Farmers
Association regarding the production of sheepmeat, taking
an important step towards the decoupling of domestic
support, by moving from price-related support towards
direct budgetary support. Direct payments to sheep farmers
based on the quantity of sheepmeat were abolished while
direct payments to each sheep farm were introduced
regardless of the production.  The payment is US$53 a year
for each sheepmeat pr oduction unit.  The total payment is
not transferable between sheep farms, although there are a
few exemptions.  To be eligible, the farmer must have a
certain minimum number of winter-fed sheep. If the farm
cannot maintain this minimum level, the payments are
reduced proportionally.  The yearly total payment amounts
to Million US$25.  In the farms where all, or most of, the
sheep were slaughtered for sanitary reasons or in case of
earth erosion, farms are eligible to receive such payments
without having temporarily any sheep.  In addition, farmers
who attend an educational programme, or participate in
environmental, marketing or employment-related
programmes, are also eligible even though they are not
breeding any sheep during the period of time that they are
participating in such programmes.
Canada/United States: Item (j) "promotion of organic
production":  Whether this is a new programme;  if so,
Iceland's intention to submit a Table DS:2 notification;
whether this is the same measure as that listed in 1996
under "marketing and promotion"; conformity with Annex
2, para 12;This is not a new programme.  In 1995, the Icelandic
Parliament passed law, Act No. 27/1995, calling for special
assistance to farmers in organic agricultural production and
granting them a total yearly payment of US$350,000 for
four years beginning in 1996 and ending in 1999.  This
payment had been notified earlier under "general services,
marketing and promotional services".  Iceland considers
that it is more accurate to notify this measure under the
heading "environmental programmes", hence the
correction.G/AG/R/16
Page 38
India    G/AG/N/IND/1   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada:  Reason why the currency used in the base period
supporting tables, i.e. million rupees, was not used innotifying domestic support for 1995/96.The external reference price for various commodities for
the base period 1986-88 had been fixed in US dollar terms.
India at present has a market-based exchange rate.  Hence
in order to obtain comparable estimates of AMS, Indiafound it most appropriate to express domestic prices in USdollar terms.
Canada:  Request that a new notification be submittedusing base period data.India does not intend to submit a new notification.  Please
also refer to above answer.
Brazil:  Introduction  – Clarification of the operations of
the Food Corporation of India (FCI), with regard to
purchases at support prices, formation of stocks for foodsecurity purposes, and sales to consumers at prices belowmarket prices;  conformity of these operations with para 3,Annex 2.The FCI purchases food grains at support prices in order to
ensure public stocking for food security purposes and for
selling to consumers throu gh the Public Distribution
System (PDS).  The thrust of the PDS is to provide basicfood grains to the very poor and vulnerable groups of the
society such as landless agricultural labourers, marginal
farmers, rural artisans, craftsmen, and persons earning theirlivelihood on a daily basis.
Australia/Canada:  Table DS:1 – Request that this table be
submitted to indicate that total AMS is zero.Table DS:1, as presently drafted, is specifically designed
for countries which have domestic support reductioncommitments indicated in Section I, Part IV of theirrespective Schedules.  Countries like India, which do not
have any such reduction commitments shown in their
Schedule, are not, in India's opinion, required to submitTable DS:1.
Supporting Table DS:1
Canada:  "Command Area Development Programme
(CADP)" -  Objectives of the programme; definition of a"command area"; types of development activities covered;parameters and eligibility criteria."Command area" has been defined as the approved
downstream area of any major or medium irrigation projectin which the state governments, not the central government,
through their respective command area development
authorities (CADA), undertake an integrated development.The CADPs are being implemented for efficient waterutilization and an integrated area development in the
irrigation command including the modernization of the
distribution system, the provision of drainage, and themaintenance and operation of both the distribution anddrainage systems.
Australia/Brazil/Canada/Korea: Details sought on the"buffer stock operations" programmes; in particular, types
of products covered by these operations; administration anddistribution system involved.The Government has followed a policy of buffer-stocking
of food grains in order to provide a certain level of foodsecurity and stability in food supplies and prices, insulatingthem to the extent possible from variations in agricultural
production. Related policies are laid down for a five-year
period. Decisions are generally taken on the basis ofrecommendations by a technical group headed by theSecretary of the Department concerned. Certain minimum
levels of stocks of rice and wheat
 are maintained in a
central pool during different periods of the year in order to
meet emergency situations arising from floods, droughts, orother such similar events.  Stocks are distributed through anation-wide network of public distribution shops.G/AG/R/16
Page 39
India    G/AG/N/IND/1   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada:  "Crop insurance" (income insurance) -  Operation
of this programme; trigger level for payments to be made;
share of income loss compensated; justification for current
classification versus  the category "payments for relief from
natural disasters" including crop insurance schemes, underpara 8, Annex 2.A comprehensive crop insurance scheme was introduced in
April 1985 in order to provide financial support to farmers
in case of crop failure and to restore the credit eligibility for
the next season.  The participation to the scheme isvoluntary and the states are free to opt for the scheme.Farmers availing of crop loans from cooperative credit
institutions, commercial banks and regional rural banks, for
producing rice, wheat, millet, oilseeds and pulses, arecovered by the scheme.
The sum insured is equal to the crop loan disbursed subject
to a maximum of Indian Rupees 10,000 per farmer.
Indemnity claims are shared by the central and concernedstate governments in the ration 2:1.
As for the trigger level for the payment to be made under
the scheme, the farmers are entitled to indemnity to the
extent of shortfalls in yield vis-à-vis  the guaranteed yield.
If the actual average yield in any area covered by thescheme falls short of the guaranteed yield (the moving
average of the last five years' productivity), the farmer
becomes eligible for this type of insurance scheme.
Australia: Details on the "Dry land farming programme"
and how this programme meets Annex 2, para 11 criteria.In order to promote the development of rain-fed areas and
to restore the ecological balance a centrally-sponsored
scheme, namely the National Watershed Development
Project for Rain-fed Areas (NWDPRA), was launched in1990-91 and was implemented through India's Eighth FiveYear Plan.  This project covers an area of 4.3 million
hectares spread over nearly over 2,554 project-areas in 25
states and union territories.  The various programmes underthe scheme include inter alia  :  treatment of, and
production systems in, arable and non-arable lands, with
emphasis on multiple and mixed cropping, dry-land
horticulture, etc.   This programme therefore meets thecriteria stipulated in Annex 2,  para 11.
New Zealand:  Environmental programmes:  Details sought
on the first three programmes; confirming their consistencywith relevant Annex 2 criteria.The first scheme is a centrally-sponsored scheme launched
during the Third Five-Year Plan.  The main objectives ofthe scheme are:  enhancement of productivity of degradedlands; improvement of land capability; prevention of soil
erosion of the catchment and watershed area; and
increasing the life of réservoirs; etc. To achieve theseobjectives, soil and water conservation measures are used,such as: agro-forestry; horticultural development;afforestation; silvi-pastoral development; etc.. These
measures are applied in an integrated manner with due
support of drainage line treatment measures.
The second scheme was launched during the Sixth Five-
Year Plan aims at reducing the peak rate of run-off by
increasing in situ  conservation of water and ground-water
by increasing the time of con centration resulting in the
reduction of flood hazards.
The third programme, control of shifting cultivation, lays
emphasis on the adoption of low-cost technology with the
use of local material for soil and water conservation, suchas vegetative measures, improved production systems, andconstruction of small water-harvesting structures.G/AG/R/16
Page 40
India    G/AG/N/IND/1   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada -  Supporting Table DS:4 -  Request that ST/DS:4
be provided.India will be happy to provide this table although it is
unsure as to why such table is needed since it is only a
summary of the data already provided in Supporting Tables
DS:5 and 9.
Supporting Table DS:5
Australia/Brazil/Canada/New Zealand: Value of sugar caneproduction to substantiate  de minimis  claim.The total value for sugar cane production for the marketing
year 1995/96 is approximately Million US$2,210.  Sincethe total market price support to sugar cane, as shown incolumn 8, was  Million US$184 during that period, the
overall level of support amounted to 8.3 per cent of the
total value of sugar cane production, which is within the de
minimis  requirements.
New Zealand:  Meaning of footnote (3) regarding the
procurement price for common paddy and rice coefficient.The Government of India announces a procurement
administered price for common paddy and not for rice,since the commonly-accepted conversion ratio of 1.5:1(when paddy is converted into rice) was used to derive the
administered price for rice from the administered price for
paddy.
Thailand:  Reason why the domestic prices of agricultural
products are much lower than the average world prices in
the base year; whether domestic prices are still below world
prices at present and why.
Follow-up: Confirmation sought by Thailand  that the low
domestic prices are not the result of government price
support. India reiterated that government support was one
of a variety of other  factors influencing the level of
domestic market prices.The situation where variations exist between domestic
prices and the average world prices in respect of
agricultural commodities is not unique to India. Any
support price is based on a variety of factors whichprimarily include: cost of inputs, labour costs, productivityof land, and the cost-of-living index, etc.  It is therefore
obvious that these factors would differ among different
countries, thereby resulting in variations between domesticand average world prices.
United States:  Supporting Table DS:9  - Irrigation,
fertilizer and electricity subsidies – Operation of theseprogrammes; level of subsidization; whether figuresnotified represent actual budgetary outlays or estimations;if estimated, calculation details are sought.The fertilizer subsidy is pr ovided to low-income and
resource-poor producers.  The amount shown represents theactual amount of subsidy given as reflected in theEconomic Sur vey of India, 1996-97.
The electricity subsidy is the amount lost by the various
state electricity boards by selling at less than average costto the agricultural sector and this varies from state to state.
The irrigation subsidy figures are broad estimates of
working expenses and revenue collection and include the
interest component assumed on total estimated investmentsmade in the irrigation sector.G/AG/R/16
Page 41
Jamaica    G/AG/N/JAM/2   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:  Supporting Table DS:1  -  Details sought
on the operation of support programmes under "researchand development"; and "extension of advisory services".The Research and Development Programme has
responsibility for generating cost-effective technology for
the improvement of production and productivity in
domestic food crops, non-traditional export crops andlivestock.  Its activities are principally executed in twopriority areas: crop research and livestock research andimprovement.
The Extension service aims at facilitating improved
production and productivity in domestic food cropsagriculture, mainly carried out by small farmers.  Themajor role of this programme is the transfer of technologies
generated by research agencies and ensuring their adoption
by farmers.
Supplementary information on the above programmes is
provided in Attachment no. 5 .
Morocco   G/AG/N/MAR/11   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand:  Supporting Table DS:1  – Details sought
on "regular campaign against the effects of drought" toassess the conformity of this programme with Annex 2criteria.This programme is not implemented on a permanent basis
but rather selectively, in emergency situations, to counterthe adverse impact of natural disasters on herds.  It is
introduced in selected regions only once these have been
recognized as drought areas by the competent governmentauthorities.
Philippines   G/AG/N/PHL/15   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada:  Whether the Philippines intends to provide a
Table DS:1.As currently formulated, the Table DS:1 format on the
current AMS refers to the notification on the
implementation of reduction commitments undertaken inthe Uruguay Round.  It is therefore believed that thisnotification is not relevant to the Philippines as it has not
undertaken this particular commitment in the Uruguay
Round.
Canada/Japan:  Reason for the absence of Supporting Table
DS:1 compared to previous years; confirmation is sought
that no "green box" support was provided in 1997."Green box" measures were applied by the Philippines in
1997. The corresponding notification is being finalized and
will be shortly submitted to enable the Committee toreview it at its November 1998 meeting.
Slovak Republic    G/AG/N/SVK/14   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada: Supporting Table DS:1  - Reason for reclassifying
"rural tourism" under the "regional assistance" category;
conformity with criteria of para 13, Annex 2.Taking into account the information submitted in previous
notifications, this programme was not reclassified.  It is
fully consistent with the provisions of Annex 2, para 13,because support is granted exclusively to agriculturalproducers situated in disadvantaged territories and facing
adverse natural conditions in terms of the quality of soil.
Support under this scheme can also be granted toagricultural producers undertaking supplementary activitiesnot related to agricultural production.G/AG/R/16
Page 42
Slovak Republic    G/AG/N/SVK/14   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand:  Supporting Table DS:4  - Reason for the
significant increase in expenditures on (a) the purchase of
seed for the sowing programme and on (b) the technical
equipment.The increase in expenditures merely reflects the higher
interest expressed by domestic producers in obtainingquality inputs.
Supporting Table DS:5
New Zealand:  Apparent discrepancies in the externalreference prices for raw cow milk used in 1996 and 1997respectively; reasons for this difference.The Slovak Republic undertook to provide a response in
writing.
New Zealand:  Reasons why the State Fund for MarketRegulation (SFMR) was omitted since its operationsinclude minimum price setting;  whether minimum priceswere set for agricultural products other than milk in 1997 as
well as in previous years; if so, reason why such
information was excluded from the AMS calculation.The SFMR does not grant any price support to the domestic
market.  The purpose of this body is to regulate the supplyof certain manufactured agricultural products and monitorthe adjustments to changing market conditions as described
in G/STR/N/3/SVK, dated 25 June 1998. The list of
agricultural products subject to market regulation ispublished by the SFMR.  The Fund's interventions aredesigned to solve domestic surplus conditions, i.e. when
production exceeds domestic consumption or when
agricultural prices have decreased under the pressure of realproduction costs.
Australia:  Supporting Table DS:9  - Reason for
identifying (a) sheep and goat breeding promotion and (b)
tobacco promotion as non-product-specific support;operation of these programmes.(a) The subsidy for the promotion of breeding is a per head
monetary subsidy granted to owners of at least 20 head of
sheep or goats.  As this programme is not specificallytargeted to each separate category of herd, and consideringthat decisions to grant the subsidy are based on the total
number of sheep and goats, the Slovak Republic is of the
opinion that this is in fact a non-product-specific subsidy.
(b) Support for the promotion of tobacco production can be
granted to producers in amounts per kilogram of contracted
and sold tobacco.  The Slovak Republic agrees that this
type of support should not be listed under the non-product-specific category and the relevant corrigendum will bepresented accordingly.
Slovenia    G/AG/N/SVN/8   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand: Supporting Table DS:1  -  Reasons why the
expenditures on extension and advisory services haveincreased by 30 per cent since 1996.This is due to the modernization and equipment of the local
stations in the past two years. The figures includeinvestment into research centers and experimental farmswhich are run by the advisory services.  The Government
attaches considerable importance to these activities which
offer training.  The expenditures include grants to theLipica Stud Farm.
Canada: Supporting Table DS:5  - Noting that the external
reference prices are different from those in the base periodreported in G/AG/AGST/SVN, request that a modifiednotification be submitted using base period data for milkand cream, wheat, wheat flour and sugar beets.
Follow-up:  New Zealand indicated its interest in receiving
in writing information on the outcome of the bilateral
consultations mentioned by Slovenia .Slovenia confirms that the reference prices used are
different from those in the base period.  Although Sloveniais prepared to submit a modified notification, this couldhave some implications that it wishes to explain on abilateral basis.
Australia: Supporting Table DS:6 – Noting that no
applied administered prices nor external reference pricesare provided, request that such information be provided,together with the source.This omission is due to a technical error.  Slovenia does not
apply any price-related direct payments, but only directbudgetary payments.  An appropriate corrigendum of thisnotification will be prepared and made available.G/AG/R/16
Page 43
Switzerland   G/AG/N/CHE/15   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Supporting Table DS:1
General services
Australia/Canada: Operation of the "family allowance
programmes for small farmers and for agricultural
workers"; conformity of such programmes with criteria of
para 2, Annex 2 which do not allow payments to producers
or processors.Family allowances are an integral element of Switzerland's
general social policy, also applying in the field ofagriculture, albeit in a more specific way.  These
allowances are notified to the WTO for the sake of
transparency and completeness.
Canada: Details sought on the types of initiatives covered
under the heading "Cantonal spending on agriculture";
Breakdown of expenditures among the types of measureslisted;
Whether some of these measures involve on-farm
initiatives.Agricultural policy in Switzerland is a federal matter
although the implementation of these policies can also be
the responsibility of the Cantons in many of the areas
concerned.  In some specific instances, topping up oradditional cantonal measures are allowed.  It is not possibleto provide a detailed breakdown of all the measures
concerned.  Data have, however, been notified by category
of measures.  Total cantonal expenditure amounted to 374.2million Swiss francs.  Of these, 68.8 million Swiss francswere notified in Supporting Table DS:7 in relation to item
(6), in order to account correctly for the fraction of cantonal
spending directly linked to production, falling under theAMS.  The remaining 305 million Swiss francs are split asfollows (estimates provided in million Swiss francs): -
General administration: 15.3;  - Land improvement: 177.1;
- Animal welfare: 33.6;  - Health and social measures: 79.3.
"Land improvement and rural buildings" involve support
for improving land (i.e. drainage) and may include cantonal
complements to federal disbursements under structural
adjustment assistance through investment support, whetherdirectly related to agriculture or not.
Animal tending refers to cantonal complements that may be
given in relation to animal husbandry programmes.
Public stocks for food security
Korea:  Operation of the two programmes listed under thiscategory.Under this heading, Switzerland has notified guarantee
stocks for potatoes of 2 million Swiss francs (and not 12
million Swiss francs as mentioned in the English version, acorrigendum is forthcoming)  and apple juice concentrate
with total expenses amounting to 3.3 million Swiss francs.
The purpose of the guarantee stocks is to ensure a minimal
level of supplies within the meaning of the Swiss foodsecurity concept for emergency situations.  Stocks remainthe property of the private sector but the sale requiresgovernment authorization.G/AG/R/16
Page 44
Switzerland   G/AG/N/CHE/15   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Decoupled income support
Australia/Canada/United States:  "Payments to owners of
cows who do not market milk" - Whether eligible
producers are able to market these cows for other purposes,
such as the production of meat; defined and fixed baseperiod (as per Annex 2, para 6 (a)).
Recalling Switzerland's previous explanation that payments
are adjusted according to the evolution of the milk price inorder to maintain income par ity between producers of milk
and owners of cattle who do not market milk , explanation
of the conformity of this programme with Annex 2, para 6c) which requires that the payments not be related to, orbased on, the prices applying to any production undertakenafter the base period.This type of payment is fully decoupled from production.
Eligibility to receive payments is not linked to anymarketable production of the farm, such as the sale ofanimals or meat.   Rather, it is linked to a prohibition to sell
milk.  However, producers are free to market the animals or
meat thereof.  The link to the milk price is exclusively amatter of efficient use of public funds.  As mentioned onvarious occasions, Swiss agriculture has been undergoing
and continues to undergo a process of major reforms
towards full market orientation.  Given the importance ofmilk production for the entire Swiss agricultural sector, themilk price is an important reference when determining the
income situation of the farming community.  As such, the
milk price is one of the criteria used in the determination ofthe payments.  These payments were gradually reducedover the past years in order to match the increasedcompetitiveness of agricultural producers.
A detailed reply concerning the Annex 2 criteria related to
defined and fixed base period is under preparation.
Australia/Canada/United States: "Direct additional
payments to producers" - Whether this is a single
programme; recalling a previous reply that such paymentswere made on a per farm, area or animal basis, additionalinformation is sought on each listed measure;  fixed and
defined base periods involved; method of calculation of
payments; conformity with criteria of para 6, Annex 2.This category of support is aimed at making a contribution
to the multiple functions of agriculture and involves
payments on a per farm or per area basis.  Such paymentsare consistent with para 6 of Annex 2 since they are fullydecoupled from marketable production, farm output, or
prices paid for agricultural products.  Payments are based
on the surface, subject to clear cultivation standards, andrestricted by farm income thresholds.
Korea:  Information requested on "Supply of foodstuffs"
and "Supplement to market earnings" programmes.These payments are a sub-category of the programme
described above.  The reference to the supply of foodstuffs
and supplements to market earnings relates to Article 31octies of the Swiss Constitution which states, inter alia ,
that " agriculture contributes, through sustainable and
market-oriented production, to the safe and secure supply
of food to the population ".  Hence the reference often made
by the Swiss society to the multifunctional dimension ofagriculture within society.
Australia/Canada:  Structural adjustment assistance through
programmes for the withdrawal of production resources -
Details sought on the "Relief purchasing programme";
time-period required before cattle producers may increase
ther herd after the livestock has been purchased under theprogramme; conformity with criteria of Annex 2, para10(d), requiring payments not to be related to either thetype or quantity of production or to prices.This programme is a clearly-defined instrument of regional
policy.  The measure is intended to mitigate the seasonalpeak offer of animals in the fall when herds return fromalpine pastures and appear in large numbers on the markets.
Canada: Structural adjustment assistance through
investment support - "Investment credits":  Nature of the
structural disadvantage being addressed; duration of the
programme; period of time necessary to overcome the
structural disadvantage.Investment credits are granted to farmers for the purchase
of land and the improvement of land and buildings.  Aseries of conditions apply.  Credits are only given as a
complement to other sources of financing (commercial
lending, use of private resources).  Credits are subject toceilings and projects submitted must meet clear criteriaconcerning future viability of the business. The adjustment
of structures is an on-going process. The overall
programme is not limited in time.  However, the durationand the grace period of each individual loan granted to asingle farmer are limited.G/AG/R/16
Page 45
Switzerland   G/AG/N/CHE/15   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Environmental protection
Australia/United States: Details are sought on each of the
listed programmes; conformity of each programmes withcriteria of para 12, Annex 2.Payments under this category are designed to compensate
the loss of income due to the additional costs arising fromthe implementation of extensive and ecological methods ofproduction.  Specific criteria, laid down in the relevant
regulations, are applied such as:  areas of reduction or
elimination of phosphate and nitrate runoff and spilloverinto aquifers; the application of pesticide-free or pesticide
reduced production methods, the improvement of
biodiversity and the protection of wildlife.  These amounts
payable are reviewed on an annual basis.
Payments for "summer pasturing" are granted to farms
located in marginal areas.  To qualify for the payment,
beneficiaries must comply with clearly defined ecological
rules such as concentration of livestock, use of fertilizerand manure, etc.  The payment is not linked to productionand entails exclusively an incentive to graze alpinemeadows, which is considered an important element of the
Swiss regional policy and an important factor in the
protection against natural disasters - i.e. grazed meadowshelp prevent the formation of avalanches - in particularabove the forest level.
Canada/Korea: "Egg disposal, producers' reconversion
contribution" - Whether this programme is the same as
notified in CHE/16; introduction date; conformity withfundamental "green box" requirements.Confirmed.  Please refer to G/AG/N/CHE/16 below.
Canada:  "Payments for extensive cereal production" -
Method used to determine the payments; conformity with
Annex 2, para 12.These payments compensate producers for the restricted
use of pesticides in cereal production.  The programme isclearly defined: it prohibits the use of fungicides,
insecticides and growth regulators. The level of the
payment is set in order to compensate for the productionforegone.G/AG/R/16
Page 46
Switzerland   G/AG/N/CHE/15   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Regional assistance programmes
Australia/Canada/New Zealand/United States:  Details are
sought on the programmes below; payment method; baseperiod used; conformity with Annex 2 criteria, particularlysince the payments foreseen appear to be very product-
specific or target particular producers (Para 13(d) requires
that the payments must be generally available to allproducers within the region)
(a)  Non-silage allowances;
(b)  Supplements for the manufacture of hard cheese in the 
silage area;
(c)  Allowances for milk processed into cheese;
(d)  Allowances for the cost of cattle owners in mountain 
and hill areas;
(e)  Compensatory payments for cultivating fields under 
difficult conditions.(a) Non-silage allowances are designed to compensate for
the disadvantages due to the use of milk produced forcheese without having recourse to silage.  Beneficiaries arelocated in clearly defined regions (i.e. Gruyère).  The
measure is temporary.  It is an element of the transition
process followed by the Swiss cheese industry towards afree market system.
(b) This payment compensates producers and processors
for the financial burden of operating their installations in
the summertime only.  The premium for amalgamation wasoffered until 1995 in order to help the regionalconsolidation of small cheese processors into viable units.
This consisted in a benefit during the first five years of
operation of a new facility.  Both measures are part of theregional development policy and their purpose is tocontribute to a minimum level of decentralized, viablecheese processing sector.
(c) This payment is designed to get the best added value out
of the milk produced.  The measures are not linked to theproduction of milk as such and do not lead to additionalmilk output.
(d) These payments are intended to preserve a minimum
level of agricultural activity in the specified regions.  Thesepayments are decoupled from production or farm outputand are limited to a maximum of fifteen cow units per farm,
fully decoupled from the actual number of head kept on the
farm.  In addition, as with most support measures, incomeand wealth thresholds apply.
(e)  This is a surface-based payment, fully dec oupled from
production, designed to maintain a minimum cultivation of
land in the hill and mountain area and constitutes andelement of regional policy.
Supporting Table DS:5
Brazil:  Explanation of the difference between "guaranteedprice" and "support price".The concept of "guaranteed price" stands for products for
which the government guarantees a price to the producer.This guarantee is restricted to a limited quantity of the
product concerned.  "Support price" stands for products for
which prices fluctuate due to market conditions but are keptwithin a certain range by government action.  However, inseveral instances, price policies have not been applied in
the past, leaving prices to market forces.  The price support
policy for beef is a case in point.  In this respect, it is worthnoting that the new Law on agriculture will enter into forceon 1 January 1999, abolishing all price guarantees eitherwith immediate effect, or over a given transition period.
Brazil:  Information requested on the total amount ofproduction for poultry and bovine meat, soya beans
,
tobacco.The quantities involved are shown in column 6 "eligibleproduction" (tonnes):  poultry: 43,870; bovine meat:151,787; soya beans: 4,554; tobacco: 1,000.G/AG/R/16
Page 47
Trinidad and Tobago    G/AG/N/TTO/2   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand:  Reason for the substantial difference in
"green box" expenditures for 1996, compared to 1995 and1997.As indicated, the figures provided represent the annual
aggregate for the years 1995 to 1997 of both the Recurrent
Expenditure Programme and the Development Programme
of the Ministry of Agriculture, Land and Marine Resources.The data notified by Trinidad and Tobago in respect of theAgricultural Development Programme should have read asfollows: TT$90 million (1995); TT$58.6 million (1996)
and TT$96.7 million (1997) respectively, or US$14.4
million, US$9.3 million and US$15.3 million respectively.Trinidad and Tobago undertook to provide a corrigendumto the Secretariat  for circulation.
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Supporting Table DS:1
General comments:  state-level expenditures
Australia/Korea:  Confirmation sought that all the state
level programmes for agriculture that are based on financial
year outlays are exempt payments consistent with Annex 2;
that they are covered by this notification..Two state-level programmes are covered by this
notification: the State Credit Programme (ST/DS:9) and the
aggregate state expenditures on agricultural programmes
obtained from the Bureau of Census, which is reportedunder the "green box".  These are the only state-levelagricultural programmes for which the United States was
able to obtain data.  To the extent possible, all sub-national
expenditures on agriculture  were included.
Canada:  Whether state level fuel tax exemptions or refund
programmes applicable to farmers are included in thisnotification; if so, where; estimation method used.State level fuel tax exemptions are not included in this
notification.
Follow-up:  In the context of the forthcoming agricultural negotiations when  tighter disciplines on domestic support will
be sought, New Zealand, Australia  and Switzerland  encouraged the United States to look at ways of improving its data
collection methods to ensure that all state-level expenditures are accurately captured in future notifications.  In view of
the widely diverging standards applied by different Membe rs, Switzerland suggested that the issue be taken up for
discussion on a horizontal basis.
General services
Australia/Canada: Noting that the United States continues
to notify a single aggregate amount for all state levelagricultural programmes, details are sought such as: nature
and breakdown of expenditures according to the various
general services categories; specific Annex 2 criteria metby these payments.The Bureau of Census does not provide details on the
quantitative composition of this aggregate expenditure.Examples of state financed activities for agriculture
include: national resource conservation; support and
promotion of agricultural associations, fairs, exhibitions,extension services, research, etc.  Based on the informationavailable, the United States believes that the programmes
included in these expenditures meet Annex 2 criteria
insofar as they provide services or benefits to theagricultural and rural community at large, and do notinvolve direct payments to producers.
Brazil: Food Safety Inspection Services -  Reason for the
increase of US$10 million in relation to the year 1995.This increase reflects the United States' strong commitment
to fully implement the WTO SPS Agreement and to ensurethat US meat and poultry safety is among the highest in theworld.G/AG/R/16
Page 48
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Brazil:  National Resource Conservation Service - Reason
why the related expenditure was not included in the AMS
calculation for the year 1995 .Based on feedback received at the September 1997
meeting, the United States moved this programme from the
category "payments under environmental programmes",
where it was notified in 1995, to the "general services"category in the present notification, since the programmedoes not entail direct payments but has more of an advisoryfunction.
Public stockholding for food security purposes
New Zealand:  "CCC Food Security Reserve"-  Conformity
with Annex 2 criteria, since significant quantities of wheatwere destined to export as food aid in 1998 under thisprogramme rather than stocking for domestic food security.
Follow-up: In the expectation that the 1998 notification
would not show zero expenditures (because of the food aid
exports described above), New Zealand reiterated its
interest in the conformity of  the programme with Annex 2
criteria and questioned the manner in which food aid is
reflected in the domestic support notification, and more
specifically the inclusion of what is essential export food
aid under "public stockholding for food security purposes".The purpose of this programme is to support the food
security in developing countries by providing emergency
assistance.  In the spirit of transparency, it was included inthis notification despite the fact that there were noexpenditures.
Domestic food aid
European Communities:  Nature of products and quantitiesdistributed under these programmes; system in place toensure that products are bought at current market prices;
whether products are bought for distribution to needy
people or for further processing; existence of an overallpurchase and distribution plan for the whole year versus ad
hoc purchase and distribution decisions; in the latter case,
criteria triggering the concerned measures; whether only
Federal aid is involved;The aid is targeted at a clearly-defined segment of the
population and is tied to nutritional objectives.Commodities are purchased at market prices through a
competitive tender or contract process. Commodities are
distributed through eligible schools, soup kitchens, foodbanks, shelters.  In some cases, further preparation orprocessing of food takes pl ace at these distribution points.
A wide range of items is distributed:  meats, poultry, fish,
fruit, vegetables, dairy, grains, dry beans, and tree nuts.Comprehensive information regarding the quantity ofproducts purchased and distributed through these
programmes is not readily available. Invitation for
commodity purchases are made throughout the year, basedon annual estimates of programme needs.  A small amountof funding is allocated to so-called ad hoc  purchases, which
are made at the discretion of the agencies administering the
programme.  All of these programmes are financed fromthe federal budget, although state and local governmentsplay an important role in their implementation.  Overhead
costs are captured in the line item "food programme
administration" and reflect the cost of administering theprogramme.
European Communities: "Food Stamp Programme" :
Description of operations.This programme involves monetary transfers which enable
low-income families to buy food. The aid is targeted at a
clearly-defined segment of the population and is tied tonutritional objectives.  Households that meet income andresource standards receive coupons to buy f ood in approved
food-stores.
European Communities/Korea: "Child Nutrition and School
Lunch Programmes" : Description of operations; prices
involved; impact on beef market prices.This programme operates similarly to the Food Stamp
Programme to ensure that children from low-income
families receive free or reduced-cost nutritious meals in
school.  The National School Lunch Programme providescommodities but also cash payments to schools to offset thecost of food service.G/AG/R/16
Page 49
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
European Communities: "Speci al Supplemental Nutrition
Programme" : Description of operations.-
European Communities: Background for the doubling of
expenditures since 1986-88.The bulk of this increase comes from higher spending on
the Food Stamp Programme.  The food stamp participationrate has increased by 40 per cent over this period, leading
to rising food stamp outlays.  Higher per capita benefits and
the effect of inflation on these expenditures also explain theincrease.  Expenditures on food stamps started to decline infiscal year 1996 due to improving economic conditions and
are projected to fall further due to recent welfare reforms.
Since the Food Stamp programme and some of the otherdomestic food aid programmes (such as the Child NutritionProgramme) are entitlements, expenditures on these
programmes are affected by factors such as the poverty
rate, economic conditions and programme enrolment.
Decoupled income support
Brazil/European Communities:  "Product Flexibility
Contracts (PFC)" - Nature of products benefitting from the
programmes; number of hectares eligible; area used under
this scheme; relationship with the implementation of theFAIR Act.Producers are free to farm as much or as little of their land
as they want.  The FAIR Act allows participating farms toplant 100 per cent of their total contract acreage plusadditional acreage to any crop with no loss in payment.  In
1996, 1.7 million farms enrolled in the programme,
accounting for nearly 90 per cent of total farms.  Enrolledcontract acres totalled 207.6 million acres, or nearly 100per cent of total contract acreage.
European Communities: PFCs -  Whether eligibility to
receive payments is related to the use/ownership of the landin the past or whether such contracts can be concluded withnew users/owners;  criteria applying in the latter case;
whether the use of land for non-agricultural purposes is
allowed.A farm's eligibility depends on whether it had at least one
crop acreage base that participated in a productionadjustment programme for any of the crop years 1991-95 orthat was considered planted under programme rules
(certified acreage).   New owners can conclude a contract,
since the eligibility to enter the programme stays with the
land.  No production is required to receive the payment.However, payments stop if the land is used for non-agricultural commercial or industrial purposes.
European Communities:  PFCs: payment reductions -Whether these are foreseen in certain cases;  if affirmative,
whether they are related to certain crops; calculation
method used to determine the extent of reduction;examples.The total amount of contract payments are set for each
year, decreasing from US$5.8 billion in fiscal year 1998 to
US$4 billion in fiscal year 2002.  Since the commodity
allocations are based on a percentage of the total amount ofcontract payments, these amounts will also decline overthis period.  The commodity allocations are only made todetermine the contract payment, and are not tied to farmers'
production decisions.  Payments are received by farmers
who are not required to plant a specific crop.  If a producerviolates one of the programme requirements, the paymentsstop.G/AG/R/16
Page 50
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Brazil/Canada/European Co mmunities: PFCs - Certain
limitations are placed on planting fruits and vegetables on
acreage eligible for PFCs (USA/5 refers) and appear to
constitute a "requirement" for certain types of production:whether this feature is consistent with Annex 2, para 6 (b)criteria which requires that payments cannot be based onthe type of production in any year after the base period.
Follow-up: In reply to a question raised by the European
Communities regarding the scope of planting restrictions,
the United States confirmed that other crops do not come
under the same provisions as fruit and vegetables.These crops can be planted if there is a history of double
cropping with fruit and vegetables in the region, if the farm
has a history of planting fruit and vegetables, or if the
producer has a history of planting fruit on contract acreage.Planting of lentils, mung beans, and dry peas is permittedfor all farms.  Para 6 (b) of Annex 2 stipulates that "the
amount of such payments in any given year shall not be
related to, or based on, the type or volume of productionundertaken by the producer in any year after the baseperiod".  A farmer's contract payment is based on the
commodity acreage that would have been in effect for the
1996 crop, had the deficiency payment programme notbeen suspended.  Therefore,  the PFC programme is incompliance with para 5 (b), since payments are only based
on the type of commodity in a fixed base year.  More
generally, these payments are not linked to production inany year after the base period, nor are they tied to prices orfactors of production, which are the fundamental elementsof decoupled income support.
Payments for relief from natural disasters
Canada:  "Disaster Assistance Reserve Programme" -  Does
not appear to have been previously notified.  Whether thisis a new programme; additional information is requested.This programme was implemented for the 1996 crop, and
was originally authorized by the Agricultural Act of 1970.
It compensates livestock producers for losses of feed cropsin authorized counties.  Payments are triggered if countyand producer both have losses of at least 40 per cent.
European Communities:  "Tree Assistance Programme" -
Reason why this programme is reported in this notification.This programme is included in  this category in supporting
tables DS:1 for 1986-88, 1995 and 1996.  Eligibility isbased on the formal declaration of a natural disaster.  Cost-share payments are provided to orchard and vineyardgrowers affected by natural disasters.
Structural adjustment through resource retirement programmes
European Communities: "Conservation Reserve
Programme, (CRP)" - Share of total US agricultural land
eligible for participation; total area covered in practice.Eligible land must have been cropped in two of the past
five years and meet specific environmentally-based criteria.
European Communities: CRP - Definition of cropland;
crops concerned; whether these crops may be used for other
purposes; method of calculation of the rentals and whetherthey are fixed during a ten-year period; if not, parametersinvolved; eligibility criteria for areas to be classified as
subject to "critical soil erosion"; surface of land falling
under these criteria; whether the participation to the schemeis voluntary or compulsory.Since any crop land meeting the above criteria is eligible,
any crop would be affected by enrolment.  Annual per-acre
rental payments are based on site-specific soil productivityand local prevailing cash equivalent rental rates.  The ratesare fixed throughout the rental period.  In the 1996 Farm
Bill, the cap on CRP enrolments was set at 36.4 million
acres, accounting for around 15 per cent of eligible cropland.  CRP acreage in effect for 1997 crop year was 32.82million acres.  Only the most environmentally-sensitive
land, yielding the greatest environmental benefits, will be
accepted into the programme.  Participation is voluntary.
European Communities:  CRP -  Whether certain areas can
benefit simultaneously from PFC (decoupled income
support) and CRP payments.A producer cannot receive both CRP and PFC payments for
the same land area.  Highly erodible cropland areas can
benefit from CRP and other environmental programmes atthe same time.G/AG/R/16
Page 51
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Environmental payments
Canada:  "Commodity Credit Corporation" -  Does not
appear to have been previously notified.  Whether the three
listed sub-programmes are new; additional details aresought on each.These programmes were established by the Fair Act.
Under the Farmland Protection programme , voluntary
conservation purchases are made based on specific criteria.The Conservation Technical Assistance programme
provides technical and financial assistance to encourage
farmers to adopt practices that reduce environmental andresource problems.
Brazil:  Supporting Table DS:3  - Reason why such
programmes were eliminated for wheat, rice, corn,
sorghum, barley, oats and cotton.Since the 1996 FAIR Act eliminated deficiency payments
for these commodities, they are no longer included in the
US notification.
European Communities:  Supporting Table DS:4  - Nature
of the crops for which the loan rate scheme was applied in
1996.In 1996-2002, non-recourse marketing loans are mandated
by the FAIR Act for wheat, corn, barley, grain sorghum,
oats, upland cotton, extra-long staple cotton, rice, soyabeans, sunflower seed, canola,  rapeseed, safflower,mustard seed, and flaxseed.  With the exception of extra-
long staple cotton, the Secretary may make loan deficiency
payments available to producers of loan commodities who,in lieu of obtaining a loan for the commodity agree toaccept a payment.
Supporting Table DS:5
Brazil: Reason for the decrease in the administered pricefor sugar from US$396.832 per tonne in 1995 toUS$374.786 per tonne in 1996.While the applied administered price for 1996 remains the
same as for 1995,  the 1996 FAIR Act  introduced a 1.072
cent per pound penalty for forfeiting sugar to the CCC, thus
lowering the effective level of price support by about 1 centper pound.
Japan: Reason why the columns 4 (applied administered
price) and 5 (external reference price) were left blank for
beef;  purpose and outline of the beef purchases system;entity conducting these purchases.In calculating the base AMS, we included a policy designed
to minimize the effect of the dairy herd buy-out programme
on red meat prices (G/AG/AGST/USA refers).  The CCCwas mandated  to purchase red meat as part of the dairyprogramme. However, this programme was phased out
after 1987. The Agricultural Marketing Services continues
to purchase beef and related products at market prices fordomestic food aid programmes such as the National SchoolLunch Programme.
Korea: Confirmation that the beef purchases programme isincluded in the calculation of the AMS; calculation methodof the eligible production.As noted in the US response on domestic food aid
programmes above, these purchases are made at marketprices through competitive tender or contract process, so
they would not be included in the AMS calculation.  In
future notifications, the United States will remove thevolume of eligible production from this table since there isno administered price in place for beef.G/AG/R/16
Page 52
United States    G/AG/N/USA/17   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Australia:  Supporting Table DS:6  - Step 2 marketing
certificates for cotton since 1996 - Confirmation sought that
the notification covers all payments under this programme;
break-up of expenditure whethe r it is for domestic mills or
for exporters; extent to which the subsidies are in the formof certificates or in cash; whether information is collectedon impact of the programme on prices received by farmers.All payments under this programme are included in the
notification.  This notificati on covers a period in which the
Programme was not active since it was suspended between
1 December 1994 and 17 July 1997 due to specific rules.During that period, average world prices exceeded the loanrate by more than 130 per cent, which is the price trigger
that terminates Step 2 payments.  Use of Step 2 was
triggered again on 17 July 1997.  Due to market conditions,use of the payments has accelerated in 1998.  Payments aremade on all sales, whether domestic or export, at the same
rate.  Estimates indicate that two-thirds of the certificates
are used for domestic transactions and the rest for exporttransactions.  The payments are currently made in checksdrawn on the CCC.  In the first two years of the
programme, payments were made in "payment in kind".
No information has been collected which describes theeffect of the programme on prices received by farmers.
Supporting Table DS:9
Canada/European Communities: Irrigation subsidies -
Confirmation that all applicable government subsidies (atstate and federal levels) with respect to irrigation in theWestern United States are covered by this notification.
Difference between the debt-financing method and the
method used to calculate the 1986 estimate.Expenditures are provided at the federal level.  These are
the only expenditures for which the United States couldobtain information.  This subsidy seems to include all
applicable government subsidie s with respect to irrigation
in the Western United States.  The difference between thedebt-financing method and the method used to calculate the1986 estimate is provided in Attachment no. 6.
Canada:  State credit programmes - Noting that the value of
estimated outlays in 1995 and 1996 is derived from a mailsurvey designed to estimate the value of outlays for fiscalyear 1994, details are sought on the method used to
generate estimates for 1995 and 1996 on the basis of a 1994
survey.These outlays are estimated using data without any
adjustment from a survey for fiscal year 1994, the mostrecent year for which information is available.
European Communities:  "Net Federal budget outlays for
grazing livestock on Federal Land" -  Purpose of the
programme and nature of the land concerned; whether theprogramme is targeted to agricultural land; can the land inquestion benefit from payments under other programmes,for example under the PFC scheme.USDA (Forest Service) and the US Department of Interior
(Bureau of Land Management) administer livestock grazing
on approximately 307 million acres of public range landslocated in 16 Western States under the Public Range landsImprovement Act of 1978 (PRIA).  The grazing
programme is part of an overall programme of management
of public lands involving multiple objectives related to theprotection and improvement of national resources, theefficient utilization of resources, and the equitable
distribution of benefits from resources. Since the grazing
programme involves federally-managed public land, PFCpayments or other programme payments are not relevant.
Uruguay    G/AG/N/URY/13   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Supporting Table DS:1
Canada: "Marketing and promotion services" and
"PREDEG - Farm conversion and development
programme" : Conformity with Annex 2 criteria.
Australia/Canada/New Zealand: "PREDEG investment
aids" -  Operation of the programme; conformity with
Annex 2.On the basis of the feedback received as a result of the
multilateral review process, the competent authorities willshortly submit a revised notification.  The category of
support "PREDEG investment aids" will be removed from
ST/DS:1.  A new ST/DS:6 will include all non-exempt
direct payments effectuated under the category "PREDEG-Farm conversion and development" together with correctedfigures.G/AG/R/16
Page 53
Table DS:2 Notifications
Switzerland   G/AG/N/CHE/16   New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
Australia/Canada/Korea/New Zealand: This payment is tied
to animal welfare conditions not covered by Annex 2 and
appears to be directly related to production; clarification ofthe set of criteria of Annex 2 under which this programmeis classified.
United States:  Whether the measure is part of a clearlydefined environmental or conservation programme asrequired under para 12, Annex 2; whether disbursements
are limited to the extra cost of complying with the
programme.The temporary measure notified encourages domestic
producers to switch their egg production methods to
systems which comply with stringent conditions regardinganimal welfare and husbandry systems particularlyrespectful to the creature.  Payments therefore compensate
farmers for the extra cost involved in complying with
animal welfare requirements. The measure complies withpara 12 of Annex 2 wish refers, inter alia , to production
methods.  The measure is also designed as structural
adjustment assistance (para.11) in the form of 3 centimes
per egg and will expire after 5 years, i.e. in 2001.  It is notimposed on Switzerland's trading partners.G/AG/R/16
Page 54
Tables ES:1 to ES:3 Notifications
Australia   G/AG/N/AUS/19   Export subsidies (Tables ES:1 and ES:2)
This notification was subject to preliminary review.
Points raised by other Member s Response by Notifying Member
Thailand:  Whether "Quantity of exports" in Table ES:2 is
expressed in "metric tons" or Australian currency."Quantity of exports" is ex pressed in metric tons.
Thailand: Considering that no export subsidies were
provided to dairy products in the financial year 1997/1998,
whether Australia has considered not using export subsidies
at all in the future, especially in view of the next round ofagricultural negotiations.Australia confirms that no export subsidies were provided
to the listed dairy products during the said period.  Export
subsidies on dairy products were terminated on 30 June
1995. Australia's position on the subject is well known, canbe reiterated, and will be adopted during the next round ofnegotiations.
Hungary   G/AG/N/HUN/14   Export subsidies (Tables ES:1 and ES:3)
Points raised by other Member s Response by Notifying Member
Canada:  List of HS tariff lines covered by the Table ES:1
notifications for 1995 and 1996; whether Hungary plans tosubmit Supporting Table ES:1 for these years.The HS tariff lines are listed in Section II of Part IV of the
Hungarian Schedule. Supporting Table ES:1 wasinadvertently omitted.  It would have indicated that exportsubsidies in the calendar years 1995 and 1996 were
provided exclusively in the form of direct subsidies.
Supporting Table ES:1 will be attached to future TableES:1 notifications.
Canada:  Confirmation sought that no additional exportsubsidies were provided in 1995 and 1996 for any otherproduct.-
Canada:  Details requested on export subsidies provided for
any products not outlined in Hungary's Schedule LXXI, in
volume and budgetary terms.The notification of these details falls under the provisions
of the waiver granted to Hungary on 22 October 1997
(WT/L/238).
Follow-up:  Canada found that a gap existed between the
information presented in HUN/14 and strict compliancewith Hungary's notification obligations, and the situationwhich Hungary has admitted existed in 1995 and 1996.This situation has led to the granting of a waiver but it will
not be addressed directly in the report pursuant to that
waiver. Essentially, the question is whether and how willHungary inform the Committee of (a) the product coverage(b) the volume and (c) outlays on export subsidies overall
in those two years, not just in the sixteen scheduled product
areas.
 Uruguay recognized the existence of a waiver, which it
had supported during the approval of the corresponding
General Council Decision.  Nevertheless, it reaffirmed its
belief that all Members are under the obligation to submitfull and complete information in their notifications to theCommittee on Agriculture.  This  important systemic issue
should be discussed further within the Committee.  Any
information shared on a bilateral basis  must be providedin full to the Committee, through the Secretariat, and dulyreflected in Committee Report s. This stand-point was
supported by the United States and New Zealand
.Such information was shared during an extensive
consultation process that was open to all interested
Members and that finally led to the waiver.  The conditionsunder which the waiver was granted were thoroughlydiscussed and were approved by all Members of the WTO.
The notification provides the Committee with complete and
accurate information on export subsidies in the calendaryears 1995-96 for products outlined in the HungarianSchedule.G/AG/R/16
Page 55
Morocco   G/AG/N/MAR/10   Ex port Subsidies (Table ES:2)
Points raised by other Member s Response by Notifying Member
Canada/Japan: Whether Morocco intends to submit a
Supporting Table ES:2 notification for calendar year 1996.A notification will be submitted in the near future for
calendar year 1996.
Canada: Definition of "freight/payment"; how suchpayments are made.The disbursements under this category are based on export
opportunities and the rate of utilization of these subsidies.
Japan: Reason why export subsidy amounts for vegetableshave doubled since 1995.Undertook to provide a response in writing.
Norway   G/AG/N/NOR/18   Export Subsidies (Tables ES:1 and ES:3)
Points raised by other Member s Response by Notifying Member
Argentina/Australia/Brazil/Korea:  Reason why unused
export subsidies were carried over for swine meat, sheepand lamb meat, eggs and egg products and cheese, in 1997.In conformity with Article 9:2(b), Norway used its right to
carry over unused quantities or subsidy amounts fromprevious years to the year 1997 for these productcategories. Thus those notified quantities/amounts that
exceed commitment levels include the quantities/amounts
carried over from previous years.
Canada:  Noting that export subsidies are higher than the
base-period average for certain products, explanation is
sought as to the conditions wh ich led to this substantial
increase in 1997.Article 9:2(b) allows the carrying over of unused
committed levels of subsidi zation from previous years
during the implementation period, provided that, in year2000, the last implementation year, actual levels andvolumes are within the specifi ed commitment levels for
that year.  Norway intends to meet its obligations
accordingly.
Several reasons explain the actual levels of subsidization
and export in 1997.  Among these were difficulties in the
meat markets in Norway in 1997 which were reflected in
increased meat exports.
New Zealand:  Whether Norway intend to continue this
practice in future and for which products.The actual practice in 1998 and 1999 depends on price and
market developments for the concerned products.  The
yearly export subsidy notifica tions will provide information
on this in due course.  However, Norway can alreadyindicate that in 1998, unused subsidies will be rolled overfor at least cheese and processed agricultural products.
Switzerland   G/AG/N/CHE/17   Export Subsidies (Tables ES:1 to ES:3)
Points raised by other Members Response by Notifying Member
Canada:  Reason for the change in reporting period for
potatoes and fruits, i.e. from crop year to calendar year.The Swiss government changed its entire administration
cycle for the products concerned from crop year to calendaryear.
New Zealand:   Details on export figures for the 1997 cropyear including pattern of exports.Export figures for the period Jan-Dec 1997 are: (a) Fruit:
836 tonnes, exported with an outlay of 4.08 million Swissfrancs - (b) Potatoes: 5,705 tonnes exported with an outlayof 1.8 million Swiss francs. The year 1996 was an
extremely bad potato year and only minimal export
subsidies were recorded in the second semester of 1996.G/AG/R/16
Page 56
Switzerland   G/AG/N/CHE/17   Export Subsidies (Tables ES:1 to ES:3)
Points raised by other Members Response by Notifying Member
Canada/New Zealand: Noting that the relevant base period
for potatoes and fruits is the crop year, explanation of how
a change in reporting period will impact on scheduled
reduction commitments.This change does not imply any alteration of commitments
which remain as indicated in Schedule LIX, Suisse-
Liechtenstein. The calendar year commitment was
calculated by adding 50 per cent of each of the respective,overlapping commitments covering the calendar year in theSchedule. Exported quantities and outlays over the 18
months transition period are well below the crop year
commitments from 1 July 1996-June 30, 1997.  In the caseof fruit, expenses are at 20 per cent level of thecommitment mentioned and the quantities at about 10 per
cent thereof.  The 18 month figures for potatoes do not
exceed 70 per cent of the crop year commitment.
New Zealand: Concern about lack of transparency inaggregating periods of 18 months.(See above calculation method). Switzerland believes it is
more appropriate to have the same reporting periods in all
the notifications. Recourse to uniform reporting periodscontributes to enhancing transparency and it would beinappropriate to split up a domestic reporting cycle forCOA notification purposes.G/AG/R/16
Page 57
ANNEX – Part II
Deferred replies to questions on notifications raised in the June 1998 meeting
Table DS:1 Notifications
European Communities    G/AG/N/EEC/12 (and Corr.1)   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
General Services
New Zealand - “Aid to encourage establishment of
producer groups and ease administrative overheads”:
Conformity with fundamental and specific green box
criteria (that  measures have “no, or at most minimal, trade-
distorting effects on production” and that they not be
“expenditures for unspecified purposes that could be usedby sellers to reduce their selling price”).The aids in question may be granted for a limited period of
time to encourage the formation of producer groups andfacilitate their administrative operation.  This aid is limitedto a certain percentage of the actual formation and
operation expenses of the producer groups. For instance,
expenditures incurred in connection with the preparatorywork towards setting up producer groups, expenditures onadministrative staff, office stationery.
This type of aid is covered under "(f) Marketing and
promotion services". No further details are availableregarding the expenditures under this heading.
New Zealand - “protection of geographical indications”:How much money has been spent on this assistance? Howdoes support in this area meet the Green Box criteria?This programme consists in a global communication
campaign designed to promote the protection ofdesignations of origin and certain geographical indications,for instance the European logo.  It consists of many global
(not product-specific) public relations activities.  No
amount is spent on individual products. No further detailsare available regarding the expenditures.
Structural adjustment assistance through investment aids
Australia/Brazil/Canada/United States - More than one-third of EC Green Box payments in 1995-96 fall under thisheading, even though G/AG/AGST/EEC seems to indicate
nil support provided under this category (the measure is
listed but no support amount is shown).   What accounts for
the huge increase in such support?  Breakdown of supportprovided under each listed measure.Base period data does not indicate a nil support.
Expenditures on investment aid were not specified duringthe base period but were included in the total amount
indicated for green expenditures in G/AG/AGST/EEC. No
information available on the amounts of support providedunder each of the measures listed in section (I) of ST/DS:1.
Australia/Brazil/Canada/United States - Conformity of
subsidies and interest concessions granted for farmmodernization  programmes with criteria of Annex 2, para11.The criteria of Annex 2, para 11 are respected. The amount
of payment given is strictly determined by the costs andtype of investment (fixed assets or equipment) and notrelated to the volume of production or product price.  The
payments relate strictly to the investment concerned.  There
is no obligation for beneficiaries to produce a particularproduct.G/AG/R/16
Page 58
European Communities    G/AG/N/EEC/12 (and Corr.1)   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Australia/Brazil/Canada/United States - Structural
disadvantage being addressed; time-period foreseen for the
realization of the investment; and calculation method of
compensatory payments.The diversity of European agriculture and national/regional
conditions does not allow to give an exhaustive list of
structural disadvantages being addressed.  National or
regional investment aid programmes are always adapted tothe specific structural problems which might be, e.g. smallstructures of holdings, out-dated technical equipment, lowdiversification of agricultural activities.
The farmer applying for investment aid has to specify in the
investment plan the time-period in which the investment isto be realized.  On average, investment plans have a
duration of two to three years.  One farmer may only apply
for three investment plans in a six-year period.
Compensation is calculated in accordance with strict limits
set up at Community level expressed in terms of maximum
eligible investment amounts and aid intensities which are
considered to be sufficient to compensate the structuralhandicaps. The aid amounts are defined by MemberStates/regions according to specific respective situations.
The aid may in no case go beyond the limits set at
Community level.
Regional assistance programmes
Canada - What are the “specific measures” being referred
to?These measures benefit the Less Favored Areas (incl.
French Overseas Departments, Azores, Madeira, Canary
and Aegean Islands) and mountainous areas. Compensatory
allowances are paid under certain conditions, per hectare orper livestock unit.  Aid may e.g. be granted for locallyproduced agricultural products of certain regions (islands).
Canada - Description each measure and breakdown of thetotal support allocated "for the benefit of Less FavouredAreas".  Conformity with Annex 2 criteria.It is not possible to provide information on support for each
individual measure. Support is given either in headagepayments in case of farms keeping cattle, sheep, goat or
equine animals; or as hectare payments. (a) Compensatory
allowances are only paid up to a stocking density of 1.4LU/ha (LU=life stock unit).  More LU are not eligible. (b)In case of hectare payments, the payments per hectare of
total forage area may not exceed a certain am ount.  (c) The
full amount of co-financing is only given to the first 60units per holding, beyond 60 up to 120 units per holding,the maximum eligible amount is reduced by half.  Beyond120 units, no further unit is eligible.  This shows the cleardegressive approach of the support scheme.G/AG/R/16
Page 59
European Communities    G/AG/N/EEC/12 (and Corr.1)   Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Blue box
Japan/Switzerland - Whether compensatory payments to
producers cover both the planted area and the set-asidearea. If so, whether compensatory payments for set-asiderequirements have been granted to products other thancereals.The new arable crop farm policy of 1992 is based on the
following principles.  Farmers can apply for a hectare aidfor cereals, oil seeds, protein crops, non textile linseed andset-aside.  The aid is regionalized and fixed per hectare
(based on the average yield in the past).  The hectare aids
are limited to a fixed area at a regional or national level, theso-called base area (based on the number of hectarescultivated in the past).  In the case of the large producers,
there is an obligation to set aside land on the holding (in
relation to the request for compensatory aid), the farmerwill be granted a special compensation for the set-asideland.
The sum of the base areas for the EC-15 amounts to 53.6
Mio hectares.  A base area is the surface for which farmerscan apply for a hectare aid for cereals, oilseeds, proteincrops, non textile linseed or set-aside. There is no sub-
division into different crops, except for maize for which
Member States may reserve part of a base area only for that
crop by defining a specific base area for maize.  The sum ofthose specific base areas amount to 3.1 Mio hectare.  In thecase of the crop-specific payment granted to oilseeds, a
supplementary discipline applies, as provided for in
Schedule CXL.
Table ES:1 - ES:3 Notifications
European Communities   G/AG/N/EEC/11   Export Subsidies (Tables ES:1 to ES:3)
Points raised by other Member s Response by Notifying Member
Brazil - Clarification sought as to why the quantity of
subsidized beef (2.227 Mio tonnes) is superior to the
exported amount (1.081 Mio tonnes).For 1996/97, the subsidized quantity of beef exports
amounts to 1,177,400 tonnes, while total exports are
1,081,900 tonnes.  Data on total exports represent ECexport statistics (i.e. actual exports) for the period July1996-June 1997 and are expressed in product weight.  The
figures on subsidized exports are in carcass equivalent
weight and are based on export certificates issued duringthe marketing year in question, irrespective of the actualdate of export.  The EC has applied export subsidies for
beef and wine in conformity with its scheduled
commitments.
Canada/New Zealand - Whether in Table ES:1 any amounts
have been included in the notification of export subsidies on
skim milk powder and butter which reflect activities under
the inward processing relief (IPR) scheme.  Could the ECplease provide the figures?The application of the IPR scheme is reflected in the export
subsidy figures for EC dairy products used under this
system. The EC has provided the relevant information in
accordance with the notification requirements.
United States - It was our understanding during theUruguay Round negotiations that EC Class C sugar wouldbe subject to export subsidization. Could the EC indicatewhether its notification cover subsidies granted to Class Csugar?Exports of C sugar are not subsidized .  The EC notification
does not therefore include exports of C sugar:  this type ofsugar is not included in EC's scheduled export subsidycommitments.G/AG/R/16
Page 60
Attachment no. 1 – (G/AG/N/GTM/6)
Guatemala -  Tariffs applied to tariff quota products not subject to tariff quota arrangements in 1998
SAC
CodeDescription (in Spanish only) Tariff applied
0203 Carne porcina fresca refrigerada o congelada 19%
0401 Leche y crema (nata), sin concentrar, azucarar ni edulcorar de otro modo
20%
0713 Legumbres secas desvainadas, incluso mondadas o partidas 20%
0806 Uvas y pasas 19% y 15%
0808 Peras
y membrillos frescos19%
19%
1007 Sorgo para grano 20%
1201 Habas de soja (soya) 1%
1208 Harina de semilla o de frutos oleaginosos 5%
1507 Aceite de soja (soya) 19%
1511 Aceite de palma 19%
1512
15122Aceite de girasol
Aceite de algodón19%
19%
15152 Aceite de maíz 19%
1701 Azúcar de caña o de remolacha y sacarosa químicamente pura 20%
2304 Tortas y demás residuos sólidos de la extracción del aceite de soja (soya)
incluso molidos o en pellets9%
2401
2402
2403Tabaco en rama o sin elaborar
Cigarrillos o puros
Tabaco homogeneizado o reconstituido9%
Source:  UDACA/Ministry of the Economy.G/AG/R/16
Page 61
Attachment no. 2 - (G/AG/N/GTM/9)
Guatemala –  Import arrangements for wheat and meslin flour
If the entire quota for flour has not been allocated by the end of the year, the wheat equivalent
of the unused portion is added to the wheat quota, as provided for in Article 2 of Government
Decision No. 152-96 which stipulates that:
"Article 2.  The Ministry of the Economy, the Ministry of Agriculture, Livestock and
Food, and the Ministry of Public Finance shall be responsible for establishing the annual tariff
quotas for wheat and wheat flour referred to in Article 1 above, taking due account of the
relevant proposal of the commission created under Article 4 of this Decision.
In establishing the said quotas, the following elements shall be taken into consideration:
(a) The annual wheat quota shall be 94 per cent of the quantity, in tonnes, obtained by
deducting from the projected domestic consumption of wheat the estimated domesticwheat production for the following year.
Feed wheat shall not be included in that quantity.
(b) The flour quota shall be six per cent of the quantity mentioned in subparagraph (a)
above expressed as a flour equivalent.
The wheat equivalent of the leftover flour quotas shall be added to the wheat quota at
such time as is established in the supplementary provisions to be issued in connection with the
implementation of this Decision and in accordance with the conversion factor* indicated
therein."
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*The wheat/flour conversion factor is 0.72.G/AG/R/16
Page 62
 Attachment no. 3 - (G/AG/N/GTM/9)
Guatemala -  Import data for all tariff quota products, calendar year 1997
SAC Code Description (in Spanish only) Volume (MT) Tariff applied
0201
0202Carne de animales de la especie bovina, fresca,
refrigerada o congelada        369 19%
0203 Carne porcina fresca, refrigerada o congelada        588 19%
0207 Carne y despojos comestibles de aves de la partida 1.05,
frescos, refrigerados o congelados     6,192** *
0401 Leche y crema (nata), sin concentrar, azucarar ni
edulcorar de otro modo     1,620 20%
0713 Legumbres secas desenvainadas, incluso mondadas o
partidas     1,960 20%
0806 Uvas y pasas     4,699 19% y 15%
0808 Manzanas,
peras y
membrillos frescos    4,725** *
19%
19%
1001.10.00 Trigo duro 176,194** *
1001.90.00 Los demás (trigo suave) 103,055** *
1005 Maíz 284,572** *
1006 Arroz   28,784** *
1007 Sorgo para grano       108 20%
1101.00.00 Harina de trigo y morcajo o tranquillón     1,205** *
1201 Habas de soja (soya)     116 1%
1208 Harina de semilla o de frutos oleaginosos                   595 5%
1507 Aceite de soja (soya)                2,675 19%
1511 Aceite de palma                4,201 19%
1512
15122Aceite de girasol
Aceite de algodón34,652
72,98119%
19%
15152 Aceite de maíz   1,310 19%
1701 Azúcar de caña o de remolacha y sacarosa químicamente
pura        25 20%
2304 Tortas y demás residuos sólidos de la extracción del
aceite de soja (soya) incluso molidos o en pellets     325 9%
2401
2402
2403Tabaco en rama o sin elaborar
Cigarrillos o puros
Tabaco homogeneizado o reconstituido     437 9%
* Activated quota.
Source:      Bank of Guatemala.
**Source:  UDACA/Ministry of the Economy.G/AG/R/16
Page 63
Attachment no. 4 - (G/AG/N/ISR/7)
Israel -  Yearly increase of market access opportunities, 1995-2000
H.S. Code Base
(tonnes)Yearly
increase1995 1996 1997 1998 1999 2000
02.04 240 40 280 320 360 400 440 480
04.02.1000 1,200 0 1,200 1,200 1,200 1,200 1,200 1,200
04.02.2000 50 8.33 58.3 66.7 75.0 83.3 91.7 100.0
04.06.3000 34 5.67 39.7 45.3 51.0 56.7 62.3 68.0
04.06.9000 540 90 630 720 810 900 990 1,080
08.13.2000 600 0 600 600 600 600 600 600
08.02.3000 100 7 107 114 121 128 135 142
10.01 450,000 0 450,000 450,000 450,000 450,000 450,000 450,000
15.16.1110 450 30 480 510 540 570 600 630
20.05.8000 200 15 215 230 245 260 275 290
20.09 100 6 106 112 118 124 130 136G/AG/R/16
Page 64
Attachment no. 5 – (G/AG/N/JAM/2)
Jamaica -  Supplementary information on "green box" programmes
A.  Extension Services
Extension delivery is focussed on the following areas:
Crop production  – Mainly domestic food crops as Commodity Boards provide Extension Services
for their respective plantation crop e.g. coffee, sugar cane, bananas, etc.
Livestock production  – Beef and dairy cattle, goats, pigs, poultry.
Marketing
Social service/Home economies
Technologies are transferred th rough the following methodologies
Farmer training
Lectures
Seminar/workshops
Field daysIndividual farm visits
Demonstration plots on the testing and validation of new varieties and production methods
Radio/Television broadcasts
Printed media
Booklets, manuals and leaflets
Extension advice is given on:
Planning and developing strategies for small and medium size farming enterprises.
Production practices and cropping systems
Pests and disease control, particularly in cases of severe threats and attacks – Pink Mealybug,
Papays Ring spot
Modern pest control e.g. Integrated Pest Management
Care and management of small and large livestock, recommend new breeds for adoption.
Social service
Development of home marketing skills e.g. garment making, small craft production,
consumer education, health and nutrition, to enable rural women to be more effective home
managers.
Group formation and development of income generating projects
Small Agro-processing enterprises.
Marketing of products.G/AG/R/16
Page 65
Marketing
Quality control through appropriate post harvest practices
Development of marketing groups (PMOs) through which training and  technical support
could be channelled.
Accessing of markets, marketing trends, prices and the use of crop situation dataForging linkages to assist producers and market intermediaries to solve marketing problems.
B.  Research and Development Programme
Crops Research  – Development of improved production systems (inclusive of the control of pests
and diseases) in vegetables, root crops:
Livestock Research Improvement  – Development of livestock production systems based on an ever
increasing component of local resources.  Against a background of increased competition from
imported milk solids, priority is given to the development of systems aimed at reducing cost of
production.
The 1998/99 Research and Development programme will highlight the following activities:
Crops Research and Development
Varietal trials of Kenaf to determine yield and adaptability.
Varietal trails of tomato to identify suitable varieties for all year production, especially during
the warmer periods.
Varietal trials of sweet pepper to identify varieties that are more resistant to the major viral
diseases.
Varietal trials of sorrel to identify high yielding types which are suitable for agro-processing.Varietal trials of Pigeon Pea to identify dwarf, day-length insensitive varieties.Maintenance of cassava, sweet potato, coco and dasheen germplasm and varietal trials of the
latter two.
Development of a package of production practices for Scotch Bonnet Pepper and onions.Evaluation and improvement of pumpkin germplasm.Development of integrated pest management approaches to the pests of mango, citrus and
papaya.
Assessing cultivars of plantain with the aim of introducing new accessions which are resistant
to Sigatoka Diseases.
Improving the productivity of ginger by controlling soil borne diseases.G/AG/R/16
Page 66
Developing environmental-friendly methods fo r the control of yam weevil, which is an
actionable quarantine pest and blue mold in storage.
Livestock Research and Development
Characterization of the native goat, the St. E lizabeth sheep and evaluation of Boer germplasm
to improve the native goat through cross breeding.
Upgrading pastures by the introduction and evaluation of new species and developing
management systems for grass/legume combinations.
Effective management practices including desired nutritional inputs for early weaning and
post weaning development of pigs.
Evaluation of breeding system utilizing inter-breeding of three breeds of pigs and selected
lines of the three breeds.
Rapid multiplication of Jamaica Hope cattle, utilizing embryo transfer.Molecular characterization of Jamaica Hope cattle, conservation of the breed and estimating
of the levels of inbreeding.
Performance testing of Jamaica Hope Bulls and progeny testing Jamaica Hope Sires.Husbandry systems for the rearing of dairy heifers to provide replacement in the dairy herd.Characterization of Jamaica Black/Brangus(A ngus germplasm and conservation of polled
Jamaica Brahmans.
Performance testing of beef cattle.G/AG/R/16
Page 67
Attachment no. 6 – (G/AG/N/USA/17)
United States -  Explanation of the different methods used to calculate irrigation subsidies
The 1994 subsidy was assumed for the 1995 and 1996 notification (US$381.4 million), based
on a debt refinancing method.  The 1986 subsidy (US$543.3 million) was based on a full cost method,
with actual fees received deducted from the cost.
The 1994 subsidy is the product of the 30-year Treasury Bond interest rate (7.37 per cent) and
the amount of the unpaid balance of the capital investment of the Federal Government in the irrigation
projects (US$5,174.4 milion). Irrigators repay the principal, but not the interest costs.  A comparisonof two different methods was made in 1991.  The debt refinancing method results in a subsidy
estimate that was 3.5 per cent higher than the following full costs method.
The 1986 subsidy was calculated for each water project using the full costs definition of a
subsidy.  The difference between:
(a) the annual federal cost of constructing, operating, and maintaining the irrigation portion of
a water project (including the interest on capital investment) and
(b) the revenues received by the Government from fees charged the users for the water.Full costs were defined in a way to make them consistent with requirements for compliance
with the Reclamation Reform Act of 1982.
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