What are the effects on trade regulation for food security under the world trade organization system
With the launch of new negotiations on international trade called ‘Doha Development Agenda’ (DDA), agriculture is once again expected to be a central and difficult issue. As a solution to the problems associated with food security in the DDA negotiation on agriculture, this article suggested a creation of a food security box.
The basic idea of the food security box is, (i) to allow, like other existing exemptions (such as Green and Blue Boxes), a series of exemptions to the AoA for members whose agriculture was not meeting basic food security needs (hereinafter the members); (ii) to allow the members to protect and enhance their domestic production capacity under certain conditions; (iii) to provide flexibility to the members so as to increase domestic support for agriculture until they have achieved a certain level of food self-reliance; (iv) to obligate developed countries to give to developing countries technical assistance for improvement in the productivity; (v) to balance the rights and duties between food-exporting countries and food-importing countries.
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Free trade alone cannot solve the global food security problems, since free trade may have both positive and negative effects on food security. It should be noted that the policy to achieve food security based only on food aid and trade liberalization is too risky in terms of long term public policy. Given the instability of agricultural production and food aid, it is in the special interests of many food-importing countries such as the Republic of Korea and Japan to increase domestic agricultural production to ensure food security.
I . Introduction
The Doha Ministerial Declaration, issued at the fourth World Trade Organization (WTO) Ministerial Conference on 14 November 2001, launched new negotiations on a range of subjects, and included the negotiations already underway in agriculture and services. With the launch of new negotiations on international trade entitled “Doha Development Agenda (DDA),” agricultural trade is expected to be the most contentious and difficult issue.’) It is agreed that the non-trade concerns (NTCs) such as food security and environmental protection will be taken into account. At the DDA agricultural negotiation, food security
* Professor, College of Law, Kyung Hee University, Seoul, Korea E-mail: <[email protected] >
This work was supported by the Korea Research Foundation (KRF-2001-013-000021). is a key element of NTCs. The NTC Group (comprising the European Communities, Japan, Norway, Switzerland, South Korea and Mauritius), often called as the ‘Friends of Multifunctionality’, raised NTCs as a central part of their negotiating positions.
The United States and the Cairns Group rejected, however, the concept. Some countries argue that there is no food security issue for developed countries because they can afford to purchase if necessary. Food security is, however, fundamentally a matter of national security, justice and human rights where all countries have a great concern.
The focus of the Agreement on Agriculture (AoA) is, unfortunately, not on food security but on trade liberalization. The existing provisions of the AoA can not only not solve the global food security problems but also have detrimental impacts on food security and sustainable development, consumer health and safety and the environment. The AoA does not adequately and equitably address the food security needs of both developing countries and developed countries. As a solution to the problems associated with food security in the WTO negotiation on agriculture, this article suggests a creation of a food security box. This article will not attempt to explain or describe the details of the AoA.
Section II describes the concept of food security under the context of the WTO system and international law. Section HI points out some problems and shortcomings in the current AoA. Section IV describes the concrete contents of a proposed food security box. Section V provides a brief summary and conclusion.
II. The Concept of Food Security
1. Definition of Food Security
The term ‘food security’ has been defined in diverse ways. Both developing countries and developed countries have adopted some kind of food security policy. One starting point in understanding the concept of food security is a widely accepted definition adopted by the United Nations Food and Agriculture Organization (FAO) at the World Food Summit in 1996: “Food security exists when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preferences for
an active and healthy life.” 2) There are four elements implicit in this definition: availability, accessibility, reliability (or stability), and sustainability. Adequate food availability means that sufficient food supplies should be available to meet consumption needs. Access to food means that both physical and economic access to food should be guaranteed. 3) A reliable food supply means that an adequate food supply should be continued even during seasonal or cyclical variations of climate and socio-economic conditions. Access to adequate food is essential for good nutrition, but it is not in itself sufficient. Food should also be safe in order that people may survive and be free from disease. Food security, therefore, inevitably requires food safety. In addition, food security requires agricultural sustainability in terms of long-term food security. If agricultural production is managed through exploiting non-renewable natural resources or degrading the environment, it may threaten long-term agricultural sustainability and global food security. 4) Thus, food security requires available, accessible, reliable and sustainable food supply at all the times.
Food security has three dimensions: individual, national and multinational levels. 5) At the individual or household level, poverty or gender inequality may influence the distribution of food affecting individual food security even when food supply is sufficient. At the national level, natural disasters or socio-economic conditions such as armed conflicts may seriously disrupt food production and supply. States may have sufficient food at the national level, but have some food insecure individuals because of unequal distribution of food. At the multilateral level, especially within the context of WTO, food security is considered as a State affair, and discussion tends to focus on liberalization of agricultural trade, trade regulation and adequate supplies of imported food to members.
2. Food Security as a Food Sovereignty
“Food sovereignty is the right of each nation and its people to maintain and develop its own capacity to produce the people’s basic food, while respecting productive and cultural diversity.”6) Food may be used as a tool by nations to impose political and economic pressures on others. The effective realization of food security is essential to national sovereignty since the use of food as a political weapon among nations may limit and jeopardize the sovereignty of individual nations.
Thus, in the Rome Declaration on World Food Security, government delegates agreed that “[alttaining food security is a complex task for which the primary responsibility rests with individual governments.” Because of the responsibility assigned to governments for achieving food security, they emphasized that “Mood should not be used as an instrument for political and economic pressure.” Food sovereignty is, therefore, a pre-condition for a genuine food security.
The term ‘food sovereignty’ was elaborated by NGO. In an Action Agenda adopted at NGO/CSO Forum on Food Sovereignty, food sovereignty was affirmed as “a right of countries and peoples to define their own agricultural, pastoral, fisheries and food policies which are ecologically, socially, economically and culturally appropriate.” 7)
3. Food Security as a National Security
One of the major tasks of a State is to ensure enough food to feed its own people. Adequate food is indispensable for the survival of a sovereign State. When we are, therefore, talking about food security, we are really talking about a national security issue. Thus, some commentators justify the maintenance of a certain minimum level of production of agricultural products in the name of national `safety and security’.
Although the WTO members have not resorted to Article XXI (national security exception clause) of the GATT (General Agreement on Tariffs and Trade) to protect their domestic agricultural industry, the relevance of national security was pointed out at the Special Sessions of the WTO Committee on Agriculture. “Under GATT Article XXI, national security issues may be exempted from Wf0 trade disciplines. Food security is also inextricably connected to national security and political sovereignty. Chronic food insecurity puts national security in jeopardy by placing at risk the health of a large number of people, and also it incites internal turmoil and instability. ”
4. Food Security as a Human Right
Access to adequate food is recognized as a human right. Food security is fundamentally a matter of human right. Many commentators agree that “under international law there is currently found, to a minimal extent, a treaty right conjoined with a customary right to be free from hunger.”il)) International Agreements such as the Universal Declaration of Human Rights”) and the International Covenant on Economic, Social and Cultural Rights 12) support this view.
In the Rome Declaration on World Food Security, government delegates reaffirmed “the right of everyone to have access to safe and nutritious food, consistent with the right to adequate food and the fundamental right of everyone to be free from hunger.•..” 13) Food security is a global issue. National disaster or armed conflict in one agriculture exporting country can seriously affect the food security of other countries. International cooperation is, therefore, indispensable in order to ensure universal food security. Thus they also reaffirmed “the importance of international cooperation and solidarity as well as the necessity of refraining from unilateral measures not in accordance with the international law and the Charter of the United Nations and that endanger food security.” 14) “Each nation must – cooperate regionally and internationally in order to organize collective solutions to global issues of food security. In a world of increasingly interlinked institutions, societies and economies, coordinated efforts and shared responsibilities are essential.” 15)
III. Problems and Shortcomings in the Agreement on Agriculture
1. Lack of Food Security Provision
The focus of the AoA is not food security, but trade liberalization. Its main objective is to establish “a fair and market-oriented agricultural trading system” through “substantial progressive reductions in agricultural support and protections”(Preamble). The AoA aims to liberalize agricultural trade in three principal ways: increase of market access, reduction of both domestic support and export subsidy.
The AoA has no provision on food security, and no definition on food security. There are, however, a few provisions mentioning the term ‘food security’ in a very narrow sense. Commitments under the reform programs should be made in an equitable way among all members, having due regard to non-trade concerns, including “food security”(Preamble). Article 12 of the AoA provides that members instituting ‘export prohibition or restriction’ shall give due regard to the effects of such prohibition or restriction on importing members’ “food security”. Annex 2 of the AoA articulates ‘public stockholding’ (para3) for “food security purposes”. 16) Para.4 (“domestic food aid”) of the Annex 2 is also a provision for food security, although the term food security is not used. Thus, the term ‘food security’ in the WTO is used in a very narrow sense and relates primarily to the adequate supply of food to member states through free trade.
2. Inequity between Food–Export and Food–Import Countries
The AoA has a lack of due consideration for non-trade concerns such as food security. The AoA enables food-export countries to continue to subsidize and protect domestic producers while requiring food-import countries to open up their markets to foreign competition. Consequently, it failed to balance the interests of food-exporting and food-importing countries. It should be noted that there are special provisions for developing and least-developed countries, not for food-importing countries. Even the net food-importing countries (NFICs) are merely a subcategory of developing countries. 17)
The AoA, like other WTO Agreements, specifies different types of legal rights and obligations concerning market access, export subsidies, and domestic support, according to different categories of countries. The principal classifications are developed and developing countries, with the latter receiving ‘special and differential (S&D) treatment.’ It should be also noted that commitments under the reform programs for agricultural trade should be made ‘in an equitable way’ among ‘all’ members, having due regard to non-trade concerns, including food security (Preamble).
3. Insufficient Recognition of S & D Treatment for Developing Countries
As pointed out above, the AoA confers more beneficial legal rights and obligations concerning market access, export subsidies, and domestic support on developing countries. Developing countries were given different timetables, different target reduction rates, and different exemptions. The implementation period for making reductions was six years (until 2000) for developed countries and ten years (until 2004) for developing countries. Developing
17) The net food-importing countries (NFICs) are a subcategory of developing countries, which is defined by the WTO Committee on Agriculture based on trade profile data and negotiation among members. As of February 2000, there are 19 NFICs.
countries were allowed to apply lower rates of reduction in the areas of market access, export subsidies, and domestic support (but not less than 2/3 of those to be applied by developing countries). Least-developed countries were exempted from reduction commitments, although they were required to bind their tariffs and domestic support and not exceed those amounts.
Most of the current S&D provisions for developing countries are, however, largely irrelevant and ineffective because they lack the funds and means to use export subsidies, and domestic supports. The AoA enabled developed countries to continue to subsidize and protect domestic producers while requiring developing countries to open up their markets to foreign competitors. The AoA provisions systematically favor agricultural producers in developed countries and multinational agribusiness, and are unfair to developing countries. No WTO Agreement is more iniquitous than the AoA. Thus, the AoA enabled developed countries to maintain trade-distorting subsidies and import restrictions, and failed to achieve its stated objective of establishing a fair and market-oriented agricultural trading system. 18) It should be noted that the Doha Declaration articulated that S&D treatment for developing countries shall be “an integral part of all elements of the negotiations.”(para.13)
4. No Recognition of Uniqueness of Agricultural Products
Agricultural products are unique and most essential commodities in every country. In addition to its primary function of producing food, agriculture also provides non-food services to our societies jointly produced from agricultural activities. Non-food services of agriculture that have characteristics of public goods include the viability of rural areas, food security, environmental protection, rural employment, and preservation of cultural heritage and agricultural landscape. In this context, the multifunctional role of agriculture, in both developed and developing countries, should be recognized. 19)
In addition, agricultural production is biological and site-specific. Demand and production in agriculture is inelastic. Supply is heavily dependent upon the weather, and very sensitive to climate change. Over 90% of global rice production depends on the same monsoon area. 201 All these unique and multifunctional characteristics of agriculture need to be recognized and should be reflected in the revised AoA. “[T]o ensure that international trade plays a positive role in ensuring food security…, it is essential that trade rules respect the characteristics that distinguish agriculture from other sectors.” 21 )
5. Insufficient Recognition of Importance of Domestic Production for Development and Food Security
The AoA is premised on the idea that trade liberalization can enhance national and global food security. There is, however, widespread public concern that the current direction of trade liberalization under the AoA has a detrimental impact on food security and development. To date, the AoA’s objectives of removing trade barriers and protection have failed to promote the goals of sustainable agriculture and food security. The AoA overestimates the importance of free trade, but underestimates that of domestic production, in terms of sustainable development and food security.
In order to reduce the risks that are often associated with an excessive reliance on imports, a certain degree of domestic agricultural food production is essential for food security and development.22) Domestic production may play a role of insurance against risks such as import interruptions and poor harvests in exporting countries. 23) Agriculture is a way of life in many developing agrarian countries, and support of agricultural production is essential for ensuring food security, rural employment, and poverty alleviation. Agriculture continues to be an important source of foreign exchange and revenue for developing countries. In this context, domestic production should be recognized as an essential means to secure food security and development in the revised AoA.
6. Non–Implementation of the Marrakesh Decision
For countries that may be adversely affected by trade liberalization, a separate ‘decision’ was adopted, called ‘the Marrakesh Ministerial Decision on Measures Concerning the Possible Negative Effects of the Reform Programme on Least-Developed and Net Food-Importing Developing Countries’ (Marrakech Decision). 25) The Marrakech Decision was supposed to protect LDCs and NFIDCs from food insecurity caused by trade liberalization through ensuring a continued flow of financial resources, food aid, and technical assistance.
To date, the Marrakech Decision has not been sufficiently implemented. The Marrakech Decision is ineffective because it does not adequately define the problem (what are the negative effects?), it does not assign responsibilities, and it has no implementation mechanism. The requirement for providing a proof of damage and causality makes it also very difficult to invoke the Decision.
N. Proposals for Food Security Box
Food security is a key element of non-trade concerns and agricultural problems. As pointed out earlier, however, the existing provisions of the AoA can not only not solve the global food security problems but also have a detrimental impact on food security and sustainable development, consumer health and the environment. The AoA does not adequately and equitably address the food security needs of developing countries and developed countries.
The AoA needs, therefore, fundamental reform from the perspective of food security, and food security should have top priority in the DDA agricultural negotiations and a revised AoA. Food security should be mentioned in the preamble of the AoA as a central objective,and specifically reflected in its Articles. As a solution to the problems associated with food security in the DDA negotiations on agriculture, this section will suggest a creation of a `food security box’; the provisions of which will be elaborated in detail, based on the four elements of food security mentioned above.
It should also be noted that the food security box is different from the concept of a `development box’ in that the latter is concemed with S&D treatment for developing countrie s,26) while the former reflects the food security concerns of both developing countries and (net food-importing) developed countries. 27)
The basic idea of the food security box is, (i) to allow, like other existing exemptions (such as Green and Blue Boxes), a series of ‘exemptions’ to the AoA for ‘members whose agriculture was not meeting basic food security needs’ (hereinafter “the members”); (ii) to allow the members to protect and enhance their domestic production capacity under certain conditions; (iii) to provide ‘flexibility’ to the members so as to increase domestic support for agriculture until they have achieved a certain level of food self-reliance; (iv) to obligate developed countries to give to the members technical assistance for improvement in productivity; (v) to balance the rights and duties between food-exporting countries and food-importing countries.
Basic food security crops should be exempt from tariff reduction commitments. Each member may nominate, based on a negative list approach, a list of staple food security crops for exemption from reduction commitments. The ‘basic food security crops’ or ‘staple food security crops’ are crops which are either staple foods in the country concerned, or the main sources of livelihood for low-income farmers 2 8) To be qualified as ‘basic food security crops’, they should be sensitive in terms of food security and sustainable development.
26)Some members proposed a Development Box at the Committee on Agriculture. See The Development Box, Non-papa by Dominican Republic, Kenya, Pakistan and Sri Lanka, Special Session of the Conunittee on Agriculture Informal Meeting, 4-6 February 2002.
Tariff rate quotas (TRQs) were introduced in the Uruguay Round to ensure that existing access conditions were not undermined and as a means to create new market access opportunities. The expansion of TRQs may help to ensure greater market opportunities, for exporters especially in developing countries, and to further liberalize and increase trade in agricultural products. Since TRQs have contributed positively to increased market access and the food security of net-food importing countries, much flexibility in connection with the TRQs administration should be given to the basic food security crops of net-food importing countries. Some members proposed at the Committee on Agriculture ‘auctioning’ as an efficient and transparent method of TRQ allocation. 29
The Special Safeguard (SSG) provisions were introduced to facilitate the reform process and as a means of protecting domestic farmers injured by increase in imports. Given the special nature of agricultural products, the SSG mechanism should be continued, in order to minimize serious injuries caused to the domestic industry by sudden import surges and price fluctuations in ‘food security crops’. Consideration should also be given for extending the SSG to cover crops which have the potential to substitute for local food security crops.
At the WTO Committee on Agriculture, many delegates emphasized the importance of domestic production in achieving food security. 30) Most delegates contended that the most efficient solution should lie in a combination of domestic production, imports (trade liberalization), food aid and stockpiling, but they varied a lot in the emphasis they gave to various means.
Food aid and free trade can play important roles in achieving food security. The heavy dependency on imported foods and foreign food aid is, however, too risky especially to net food-importing countries in terms of food security policy, since they can provide major food-exporting countries with a powerful political weapon. They can foreclose the potential of domestic production as an engine of rural development and economic growth. It should be noted that the policy to achieve food security based only on food aid and trade liberalization is, therefore, too naive and risky in terms of a long term public policy.
The maintenance of a certain degree of domestic food production is, therefore, an essential element in national food security policies, in each country whether it is a developing or a developed country, and no matter how high its optimum self-sufficiency ratio may be. All domestic support taken to increase domestic production of basic food security crops for `domestic consumption’ should, therefore, be exempted from any form of domestic support reduction commitments. 32)
It should be emphasized that greater diversity in food production systems may contribute to achieve food security by enabling the access to food within a region 33) Developing countries should have the flexibility to take any domestic support measures including price support for food security, rural development and poverty alleviation, regardless of its impacts on trade.34)
(5) Export Subsidies
Export subsidies provided by developed countries may impact negatively on the food production system of importing countries and have detrimental effects on their domestic markets.35) Thus, they may impact negatively on the food security situation of net food-importing countries and developing countries. It may be contended that net food-importing countries and developing countries may also benefit from lower world agricultural prices caused by export subsidies provided by other countries. These benefits are, however, highly unreliable, and export subsidies are the most trade distorting of policy tools used in the agricultural sector. Therefore, at the Doha Ministerial Declaration, it was agreed to reduce, with a view to phasing out, all forms of export subsidies. 36) Developing countries should have the flexibility to use export subsidies in order to promote exports, especially when these exports are critical for achieving their food security needs.
Export subsidies may contribute to the problem of dumping which has also detrimental effects on the food production system of importing countries. The US and EC farmgate prices for many crops are less than many countries’ cost of production, because of huge amount of export subsidies. Producers from other countries cannot compete with dumped products from the US or EC based grain multinationals such as Cargill. The existing AoA does not address the problem of dumping of agricultural products. Thus, “[Ole lack of rules in agricultural trade that preceded the AoA contributed directly to food insecurity in the world.”37) Therefore, dumping of agricultural products should be prohibited, and food-importing countries should be allowed to take appropriate border measures against the dumped products, if they impact negatively on the food security policy of importing countries.
(7) Export Credits
Subsidized export credits, along with export guarantees and insurance, could be used to circumvent export subsidy commitments. 381 For this reason, strict rules and disciplines on export credits should be established in the revised AoA. Export credits may be, however, useful for food security in food importing countries suffering from financial crises or food supply problems,39) and should be allowed to be invoked through specific criteria, so long as they are not used as a means of circumventing export subsidy commitments. As of August 2002, export credits covering exports of agricultural and food products are not governed by any specific discipline within the AoA. 401 Rules and disciplines on export credits should ensure that export credits conform to commercial practices and do not confer an export subsidy.41) Developing countries should be, however, allowed to have the flexibility to use export credits.
(8) Export Restrictions and Taxes
Export restrictions and export taxes may be necessary for the food security of food-exporting countries in cases of emergencies like food shortages. For this reason, article XI of GATT 1994 prohibits quantitative export restrictions but makes an explicit exception for “export prohibitions or restrictions temporarily applied to prevent or relieve critical shortages of foodstuffs or other products essential to the exporting contracting countries.” Export restrictions and export taxes may, however, have detrimental effects on the food security of food-importing countries by promoting price variability and uncertainty.
At the WTO Committee on Agriculture, a number of food-importing countries, like South Korea and Japan, contended that their food supplies could be disrupted and their food security jeopardized if exporting countries restrict exports of agricultural products. 42) Article 12.1 of AoA further obligates the member instituting the export restrictions to give due consideration to the effects of such restrictions on importing countries’ food security.
However, given their significant distortion effects on world agricultural markets, strict rules and disciplines on export restrictions and export taxes should be established in the revised AoA. Above all, the period of export restrictions should not exceed more than three months, and a certain amount should be exempt from exporting restrictions during its implementation, for the food security of importing countries. Differential export taxes which encourage exports of processed products and discourage primary product exports should be prohibited.43) Developing countries should be, however, allowed to have the flexibility to use export restrictions and export taxes.
(9) State Trading Enterprises
Many countries have used state trading enterprises to control domestic markets and to regulate trade. State trading enterprises with exclusive or special rights and privileges may have negative effects on the establishment of a fair and market-oriented agricultural trading system. From the viewpoint of food security of importing countries, import state trading enterprises may, however, play an important role to ensure stable food supply. On the contrary, export state trading enterprises with monopolistic power may have a significant and direct impact on the international market.
More stricter rules and disciplines on export state trading enterprises should be, therefore, established in the revised AoA. New disciplines on state trading enterprises should ensure export and import transactions are non-discriminatory and transparent. Developing countries should be, however, allowed to have the flexibility to use state trading enterprises. 44)
(10) Food Aid and Stockholding
Article 10.4 of the AoA does not prohibit the use of food aid as a means of surplus disposal or market expansion. 45) Food aid may, however, have negative effects on food security, and be used to circumvent export subsidy commitments. 46) At the WTO Committee on Agriculture, MERCOSUR group contended that there was an urgent need to establish more detailed rules on food aid in order to ensure that WTO commitments on reducing export subsidies are not circumvented while at the same time preserving the humanitarian dimension of food aid. Strict rules and disciplines on export restrictions and export taxes should be, therefore, established in the revised AoA. 47)
Above all, food aid should only be in the form of grants rather than credits, should respond genuinely to demand, and should be targeted at the needs of the recipient countries. It should not harm the domestic production systems of the recipient countries, should not distort international trade, should not amount to the disposal of price-depressing surpluses, should not allow countries to circumvent their export subsidy commitments, and should not be used as a means of expanding market share by subsidizing countries. Developing countries should be provided with the technical and financial assistance to improve their domestic food production capacity.48)
Public stockholding of basic food security crops for food security purposes should be given a wider definition under the Green Box provision. According to para.3 of Annex 2 to the AoA, the volume and accumulation of stocks shall correspond to predetermined targets related solely to food security, and there are strict criteria for how such stocks are purchased and sold. The AoA should also provide for regional food security plans, including joint maintenance of emergency food stocks. 49) Some countries at the WTO Committee on Agriculture proposed creating an international food stockholding system in order to effectively address food security concerns of developing countries. 50) Developing countries should be allowed to have the flexibility to use food security stocks.
(11) Food Safety
Recently, food safety has been an emerging NTC issue. Public concerns on food safety increases as the trade of agricultural products increases. Food safety requirements may be used as a means of disguised protectionism. Food safety can’t be, however, given up in the name of trade liberalization, because food supplied to people should be safe, at least from the perspective of food security. Without consumers’ confidence in food safety, trade liberalization of agricultural products can’t be accomplished successfully. Strict rules and disciplines on food safety should be, therefore, established in the revised AoA. Since food safety issue may also be discussed in the SPS and TBT Committees, this article proposes a written ‘Understanding’ to be adopted, which may be annexed to the AoA or SPS Agreement.51 )
The Understanding should, among other things, deal with the precautionary principle, burden of proof on food safety, mandatory labeling for GM (Genetically Modified) crops or foods, cooperation with other organizations such as OECD and Codex. Since most food-importing countries lack technical capacity to show scientific evidence against imported foods, technical and financial assistance should be provided to members, especially to developing countries. 52)
Article 13 (“due restraint”) of the AoA is due to expire at the end of 2003. This Peace Clause protects members using domestic support measures from being challenged under the GAIT 1994 and the Agreement on Subsidies and Countervailing Measures, so long as they comply with their commitments on export subsidies and domestic support under the AoA. The Peace Clause should be preserved and extended for all measures that are taken to achieve the food security policy of developing countries.
(13)Environment and Sustainable Agriculture
Agricultural activities have both positive and negative effects on the environment. Agriculture contributes to environmental goods such as biological diversity and landscape conservation, which may enhance agricultural sustainability. It should be noted that agriculture in many developing countries is based on small-sized farms, and this type of farming is ecologically sustainable. “[There is an emerging realization that agricultural systems in both developed and developing countries face challenges to achieve long-term sustainability and food security,” 53)especially in light of growing populations and resource degradation. Without local agriculture there would be no positive effects, and without some level of support and protection there would be no agriculture.
A certain degree of domestic production should be, therefore, maintained for sustainable agriculture and long-term food security. Green Box measures alone are not sufficient, 54) and the criteria for Green Box need to be broadened and flexible enough to enhance sustainable agriculture and long term food security. 55) Domestic supports for sustainable agriculture should be also allowed under the Blue Box.
At the DDA agricultural negotiation, food security is a key element of the NTCs and the most contentious issue. Trade liberalization may enhance national and global food security by expanding sources of food supply, encouraging more efficient allocation of resources, lowering food prices in importing countries, and increasing economic growth rate.
However, the proposition that free trade can solve the food security problems is wrong for the following reasons. Agricultural products are different from industrial products in some respects and agriculture has the characteristics of a public good. Thus, when we are talking about agriculture, we are really talking about food security, rural development, environment, employment, culture, as well as production of food for sale in a market. Agricultural production heavily depends on climate and land conditions, unlike industrial products. Given the uncertainty of food supply in the world food market, there will always remain a residual threat to food security. The policy to achieve food security based only on free trade is too risky in terms of long term public policy. The maintenance of a certain level of domestic agricultural food production is, therefore, essential for food security of both developed and developing countries.
The current AoA does not, however, adequately and equitably address the food security needs of developing and developed countries. With a view to redressing the imbalance and inequity of rights and obligations under the AoA between food exporting and importing countries, this article proposed a food security box. Among other things, basic food security crops should be exempt from tariff reduction commitments. Much flexibility in connection with TRQs administration should be given to basic food security crops. All domestic support measures taken to increase domestic production of basic food security crops should be also exempted from any form of domestic support reduction commitments.
The agricultural negotiations are scheduled to end by 1 January 2005, along with almost all the other negotiations under the DDA. It should be noted that the DDA negotiations are a single undertaking. No element of them will be agreed until all areas are agreed on. As of 23 November 2003, the 31 March deadline for establishing ‘modalities’ in the agricultural negotiations was not met. WPO members failed to set guidelines on tariff and subsidy cuts to use in subsequent negotiations. The first and revised draft of modalities for the future commitments prepared by the chairperson of the Committee on Agriculture failed to reflect the food security concerns of net-food importing and developing countries.
This agricultural impasse may, therefore, spill over into other areas of negotiations, including services, and threaten the entire DDA round of multilateral trade negotiations. Without a system or compromise to solve the food security problems of both net-food importing countries and developing countries, the DDA round can’t reach a successful and satisfactory settlement.