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Agriculture

Agricultural export restrictions: welfare implications and trade disciplines

Can domestic demand management measures offset the need for export restrictions?

Authors: S. Mitra; T. Josling; Japan’s Ministry of Agriculture, Forestry and Fisheries; The Japan Association for International Collaboration of Agriculture and Forestry
Publisher: International Food and Agricultural Trade Policy Council, USA, 2009

Full text of document

Export restrictions are often imposed as a mean to promote domestic food security. Although they may bring some short-term relief to domestic consumers, economic analysis shows that their overall impact on the domestic economy as well as on the rest of the world is negative. This paper suggests some alternative measures to safeguard food security without harming producers and without triggering even higher global prices. In this context, the paper underlines the importance of steps that can be taken at the bilateral and regional level. However, it thinks that action at the multilateral level would be optimal. Some of the suggested procedures and highlighted ideas in the paper are:

  • efforts should be made to boost agricultural production and augment global food supplies
  • when the international prices of staples like food grains are high, the government can opt for dual pricing instead of export restrictions
  • innovative supply-side measures are worth exploring
  • an 'exporters code' should be encouraged; such codes would include self-restraint on both export subsidies and export restrictions
  • there is an urgent need for an exemption from export restrictions for food aid procurement
  • domestic demand management measures can offset the need for export restrictions
  • any disciplines on export restrictions must address both quantitative restrictions and export taxes to be meaningful
  • a balance between trade disciplines for exporters and those for importers should be restored
  • meaningful disciplines on export restrictions might facilitate a greater readiness by import-sensitive countries to undertake greater market access opening