• WTO and SDT

WTO and SDT

This paper starts from the premise that subsidy and tariff cuts under the Doha Round will not be uniformly good for all farmers in all developing countries, and that opening markets to competition from cheap – often subsidised – foreign imports may devastate the livelihoods of small and resource-poor farming communities.

The paper notes that a food security strategy based solely on imported food, whether through commercial imports or food aid, would entail significant risks, particularly for poor countries which are highly dependent on a few export commodities.

Against this background, the paper focuses on two key concepts that have emerged in WTO negotiations: allowing developing countries special tariff treatment for ‘Special Products’ (SPs) that are important for food security, livelihood security, and rural development needs; and access to a Special Safeguard Mechanism (SSM) to afford themselves a measure of protection against import surges. The paper reports on a consultations process with leading thinkers in this area to develop a conceptual framework for how developing country Members of the WTO could operationalise the SP-SSM concepts in order to promote sustainable development. It also reports on a series of six country studies that applied the framework, carried out in Barbados, Honduras, Kenya, Pakistan, Peru and Sri Lanka.

The paper:

• aims to synthesise the knowledge generated through this fact-finding exercise and convey its main findings to policy makers, negotiators, civil society representatives, farmers groups, and academics
• provides some empirically-based and scientific elaboration of the SP-SSM concepts from a sustainable development perspective
• proposes a possible methodology that governments could follow when developing their national lists of SPs
• connects local realities – such as food insecurity, the composition of traditional diet, rural employment structures, and market conditions – with disciplines under negotiation in the market access pillar of the WTO agricultural talks
• examines how import surges over the last twenty years have contributed to the displacement of domestic production
• ends with a set of options to design a fully operational SSM that would better equip developing countries to mitigate the sustainable development impacts of import surges.

Some of the conclusions are:

• SPs and the SSM share the same goal, but are two different instruments: SPs are more connected with public policy concerns, which should provide targeted protection through tariff reduction exemptions or minimal tariff cuts; while the SSM would allow countries to raise tariffs above their bound levels for a limited duration, to protect importcompeting sectors against price depression and/or import surges
• each developing country will have to undertake a process of internal reflection, discussion and consultations in order to identify its SPs, in the context of food security, livelihood security and rural development needs
• the methodology presented in this document aims to guide countries in establishing their national lists of SPs and identifying products that could be eligible for an SSM

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