Reforming Agricultural Trade for Developing Countries
330 Pages

Reforming Agricultural Trade for Developing Countries


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In the ongoing Doha Development Round of World Trade Organization negotiations, developing countries have had much greater leverage, due at least in part to their large and growing share of world trade. But will the increased influence of developing countries translate into a final agreement that is truly more development-friendly? What would be key ingredients in such a final outcome of the negotiations, and what would the developing countries really get out of it. This two volume set seeks to answer these questions.
This volume (Volume 1) is issues-oriented. It takes up some key questions in the negotiations, setting the stage with a historical overview of the Doha Development Agenda to help identify issues of most significance to developing countries, and then explores select issues in greater depth.
Volume 2 addresses the question of how a development-friendly outcome to the talks would affect developing countries by quantifying the impact of multilateral trade reform. It presents several different approaches to modeling the effects of the outcome of negotiations, and then investigates why these (and other) modeling efforts produce such divergent results.
Aimed at policymakers and stakeholders, this two-volume effort puts into the public domain important analytical work that will improve the chance for a pro-development outcomes of the Doha round negotiations.



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Published 09 November 2006
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Agricultural Trade for
Developing Countries
Alex F. McCalla and John Nash, Editors
Volume One: Key Issues for a
Pro-Development Outcome
of the Doha Round
Alex F. McCalla & John Nash, editors
Washington, DC© 2007 The International Bank for Reconstruction and Development / The World Bank
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This volume is a product of the staff of the International Bank for Reconstruction
and Development / The World Bank. The findings, interpretations, and conclusions
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e-ISBN: 0-8213-6497-9 DOI: 10.1596/978-0-8213-6496-3
Library of Congress Cataloging-in-Publication Data
Reforming agricultural trade for developing countries / edited by Alex F.
McCalla, John Nash.
p. cm. — (Agriculture and rural development)
Includes bibliographical references and index.
Contents: v. 1. Key issues for a pro-development outcome of the
Doha Round negotiations — v. 2. Quantifying the impact of multi-
lateral trade reform.
ISBN-13: 978-0-8213-6496-3 (pbk. : v. 1)
ISBN-10: 0-8213-6496-0 (pbk. : v. 1)
ISBN-13: 978-0-8213-6716-2 (pbk. : v. 2)
ISBN-10: 0-8213-6716-1 (pbk. : v. 2)
1. World Trade Organization—Developing countries. 2. Agriculture
and state—Developing countries. 3. Developing countries—Commerce.
I. McCalla, Alex F., 1937– . II. Nash, John D., 1953– .
HF1385.R42 2006
382′.41091724—dc22 2006049111CONTENTS
Boxes, Figures, and Tables viii
Preface xiv
1. Agricultural Trade Reform and Developing Countries:
Issues, Challenges, and Structure of the Volume 1
Alex F. McCalla and John Nash
Why Are Agricultural Trade Reforms Important? 2
What Is Important to Ensure a Pro-Development and Pro-Poor
Outcome from the Doha Negotiations? 5
How to Design, Sequence, and Implement Trade Policy Reform
at the Country Level 12
Roadmap for the Volume 14
Notes 17
Bibliography 17
2. An Overview of the WTO Agricultural Negotiations 20
Tim Josling
The Legacy of the Uruguay Round and the Current Situation
in Agricultural Trade Policy 21
Progress, Options, and Proposals in the Current Talks 41
Options for Improving Market Access 44
Developing Countries and the Agricultural Negotiations
under the Doha Development Agenda 59
Negotiation Outcomes and Interests 62
Annex. Background Papers 64
Notes 65
Bibliography 71
v3. Developing Country Experience with the Key Policy Issues
of the Uruguay Round Agreement on Agriculture 74
Ramesh Sharma
How Should Implementation Experiences with the Uruguay
Round Agreement on Agriculture Be Evaluated? 75
Domestic Support Measures 76
Market Access 81
Export Competition 84
Experience with Agricultural Exports and Food Imports Since 1995 85
Concluding Remarks 91
Notes 96
Bibliography 97
4. The Impact of Agricultural Support Policies on Developing
Countries 100
Bernard Hoekman, Francis Ng, and Marcelo Olarreaga
Who Subsidizes What? 101
Who Is Affected? 103
The Importance of Complementary Trade Policy Reform 122
Conclusion 123
Annex. Data Sources 129
Notes 129
Bibliography 130
5. Coalitions and Alliance Strategies for Developing Countries
in the Doha Round of Agricultural Negotiations 132
Rashid S. Kaukab
Developing Country Positions and Groups in Agricultural
Trade Negotiations 132
Experience of Coalitions of Developing Countries in the Multilateral
Agricultural Trade Negotiations 135
Elements of Possible Strategies for Effective Alliances and Coalitions
in the Current Agricultural Negotiations 145
Concluding Remarks 150
Notes 150
Bibliography 152
6. Domestic Management of Price Risk in the Context of
Trade Reform in Developing Countries 154
William Foster and Alberto Valdés
Greater Price Transmission and the Limits to Managing International
Price Variability under Trade Liberalization 155
The Role of Developed Country Subsidies in Lowering World Prices 157
What Do We Know about Price Variability and the Persistence
of Low Prices—the Stochastic Nature of World Prices 159
The Practical Relevance of Price Transmission to the Price
Risks Facing Farmers 161
vi CONTENTSPolicy Implications for Managing Price Risk in the Context of WTO
Commitments 164
Notes 175
Bibliography 177
7. Implications of Food Import Regulations and Market Access
for Developing Countries 180
Tim Josling
Obligations under the Agreement on the Application of Sanitary
and Phytosanitary Measures 180
The SPS Committee and Trade Disputes 184
Experience of Developing Countries in Resolving Disputes 189
Suggestions for Improving Market Access 198
Annex Tables 201
Notes 203
Bibliography 204
8. Implications of Multifunctionality for Developing Countries 205
Philip L. Paarlberg, Maury Bredahl, and John G. Lee
The Multifunctionality Debate 205
Proposed Framework for Handling Multifunctionality 206
Implications for Developing Countries 208
Conclusions 217
Bibliography 218
9. Managing Import Competition When Developing Countries
Liberalize Trade: India’s Experience 220
Ashok Gulati and Sudha Narayanan
India’s Policy before the Uruguay Round 221
India’s Liberalization Experience, 1995–2002 221
Managing Import Competition 236
Notes 240
Bibliography 242
10. The Breadth of Policy Reforms and the Potential Gains
from Agricultural Trade Liberalization:An Ex Post Look
at Three Latin American Countries 244
Alberto Valdés and William Foster
Complaints about the Results of Past Trade Liberalization
and Model Estimates of Future Gains 246
A Review of Reform Efforts and Agricultural Performance in Latin America 250
Three Contrasting Cases: Agricultural Reforms in Argentina, Chile,
and Colombia 260
Policy Implications and Conclusions 288
Notes 290
Bibliography 292
Contributors 297
Index 299
2.1 Accomplishments of Uruguay Round Agreement on Agriculture 22
3.1 Availability of Information on Trade-Distorting Domestic Support
Measures 77
10.1 A Case Study of the Differential Effects of Reforms and
Trade Liberalization 257
10.2 On Reform, Poverty, and Targeted Taxpayer Support 285
1.1 Average Tariffs, by Region, 2003 6
1.2 Coverage of Tariff Rate Quotas, 2003 6
1.3 Tariffs Escalate in Final Products 7
1.4 Border Protection and Direct Payments in High-Income Countries,
2000–2002 8
1.5 Food Aid and World Prices 8
2.1 World Agricultural Tariff Averages, by Region 24
2.2 WTariff Averages, by Commodity 25
4.1 Relationship Between Trade Shares Affected by Total Domestic Support
in All WTO Members and GDP per Capita 114