Removal of Agricultural Export Subsidies will Boost Global Trade – WTO Head

Photo: Melroy Sterling Minister of State in the Ministry of Foreign Affairs and Foreign Trade, Hon. Arnaldo Brown (right), engages in light conversation with Director General of the World Trade Organization (WTO), Ambassador Roberto de Azevêdo, just before the start of a public lecture on international trade on January 18 at the University of the West Indies, Mona campus. The lecture was delivered by Ambassador de Azevêdo.

Story Highlights

  • Director General of the World Trade Organization (WTO), Ambassador Roberto de Azevêdo, says the decision to scrap subsidies for agricultural exports is a significant development, which will improve the global trading environment.
  • The Director General also noted that the decision will help to limit similar distorting effects associated with export credits and state trading enterprises.
  • There was also an agreement on the expansion of the Information Technology Agreement, which will eliminate tariffs on 10 per cent of global trade.

Director General of the World Trade Organization (WTO), Ambassador Roberto de Azevêdo, says the decision to scrap subsidies for agricultural exports is a significant development, which will improve the global trading environment.

He was speaking at a public lecture held on Monday (January 18), at the University of the West Indies (UWI), Mona campus.

At the 10th WTO Ministerial Conference held in Nairobi, Kenya, in December, developed countries agreed to remove their subsidies starting January 1, while developing nations will have until the end of 2018.

Ambassador de Azevêdo, in hailing the move, noted that WTO members, particularly developing countries, have consistently demanded action on the issue, because of the enormous trade-distorting effects of those subsidies.

He added that the decision has been outstanding since export subsidies were banned for industrial goods more than 50 years ago.

“Countries have often resorted to export subsidies during economic crises, and once a country uses that, others followed suit. So it is very important then to have these disciplines in place,” Ambassador de Azevêdo stated.

The Director General also noted that the decision will help to limit similar distorting effects associated with export credits and state trading enterprises.

“It will also provide a better framework for international food aid… avoiding the trade distorting and the trade displacement effects that food aid activities may have,” he pointed out.

Meanwhile, Ambassador de Azevêdo said members also took action on other developing-country issues, such as committing to finding a permanent solution on public stockholding for food security purposes, and a Special Safeguard Mechanism for agriculture.

He said members also agreed on a set of issues for least developed countries, to support their integration into the global economy.

“This contained measures to enhance preferential rules of origin for these countries to get more market access for services provided. We also took action on some issues pertaining to cotton… helping low-income cotton producers to access new markets,” Ambassador de Azevêdo said.

There was also an agreement on the expansion of the Information Technology Agreement, which will eliminate tariffs on 10 per cent of global trade.

“We are talking about trade covering $1.3 trillion. That is how big this agreement is. All these outcomes from Nairobi will clearly provide a real boost to growth and development around the world and most of those outcomes were related to developing countries,” the Director General said.

JIS Social