RESTRICTEDWORLD TRADE
ORGANIZATIONG/AG/R/27
14 September 2001
(01-4332)
Committee on Agriculture
SUMMARY REPORT OF THE MEET ING HELD ON 28-29 JUNE 2001
Note by the Secretariat
1. The Committee on Agriculture held its twenty-seventh regular meeting on 28-29 June 2001
under the chairmanship of Minister Yoichi Suzuki, of Japan.  The agenda of the meeting as contained
in WTO/AIR/1569 was adopted.
PART I:  T HE REVIEW PROCESS
A. M ATTERS RELEVANT TO THE IMPLEMENTATION OF COMMITMENTS UNDER THE REFORM
PROGRAMME :  ARTICLE 18.6
(a) Argentina:  European Communities – Payments under production-limiting programmes
2. The Chairman reported on the informal discussions held on 13 June 2001 regarding
Argentina's request for information (G/AG/R/26, paragraph 12, refers).  In the course of this informal
exchange of views, the European Communities ha d elaborated the position taken in declining to
provide the information requested. Reference was also made to earlier discussions in the Committee
on transparency in this area (in 1995), and to the fact that information on 1992 support on a
"budgetary outlays" basis had been provided in 1997 in response to a similar request in the context of
the Committee's review of a domestic support notification.  In concluding these informal discussions,
the Chairman had urged further reflection in light of the general and specific points that had been
raised.
3. The representative of Argentina renewed the request for information presented during the
March Committee meeting for the following reasons (G/AG/R/26, paragraph 2, refers).  First,
Argentina could not accept the EC's argument that it was not in a position to provide the Committee
with a breakdown of subsidies granted by product.  The EC did, however, offer assurances that it had
not exceeded the ceilings set by Article 13(b)(ii) of the Agreement on Agriculture but gave no
explanation concerning the elements on which it relied to give such assurances.
4. Secondly, the EC also argued that issues relating to Article 13 of the Agreement on
Agriculture were not implementation issues that should be taken up at the regular meetings of the
Committee.  In the view of Argentina, this argume nt was not valid as the questions posed referred to
an issue which directly related to an article of an  Agreement that was in force.  The EC statement
concerning the difference between the regular and special sessions of the Committee on Agriculture,insinuating that what took place in one forum woul d not be applicable in the other, could not be
considered a valid argument, because both fora dealt with the same subject matter – agriculture – from
two different standpoints (implementation of the existing Agreement, and negotiations mandated
under Article 20 of the same Agreement).  As further proof of the weakness of the EC's assertion,
Argentina pointed out that Article 17 of the Agr eement establishes a single Committee on Agriculture.
5. There was yet another contradiction in the replies provided by the EC that Argentina wished
to underline.  During the Special Session held in February 2001, the EC had argued that subsidies
under Article 6.5 did effectively have limits, namely the levels established in the 1992 marketing yearG/AG/R/27
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(G/AG/NG/R/5, paragraph 39, refers), whereas at the 26th Committee on Agriculture the EC refused
to give information on those ceilings, the existence of which it had already recognized.
6. Lastly, despite the EC statement made at the last regular session of the Committee that it was
not failing to comply with any obligation, no substantiating evidence was provided.
7. The representative of the European Communities first confirmed the EC's previous answer,
i.e. that cereal producers received direct payments based on fixed area and yields in conformity with
the EC commitments under the Agreement on Agriculture.  Since no distinction was made between
cereals in relation to payments or aid amounts, a breakdown was not available.  In addition, the EC
believed that the marketing year 1992 was not covered by the review of implementation of
commitments as decided in the Agreement on Agriculture, nor was Article 13 subject to notification
commitments.
8. The EC agreed with Argentina that there was only one Committee on Agriculture and that the
regular Committee, dealing with implementation aspects, and the Special Session, dealing with
Article 20 negotiations, were manifestations of a single body which dealt with the same subject
matter.  The issue raised by Argentina was not, however, a question of implementation, and therefore
not a matter for consideration by the regular Committee.  Under the present Agreement, there was no
specific commitment in relation to the support decided in the marketing year 1992.  This wasrecognized in two WTO documents: the workin g procedures (G/AG/1), and the notification
requirements (G/AG/2).  The EC stood ready to consid er the issue raised by Argentina as part of the
discussions under the Article 20 negotiations to be held in the Special Sessions of the Committee on
Agriculture.
9. Furthermore, the EC saw no contradiction between the remarks it made during the Special
Session held in February 2001 and its position on the reporting of the support levels decided in the
marketing year 1992.  In this respect, the EC reiterated that the Peace Clause placed a de facto
limitation on the level of subsidies per commodity that  could be granted.  This meant that if a Member
provided support to a specific commodity in excess of the level decided in the marketing year 1992, it
no longer benefited from the protection of the Peace Clause.  For the EC, therefore, this issue wasclearly a matter of legal protection, not a matter of notification of compliance with commitments.
10. For the sake of transparency, the EC gave information on the support for cereals decided in
the marketing year 1992.  Article 3 of Council Regulation (CR) 1766/92 established the intervention
price decided for the marketing year 1995/96 at 100 ECU per tonne.  The cereals compensatory aid
was fixed in Article 4 of CR 1765/92 at 45 ECU pe r tonne for that same marketing year.  For the
purpose of comparison with amounts in current Euro terms, these support levels should be increased
by a switch-over coefficient of 20 per cent.  Th ey would correspond to approximately 120 Euro per
tonne for the intervention price, and 54 Euro per tonne for the cereals compensatory aid, respectively.
However, since marketing year 1995/96, there had been one single intervention price for cereals,
119.19 Euro per tonne, while the compensatory payment for cereals had been 54.34 Euro per tonne.
Following the decisions taken as part of Agenda 2000, these aid amounts have been decreased to
101.31 Euro per tonne for the cereal intervention price (CR 1253/99, refers) and 63 Euro per tonne forthe compensatory amount (CR 1251/99, refers).  These amounts would apply from the marketing year
2002/2003 onwards.  Since marketing year 1992, the total level of support, taking into account both
the intervention price and the compensatory aid, had clearly decreased.
11. Various delegations thanked the European Communities for having shown good faith and
good will in providing the above additional information, given their initial position, as this was anissue of interest to a number of Members.  Several Members stated that, before commenting further
on this matter, they would appreciate receiving this in formation in writing so as to study it in detail.G/AG/R/27
Page 3
12. New Zealand expressed appreciation for the transparency shown by the EC but noted that,
although the support levels seemed to have been degressive, the EC should consider elaborating its
response further by giving specific details.
13. Uruguay expressed concern at the arguments presented regarding the non-availability of
statistical data and  the EC's refusal to supply the Committee with information that was necessary to
assess compliance.  If it adopted a similar standpoint, Uruguay could simply refuse to substantiate its
de minimis  claims in future.  In doing so, Uruguay could argue that it had no obligations in that
respect since, strictly speaking, the value of production figures were never subject to the notification
requirements adopted by the Committee.  The matter would probably end up in dispute settlement, for
a trivial issue.
14. Moreover, Uruguay failed to understand the attitude presently adopted by the EC, an attitude
which would have repercussions in the position adopted by Uruguay when giving consideration tobroader issues in future.  On the one hand, the EC wanted to launch a comprehensive round of
negotiations so that all Members undertake broader  commitments, but, when confronted to simple
requests for information on compliance with existing  commitments, it refused to provide the basic
elements sought by Argentina during the review process.
15. Supporting Argentina's request for information and the comments made by Uruguay, Brazil
stated that, while there may not be any specific notification requirements, it would seem appropriate
that a genuine request for information necessary to verify compliance with Article 13 should be
looked at favourably.  In this sense, Brazil felt that a positive reply to Argentina's request would
constitute an important confidence-building measure in solving this issue.
16. Argentina took note of the EC responses and thanked the EC delegation for the additional
details on the support levels for cereals.  Argentina, however, registered continued concerns regarding
the interpretation made by the EC of what constituted Members' commitments under the Agreement
on Agriculture.  The EC seemed to suggest that no exchange of information should take place beyond
the framework established by the notification procedures.  Certainly, the purpose and intent of
Article 18.6 were not limited to such a scenario.  In addition, Argentina perceived a lack ofcooperation on the part of the EC during the informal consultations conducted by the Vice-Chairman,
as well as during the present meeting.  Since its expectations had not been fully met, Argentina
reserved its rights to raise this question again in future, as well as its rights under the GATT.
(b) Argentina:  Support for certain products by the United States during marketing year 1992
17. Argentina sought information on support granted to feed grains, and particularly soya beans,
during the 1992 marketing year.  The representative of the United States stated that during the period
1 October 1992 to 30 September 1993, the net budgetary outlays made through the Commodity Credit
Corporation (CCC) in support of feed grains incl uded (in million US$):  5,143 for corn;  410 for grain
sorghum;  186 for barley;  16 for oats.  During that same period, the net budgetary outlays through the
CCC in support of soyabeans amounted to US$109 million.
18. Argentina thanked the United States for the above information and asked whether the above
figures represented the total amount of support granted to the feed grains.  The United States
confirmed that the reported figures included all the support that could be identified for each of the
products mentioned.
(c) United States:  Ban on US poultry imports by Costa Rica
19.  The questions posed in G/AG/R/26, paragraph 23, were reiterated by the United States.  The
representative of Costa Rica stated that, under the national health legislation, imported animal
product-processing plants were subject to prior approval.  In the specific case of poultry, US exportsG/AG/R/27
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to Costa Rica were being conducted under a temporary inspection permit.  At the beginning of this
year, the health authorities decided officially to launch a plant inspection process with a view to the
certification of US exporting plants.  The US Go vernment was accordingly informed that plant
approval permits were required for all poultry imports, failing which entry into the country would be
refused.  On 8 February 2001, the United States Embassy in Costa Rica was officially notified of thelaunching of this approval process.  The United States was requested to supply information for the
purpose, which the US authorities duly provided to the Directorate of Agricultural Protection at the
Ministry of Agriculture and Livestock on 11 May 2001.  Costa Rica indicated that the evaluation of
the information supplied by the United States was currently under way.
20. The United States stated that they were look ing forward to working very closely with Costa
Rica to provide all the information that was necessary for the prompt accreditation of US exporting
plants.
(d) United States:  French subsidy programme
21. The United States requested information on a new domestic support programme offered to
French soyabean producers.  This programme was created in the spring of 1999, and announced by
the Government of France in October 1999 but had not been notified yet to the WTO.  Specific detailswere sought on the expected duration of the " Soya du Pays " programme;  the eligibility conditions
applicable to farmers;  the amount of payments that French soya bean farmers had been paid each year
since programme inception, either by the EC or by the French Government;  the land area dedicated to
soyabeans and upon which these economic benefits had been paid and were currently being paid.
22. The representative of the European Communitie s reported that the French authorities had
informed the Commission that a measure concerning " Soja de qualité " had been examined but had not
been introduced.
(e) Canada and United States:  India wheat exports
23. The representatives of Canada and the United States  reported that they were currently
reviewing India's written responses to the questions posed in G/AG/R/26, paragraphs 14-16.
24. In its written answers, India had provided the following clarifications.  The Food Corporation
of India (FCI) was a public sector organization und ertaking public stockholding operations.  The FCI
did not establish any distinction between commerci al and non-commercial stocks of wheat.  After
catering to the public distribution system as well as other welfare schemes and after storing the
required quantities in its buffer stock, it took a commercial policy decision to liquidate the excess
surplus buffer stocks.  Such stocks might otherwise deteriorate due to long periods of storage and
become unfit for human or animal consumption.  Exportation of food grains was only one of theoptions exercised by the FCI.
25. Furthermore, the Government of India had not directly sold any wheat for export purposes.
However, the FCI, which procured food grains for the Central Pool, had made available wheat on the
basis of a global tender to a few enterprises out of its surplus stock and about 1.6 million tonnes of
wheat had been exported during the period April/March 2000-2001.  These enterprises were:  theState Trading Corporation of India Limited (STC); MMTC Limited, Project & Equipment
Corporation (PEC);  NCCF;  NAF ED and MARKFED.  These agencies engaged in the export of a
very limited quantity of the food grains have done so on a commercial basis.  India had not provided
any subsidies to those exports.  Being a developing country, India was also entitled to avail the
provisions of Article 9.1(d) and (e) of the Agreement on Agriculture and reserved its right to makeuse of these provisions if considered necessary.G/AG/R/27
Page 5
26. India confirmed that the Government had not specifically established any wheat export target
for marketing year 2001/2002.  However, a quantity of 5,000,000 tonnes had been assessed as
exportable by the exporting agencies.  About 700,000 tonnes of wheat had been exported to date.
27. In the tender process referred to in paragraph 25 above, the FCI had invited an expression of
interest from all parties, with no a priori exclusions, by issuing a global tender in view of its surplusbuffer stock position.  As mentioned above, the wheat had been taken from FCI by cooperative
agencies like NCCF, NAFED and MARKFED, in addition to the state trading enterprises.  In any
case, as per the trade policy of the Government of India, exports of wheat were free subject to certain
quantitative limits wherein any private individual or firm could also export.  When lifting wheat from
the Central Pool of FCI, the agencies have the option to sell it in the domestic market upon payment
of an open market sale price, in addition to the prevailing taxes.
28. The price of Rs 4,150 per tonne at which the wheat was sold was based on the best offers
received by the FCI during the tender process for the year 2000-2001.  This was the price payable to
the FCI at their go-downs and did not include th e cost of transportation, insurance, freight and
handling, etc.  For the year 2001-2002, interested parties can purchase wheat at Rs 4,300 per tonne.
According to the information available to the Gove rnment of India, the agencies engaged in the
exportation of wheat are selling it in the international market as per the prevailing international prices,which at present are not below their cost price.
29. On domestic support to producers, the Government of India did not grant payments to the
local farmers to grow wheat.  Every year, a minimum support price was announced for procuring the
quantities required for the operation of India's public distribution system.  The farmers were not,
however, constrained to sell their produce to the procurement agency at the announced minimumsupport price.  The support price and the other charges associated with storage also varied from year
to year.
30. The public distribution system offered wheat to above poverty line families keeping in mind
the local domestic prices in the free market.  This price varied from region to region and from time to
time.  For example, the open market price for the Northern region was Rs 6,500 per tonne until theend of March 2001 and was presently Rs 7,000 per tonne.
31. In accordance with the objectives of the public distribution system, wheat was made available
to families below the poverty line at a rate of Rs 4,150 per metric tonne.  In a recently announced
scheme, Antyodya Anna Yojna , it has been decided to identify the poorest among those families and
provide food grains to this segment of the population at the rate of Rs 2 per kg., with a ceiling of
25 kgs. per family per month.
32. Regarding Government sales to millers, the Roller Flour Mills could purchase wheat at the
open market sales prices from FCI.  Furthermore, any consumer could also directly approach the FCI
anywhere in the country and buy the required quantity of wheat.  The issue prices were reviewed
periodically and the current revised issue price of wheat for the entire country was Rs 7,000 per tonne.
33. Both Canada and the United States
 stated that they might wish to revert to this issue if
necessary at a later stage.  As a major exporter of wheat, Australia registered its interest in this matter
and raised concerns from a systemic point-of-view with regard to the use of export subsidies.
(f) United States:  Switzerland market access barriers for imported bull semen
34. The United States expressed concerns that some exporters of bull semen to Switzerland
appeared to be facing market access restrictions despite the fact that there was considerable trade
interest in the Swiss bull semen market.  In this connection, the United States sought clarification onthe allocation regime and the distribution requirements, if any, applying to the bull semen tariff rateG/AG/R/27
Page 6
quota.  Moreover, exporters of bull semen had also been informed by the Swiss Government that they
had to sell to three breeding companie s, rather than directly to farmers.  The United States sought the
reasons behind this decision, whether this change had been notified to the WTO, and whether this was
a permanent action by the Swiss Government.  Confirmation was also requested that a tax was
charged on animals born from imported semen, but not on animals born from domestic semen.
35. The representative of Switzerland stated that there were no import restrictions of bull semen
in Switzerland.  Unlimited quantities may be imported at the out-of-quota duty.  For tariff item HS
0511.1010, the scheduled tariff quota quantity was 20,000 doses.  However, the applied tariff quota
for the years 2000 and 2001 was 800,000 doses.  The in -quota and out-of-quota duties were 0.1 and 5
Swiss francs per dose, respectively.  The in-quota imports during the year 2000 amounted to 662,929
doses, including 303,517 doses from the United States.
36. Regarding the allocation regime and the distribution requirements, Switzerland indicated that
the Federal Office for Agriculture (OFAG) was the body responsible for the allocation of tariff quota
shares to importers.  The following categories of importers were entitled to apply for import licences:
recognized artificial insemination organizations (four, presently);  breeders inseminating their own
animals (farmers);  recognized cattle breeding organizations and breeders' associations distributing
imported semen through an authorized artificial insemination organization.  The applied allocationmethod was the first-come, first-served method, based on the date of the application made by import
licence holders to OFAG.
37. Switzerland confirmed that every farmer or firm established in Switzerland could get an
import licence to import bull semen under the tariff quota.  This meant that each exporter could also
sell the product directly to Swiss farmers.  However, farmers were not allowed to sell the product toother farmers or to breeders' associations or to artificial insemination organizations, unless they have
acquired the status of a recognized artificial insemination organization.  No tax was charged on
animals born from imported semen.
B. R
EVIEW OF NOTIFICATIONS
38. The Committee reviewed the following notifications as listed in the agenda:
(i) on the administration of tariff and other quota commitments (Table MA:1): from
Poland (POL/40); Slovak Republic (SVK/ 29); South Africa (ZAF/35); Thailand
(THA/38); United States (USA/34);
(ii) relating to imports under tariff and other quota commitments (Table MA:2): from
Barbados (BRB/6); Colombia (COL/24); Costa Rica (CRI/8); European Communities
(EEC/31); Hungary (HUN/25); Latvia (LVA/4); Morocco (MAR/21); Poland(POL/41); Slovak Republic (SVK/27); Slovenia (SVN/16); Thailand (THA/39);
Tunisia (TUN/15/Corr.1 and TUN/20/Corr.1); Venezuela (VEN/20);
(iii) in the context of the special safeguard (Tables MA:3 to MA:5): from Colombia
(COL/25); Japan (JPN/64); Morocco (MAR /18); Norway (NOR/32); Slovak Republic
(SVK/28);
(iv) relating to domestic support commitments  (Table DS:1): from Bolivia (BOL/6);
Canada (CAN/37/Rev.1 and C AN/43); Chile (CHL/13); Cyprus (CYP/10/Corr.1);
Dominican Republic (DOM/4); European  Communities (EEC/30); Gabon (GAB/1);
Hong Kong, China (HKG/10); Jamaica (JAM/5); Japan (JPN/61); Korea (KOR/30);
Macau, China (MAC/8); Malta (MLT/6); Mexico (MEX/7); Morocco (MAR/20);Norway (NOR/30); Paraguay (PRY/6); Romania (ROM/17); Turkey (TUR/12);
Venezuela (VEN/19);G/AG/R/27
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(v) relating to new or modified domestic support measures exempt from reduction
(Table DS:2): from Canada (CAN/44); Cuba (CUB/13); Japan (JPN/62); Mexico
(MEX/6);
(vi) relating to export subsidy commitments (Tables ES:1 to ES:3):  from Argentina
(ARG/14); Bolivia (BOL/5); Chile (CHL/12); Colombia (COL/26); Cuba (CUB/12);
Dominican Republic (DOM/3); European  Communities (EEC/32); Gabon (GAB/2);
Hong Kong, China (HKG/11); Japan (JPN/63); Macau, China (MAC/9); Morocco
(MAR/19); Paraguay (PRY/7); Slovak Republic (SVK/26); Slovenia (SVN/17);
United States (USA/35); Zimbabwe (ZWE/3 and 4).
39. Specific points raised with respect to the notifications listed above and the responses thereto
are summarized in Part I of the Annex to this report.
40. During the review of notifications, Costa Rica provided a response to an issue previously
raised by the United States on the relationship between price differentials and tariff quota utilization
(G/AG/R/26, paragraph 27, refers).  Costa Rica's response is reflected in Attachment no. 1 .  The
United States and New Zealand  expressed appreciation for receiving such information. They
expressed the view that consistent or variable underfill of tariff quotas was a systemic issue whichimplied that Members needed to monitor very caref ully their administration regimes and introduce the
necessary flexibility in order to meet changes in demand.  Moreover, based on a preliminary
examination of the price trends described by Costa Rica, it appeared that the tariff quotas were not
needed.  Both delegations, therefore, invited Costa Rica to move away from tariff quotas, the
administration of which can be difficult, costly, and time-consuming, to a tariff-only regime.
41. Referring to all the notifications on tariff quota fill (Table MA:2) which were up for review,
Argentina noted that the underfill situation was quite a common situation, often justified by the
notifying Member with the following arguments:  a lack of demand;  an applied MFN duty which was
lower than the in-quota duty;  an efficient domestic production sector.  Under those circumstances,
Argentina questioned the rationale behind the maintenance of such tariff quotas and supported the
view, frequently expressed by the United States, that these were instances where the tariff quotas wereredundant given these specific market and economic conditions.  Their elimination would result in
greater transparency in market access conditions.  The reduction of recurrent questioning would also
improve the time efficiency of the review process and would greatly facilitate the work of the
Committee.  Argentina called on Members to reflect on this proposal in the context of the current
negotiations.
42. Colombia indicated that it intended to maintain its scheduled tariff quotas until the end of the
implementation period, and that any modification would have to be envisaged within the framework
of the current negotiations.  For Hungary, as long as the administrative procedures did not result in
obstacles to import, underfill should not represent a problem for exporters.
C. P OINTS CONCERNING NOTIFICATIONS RAISED AT PREVIOUS MEETINGS (G/AG/R/2,
PARAGRAPH 14, REFERS )
43. There was no discussion under this agenda item.G/AG/R/27
Page 8
D. N OTIFICATIONS CIRCULATED OR MADE AVAILABLE AFTER THE NOTICE CONVENING THE
MEETING WAS ISSUED (G/AG/1, PARAGRAPH 9, R EFERS )
44. The following notifications were subject to prelim inary review and are to be reverted to at the
next meeting for substantive review in accordance with paragraph 9 of the Committee's WorkingProcedures:
(i) on administration of tariff and other quota commitments (Table MA:1):  from Canada
(CAN/2/Add.2, 6/Add.1, 10/Add.1, 19/A dd.1); Japan (JPN/1/Add.1, 8/Add.1,
23/Add.2, 57/Add.1); New Zealand (NZL /1/Add.1); Norway (NOR/1/Add.1);
(ii) on imports under tariff and other quota commitments (Table MA:2):  from the Czech
Republic (CZE/29); European Communities (EEC/31); New Zealand (NZL/27 and
Corr.1);
(iii) on special safeguard (Tables MA:3 to MA:5):  from the Czech Republic (CZE/30);
Namibia (NAM/13); New Zealand (NZL/ 28); Poland (POL/28/Corr.1 and POL/42);
(iv) on domestic support commitments (Tables DS:1 and DS:2): from Australia (AUS/36);
Namibia (NAM/14); New Zealand (NZL/ 29); Slovak Republic (SVK/30); United
States (USA/36);
(v) on export subsidy commitments (Tables ES:1 to ES:3):  from Argentina (ARG/14);
Czech Republic (CZE/31); European Communities (EEC/32); Namibia (NAM/12);
Venezuela (VEN/21).
45. The Committee took note that a revision of the notification by the Czech Republic on export
subsidy commitments (CZE/31) would be submitted shortly.
46. Australia and New Zealand  welcomed the notification on domestic support commitments by
the United States, which duly recorded market loan assistance payments as falling under the trade-
distorting category of support, i.e. the Amber Box.  While commending this development, New
Zealand wondered how payments which depended on the prices of particular commodities could be
non-product specific.  Australia registered its concerns regarding the high levels of support providedby the United States during the last three years.
E. C
OUNTER NOTIFICATIONS UNDER ARTICLE 18.7
47. The Committee took note that no counter-notifications had been received under Article 18:7
of the Agreement.
F. O THER MATTERS RELATING TO THE REVIEW PROCESS
(a) Deferred replies to questions raised under the Review Process
48. The deferred replies by Mexico concerning  notifications G/AG/N /MEX/6, MEX/7, MEX/8
and  MEX/11/Rev.1, are reflected in Part  II of the Annex to this report.
(b) Overdue notifications
49. As had been agreed at the March 1997 meeting of the Committee (G/AG/R/10, paragraph 10,
refers) the Secretariat made available a Room Document, dated 28 June 2001, showing the current
status of compliance with the notification obligations.G/AG/R/27
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G. I MPLEMENTATION -RELATED MATTERS REFERRED TO THE COMMITTEE BY THE GENERAL
COUNCIL
(a) Implementation of Article 10.2 of the Agreement on Agriculture
50. The Committee's discussions under this agenda item are summarized in the progress report
which it was agreed would be submitted by the Vice-Chairman to the General Council (G/AG/9,
refers).
(b) Submission of addenda to Table MA:1 notifications
51. The Vice-Chairman recalled that this item was on the Committee's agenda on referral from
the General Council pursuant to its Decision of 15 December 2000 on implementation-related issuesand concerns (WT/L/384, paragraph 1.1, refers).
52. The Committee noted that the following Members with tariff rate quota commitments had
submitted the relevant addenda:  Canada (G/AG/N/CAN/2/Add.2, 6/Add.1, 10/Add.1, 19/Add.1);
European Communities (G/AG/N/EEC/1/Add.2, EEC/3/Add.1, EEC/14/Add.1, EEC/15/Add.1);
Japan (G/AG/N/JPN/1/A dd.1, 8/Add.1, 23/Add.2, 57/Add.1);  Ne w Zealand (G/AG/ N/NZL/1/Add.1);
Norway (G/AG/N/NOR/1/Add.1).  The United Stat es indicated that an addendum to its MA:1
notification was under preparation.
53. The Vice-Chairman urged all other Members with tariff quota commitments shown in their
schedules to submit the relevant addenda to their Table MA:1 notifications well in advance of the
September meeting.
P
ART II:  O THER MATTERS WITHIN THE PURVIEW OF THE COMMITTEE
A. I MPLEMENTATION -RELATED MATTERS REFERRED TO THE COMMITTEE BY THE GENERAL
COUNCIL - EXAMINATION OF POSSIBLE MEANS OF IMPROVING THE EFFECTIVENESS OF THE
IMPLEMENTATION OF THE DECISION ON MEASURES CONCERNING THE POSSIBLE NEGATIVE
EFFECTS OF THE REFORM PROGRAMME ON LDC S AND NET FOOD -IMPORTING DEVELOPING
COUNTRIES
54. The Vice-Chairman stated that this item had been included on the Committee's agenda
pursuant to the General Council Decision of 15 December 2000 (WT/L/384 refers).  The Committee's
discussions under this agenda item are summarized in the progress report which it was agreed would
be submitted by the Vice-Chairman to the General Council (G/AG/10, refers).
B. M ATTERS RAISED UNDER "OTHER BUSINESS "
(a) Chile - Functioning of the US Hass Avocado Board
55. The representative of Chile thanked the US delegation for providing detailed written
responses to the questions raised during the previo us meetings.  These responses were being examined
by the competent Chilean authorities.
56. In its written replies, the United States indicated that statistical information on the domestic
production of avocado varieties, consumption and imports was under preparation.  On taxation, the
United States clarified that USDA authorized assessments on avocados under the Florida AvocadoMarketing Order (7 CFR Part 915), which covered all avocados grown in Florida.  Under that
programme, avocado handlers paid an assessment of 19 US cents per bushel shipped.  The State of
California also imposed an assessment on all California avocados under a state marketing programmeG/AG/R/27
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under which California avocado producers, packers, and handlers paid an assessment of 3.5 per cent
of the gross dollar value of avocados sold.
57. Under the Act, import associations become eligible for fund remittances if they are
established pursuant to state law, or in the alternative, if they are certified by the Secretary of
Agriculture.  First handlers are required to remit to the Hass Avocado Board an assessment ofUS$0.025 per pound on each sale of the fresh domestic Hass avocados.  In the case of imports, the
assessment is levied on imports and remitted to the Board by the US Customs Service.  A state
organization of avocado producers and associations of avocado importers will receive funds from the
Board based on 85 per cent of the assessments paid by domestic producers and importers respectively.
58. Finally, the representative of the United States made reference to a Supreme Court Decision
dated 25 June 2001, dealing with promotion and research which he thought was of relevance to the
present issue.
59. Mexico and New Zealand
 expressed their appreciation to the United States for directly
sending copies of the written responses to their respective delegations and for handling this issue in a
spirit of transparency.
Date of Next Meeting
60. The next regular meeting of the Committee on Agriculture will be held on 27 September
2001.  The airgram convening the meeting and containing the draft agenda will be issued on Friday,
14 September 2001.G/AG/R/27
Page 11
ANNEX
Review of Notifications by the Co mmittee on Agriculture on 28-29 June 2001
Page
Part I Summary of specific points raised on  notifications and responses thereto -
(28-29 June 2001)
(i) administration of tariff and other quota commitments (Table MA:1):  Poland
(POL/40); Slovak Republic (SVK/29); United States (USA/34);12
(ii) imports under tariff and other quota commitments (Table MA:2):  from Barbados
(BRB/6); Colombia (COL/24); Costa Rica (CRI/8); Hungary (HUN/25); Latvia
(LVA/4); Morocco (MAR/21); Poland (POL/41); Slovak Republic (SVK/27);
Slovenia (SVN/16); Venezuela (VEN/20);14
(iii) use of the special safeguard (Tables MA:3 to MA:5):  from  Japan (JPN/64); 20
(iv) domestic support commitments (Table DS:1): from Chile (CHL/13); European
Communities (EEC/30); Japan (JPN/61); Korea (KOR/30); Malta (MLT/6);
Mexico (MEX/7); Norway (NOR/30); Paraguay (PRY/6); Romania (ROM/17);
Turkey (TUR/12); Venezuela (VEN/19);21
(v) new or modified domestic support measures exempt from reduction (Table DS:2):
from Japan (JPN/62); Mexico (MEX/6);28
(vi) export subsidy commitments (Tables ES:1 to ES:3): Slovak Re public (SVK/26);
United States (USA/35).30
Part II Deferred replies to questions on notifi cations raised at previous meetings
(i) relating to imports under tariff and other quota commitments (Table MA:2): 31
Mexico (MEX/11/Rev.1)            G/AG/R/26, page 17, refers.
(ii) relating to domestic support commitments (Table DS:1): 31
Mexico (MEX/7)                         G/AG/R/25, pages 21-23, refer.
(iii) relating to new exempt domestic support measures (Table DS:2): 34
Mexico (MEX/6)                         G/AG/R/25, page 27, refers.
(iv) relating to export subsidy commitments (Table ES:1): 35
Mexico (MEX/8)                         G/AG/R/25, page 28, refers.
Attachments
1 Costa Rica – CRI/8:  Trends in Domestic Producer Prices,  1998-99 36
2 Korea – KOR/30:  Calculation of de minimis  Levels, 1999 37
3Mexico - MEX/7:  Comparative Budget of the Alliance for Agriculture
Programme, 1996-9838
4 Mexico – MEX/7:  Market Price Support Calculations, 1996-98 39
5 Mexico - MEX/6 and MEX/7:  The Alliance for Agriculture Programme 40
6 Mexico - MEX/6:  Budget of the Alliance for Agriculture Programme, 1996-98 43G/AG/R/27
Page 12
ANNEX
Part I - Summary of Specific Points Raised on Notifications and Responses Thereto
Table MA:1 Notifications
Poland    G/AG/N/POL/40       Tari ff quota administration   (Table MA:1)
Points raised by other Member s Response by Notifying Member
New Zealand: Butter and dairy spreads  –
Basis for reducing the size of licence allocations and the
validity period of import licences, given that there wassubstantial underfill (POL/41 refers).
Follow-up question: Noting that the reason for reverting
to the 20 tonne size of licence allocation was under-
utilization, New Zealand sought further details in relation
to the causes of such under-utilization, i.e. whether in factthis was due to d ifficulties with tariff quota administration
or whether some market factors were involved.  The
response by Poland is given below, in relation to the
review of POL/41 (Table MA:2).The present size of the allocation, namely 20 tonnes, was
introduced in 1999; was increased in 2000 to 100 tonnes;and was returned to 20 tonnes in 2001.  In reverting to the20 tonne size of licence allocation, the Polish authorities
attempted to ensure broad access to the tariff quota and
prevent the blocking of large parts of it by importers whowould not later utilize their import allocations.  The validityperiod was extended in the year 2000 from 30 to 90 days.In 2001, it was set to 60 days.
Whether importers can make multiple applications forlicences.There is no limit on the number of applications.  New
applications are considered after the previous import
licences have been utilized.
Slovak Republic     G/AG/N/SVK/29       Tariff quota administration   (Table MA:1)
Points raised by other Member s Response by Notifying Member
Australia:  Comments sought on the impact of the change
in allocation method to first-come first-served (FC) on fillrates.The FC method, introduced on 1 January 2000, is operated
by the Customs Directorate on-line, on the Web site.  This
enables equitable conditions for all applicants, improves the
level of transparency and access to information and thusreduces arbitrariness in the selection process. Positivefeedback and satisfactory reactions were received, even
though no significant improvement in tariff quota fill has
been recorded so far.
United States: Given the low fill rates shown in SVK/17,
whether modifications in the administration system have
been considered (e.g., reallocation of unused quotas,extension of validity period for import permits).
Additional comments: Australia
 believed that, if these were
indeed the reasons why underfill prevailed over such an
extended period, it implied that the tariff quotas wereredundant.  The tariff quotas in this case were distortingthe trading system and created unnecessary administrative
and other transaction costs. The United States failed to
understand why there was a need for tariff quotas if local
demand was stagnant; believed that it would be muchsimpler to move to a tariff-only  regime in cases of underfill;
and encouraged the Slovak Republic to consider that
option. The Slovak Republic recalled that the change
introduced in 2000 already represented a considerablesimplification over the previ ous administration regime.Generally, low fill is caused by significant imports of most
tariff quota products from the C zech Re public under
preferential trade, which are not reported in the notification.Other reasons are little interest from importers and thestagnation of domestic demand.  As notified, there is no
possibility for reallocation.  Unused tariff quota shares
indicate that no applications are received.  According to theDecree of the Ministry of Economy, licences are normallyissued 15 days after the applicants have met all therequirements.G/AG/R/27
Page 13
United States    G/AG/N/USA/34       Tariff quota administration   (Table MA:1)
Points raised by other Member s Response by Notifying Member
Japan: Country allocations –
Basis for allocating quotas among importers if demand
from a given country exceeds its actual allocation;The tariff quota allocations are not distributed among
importers. The allocations are provided to exportingcountries in accordance with GATT 1994 Article XIII,
based on the historical average of each country's raw sugar
exports to the United States during the base period 1975-1981, which was the last period during which access to theU.S. raw sugar cane market was relatively unrestricted.
After the USDA announces the tariff quota quantity for the
fiscal year, the U.S. Trade Representative's Office allocatesit based on these historical shares.
On the other hand, if the quota requested by a certain
country falls short of the actual allocated quantity,
whether the "unfilled quantity" is reallocated to anothercountry in order to compensate the deficiency;As noted above, tariff quota allocations are provided to
countries based on their historical access to the U.S.
market.  WTO minimum access opportunities are alwaysallocated as reflected in USA/34.  The United States doesnot consider that the difference between (a) the allocation a
country may request and (b) that which is actually
provided, is an "unfilled quantity".
Meaning of " None " under the item " Importer allocation "; " None " refers to the fact that the United States does not
allocate the right to import sugar, when administering the
sugar tariff quotas.
Whether this means that there are no limitations on the
eligibility of applicants with regard to allocation;The United States does not use importer licensing in its
administration of sugar tariff quotas.
Reason why some of the information required as perG/AG/2 has been omitted (e.g., government agency,trading or administrative body competent to grant licences
or access to quotas, how licences or access are to be
allocated by the competent agency; any limitations on theperiod of validity of the licences granted).For the above reasons, the United States does not have any
additional information to supply regarding a governmentagency, trading or administrative body, that might engagein the administration of import permits.
G/AG/R/27
Page 14
Table MA:2 Notifications
Barbados      G/AG/N/BRB/6    Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina:  Poultry, milk and cream, eggs, onions, beets,
shallots, cucumber, peas, string beans, aubergines,
pumpkins, sweet potatoes, melons  – Reasons for
underfill.The questions were transmitted to the competent authorities
and a response will be submitted at a later stage.
Colombia      G/AG/N/COL/24    Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina : Reasons for underfill :
  Poultry meat During the last few years, the domestic poultry sector has
benefited from increased competitiveness and expanded
supplies have met most domestic requirements.  Low fill
reflects the absence of demand for imports.
  Rice There is sufficient internal production to meet domestic
consumption requirements.
  Oilseeds, animal/vegetable fats and oils, lard  stearin Domestic production of African palm oil has increased over
the last few years, generatin g ample internal supplies and
surpluses for exports. This led to changing patterns of
import demand for those products where palm oil and its
fractions are substitutes.  It should be noted that importsabove quota have been registered for soya beans, soya oil,sunflower oil, which are complementing palm oil in theproduction of refined vegetable oils.
  Cane or beet sugar Colombia is one of the most efficient producers of sugar.
Domestic production is amply sufficient to meet domestic
needs and consistently generates considerable excess
supplies for export.
Japan: Reasons why there are considerable gaps, in terms
of under- and over-fill of quotas, for a number ofcommodities.This happens when domestic production falls short of
domestic demand and has to be supplemented by higherlevels of imports.
Costa Rica      G/AG/N/CRI/8    Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
United States: Dairy - (Follow-up G/AG/R/26, page 14,
refers).  Given that Costa Rica indicated that the tariff rate
quota administrative mechanism was "effective andtransparent", and given that the fill rate has not been morethan 50 per cent except in 1995, whether Costa Rica has
considered modifying its mechanism so as to provide
tangible market access.The replies concerning the previous U.S. request for price
data (G/AG/R/26, para 27, refers) are reflected in
Attachment no. 1.
Some factors may have impeded the optimum use of the
tariff quotas but this cannot be attributed to the functioning
of the administration system. Costa Rica has not considered
changing this mechanism.G/AG/R/27
Page 15
Hungary      G/AG/N/HUN/25       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina/Australia/New Zealand/Philippines/United
States:
Reasons for underfill for the tariff quota products indicated
below; domestic prices for the period under review toconfirm that domestic demand is not an issue:Hungary is a competitive producer and exporter of most of
the products mentioned in the questions. As a result,
consumers and the processing industry heavily rely on
domestically produced products.  Significant imports takeplace only out-of-season or in case of severe pr oduction
losses.
Bovine animals and meat; poultry; swine;
Since 1998, New Zealand has expressed concerns about
Hungary's decision to reduce the quantitative limits on
individual applications for import permits for a variety of
meat products. New Zealand believed that the continuousfall of fill rates since 1998 was partly due to theimplementation of this decision.  On 2 July 1999,
Hungary indicated in writing that it was considering to
reinstate the previous quantitative limit of 100 tonnes atthe next review of the Hungarian tariff quotaadministration system.  Whether this change is likely tobe made in 2001;Domestic producer prices ( US$ per tonne ) - Cattle for
slaughter: 730; Pig for slaughter: 840; Chicken for
slaughter: 580.
As of 1 January 2001, the quantitative limit on individual
applications for import permits has been increased to 100tonnes.
Eggs, not in shell ; honey; Domestic producer prices: Eggs, not in shell: 0.039 US$
per piece; Honey: 0.997 US$ per kg.
Fruit juices; Domestic producer prices ( US$ per kg. ) – Apples: 0.065:
Plums: 0.11; Cherries: 0.49; Raspberries: 0.946; Dessert
grapes: 0.16.
Milk and cream; Domestic producer price: Milk: 0.22 US$ per litre.  This
tariff quota was originally established as a minimum access
commitment.  Since the base period, consumption hasdecreased by more than 30 per cent and chocolate
manufacturers, the major users of milk powder, switched to
whey powder as a lower-priced input.
Cheese and curd ; Domestic producer price: Cheese ("Trappista"): 2.2 US$
per kg.  Domestic consumption is very much concentrated
on low-priced domestic brands.
Rye; barley; This is predominantly used in  animal feeding.  Since the
establishment of the tariff quota on the basis of domestic
consumption, livestock numbers have drastically decreased(by 50 per cent in the case of swine).  In addition,substitution effects occurred due to abundant domesticsupplies of wheat and maize.
Margarine; chocolate; beer; The privatization of the food industry in the early 1990s led
to a significant increase in efficiency, making the industry
competitive both domestically and internationally.  As in
the case of sausages, brand loyalty plays a decisive role indetermining consumer choice.
Rice; horses; vermouth Other, more advantageous market access opportunities
exist within the framework of tariff quotas establishedautonomously or as a result of preferential agreements.
Tobacco, unmanufactured In recent years, cigarette exports to the former c ountries of
the Commonwealth of Independent States have continuedto decrease. This led to the reduction of demand forimported tobacco.
Wheat; maize; Domestic producer prices ( US$ per tonne ) – Wheat:
102.74; Maize: 88.9.
G/AG/R/27
Page 16
Hungary      G/AG/N/HUN/25       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand: Notification of all scheduled tariff quotas. Since the beginning of the last calendar year, the MFN
tariff levels for the products referred to decreased to levelsbelow the respective in-quota  tariff rates. For those
products, there are therefore no tariff quotas in place
anymore.
Additional comments:  In view of the pr ice data and information provided to expla in underfill, and noting that a tariff-only
regime already applied to a range of products, it appeared that the remaining tariff quotas were not needed.  Australia
and the United States therefore encouraged  Hungary to apply a tariff-only regime in a uniform way to the remaining tariff
quotas.
Latvia      G/AG/N/LVA/4       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Australia:  Reasons for significant underfill :
Wheat and meslin; oats This was caused by a high rate of self-sufficiency of
domestically grown grain in the year 2000 (102.2 per cent).
Raw cane sugar for further processing This was due to a high self-sufficiency rate of domestically
produced raw sugar.  Self-sufficiency in white sugarproduced from domestically grown sugar beet was 99.3 percent.  Imports of white sugar in 2000 were 465 tonnes.
Canada:  Submission of Table MA:2 for 1999. Latvia became a Member in February 1999.  Latvia's tariff
quota commitments refer to full years, as indicated on theTable MA:2 notification format.
Morocco      G/AG/N/MAR/21       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand: Reasons for drop in fill rates :
Meat of ovine animals; Domestic production of sheep meat met consumption
needs.  This was largely due to the drought suffered in 1999
which led to feed shortages and forced producers to
slaughter a larger part of their herds.  There were alsoimportant substitution effects between sheep and bovinemeats.  Consumer preferences for fresh meat may alsoexplain underfill.
Meat of bovine animals; Due to a statistical error, the level of imports was wrongly
reported.  A total of 8,372 tonnes of bovine meat wereimported in 1999.
Colza seeds ; Underfill was due to important substitution effects from
other oleaginous seeds.  Imports of oleaginous seeds werenot subject to any quantitative restrictions.
G/AG/R/27
Page 17
Poland      G/AG/N/POL/41       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
New Zealand:
Reasons for continued underfill of tariff quotas; Tariff quotas are not the only import opportunities provided
by Poland.  Imports of butter and dairy spreads have
increased since 1998, from 1,022 to 12,322 tonnes in 2000.Underfill is the result of a comb ination of situations in the
Polish market, and different import possibilities.
Given the continued underfill and given Poland's aims totake into account "market developments and the
experience gained during the first years ofimplementation" and "to ensure broad access to tariff
quotas and an even distribution throughout the year",
whether Poland has considered that its current
administration practices may have a negative impact onexporters' ability to use the tariff quotas; whether theelimination or the modification of the administrationsystem has been considered.The Polish administration is reviewing and monitoring the
operation of tariff quotas with the aim to improve importopportunities and prevent unfavourable developments, e.g.,speculation or blocking of tariff quotas.  It is important tonote that a large number of scheduled tariff quotas have not
been implemented, as the related products are only subject
to customs duties.
Slovak Republic      G/AG/N/SVK/27       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina/Australia/New Zealand :  Reasons for underfill
for most tariff quotas, especially:In general, underfill is linked to the existence of the
Customs Union with the Czech Republic as significantvolumes are imported from this trading partner.
Bovine animals, live; bovine meat; swine, live andpigmeat; sheep, live, and sheepmeat; poultry meat;Apart from the above reasons, underfill was caused by a
slight decrease of domestic consumption, mainly due to thedeterioration of purchasing power.  Concerns over BSEalso influenced import demand for bovine animals andbeef.
Milk and cream; yoghurt; butter;
New Zealand noted that, despite claiming that underfill
was the result of abundant and efficiently-produced
domestic dairy products, the Slovak Republic still felt the
need to subsidize exports of "milk powder" and "otherdairy products", implying that domestic dairy prices arehigher than world prices. Whether the reasons forpersistent underfill could therefore be re-examined;Low fill was caused by domestic self-sufficiency as
production exceeded domestic consumption.  Moreover,both milk powder and butter are export-oriented items.
Export subsidies are used to bridge the gap between
domestic and world prices, in full conformity with theUruguay Round commitments of the Slovak Republic.  Thenew administration method (SVK/29) is expected togradually improve the fill rates.
Whether the full quota for the three tariff lines wasallocated in 2000 with the majority of licences left
unused; or whether tariff quota underfill reflects a lack of
demand for licences.The fill rates reflect the extent of importers' interest in
applying for the licences as these are granted automatically.
Starches and inulin There was insufficient interest from importers.
G/AG/R/27
Page 18
Slovenia      G/AG/N/SVN/16       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina/United States: Reasons for underfill for most
tariff quotas, in particular:The call for applications concerning the GATT tariff quotas
was published in the Official Journal of the Republic ofSlovenia no. 103/99 in December 1999.  All the tariff
quotas for which the applications were received have been
allocated to applicants in the beginning of the year 2000.
Beef  – Carcasses (fresh and frozen); other cuts (fresh and
frozen); high quality beef; offal; slated beef;No applications were received for high quality beef.  There
has been no commercial interest on the part of importers
because they f ound it more convenient to import live
bovine animals.  For this reason, there were no in- or out-of-quota imports.  In the case of other frozen beef offal andprepared beef, the applied MFN duties were lower than thein-quota duties.
Pork products Underfill is related to the conclusion of free trade
agreements in accordance with GATT 1994 Article XXIV
with 32 countries.  For the majority of products, the
customs duties are lower than the scheduled in-quota duty
rates.  The importers may choose under which agreementthey wish to import.
Whole milk powder; butter Same reply as above.
Apples; wheat flour Same reply as above.
Domestic prices for the notification period to confirm that
domestic demand is not at issue.In mid-2000, Slovenia launched a market information
system for some agricultural products in order to collectprimarily data on quantities, and to a lesser extent on
prices, of selected products.  However, domestic prices are
not available for the scheduled products at the six-digitlevel of the HS.  In addition, prices are based on thedomestic market and may change during the course of theyear.
United States:
First-come, first-served (FC) – Operation of the FC
allocation; reason for applying the FC to selected
products only; fill rates expected;The FC method has been used for the third consecutive
year for some tariff quota products like: fresh and frozen
beef offal, feed barley, yellow corn, rape-seed and colza-
oil, prepared beef.  It is even more extensively used forquota allocation with the framework of other free tradeagreements. Slovenia also uses: (a) simultaneous
examination: import shares are allocated in proportion to
the quantities requested.  If demand is less than the tariffquota quantity, all applicants get the requested share.Otherwise, a reduction coefficient is applied to all therequested quantities. (b) historical importers:  importers'
shares are allocated in relation to past imports of theproduct concerned.  Around 90 per cent of the tariff quotais reserved for traditional importers while the rest is setaside for new entrants.  If the requested quantities exceed
the available tariff quota quantity, then reduction
coefficients are applied, as under (a) above.G/AG/R/27
Page 19
Slovenia      G/AG/N/SVN/16       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Plans to expand the FC to all products under tariff quota
management.
Additional comments:  Since the FC method has been
applied with success, New Zealand and the United States
asked Slovenia to reconsider  its decision to introduce
auctioning. More information on plans to expand the FCto other products was sought again.  Slovenia stated that
it wished to avail itself of the positive experience of some
countries with the auctioning method.  Although it would
be introduced on a trial basis, Slovenia did not excludethe possibility to extend the system to other products.Slovenia envisages the introduction of the auctioning
method of allocation, whereby the right to import will beallocated on the basis of a competitive bidding system.
Importers shall submit sealed bids specifying up to five
quota amounts as well as the corresponding prices per unitthat they are ready to pay in order to obtain the right toimport.  This method will be applied on a trial basis in 2001for some wine products.
Venezuela      G/AG/N/VEN/20       Tariff Quota Fill (Table MA:2)
Points raised by other Member s Response by Notifying Member
Argentina: Reasons for underfill
Edible offal, poultry, milk and cream, butter, barley,
rice, sorghum, cereal flour, soya beans, molasses,pasta, soya bean cake, dextrins and other starchesFor transparency purposes, all scheduled tariff quota
products were notified.  However, tariff quota systems wereonly applied to sorghum and yellow maize in 1998 (import
licensing regime).  A tariff-only regime was applied to all
other products and the notified imports represent totalimports.  In those cases, underfill was due to the lack ofimport demand caused by a drop in domestic consumption
and the existence of sufficient domestic production to meet
those consumption requirements.
Milk powder, fat ≤ 1.5%; sugar cane; groundnuts As indicated in the notification, these tariff quotas were
under-filled, but rather over-filled.
G/AG/R/27
Page 20
Tables MA:3 to MA:5 Notifications
Japan     G/AG/N/JPN/64    Annual Summary of Safeguard Actions (Table MA:5)
Points raised by other Member s Response by Notifying Member
Australia: Quantity of imports affected by the safeguard
actions.
Volume-based : Buttermilk; inulin After the SSG was invoked, 4.6 tonnes of buttermilk had
been imported under the higher tariff rates resulting from
the application of the SSG.  No imports of inulin wereaffected after the invocation of the SSG.
Total imports
tonnesImports after SSG
tonnes
Inulin 409.8 151.4 (all within the TQ
limit)
Buttermilk 21.5 4.6
Price-based: Wheat flour, butter, peas,  milk powder SSGs were invoked only against each individual cargo
which fell short of the trigger price. To avoid the disclosure
of information on individual traders' imports, Japan has notpublished the volume of imports affected by the price-based SSG.
G/AG/R/27
Page 21
Table DS:1 Notifications
Chile    G/AG/N/CHL/13      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
New Zealand: ST/DS:1  – "Promotion of private investment
in irrigation and drainage works" –  Compliance with
Annex 2.The Law N. 18 450  was promulgated on 30 October 1985
and is administered by the Executive Secretary of the
National Commission for Irrigation.  It aims at increasingthe area of irrigated land; providing irrigation in zonessuffering from a water deficit; promoting the efficient use
of water; rehabilitating soils or poorly drained areas for
agricultural use.  The Law encourages the construction ofoff-farm works of general agricultural use and is thereforein compliance with Annex 2 criteria.
Argentina:  ST/DS:2  – Credit programmes : Programme
requirements, including allocation details, subsidy amounts.This question has been transmitted to the competent
authorities and a response will be submitted at a later stage.
European Communities   G/AG/N/EEC/30     Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
Philippines/United States: General services: marketing and
promotion –
Reason for 40 per cent increase in support compared to
1997/98;This arises for reasons of an administrative nature.  There
was an acceleration of delayed payments in Spain and Italy.
Calculation methodology used to derive the overall levelof support since detailed information is not available on
expenditures of EC and member State funds by type of
activity, nor by beneficiary commodity, as previouslystated by the EC;
Levels of EC and member State expenditures;The EC commitment is to not ify the support at EC level.
Means used to ensure all member State expenditures are
included in the notification;There is a legal obligation to notify state aids to the
European Union (Article 87 of the Treaty of Amsterdam).
Canada/United States: Public stockholding for food
security
Related Table DS:2 notification; This is a very old measure, based on a NATO decision to
ensure a certain degree of self-sufficiency in times of crisis.
Prices for food purchases and sales. Food purchases are handled under normal market
conditions in the member States.
United States: Direct income support -  Reason why the
funds previously notified under income insurance andincome safety-net programmes are re-notified under thiscategory.(EEC/26/Corr.1 refers) This was a wrong classification of a
national direct payment which was not based or linked topast or present income.
Blue Box
United States: Durum wheat, soybeans  – Compliance with
production-limiting criteria given that the harvestedhectares have increased since the previous crop year.Article 6.5 is complied with.  For arable crops, the EC have
a fixed base area which limits the support given to these
crops. In addition, in order for producers to qualify to
receive the direct payments, there are obligatory set-asiderequirements. The evolution of comparative advantagesmay result in some switch of areas harvested between thedifferent arable crops.
Canada: Rice  – Hectare-based payments: related Table
DS:2 notification.The related notification will be promptly submitted.G/AG/R/27
Page 22
European Communities   G/AG/N/EEC/30     Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Amber Box
Australia/Canada:   Substantiation of de minimis  claims;
value of total agricultural production for 1998/99 and1997/98 (EEC/26);Common wheat: 9 Billion Euro; Cauliflower
: 1.4 Billion
Euro.  The total value of production for MY 1998/99 is
213.5 Billion Euro (wrongly reported as 217.8 Billion
Euro).  In future notifications, the relevant production
values will be included as appropriate to justify claims
under the de minimis  rule.
United States: Spanish table olives  – Details on support
programme introduced in July 1998; reporting in the
current notification;There was no new support programme for Spanish table
olives in MY 1998/99.  The member States could choose to
switch part of the aid for olive oil to table olive producers ifnecessary.
Australia: Potatoes for processing to starch  - Treatment
of negative EMS support.As indicated in ST/DS:4, negative support is treated as
zero.
Japan   G/AG/N/JPN/61      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
United States:  Environmental programmes : "Conversion
from rice production"
Information on how payments to farmers to switch from
rice to other crops meet para 12 criteria;The objective of these payments is to preserve the
favourable environment of paddy fields by encouragingfarmers to grow crops other than rice, or to adopt otherappropriate management practices.  The support is provided
through a publicly-funded government programme, not
involving transfers from consumers.  Since its aim is topreserve the favourable environment of paddy fields, theprogramme does not have the effect of providing price
support to producers. In addition, eligibility for the
payment depends on the fulfilment of specific conditions topreserve the environment which are set out by thegovernment.  The amount of payments is limited to the
extra costs or loss of income  involved in complying with
the government programme for the preservation of theenvironment of paddy fields. The programme thereforemeets the criteria set out in Annex 2 para 12.
Reasons why these payments are not listed as Amber Boxsince the per-hectare subsidies provided for the plantingof other crops on rice paddies are pivotal in increasingproduction of those alternative crops;
Additional comments:  India
 wondered whether Japan
considered it more environmentally-sound to grow, than
not to grow, rice.  Japan responded that in view of the
possible adverse environmental impacts,  the government
was encouraging farmers to grow crops other than rice soas to prevent the abandonment of paddy fields.The government has been conducting the conversion
programme from rice production to other crops in order topreserve a balance between demand and production of rice.
However, if farmers stop planting rice in paddy fields, the
paddy fields risk being abandoned, and consequently thepositive environmental externalities associated to them maydeteriorate.  To avoid these adverse effects, it is essential to
maintain the function of paddy fields by growing crops
other than rice, or by using other appropriate managementmethods.  Acreage payments are only made to producerswho conduct farming activities that lead to a favourable
farm environment. In addition, payments are not linked to
the production of specific crops. Thus, the primaryobjective of the programme is not to encourage theproduction of alternative crops, and is not a product-
specific measure of support as implied in the U.S. question.
Moreover, Annex 2 para 12 does not exclude that paymentsbe made on the production of any crops.  There is no reasontherefore to classify this programme as an Amber Boxmeasure.
G/AG/R/27
Page 23
Japan   G/AG/N/JPN/61      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
AMS
United States :  Rice  -  Market price support Through a series of fundamental reforms, Japan abolished
government controls on all rice in distribution.  As a result,the rice distribution system was left to the private sector,with no government intervention.
Mechanism used to set the government purchase price forrice;All domestically-produced rice was previously eligible for
government purchases.  After the above reforms wereimplemented, the government purchase was limited to the
amount n ecessary to form public stocks for food security
purchases.  The purchase prices for stockholding are set onthe basis of the actual market prices.
Level of market price support in FY 1998 if calculatedusing the average government purchase price.In view of the above explanations, there is no administered
price for rice anymore. Consequently, the level of price
support for FY 1998 was zero.
Korea   G/AG/N/KOR/30      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada:  Substantiation of de minimis claims; whether the
provision of the relevant values of production in thenotifications has been considered when claiming de
minimis exemptions.Please refer to Attachment no. 2 .  This information will be
routinely supplied in future notifications.
Malta   G/AG/N/MLT/6      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:  "Guidance and guarantee – Beef"
Explanation of how payments, which appear to be limited
to beef producers, meet the criteria of being "… not
related to, or based on, the type or volume of production "
in accordance with Annex 2 para 6.
Additional comment:  The United States  encouraged
Malta to consider the possib ility to notify this programme
under another category of support given that paymentswere effected upon the retirement of animals fromproduction.Please refer to G/AG/R/26 page 30 for a comprehensive
reply.  Producers do not receive payments on a regularannual basis, but rather upon the retirement of animals fromproduction.  The number of animals that can be kept by any
producer is subject to a quota, a system which was
introduced a number of decades ago. The am ounts involved
are fairly modest ones.
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States:  The questions posed during the November
2000 and March 2001 meetings of the Committee were
reiterated.These deferred replies are reflected in Part II of this Annex.G/AG/R/27
Page 24
Norway   G/AG/N/NOR/30     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
United States:  Reason why " Based on OECD grouping "
was inserted.This phrase was also included in previous notifications as
well as in the Norwegian Schedule.  The grouping relates tothe three categories: research, pest and disease control, andinfrastructural services.  It is based on the way the OECD
groups these categories of support in their PSE calculations
for Norway.  However, these three groups actuallycorrespond to the criteria set out in Annex 2, paras 2(a), (b),and (g), respectively.
Canada:  "Compensation for crop damage due to natural
disasters" –  The explanation given in G/AG/R/24 (page
26) confirms that para 8(a) Annex 2 criteria are not met,
especially (i) and (ii).  Request that the measure be reported
as AMS support.The level of production loss is calculated on the basis of
total losses in all the various productions of the farm andnot only on the basis of total loss in one type of production.
Losses are not fully compensated.  The farmer has to bear
27 per cent (22 per cent in northern Norway) of the loss.This means that if the total loss equals or is less than 27 percent, the farmer is not compensated.  If the loss is 31 per
cent, the level of compensation will be 4 per cent.  These
constraints lead to considerably lower payments beingeffected than a scheme offering 100 per cent compensationfor a 30 per cent loss, which is an option according to
Annex 2. Furthermore, in marginal agricultural areas,
yields may vary considerably from one year to the other.  Inorder to reflect an adequate average under thesecircumstances, a five-year average has been chosen for the
part of the scheme that covers crop losses.  This does not
result in systematically higher payments being effectedthan under a three-year average, in particular not underNorway's climatic conditions. Taking into account theoverall limitations of the programme, Norway considersthat it operates in conformity with Annex 2.
United States: Regional assistance -  Explanation of how
payments for farmers' vacations qualify under Annex 2para 13.This question arises from a misunderstanding as the
Vacation and Replacement scheme is not placed under
Annex 2 para 13.  This scheme is included in the Green
Box in accordance with the Norwegian Schedule.
Amber Box
United States: Details on calculation of product-specific
AMS; specific reference prices used.The product-specific AMS has been calculated in
accordance with Annex 3 and the Norwegian Schedule.The administered prices are the target prices laid down inthe Annual Agricultural Agreement. The ERPs are thesame as in the Norwegian Schedule and are based on the
average of the years 1986-88 (data source: OECD).
Furthermore, associated fees and levies (i.e. farm feedadjustment and producer levies) are deducted while basedeficiency payments and transport subsidies are taken intoaccount in the calculations.
United States:  Shares New Zealand's concerns (seeG/AG/R/23 and R/26, pp. 34 and 31, respectively) on
Norway's calculation of the Current Total AMS.  Reason
why Norway continues to subtract its negative non-productspecific AMS from its product-specific AMS.
Additional comments:  New Zealand
 expressed concern
and disappointment on Norway's interpretation and
treatment of negative AMS and reaffirmed its intention to
pursue this issue further.According to Annex 3 para 4 " specific agricultural levies
or fees paid by producers shall be deducted from the AMS ".
The taxes on fertilizers and pesticides are measures
introduced in line with the "Polluter Pays Principle".  Thesetaxes are specific to agriculture. Their purpose is todiscourage producers from excessive use of these inputs.
They are also included in the Norwegian Schedule.  The
calculation of the Total AMS is thus in accordance with theAgreement on Agriculture as well as with the NorwegianSchedule.G/AG/R/27
Page 25
Paraguay   G/AG/N/PRY/6      Domestic Support (Table DS:1)
Points raised by other Member s Response by Notifying Member
Canada: S&D  – "Distribution of seeds to poor families in
rural areas"
Confirmation that this  is a new measure;
Submission of related Table DS:2.The questions were transmitted to the competent authorities
and a response will be submitted at a later stage.
Romania    G/AG/N/ROM/17     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
Canada:  The following measures seem to be ineligible for
exemption under Annex 2 criteria (some may qualify underArticle 6.2 and would, in that case, need to be shown inST/DS:2:
"Budgetary allocations in order to stimulate the increasing
of livestock" – Compliance with specific criteria of
Annex 2;
"Price reductions […] to stimulate the use of high quality
seeds" – Compliance with specific criteria of Annex 2;
"Fertilizers granted free" – Compliance with specific
criteria of Annex 2;
"Expenditures to provide electric power" – Compliance
with specific criteria of Annex 2.All these measures were included under Part IV of
Romania's Schedule (ST/DS:4, AGST/ROM, refers) underthe heading " Measures exempt from the reduction
commitments ".  All these measures are in full conformity
with Annex 2 provisions: the support in question does notinvolve transfers from consumers and has no effect ofproviding price support to producers.  These measures donot fall under Article 6.2.
Amber Box
Canada:  Details on market pr ice support calculations to be
provided in line with Annex 3, namely: administered and
external reference price; eligible quantities; information on
what these prices and quantities represent.As a transition economy, Romania is going through a
complex process of transformation into a market economy.
Supporting the agricultural sector is one of the main
government objectives.  Domestic  subsidies are subject to a
national programme for agricultural support.  During theUruguay Round, Romania passed through a difficult period
of political, social and economic transformation. It was
practically unfeasible to take commitments based onadministered and external reference prices.  Therefore,benefiting from the provisio ns granted to developing
countries, Romania availed itself of Article 6.4, and
provided support much under the 10 per cent de minimis
level.G/AG/R/27
Page 26
Turkey    G/AG/N/TUR/12     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
Green Box
Canada: Agricultural policy reform programme
(G/AG/R/23, page 35, refers) – Whether any Green Box
programmes have been introduced in that context; if so,related notifications.No Green Box programme has been introduced as yet.
However, the applicability of some direct income support
systems is being tested.  Such projects are still at the stageof data collection.  Turkey will notify the WTO as soon asa new Green Box  programme is introduced
Amber Box
Australia/New Zealand:  Turkey has previously undertakento provide AMS calculations in Turkish Lira (G/AG/R/23
page 34, refers) -The main purpose of notification obligations is to promote
transparency and facilitate surveillance. In this respect,consistency of format is important and this is why the sameformat was used in the present notification.
Reasons for not reporting domestic support in TurkishLira in the present notification;The Ministry of Agriculture and Rural Affairs has also
prepared the notification in Turkish Lira.  Since, as
indicated above, the main purpose of notification is to
allow the monitoring of changes from year to year, thatnotification was not submitted to the Committee. As aresult of economic conditions and high inflation, the
domestic support table for the year 2000 in Turkish Lira
shows negative supports for rye, oats and tob acco and a
small amount of support for wheat, barley and maize.Since high inflation makes the results of the calculations in
Turkish Lira quite misleading, Turkey preferred to submitthe table in US dollars.
Date at which the revised notification can be submitted. The delegate of Turkey undertook to send the domestic
support table in Turkish Lira to interested parties for theirreview and comments.
Australia:  Substantiation of de minimis  claims, including
for sugar beet -  Explanation as to why the required figureson value of production have never been provided.Such information is always provided in the Annex to
Supporting Table DS:5 (detailed calculation table)
Market price support: Sugar beet
Australia/Canada/New Zealand/United States:  Update on
agricultural policy reform initiated by Turkey, asannounced in G/AG/R/23, R/24 and R/25:
Privatization of Turkish Sugar Company in 2001:confirmation that reform will provide for reductions indomestic support to de minimis  levels;The state-owned Turkish Sugar Company purchases all the
sugar beet which is marketed.  It is under a privatizationprogramme.
Steps taken now, or to be taken in the future, to ensurethat Turkey quickly reaches compliance with its UruguayRound commitments.In April 2001, a new sugar law was promulgated.  Sugar
prices will be determined under free market conditions asof 2002.  Domestic support to sugar beet will be eliminated,which will enable Turkey to meet its commitments.
New Zealand/United States: Reasons why support to sugarbeet is still not reflected  in ST/DS:4 and ST/DS:5;
The United States noted that for the third consecutive year,
Turkey's AMS is about 50 per cent of the value of sugar
beet production, well beyond the agreed de minimis  level;
does not believe that the previous answer that " there is no
private buyer " is a justification for exempting this support
from the calculation of the Current Total AMS.The reason why sugar beet is not included in ST/DS:5 is
directly related to the struct ure of the sugar beet industry
and to the fact that in Turkey's Schedule, " no private
buyer " is indicated.  However, for transparency reasons, the
calculated value of support was placed in the detailedcalculation table.G/AG/R/27
Page 27
Venezuela    G/AG/N/VEN/19     Domestic Support   (Table DS:1)
Points raised by other Member s Response by Notifying Member
United States: "Comprehensive programme for the
development and promotion of coffee growing" -
Comprehensive description; whether this programme
provides production incentives or subsidies.The programme involves the following activities, mainly in
the field of pest and disease control: technical assistance
and consultancy services; setting-up and development of
pilot centres; phytosanitary campaigns, training anddemonstration of phytosanitary control methods, technicalvisits; renovation of coffee pl antations; etc. The programme
is financed through public funds and does not have the
effect of providing price support nor does it subsidizeproduction.G/AG/R/27
Page 28
Table DS:2 Notifications
Japan   G/AG/N/JPN/62      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Rice Farming Income Stabilization Programme (JRIS)"
United States:
If the price of voluntarily-marketed rice in FY 1998 does
not include a market price support component, and thecompensation standard price is a three-year moving
average of the prices of voluntarily-marketed rice,
whether Japan expects the price gap to be eliminated byFY 2001;The price of the voluntarily-marketed rice fluctuates every
year, accurately reflecting the actual situation of s upply and
demand. Therefore the gap between the "compensation
standard price", which is equal to the average price of the
voluntarily-marketed rice in the preceding three-year periodand the price of the voluntarily-marketed rice in the yearconcerned, also fluctuates every year.  Consequently, the
price gap between these two parameters in FY 2001 could
either increase or decrease.
Extent of price gap decrease since inception of JRIS; The actual price gap between the above two parameters has
widened since the introduction of the JRIS in 1998.
Whether Japan foresees a need to change the JRIS oraugment it with other measures to effectively stabilizerice farming.There are no plans to change the JRIS or to augment it with
other measures to stabilize rice farming income at themoment.
"Support Programme for the Reduction of Environmental Burden Due to Dairy Farming"
United States:  Whether this programme will be extendedto other kinds of livestock ente rprises in the future, such as
beef, pork, or poultry.This programme was introduced in response to the possible
environmental problems that would arise from the rapidincrease of larger scale dairy farming, which in turn might
result in the shortage of land where livestock manure can
be utilized properly.  There are presently no plans toexpand this programme to other livestock sectors.
"Direct Payment to Farmers in the Hilly and Mountainous Areas"
United States: Noted that much of Japan's farmland couldbe construed to be in hilly and mountainous areas.  Thismeasure could thus potentially maintain production andlimit trade.  Additional details on:The eligible farmlands should be within the specific areas
designated by various laws which deal with handicappedareas, such as the Mountainous Village Development Law.In addition, they should be handicapped farmland for
agricultural production according to specific criteria, such
as steep sloping, and should be at least 1 hectare in size.Moreover, only farmers who continue farming activities forat least five years under the community agreements areeligible for the payments.
Total area (in hectares) of the zones (handicapped areas)in which the payments could be made in 2000;According to provisional data, the total area of farmlands in
which the payments were made (eligible farmlands in
accordance with the above-mentioned requirements) was
about 567 thousand hectares in FY 2000.  This figureaccounts for about 12 per cent of Japan's total agriculturalland, namely, some 4.86 million hectares.
Whether the 1-hectare minimum farm size refers to landowned by a single farmer, or to a farm operation (e.g.cooperative or contract farming);This refers to a group of farmlands which are adjacent to
each other or which are managed in conjunction withfarmers and cooperatives regardless of their ownership.
Means by which production costs are determined; forinstance type of production costs used, source of costestimates;The production costs are calculated on the basis of the
result of a statistical survey conducted by the Ministry ofAgriculture, Forestry and Fisheries. The costs arecalculated according to land category.  For example, the
production costs in paddy fields are calculated on the basis
of the cost of rice per hectare.  The production costs inarable fields are estimated on the basis of the cost of wheatper hectare.
G/AG/R/27
Page 29
Japan   G/AG/N/JPN/62      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
Whether an eligible zone farmer whose cost of production
was equal to or below the average for plain areas, receivethe subsidy;The production cost of individual farmers in hilly and
mountainous areas are different from each other. Likewise,the production cost of individual farmers in plain isdifferent.  Therefore the unit prices of the payments are set
as 80 per cent of the gaps of average production costs
between plain areas and hilly and mountainous areas.Payments are made in accordance with the criteriadescribed above.
Determination of the ceiling on payments; The programme sets a uniform ceiling of 1 million Yen on
payments that an individual farmer can receive.
Whether a farmer who receives a payment in 2000 isrequired to continue farming activities through at least2005;As indicated above the payments are made to farmers who
continue farming activities for at least five years under thecommunity agreements, in eligible farmlands (as per theabove-mentioned criteria).  A farmer who received a
payment in FY 2000 would be required to continue farming
until at least FY 2004.
Principal commodities produced by farmers receiving the
subsidies under the 2000 programme.The programme is not targeted to the producers of any
specific commodities.  It is thus difficult to identify thecommodities that were grown in the eligible farmlands.
Mexico   G/AG/N/MEX/6      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Alliance for Agriculture"
United States: Operation details on each of the notified
components; basis on which direct payments are made :
Structural adjustment assistance provided through
investment aids -  Consistency with Annex 2 para 11;
Regional assistance – Definition of a disadvantaged
region; consistency with Annex 2 para 13.See "Deferred replies" section.G/AG/R/27
Page 30
Tables ES:1 to ES:3 Notifications
Slovak Republic   G/AG/N/SVK/26    Export Subsidies    (Tables ES:1 to ES:3)
Points raised by other Member s Response by Notifying Member
Australia:  Circumstances that led to the increase in export
subsidy outlays for milk powder and malt in 2000compared to 1999.In 2000, dairy and brewery companies had to purchase raw
cow milk and malting barley respectively at higher
purchasing prices than in previous years.  Moreover, export
subsidies were increased in  response to increasing
production costs.  The amount of subsidy is also influencedby the results of tenders (organized by the State Fund for
Market Regulation, pursuant to the Act on public
procurement No. 263/1999) as it varies according to thenumber of exporting companies involved and the offersmade.
United States   G/AG/N/USA/35    Export Subsidies    (Tables ES:1 to ES:3)
Points raised by other Member s Response by Notifying Member
The EC questions were received after the deadline (G/AG/1 refers) and were not reflected in the convening airgram.
EC: DSB ruling  - Follow-up G/AG/R/25, para 3  - Whether
the notified information responds to the US commitment to
abide by the DSB ruling;All WTO notification requirements have been fulfilled as
accurately and as timely as possible.  In the June and
November 2000 meetings, in response to EC questionsregarding potential benefits derived from the U.S. FSC, theUnited States provided the most disaggregated data that
were available at that time.  That information, which was
not associated with any particular product, could not bedisaggregated further.  As of June 2001, the status of thelevel of data disaggregation has not changed.
EC: Food aid  -
Whether the notified food aid was provided in fully grant
form;Around 90 per cent of the food aid provided is in fully
grant form.
Noted that the notified food aid in the form of wheat andwheat flour increased from 1.1 million tons in 1997 to 3.2million tons in 1998, and to 5.3 million tons in 1999 –
Indication of how much of this quantity was shipped under
the Section 416(b) programme;The amount of wheat and wheat products shipped under the
Section 416(b) program was 3,965,607 metric tons on awheat equivalent basis.
Confirmation that availability of commodities under
Section 416(b) depends on CCC inventories and
acquisitions;Food aid quantities shipped under Section 416(b) are
secured by the CCC.  Requests for U.S. food aid always
exceed stocks held by the CCC.
Whether CCC acquisitions have led to increased Section
416(b) shipments in the form of food aid;Food aid shipments were increased under that programme
but not all the requests which were received a nnually for
food aid were met.
Five main destinations for food aid in the form of wheatand wheat flour; share of the 5.3 million tonnes that wasshipped to those destinations.The five main destinations for wheat and wheat products
were as follows ( in metric tons ): 1,473,954 to Russia;
447,610 to Bangladesh; 372,940 to Ethiopia; 322,845 to
Indonesia; and 300,000 to Jordan.
G/AG/R/27
Page 31
ANNEX
Part II – Deferred Replies to Questions on Notifications Raised at Previous Meetings
Table MA:2 Notifications
Mexico      G/AG/N/MEX/11/Rev.1       Tariff Quota Fill (Table MA:2)   G/AG/R/26, page 17, refers
Points raised by other Member s Response by Notifying Member
Argentina:  Applied rates and volume of imports for the
following products: barley, maize, hard cheese, meat and
edible offal, animal fatsThe duties actually applied by Mexico to imports of the
products cited have ranged from 0 to 20 per cent ad
valorem , without prejudice to the fact that importation
under the tariff quota commitments agreed by Mexico hasalways been available to any importer, for imports fromany WTO Member.  The volumes of imports of these
products are those recorded by Mexico in the Integrated
Data Base.  All imports entered Mexico at the above ratesof duty, which are lower than Mexico's commitments forthe products in question.
Table DS:1 Notifications
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)       G/AG/R/25, pp. 21-23, refer
Points raised by other Member s Response by Notifying Member
Green Box
Canada:  Detailed references to the specific documents of
the various ministries and agencies indicated as datasources.Attachments 3 to 6 refer.
United States: "Infrastructural works" – Programme details;
demonstration of how Annex 2 para 2(g) criteria are met.The main objective of activities under the Development of
Irrigation Works programme is to make more efficient useof water for the irrigation of rural areas. Irrigation
infrastructure works include: (a) building dams so as to
include new irrigation areas in production; (b)rehabilitating and improving generally available irrigationinfrastructure networks; (c) maintaining generally available
district irrigation networks; (d) protecting generally
available productive areas and Federal watercourses.  Thecriterion used for including such support measures inAnnex 2, para 2, is that subparagraph 2(g) allows the
provision or construction of water supply infrastructure.
Moreover, this programme does not involve subsidies toinputs or operating costs, or preferential user charges, andmeets the general criteria set out in para 1 of Annex 2.
"PROCAMPO"
Japan/United States:
Description of the programme; PROCAMPO is a programme of direct support for farmers'
incomes, which grants payments by hectare of land sownwith staple grains and oilseeds in the three years precedingthe agricultural year 1994.
Compliance with Annex 2 para 6 criteria; specifically,conformity with para 6( d) and ( e)The list of beneficiaries and the acreage covered by the
programme have been held constant.  The land may be usedfor agricultural, livestock or forestry activity or forconservation projects. This fully complies with therequirements laid down in para 6 of Annex 2.
G/AG/R/27
Page 32
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)       G/AG/R/25, pp. 21-23, refer
Points raised by other Member s Response by Notifying Member
"Countryside Alliance"
United States:  Description of the programme. Please refer to the next section on Table DS:2 notifications
(MEX/6).
Canada:  The notified components account for less than
half of the total budget of the programme as reported byOECD, Agricultural Policies in OECD Countries –
Monitoring and Evaluation, 2000 .   Indication of where
other related support is reported in the present notification.The total budget is set out in Attachment no. 3  which
compares the data reported under the OECD and thosereported under the WTO during the period 1996-98.
Canada/United States: Relation between the amounts
reported for the two programme components and the single
amount notified in MEX/6.This is the same programme as that described in MEX/6.
Canada/New Zealand: Reason why the present notification
shows that support started in 1997 whereas MEX/6 reports
that the programme began in 1996.Because this is a new programme, Mexico considered that
MEX/6 provided the requisite information regarding the
budget for 1996.  Table DS:2 sets the monetary value of themeasure in 1996 at 331.2 million pesos of 1991 for theagriculture and livestock programmes and at 123.7 millionpesos of 1991 for the rural development programmes.
Australia:  "Rural development" component - Details of
payments and delivery in accordance with Annex 2 para 13.Please refer to the next section on Table DS:2 notifications
(MEX/6).
Special and differential treatment
Canada:  "Insurance premium subsidy" – Reason why this
type of support, such as the AGROASEMEX cropinsurance transfers, is repor ted as investment subsidies
instead of input subsidies.Mexico notified the AGROSAMEX insurance premium
subsidy under Article 6.2 which exempts investmentsubsidies generally available to agriculture and agricultural
input subsidies generally available to low-income or
resource-poor producers from support reductioncommitments.  In Mexico, prod ucers likely to insure their
crops (landowners) represent about 30 per cent of alldomestic producers;  82.2 per cent have annual incomes
under 500 U.S. dollars per economic dependent, that is,
approximately 11 per cent of annual per capita income (thefigure for 1998 was 4,356 US dollars, according to theNational Institute of Statistics, Geography and Informatics(INEGI)).
In Mexico's view, the Agreement on Agriculture is not very
specific as regards input or investment goods.  This topiccould be brought up for discussion during the negotiationprocess.
AMS
Use of external reference prices (ERPs) and exchange rates
Australia/Canada/New Zealand/United States:
Details on how ERPs are derived since they (a) differ
from base period data and (b) vary from year to year;
consistency with Annex 3 which stipulates that ERPs
should be fixed and refer to 1986-88.
Details on how ERP are used and consistency with Annex
3 para 9;Taking into account the average ERPs for the period 1986-
1988, the calculation of market price support was modifiedaccording to the table given in Attachment no. 4 .
The exchange rate provided does not relate to the ERPs
used when converted from base period data.  Details onexchange rate conversions for the applied administered
prices and the ERP. Relevance of the average annual
exchange rate for 1997; relation with base period ERP.-
G/AG/R/27
Page 33
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)       G/AG/R/25, pp. 21-23, refer
Points raised by other Member s Response by Notifying Member
Use of constant 1991 pesos
Australia/Canada:
Justification for price support data being in constant 1991
pesos; justification under the provisions of the Agreementon Agriculture.Mexico clearly specified in its Schedule that it would use
values in real terms (base year 1991).  Each country'sSchedule of commitments forms an integral part of theAgreement on Agriculture.
Request that, for each year of the implementation periodnotified so far (1995-1998), data in Supporting Tables beprovided in current pesos, using base period ERPs, beforeconverting Current Total AMS into 1991 constant pesos
in order to allow a proper examination against cited
sources.  As Mexico's commitments are taken in 1991pesos, a transparent deflation could then be made of theestimated support amounts from current to 1991 pesos,using the specific deflation factor for each year.Mexico's domestic support commitment is expressed in
constant 1991 prices.  In the corresponding notifications(Table DS:1), Mexico indicated the deflator used to convertconstant values into current prices for the years 1996, 1997and 1998.
United States:  Reason for reflecting the conversion to new
pesos in the calculations since the commitments areexpressed in constant 1991 ( old) pesos.From 1993, Mexico temporarily adopted the term "new
pesos" instead of "pesos" in order to facilitate transactions
by eliminating three-zero figures.  Although the term may
differ from year to year, the denomination currently in usedoes not mean that the figures expressed for any given yearcannot be expressed in real terms (in this case 1991 prices).
Product-specific AMS
United States:  Given the range of commodities which
benefitted from market price support in 1995, whether
government support policies have changed in 1996-1998;confirmation that no administered price was set for wheat,sorghum, soya, barley, rice, cane sugar, milk and poultrymeat during those years.Mexico confirms that only maize and beans received price
support during 1996, 1997 and 1998.
Japan:  Cereals  – Japan understands that market price
support for major cereals, including maize, was terminated
in 1999; whether a significant reduction of the Current
Total AMS can therefore be expected in, and after, 1999.Not necessarily, because in certain cases non-exempt direct
payments (marketing support) were given instead of pricesupport.
New Zealand/United States:  Maize  (footnote 1, ST/DS:6
refers)
Clarification of how money is channelled to support themarketing of maize;ASERCA supported the marketing of maize by
compensating for the differential between the
"indifference" price (international price plus transportcosts) in the consumer area and the floor price fixed by theGovernment, where this was paid to the producer by the
flour industry at an administered price for flour.  The
subsidy was also provided for purchases made by privateindividuals at the same floor price from entities determinedby ASERCA as being surplus producers.
Explanation of how inclusion of payments to support thecompetitiveness of corn producers would be considereddouble counting (such support was included in ST/DS:6,
MEX/5).Support for the marketing of maize during 1996-98 will be
incorporated in ST/DS:6 (non-exempt direct payments).The AMS will be modified on the basis of the information
supplied in Attachment no. 4.
United States:  Wheat  – Reason for increase in direct
payments to support the marketing of wheat in 1997 and
1998.It should be pointed out that in 1996 international prices
reached a historical high, which is why it was not necessary
to use these subsidies.  From the second half of 1997 and1998, international wheat prices declined to historically lowlevels.G/AG/R/27
Page 34
Mexico   G/AG/N/MEX/7     Domestic Support   (Table DS:1)       G/AG/R/25, pp. 21-23, refer
Points raised by other Member s Response by Notifying Member
Non-product specific AMS
United States:  "Electricity rate subsidies and maintenance
of irrigation works" – Status of previously-reported support
(MEX/5 refers).Such subsidies were managed by energy policy institutions
and have not appeared in the Treasury's Federal PublicAccounts as irrigation subsidies since 1996.
Table DS:2 Notifications
Mexico   G/AG/N/MEX/6      New or Modified Domestic Support (Table DS:2)
Points raised by other Member s Response by Notifying Member
"Alliance for Agriculture"
Australia/Canada/Japan/New Zealand/United States :
Description;This programme is geared towards promoting the use of
better technologies, through applied research, transfer oftechnology, purchase of equipment, capacity building andactivities focusing on animal and plant health.  Usingregion-specific and social-group-specific policies, it also
provides regional assistance in production and
organizational matters. Given the number of componentsinvolved in this programme ( Attachment no. 5  refers),
Mexico has basically classified support according to theprovisions of paragraphs 11 and 13 of Annex 2,
Structural adjustment assistance provided through
investment aids -  Operation details; basis on which direct
payments are made; consistency with Annex 2 para 11;Attachment no. 5 provides a comprehensive description  of
the sub-programmes involved as well as operation details.
Regional assistance – Definition of a disadvantaged
region; operation details; basis on which direct paymentsare made; consistency with Annex 2 para 13.Attachment no. 5 refers.
Canada:
It would appear from a number of other sources (OECD,
SAGAR) that many components would not meet thecriteria set out in Annex 2. Details on those componentsthat are actually notified in MEX/6.The programme offers an array of technological facilities in
support of investment and general services (research,training, pest and disease control, technical assistance, andso forth).  Producers are entitled to benefit from one or
more of the sub-programmes, insofar as they meet the
eligibility criteria. In order to facilitate implementation,several sub-programmes are directed at specific producergroups (coffee, oilseeds, rubber and cocoa).  Some of the
sub-programmes combine payments as defined in
paragraphs 2, 11 and 13 of Annex 2 of the Agreement onAgriculture;  as the budget is set out on the basis of thesub-programmes, however, it is difficult to classify the
payments according to the criteria in Annex 2 ( Attachment
no. 6 refers).
Confirmation that reported amounts cover both federal
and state government shares.The footnotes in Attachment no. 3 refer.
Method used to estimate the " cost of measure "; equivalent
amount in nominal terms; whether this relates to the totalcost over the life of the programme or for a specific year.-
G/AG/R/27
Page 35
Table ES:1 Notifications
Mexico   G/AG/N/MEX/8    Export Subsidies    (Table ES:1)   G/AG/R/25, page 28, refers
Points raised by other Member s Response by Notifying Member
Australia:
Request that data be presented in the same currency to
allow for a proper review of the implementation ofMexico's commitments.
Justification for reporting export subsidy outlays inconstant 1991 pesos.Mexico has no problem with presenting data on export
subsidies in US dollars.G/AG/R/27
Page 36
Attachment no. 1
G/AG/N/CRI/8  –  Trends in Domestic Producer Prices, 1998-99
The data supplied below by Costa Rica relates to  the prices traded on the stock exchange for
agricultural commodities subject to tariff quotas in 1999 and 2000 and the maximum and minimum
domestic prices for January 2001.  Such information was provided in response to the interest expressed
by the United States to receive additional price data for products subject to tariff quotas and theirpossible impact on the level of tariff quot a fill (G/AG/R/26, paragraph 27, refers).
Costa Rica noted that, even when certain trends could be discerned from the statistical data, it
was difficult to draw definitive conclusions on the relationship between international prices and quota
underfill for the concerned products.
The average price
1 per kilogram of dairy products, in particular ice cream, imported under tariff
quotas was US$3.80 in 1999 and US$4.86 in 2000, whilst the maximum price per litre of domestic dairy
products at the beginning of 2001 was US$2.85.  In this  case, even though the units were not the same
there appeared to be a difference between domestic and foreign prices, which could have led to quotaunderfill.  The average price
1 per kilogram of imported butter in 2000 was US$6.58, whereas the
minimum domestic price was US$5.35 and the ma ximum US$6.18, so the domestic price was also
below the price of the imported product.  A similar situation may have occurred with chicken meat.  It
was however difficult to establish such a relations hip for fresh cheese and powdered milk because the
price of the imported product remained at levels equal to or lower than the domestic price.
Costa Rica pointed out that the above trends  and conclusions were drawn from the data
available and that the figures given were approxi mate and should under no circumstances be taken as
precise.  In particular, statistics failed to take into consideration the possible repercussions on the price
of imports aimed at given market segments, for example gourmet products, and that any price
comparison was therefore limited and imprecise.
As already mentioned at the last meeting, the us e of tariff quotas has varied considerably since
1995.  They have been underfilled for all products with only one exception, namely, butterfat imports in
1995.  Nevertheless, the use of quotas has st eadily increased since their introduction.
Costa Rica reiterated that the tariff quota admi nistration mechanism as such had not revealed
any inherent shortcomings.  There were a number of  factors that have prevented tariff quotas being
utilized to the full, but these could not be attributed to the mechanism itself.  With regard to this last
point, although economic operators may not be fully in formed about tariff quota administration, this was
not due to a lack of publicity because many step s have been taken to promote its dissemination.
                                                     
1 Simple average after-tax price of imported products.G/AG/R/27
Page 37
Attachment no. 2
G/AG/N/KOR/30 -   Calculation of  de minimis  Levels, 1999
 (Unit : billion Won )
Description of
products1999 AMS
(A)1999 Production value
(B)AMS Percentage
(A/B %)
Product specific
 Maize(Corn) 3.64 41.13 8.85
 Rapeseed 0.76 not available not available
 Soybean 5.40 313.27 1.72
 Malting barley 0.74       106.74    0.69
 Red pepper 4.50 1,114.24 0.40
 Garlic 8.46 735.18 1.15
 Apple 3.27 516.91 0.63
 Pear 1.15 515.17 0.22
 Citrus fruit 0.75 747.48 0.10
 Chestnut 4.31 225.15 1.91
 Ginseng roots 10.09 393.42 2.56
 Beef 2.60 1,779.49 0.15
 Pigmeat 10.20 2,686.86 0.38
 Eggs 0.20 654.73 0.03
 Chicken 0.18 767.97 0.02
 Other cereal 1.69 71.89 2.35
 Potatoes 0.05 452.61 0.01
 Other vegetables 15.53 4,968.13 0.31
 Other fruits 3.67 2,433.57 0.15
 Medicinal crops 0.46 229.03 0.20
 Flowering plants 2.13 485.35 0.44
 Mushrooms 1.91 490.82 0.39
 Non-Product-Specific 404.85 32,842.50       1.23
Source:  Agricultural Information and Statistics Bu reau, Ministry of Agriculture and Forestry, Korea.G/AG/R/27
Page 38
Attachment no. 3
G/AG/N/MEX/7 - Comparative Budget of the Alliance for Agriculture Programme (AAP)
(Million pesos)
Heading 1996 1997 1998
AAP Budget notified to the WTO2  (G/AG/N/MEX/6 and MEX/7,
ST/DS:1)                                                                                                 (A)1,118.96 1,357.76 1,693.39
AAP Animal and Plant Health Programmes3  (G/AG/N/MEX/7)     (B) 81.20 125.64 174.14
State Governments' share of the AAP Budget4                                  (C) 676.96 1,094.53 1,096.53
National Water Board (CNA) I rrigation Infrastructure Support
Programmes5                                                                                         (D)0.00 248.94 502.40
Other AAP Prgorammes6                                                                     (E)
Information on Agriculture
Promotion of Exports
Other Programmes3.09
3.09
0.00
0.0091.62
11.02
0.00
80.6046.24
14.06
5.09
27.09
Total AAP Budget                                                      F7 = A+B+C+D+E 1,880.21 2,918.50 3,512.70
AAP Budget notified to the OECD8   (OECD, Agricultural Policies in
OECD Countries:  Monitoring and Evaluation 2000)                           (G)1,880.50 3,231.30 3,422.90
Temporary Employment Programme (PET)9                                         (H) 0.00 300.00 403.00
AAP Budget, not including the PET                                         I = G – H 1,880.50 2,931.30 3,019.90
Difference (%) between the AAP Budget in the OECD Report and
the Total Budget of the AAP Programme                                 J6 = I / F0.02% 0.44% -14.03%
Sources: Sixth Report of the Ernesto Zedillo Government, 2000; OECD, Agricultural Policies in OECD Countries:
Monitoring and Evaluation 2000 .
Note: Notifications of Mexico's AMS are given in real term s (millions of 1991 pesos).  Data in the above table are
expressed in nominal terms for comparative purposes.
                                                     
2 Includes only the Federal budget.
3 This heading is included in Mexico's notification to the WTO under the General Services category in  ST/DS:1
(Pest and Disease Control) and forms part of the AAP Programme.  The respective notifications failed to specify this.Includes only the Federal budget.
4 This heading appears in the AAP budget in the OECD document Agricultural Policies in OECD Countries:
Monitoring and Evaluation 2000  but was not taken into account in the notifications to the WTO.  It includes the State
Governments' share of the budget for all AAP programmes implemented by the Ministry of Agriculture, Livestock, Rural
Development, Fisheries and Food (SAGARPA).
5 This heading appears in the AAP budget in the OECD document Agricultural Policies in OECD Countries:
Monitoring and Evaluation 2000  but was not taken into account in the notifications to the WTO.  It includes both the State
and Federal budgets.
6 The fact that this did not appear in the AAP budget no tified to the WTO was an oversight.  It includes only the
Federal budget.
7 The total AAP budget is drawn from the information in the Sixth Government Report 2000, which is based on the
budget data from the Treasury's Federal Public Accounts.  The AAP budget for 1998 notified to the OECD is drawn fromdata in the Federation's Expenditure Budget, which explains the 14.3 per cent difference between the respective totalamounts of the AAP budget.
8 Includes the Federal and State budgets for all AAP programmes.
9 The OECD included the Temporary Employment Programme (PET) in the table setting out the AAP budget
(Table II.9.  Mexico:  Alliance for Agriculture.  OECD, Agricultural Policies in OECD Countries: Monitoring and
Evaluation 2000 , pp. 98-99), under the heading " Payments based on established minimum farming income ".  The PET is
properly notified in accordance with the OECD met hodology;  it should not have been included in Table II.19, however, and
Mexico will shortly advise the OECD accordingly.  The PET is a Federal Government contingency programme to support
rural populations in the event of natural disaster.  It allocates  resources to those affected through the temporary recruitment
of members of their own communities for reconstruction and re habilitation work.  Mexico considers that this programme
should not be notified to the WTO, since it is not part of the AAP Programme.G/AG/R/27
Page 39
Attachment no. 4
G/AG/N/MEX/7 - Market Pri ce Support Calculations, 1996-1998
ProductApplied administered
price
(Million 1991 pesos)
(1)External reference
price
(G/AG/AGST/MEX)
(2)Eligible production
(Thousand tons)
(3)Total market price
support
(Million 1991 pesos)
(1-2)*3
1996
Maize 515.2 506.8 18,026.0 152.0
Beans 1,572.5 1,680.9 1,349.2 */
1997
Maize 434.3 506.8 17,656.2 */
Beans 1,779.5 1,680.9 965.1 95.1
1998
Maize 394.5 506.8 18,476.4 */
Beans 1,738.6 1,680.9 1,244.5 72.0
Source:  Fifth Report of the Ernesto Zedillo Government, 1999.
*:  If the applied administered price is lower than the external reference price, market price support is not taken
into account.G/AG/R/27
Page 40
Attachment no. 5
G/AG/N/MEX/6 and MEX/7 - The Alliance for Agriculture Programme (AAP)
The AAP is based on the identification of producer demand for each of its various sub-
programmes.  It is run by State Agricultural C ouncils, made up of Federal and State officials and
representatives of producers and institutes of higher education.  The Councils set the priorities for the
allocation of expenditure under the AAP in each Federal district.  New sub-programmes can be
incorporated from year to year, while existing programmes may be modified or discontinued.  Some
of the sub-programmes cover the whole of the national territory, while others are implemented at state
or regional level.
In order to benefit from AAP support, producers are required to finance approximately
(depending on the subprogramme) one third of the total cost of the project involved;  the Federal and
State Governments each cover another third of the cost. The criteria for granting payments depend on
the rules of operation of each sub-programme.  The budget of the AAP is established annually in theFederal Expenditure Budget, subject to legislative approval and published in the Official Journal of
the Federation.  The rules of operation of the sub-prog rammes also appear in the Official Journal (at
www.gobernacion.gob.mx ).
Broadly speaking, the AAP sub-programmes come under three main programme headings:
- Programmes for the promotion of agriculture.   These are intended to promote the
competitiveness of agriculture and the adoption of production systems suited to each of
the country's agricultural regions.  They include inter alia  the Ferti-irrigation, "Kilo-
for-Kilo" and Mechanization sub-programmes.
- Livestock promotion programmes.   These are aimed at supporting animal production
by speeding up the adoption of technology by producers, by promoting the integration
and development of production sources and by strengthening the production-
processing-marketing chain.  The main sub-programmes include the Creation of
Prairies, Livestock Improvement and Genetic Improvement.
- Rural development programmes.   Their objective is to foster greater economic and
social equity in rural areas, by promoting a sustainable rise in production levels in the
agricultural sector and by contributing to the reduction of rural poverty.  These
programmes are implemented under differentiated policies aimed at assisting
transitional and subsistence producers in Mexico's most marginalized municipalities(according to the classification of the National Population Council (CONAPO)), which
have limited access to technology, markets and funding, and lack the capacities for
production management and organization.  Th e main sub-programmes include Rural
Equipment, the Elementary Programme of Technical Assistance, Transfer of
Technology, Training and Extension Activities, and Sustainable Development ofDisadvantaged Rural Areas.
These sub-programmes are further described below.G/AG/R/27
Page 41
Brief Description of the Main Alliance for Agriculture Sub-Programmes
Sub-programmes Objectives
Promotion of Agriculture
Ferti-irrigation To increase productivity in agricultural irrigation areas by implementing
projects using irrigation and fertilization systems that allow a more efficientuse of water, energy and fertilizers.
Mechanization To facilitate and promote the purchase of agricultural implements in order
to increase production efficiency, reduce soil degradation and improve
producers' incomes.
"Kilo-for-kilo" To foster technological change so as to increase yields and productivity by
substituting improved seed for traditional seed.
Livestock Promotion
Creation of prairies To support activities aimed at increasing the availability of forage per unit
area and at modernizing and introducing the use of technology in theproduction infrastructure, so as to ensure better management of production
units.
Livestock improvement To promote the breeding of cattle of prime genetic quality and the use of
breeding stock in commercial cross-breeding programmes.
Genetic improvement To promote herd repopulation in order to increase stocks and improve
production, by introducing mainly imported animals of good geneticquality.
Rural Development
Rural equipment To contribute to the capitali zation of transitional producers by supporting
the use of appropriate technologies and the development of sustainableproduction processes.
Transfer of technology To help producers take a mo re active part in deciding what kind of research
needs to be developed in order to resolve their main technical problems;  to
promote an increase in unit yields and a reduction of costs per product unitso as to raise producers' incomes.
Elementary programmeof technical assistanceTo promote the application of technologies suited to conditions in
agricultural areas with production potential;  to spread awareness oftechnologies validated by research and teaching institutions; and toguarantee high-quality technical support and training in technological
development.
Training and expansion To strengthen local capacities and facilities for training and expansion, in
support of technological development in rural areas.
Sustainable developmentof disadvantaged ruralareasTo raise nutritional, income and occupational levels in farming areas, by
developing production systems based on the appropriate use of naturalresources, by fostering the integration of women in productive activitiesand by promoting the diversification of economic activity in order to
increase local work and employment opportunities.G/AG/R/27
Page 42
To facilitate the notification of Mexico's Green Box measures (as set out in G/AG/N/MEX/7),
the classification of AAP support basically followed  the provisions of paragraphs 11 (structural
adjustment assistance provided through investment aids) and 13 (payments under regional assistance
programmes) of Annex 2, since:
- The eligibility criteria are clearly defined according to the structural disadvantages
suffered by producers;
- the amount of support payments is not related to production or current prices;- payments are given only for the period necessary for the realization of the investment in
respect of which they are provided and do not mandate the agricultural products to beproduced by the recipients;
- eligibility for payments is not conditional, a priori, upon any type of production.G/AG/R/27
Page 43
Attachment no. 6
G/AG/N/MEX/6 – Budget  Table for the Alliance for Agriculture Programme, 1996-1998
(Thousand pesos)
1996 1997 1998
Total % Total % Total %
MINISTRY OF AGRICULTURE ,
LIVESTOCK , RURAL DEVELOPMENT ,
FISHERIES AND FOOD (SAGARPA)1,880,236.0 100.0 2,669,519.4 91.5 3,010,315.7 85.7
Agriculture programmes 634,550.0 33.7 842,398.9 28.9 1,010,057.3 28.8
Ferti-irrigation 324,908.5 17.3 333,337.8 11.4 348,466.8 9.9
Introduction of agricultural technology 0.0 0.0 17,946.7 0.5
Mechanization 209,102.6 11.1 245,850.4 8.4 200,981.8 5.7
Other agriculture programmes 100,5389 5.3 263,210.7 9.0 442,662.0 12.6
Livestock programmes 450,185.7 23.9 610,770.4 20.9 568,283.6 16.2
Creation of prairies 152,544.7 8.1 239,628.8 8.2 187,490.2 5.3
Milk programme 112,340.6 6.0 113,495.9 3.9 111,321.7 3.2
Livestock Improvement 96,925.3 5.2 144,998.1 5.0 138,673.5 3.9
Genetic improvement 70,028.0 3.7 80,105.6 2.7 61,640.3 1.8
Other livestock programmes 18,347.1 1.0 32,542.0 1.1 69,157.8 2.0
Farm programmes 150,997.2 8.0 175,403.2 6.0 184,315.3 5.2
Transfer of technology 126,476.2 6.7 132,996.2 4.6 150,829.8 4.3
Information on agriculture 4,521.0 0.2 22,417.7 0.8 22,458.0 0.6
Other farm programmes 20,000.0 1.1 19,989.3 0.7 11,027.5 0.3
Rural development programmes 488,741.5 26.0 805,650.9 27.6 970,782.4 27.6
Support for rural development 238,116.7 12.7 360,350.0 12.3 383,778.6 10.9
Training and expansion 91,507.4 4.9 113,061.2 3.9 142,939.4 4.1
Coffee programme 135,206.0 7.2 128,670.0 4.4 199,322.8 5.7
Comprehensive development of
disadvantaged rural areas0.0 0.0 41,530.1 1.4 56,153.6 1.6
Elementary programme of technical
assistance0.0 0.0 127,781.1 4.4 136,556.2 3.9
Other rural development programmes 23,911.4 1.3 34,258.5 1.2 52,031.9 1.5
Animal/plant health programmes 155,761.6 8.3 235,296.2 8.1 276,877.1 7.9
Animal health 72,219.6 3.8 111,568.5 3.8 147,607.9 4.2
Plant health 83,542.0 4.4 122,727.7 4.2 128,219.2 3.7
Quarantine control 0.0 1,000.0 0.0 1,050.0 0.0
PROGRAMMES IMPLEMENTED BY THE
NATIONAL WATER BOARD (CNA)0.0 0.0 248,943.1 8.5 502,399.4 14.3
TOTAL 1,880,236.0 100.0 2,918,462.7 100.0 3,512,715.1 100.0
Source:  Sixth Report of the Ernesto Zedillo Government, 2000.
__________