WORLD TRADE
ORGANIZATIONG/AG/NG/W/122
21 February 2001
(01-0884)
Committee on Agriculture
Special SessionOriginal:  English
FIFTH SPECIAL SESSION OF THE COMMITTEE ON AGRICULTURE
5-7 FEBRUARY 2001
Statements by the Philippines
G/AG/NG/W/90 (Proposal by the EC)
The Philippines welcomes the EC's submission of its comprehensive negotiating proposal on
agriculture.  Based on our preliminary reading of  the EC's proposal, we sense some signals on the
right step towards the objective of the reform proce ss.  However, in our view, the proposal in general
still has very modest ambitions and leaves unchanged many of the elements in the present Agreement
that are important distortions in trade in agricultur e.  Because of its too modest ambition, the proposed
reforms would neither bring about efficiency gains in  agricultural trade, nor effectively advance the
objective of achieving a fair and market oriented trade in agriculture.
For instance, on market access, the EC's proposal to replicate the approach in the UR would
pose a lot of problem.  It would, once more, allow countries to implement deep cuts on less significant
commodities, while effecting minimum reductions on sensitive items.  The EC's proposal also fails to
address the problem of tariff peaks and tariff escalation, as applied in particular by developed
countries to products of interest to developing countries.
Consistent with our intervention on the EC's earlier proposal on export competition, we
support the suggestion that the negotiations cover this area in a comprehensive manner.  As such, the
commitment taken in the UR to introduce disciplines on export credits must be respected.  Moreover,
the negotiations should satisfactorily address other forms of export assistance such as food aid, and
single desk exporters.
In this light, we strongly share the EC's concern that food aid should not damage the local
production and marketing capacities of developing countries.  We would, however, wish to stress that
this concern is not confined only in the context of food aid, but with respect to all forms of support for
exports, including and more importantly in the application of export subsidies which remains the
single most trade-distorting measure.  Thus, while we welcome the EC's objective to achieve a levelplaying field in export competition, we are also seriously concerned that the EC's approach to link
export subsidies and put it in equal footing to the other measures of support for export, may be
counter-productive to such objective.
The objective to achieve level playing field is sadly lacking in the EC's proposal on domestic
support.  As the ASEAN proposal has emphasized, the agreement on domestic support has resulted in
major imbalances in the obligations and commitments between developed and developing countries.
ASEAN therefore deems it imperative that the negotiations rectify and not allow those inequities to
persist.
In particular, the Philippines notes with deep concern the tendency in the EC's proposal to
treat the Green Box and Blue Box in the same status.G/AG/NG/W/122
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In line with ASEAN's proposal, we support the call for the careful review of the Green Box
criteria, with the view of ensuring that the composition and instruments allowed under this category
are non-trade distorting. Measures that are not totally trade-neutral should be eliminated and
prohibited from this category.
With regard to non-trade concerns, it seems somewhat reassuring that the EC's proposal
suggests that these objectives should be dealt with through measures that are targeted, transparent and
minimally or non-trade distorting.  Given these crit eria, it would seem that these objectives would be
appropriately addressed under the Green Box, as in deed paragraph 13 of the EC's proposal indicates.
On special and differential treatment, we note with great interest, and indeed support, the EC's
proposal with respect to the need to render trade preferences stable and predictable in order toenhance further investments in, and support the development of the agriculture and agri-food sectors
of developing countries.  But to this we wish to add that a meaningful objective to increase the
economic welfare of developing countries could only be realized through adherence to the principles
of non-discrimination and reciprocity.  It is in light of this objective that ASEAN has proposed
bringing the GSP scheme into the fold of the agriculture negotiations.
Finally we appreciate the EC's recognition of the great importance of food security to
developing countries, as a means of poverty allevi ation.  We do not share, however, the EC's view that
this could be adequately addressed within the Green Box.  For as has been emphasized in the debates
on multifunctionality, the non-trade concerns of developing countries, such as food security andpoverty alleviation, are different and should not be treated in the same manner as the non-trade
concerns of developed countries.  The suggestion to subject food security under the umbrella of the
Green Box would limit rather than provide the flexibility necessary to achieve this goal.  In fact,
bearing in mind the criteria for the Green Box, such prescription would appear more restrictive than
the current provisions available for developing countries to achieve this crucial goal.
We would like to end by thanking the EC for its proposal and we look forward to a more
meaningful engagement by the EU in the negotiations.
G/AG/NG/W/102  (Proposal by India)
The Philippines welcomes with appreciation the proposals put forward by India.  To our
mind, India's submission establishes a clear assessment of the situation and problems confronting
developing countries, and puts forward concrete proposals that are meant to address these concerns.
It is instructive to recall the problems which the Agreement on Agriculture was called upon to
address.  The main problem was the prevalence of production and trade distorting policies in
developed countries which brought about huge surpluses in the agricultural market.  By and large,
developing countries were in the opposite situation, producing below their needs and potential often
as a result of disincentive.  Under the present agreement, developing countries have subscribed to
several measures which address the problems which they did not have.
In the area of export subsidies and domestic support, developed countries have legitimized
their production and trade distorting support and subsidies, while developing have neither the right
nor ability to use those measures.
Developing countries are disappointed by the lack of progress in market access.  Their exports
remain largely on primary products and very little on high value/processed commodities.  The existing
of tariff peaks, tariff escalation and problems on tariff rate quotas are reasons for developing
countries' frustrations on market access.G/AG/NG/W/122
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These fundamental flaws in the agreement should be addressed during this round of
negotiations.  We believe that many of the elements in the Indian proposal are geared towards
correcting these imbalances and are worthy of serious consideration.  Allow us to comment on the
specific aspects of the Indian proposals:
1. We fully endorse the proposal by India that all items in Annex 2 of the AoA that are relevant
tools to food security objectives of developing countries should be retained.   The Green Box
contains a number of policy instruments, such as those cited by India, which while probably
less trade distorting than price support still encourages an expansion of output.  Such policies
should therefore be deleted under this category.  These measures must moreover be immune
from countervailing measures.
2. We also agree with the proposal that measures which form an integral part of the development
programmes of developing countries including those in Annex 2, must be exempt from
reduction commitments.  Such measures must also not be limited to low-income resource
poor producers because such distinction is irrelevant in the context of a developing country'sagricultural sector.
3. We also concur with the need to provide flexibility to developing countries in the manner of
providing subsidies to key farm inputs.
4. We support the proposal that total domestic support of developed countries should be brought
down to de minimis  level within an agreed date.  In addition, we propose that de minimis
should not be allowed for as long as developed countries continue to enjoy trade-distorting
support (AMS).
5. On market access, developing countries should be provided flexibility in scheduling their
commitments including recourse to special safegu ards, in light of the fact that subsidization
would persist even after the negotiations.  It is in this light that it may also be said that market
access commitments by developing countries should be inversely proportional to the outcome
of commitments by developed countries in support and subsidies.
6. On minimum access, we believe that developing countries should not be required to open
their markets to products of developed countries which continue to benefit from trade-
distorting domestic support and export subsidies.
Again, we thank the delegation of India for it s submission and we look forward to more
fruitful exchanges with them on these issue in the course of the negotiations.
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