RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/SAU/1/Rev.4/Add.1 
6 October 2000 
 (00-4106) 
Working Party on the Accession 
of the Kingdom of Saudi Arabia Original:   English 
 
 
ACCESSION OF THE KINGDOM OF SAUDI ARABIA 
 
Communication from the Kingdom of Saudi Arabia  
 
Domestic Support and Export Subsidies  
 
Addendum  
 
Questions and Replies 
  
 The Ministry of Commerce of the Kingdom of Saudi Arabia has submitted replies to 
questions raised with specific regard to WT/A CC/SPEC/SAU/1/Rev.4 and Corr.1 (Domestic Support 
and Export Subsidies) with the request that they be circulated to members of the Working Party.  
 
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 Question 1.   
Supporting Table DS:1 - Can the Kingdom of Saudi  Arabia please provide the total value of 
production for each product receiving specific s upport and verify the de minimis of categories 
excluded. 
Answer
: 
Please note that this question is related to Sup porting Table DS:4 and not to Supporting Table 
DS:1.  The total value of production for each produc t receiving specific support (wheat, barley, and 
dates) is as follows: 
 Years Value of Product 
(Million Saudi Riyals) 
1995 2,348.93 
1996 1,829.49 
1997 2,690.16 Wheat 
Average 2,289.53 
1995 745.11 
1996 460.75 
1997 314.57 Barley 
Average 506.81 
1995 2,061 
1996 2,103 
1997 2,271 Dates 
Average 2,145 WT/ACC/SPEC/SAU/1/Rev.4/Add.1 
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Verification of the de minimis of categories excluded, shows that support of dates (23.63 
million Saudi Riyals) and palm trees (5.36 million Saudi Riyals) represent respectively 1.1 per cent 
and 0.2 per cent of the value of dates production. 
Question 2.   
Supporting Table DS:2 - Can the Kingdom of Sa udi Arabia please explain how the "public 
stockholding for food security purposes" policy opera tes?  For example, at what price does the 
government purchase the grains and then at what price do they sell the grains for? 
Answer
: 
Please note that this question is related to Sup porting Table DS:1 and not to Supporting Table 
DS:2.  Saudi Arabia has a suitable stockholding target  to cover its consumption of wheat.  Stock held 
wheat is purchased at administered prices, which ar e the market producers prices.  The amount shown 
in Supporting Table DS:1 reflects the cost  of storing wheat held for food security. 
Question 3.   
Supporting Table DS:6 - Can Saudi Arabia please explain on what basis the subsidies to dates 
are paid and how does the policy operate? 
Answer : 
The subsidies to dates are paid on the basi s of the actual production.  Each year, the 
government determines the total production of dates and a subsidy of 0.25 Riyals per Kg is given to 
the producers. 
Question 4.   
Export Subsidies - We note that according to the FAO Trade Yearbook, Saudi Arabia exported 
significant volumes of wheat and wheat flour in 1994 and 1995 (98 thousand and 60 thousand tonnes respectively).  Given the high interventi on price for domestically produced wheat in 
Saudi Arabia, how did these exports take place? 
Answer
: 
The volumes of wheat and wheat flour exports in 1995 shown in the FAO Trade Yearbook 
were for previous sales contracts, and were exec uted in 1995.  Accordingly, Saudi Arabia has 
included Supporting Table ES:1 in its recent revi sed WT/ACC/4 notification, and completed it by 
including the statement "Nil".   
Question 5.   
We appreciate the efforts made by Saudi Arabia to update the domestic support calculations to 
the 1995 - 1997 time period.  This more recent time period is an important contribution to the 
discussions on agricultural supports. 
We noticed with interest that Sa udi Arabia now reports "nil" in tables on export subsidies.  Are 
we correct in assuming this means Saudi Arabia will commit to forgoing all uses of agricultural 
export subsidies as part of its accession package?  WT/ACC/SPEC/SAU/1/Rev.4/Add.1 
 Page 3 
 
 
 Answer : 
Saudi Arabia has included Supporting Tabl e ES:1 in its recent revised WT/ACC/4 
notification, and completed by including the stat ement "Nil".  This means that, upon accession to the 
WTO, Saudi Arabia will commit not to provide ag ricultural export subsidies otherwise than in 
conformity with the Agreement on Agriculture. 
Question 6.   
We noticed that Saudi Arabia continues to pr esent its commitments in US dollars rather than 
national currency.  Saudi Arabia should present its commitments in national currency. 
Answer : 
Saudi Arabia will be presenting its commitme nts in national currency (Saudi Riyals). 
Question 7.   
Can Saudi Arabia confirm that expenditures listed under "infrastructural services" in 
Supporting Table DS:1 (do not include subsidies to  inputs or operating costs, or preferential 
user charges)? 
Answer : 
Saudi Arabia confirms that expenditures listed under "infrastructural services" in Supporting 
Table DS:1 do not include subsidies to inputs or operating costs, or preferential user charges. 
Question 8.   
Our understanding is that the applied administer ed prices used in the DS:5 for wheat are the 
prices set by GSFMO.  Yet, in Supporting Table DS:1, Saudi Arabia includes the activities of 
GSFMO under the category public stockholding for food security purposes.  Could Saudi 
Arabia explain how the public stockholding and food security program is administered by 
GSFMO and how this is consistent with the criteria of paragraph 3 of Annex 2. 
Answer : 
Saudi Arabia has a suitable stockholding target to cover its consumption of  wheat.  Stock held 
wheat is purchased at administered prices, which ar e the market producers prices.  The amount shown 
in Supporting Table DS:1 reflects the cost  of storing wheat held for food security. 
Question 9.   
In Supporting Table DS:4, Saudi Arabia indicat es that product-specific support to dates and 
palm trees, as well as non-product specific suppo rt, is de minimis.  Could Saudi Arabia please 
provide the value of production for all commodities listed in Supporting Table DS:4 to demonstrate this calculation. 
Answer
: 
Total value of production for each product r eceiving specific support (wheat, barley and 
dates) is as follows: WT/ACC/SPEC/SAU/1/Rev.4/Add.1 
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 Years Value of Product 
(Million Saudi Riyals) 
1995 2,348.93 
1996 1,829.49 
1997 2,690.16 Wheat 
Average 2,289.53 
1995 745.11 
1996 460.75 
1997 314.57 Barley 
Average 506.81 
1995 2,061 
1996 2,103 
1997 2,271 Dates 
Average 2,145 
 
Calculation shows that support of dates (23.63 million Saudi Riyals) and palm trees (5.36 
million Saudi Riyals) represent respectively 1.1 pe r cent and 0.2 per cent of the value of dates 
production and therefore are excluded on the de minimis basis. 
Question 10.   
We noticed that the updated calculations of suppo rt in 1995 are higher for wheat than the levels 
reported in WT/ACC/SPEC/SAU/1/Rev.3  For wheat, the external reference price in 1995 in the 
current document is lower than the price reported in the Rev.3 document, yet the data is reported as "cif Jeddah" in both documents.  Could Saudi Arabia explain why this price has 
changed? 
Answer
: 
There have been no wheat imports into Saudi Arabia during the reporting period.  However, 
data are reported "cif Jeddah" as it is suggested by the Agreement on Agriculture.  During the period 
1993-1995, the reference price for wheat is calculated by averaging monthly world prices (Monthly commodity price bulletin of the UN, volume XV. No. 12, December 1995).  For the other period 1995-1997, the reference prices are determined as a sum of (export price, FOB US Gulf Ports) and 
Ocean Freight to Alexandria and estimated freight  from Alexandria to Jeddah (Food Outlook of the 
FAO, No. 1, February 1999). 
Question 11.   
For purposes of transparency, in Supporting Table DS:7 please reference the type of program 
in place for dates and palm trees (the measure na me is sufficient).  Technically, supporting table 
DS:7 should sum up all product-specific support  listed in Supporting Tables DS:5, DS:6 and  
DS:7, so that data and information from Supportin g Tables DS:5 and DS:6 should be copied to 
Supporting Table DS:7. 
Answer
: 
The support for palm trees is equal to Saudi Riyals (SR) 50 per palm tree subject to a 
minimum of 30 trees at certain planting conditions.  Th e subsidies to dates are paid on the basis of the 
actual production.  Each year, the government dete rmines the total production of dates and a subsidy  WT/ACC/SPEC/SAU/1/Rev.4/Add.1 
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 of 0.25 Riyal per Kg is given to the producers.  Supporting Table DS:4 shows that all product-specific 
support listed in Supporting Tables DS:5, DS:6  and DS:7 is taken into consideration. 
Also on DS:7, we noticed the change in methodology for the livestock feed subsidy which is 
an improvement. 
Question 12.   
In Supporting Table DS:9, does the data for agric ultural subsidies and fuel represent actual 
budgetary outlays or are they calculated?  If th ey are calculated, is it possible to provide 
calculation details?  How does the fuel subsidy operate? 
Answer : 
The data for agricultural subsidies represents actu al budgetary outlays.  However, the data for 
fuel is calculated on the basis of the estimated quan tity of fuel used in the agricultural sector times the 
difference between the domestic sales fuel price of 0.37 SR and the world fuel price. 
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