JOB/AG/171  
 
22 November 2019  
(19-7987) Page: 1/3 
Committee on Agriculture  
Special Session  Original: English  
 
HIGHER AND HIGHER – GROWTH IN DOMESTIC SU PPORT ENTITLEMENTS S INCE 2001  
SUBMISSION FROM AUSTRALIA AND NEW ZE ALAND  
The following submission, dated 2 2 November 2019, is being circulated at the request of the 
delegation s of Australia  and New Zealand . 
 
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1.1.  In November 2017, Australia, Canada, Chile, Colombia, Mexico, New Zealand, Thailand and 
Uruguay circulated a room document (RD/AG/63) ill ustrating the rising tide of domestic support 
entitlements of major agricultural producers. This paper extends the analysis to capture trade -
distorting domestic support entitlements (Article s 6.3 and 6.4) available to all WTO Members up 
until 2030. This pa per does not include currently uncapped trade -distorting support under 
Article s 6.2 and 6.5.  
1.2.  Since 2001, the growth in total trade -distorting domestic support entitlements for all WTO 
Members – measured by AMS and de minimis – has more than doubled from US D322 billion to 
approximately US D740 billion in 2016. If this trend continues, driven by growing values of 
production, the entitlements of WTO Members under AMS and de minimis  could reach approximately 
USD2 trillion by 2030 (see Figure 1).   
Figure 1 : Total trade -distorting domestic support entitlements  (all WTO Members)  
 
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  1.3.  Domestic support entitlements are highly skewed to the largest agricultural producers, with 
the entitlements available to the top ten WTO Members approximately 80 % of the entitlements  of 
the entire WTO Membership. Figure 2 compares the growth in AMS and de minimis  entitlements for 
the top ten WTO Members with the rest of the WTO Membership. From 2001 to 2016, entitlements 
available to the top ten WTO Members increased from US D285 billi on to approximately 
USD590 billion. Over the same period, entitlements available to the rest of the WTO Membership 
increased from US D75 billion to US D150 billion. If these trends continue, entitlements available to 
the top ten WTO Members will exceed US D1 trillion by 2024 and will reach US D1.68 trillion by 2030.  
Figure 2 : Total trade -distorting domestic support entitlements  (Top ten WTO Members 
(2016) vs. Rest of the Membership)  
 
Conclusions  
1.4.  The domestic support commitments in Article 6 of the Agreement on Agriculture created a 
discipline to reduce subsidies and other forms of support for agricultural producers. In addition, 
another objective was to leave policy space for governments to design  agricultural policies to deal 
with country -specific circumstances. However, the exponential growth in entitlements over the past 
15 years is undermining key tenets of the Agreement.  
1.5.  We can make three observations from this analysis:  
• It is vital that ove rall global domestic support entitlements are capped and reduced, to 
reassure farmers that billions of dollars of potential subsidies are not able disrupt global 
agricultural markets.   
• To make any substantive reduction in excessive global trade -distorting support entitlements, 
contributions by individual Members will need to be proportionate to the size of those Members 
current and future entitlements.  
• The above measured entitlements do not even include  the currently uncapped forms of 
support und er Article 6 of the Agreement on Agriculture, so it is vital that we consider new 
disciplines that would incorporate all forms of trade -distorting support.  
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  Technical note  
1.6.  This analysis is based on the AMS and de minimis  limits of all WTO Members based on t he level 
of 2016 entitlements. The top ten holders of entitlements in 2016 were determined to be the 
following: China, the European Union, India, United States, Japan, Brazil, Indonesia, the Russia n 
Federation , Turkey, and Mexico.  
1.7.  AMS entitlements are cal culated based on the 2019 US dollar equivalent ( USDA data ) of the 
Final Bound Total AMS for each of the Members. De minimis  entitlements are calculated based on 
the Value of Production ( FAOSTAT data – Gross Agricultural Production Value, current US D) of ea ch 
Member multiplied by their Product -Specific and Non -Product Specific de minimis  entitlements.  
1.8.  Other forms of Article 6 support – production limiting subsidies under the Blue Box, and input 
and other forms of subsidies under Article 6.2 – are not includ ed in the analysis given they are 
currently uncapped.  
1.9.  The growth rate of  de minimis  entitlements is based on the compound annual growth rate from 
2001 to 2016.   
 
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