A Quantitative Analysis of Proposals on Domestic Support in WTO Agriculture Negotiations: Need for Reaffirming the Development Agenda

Abstract

Disciplining domestic support to agriculture remains an unfinished agenda in the WTO negotiations due to the different views and positions of members. Developing members have been consistently demanding an effective special and differential treatment (S&DT) for themselves, along with a substantial reduction in the trade-distorting support entitlement of developed members. However, members have failed to reach a consensus on different aspects, especially coverage and approaches to determine an overall trade-distorting support (OTDS) limit. In this context, this study quantifies and critically examines the implications of various proposals on the policy space to provide trade-distorting support based on floating and fixed reference period models. It estimates trade-distorting entitlements of 9 developed and 16 developing members under the Agreement on Agriculture (AoA) as well as the selected proposals for the years 2020 and 2030. These entitlements have been computed in monetary limits, percentage of the value of production, and on per farmer basis. Results show that many proposals have failed to deliver the effective S&DT, as developing members generally have to undertake higher cuts than developed members, highlighting the asymmetries in negotiations. The study will be useful for members to take an informed position in the agriculture negotiations on domestic support.