Deepening Our Understanding of the New International Trade Environment: Discussion

Abstract

International trade continues to be an important topic for the U.S. agricult~ual sector and its economic well-being, especially with the launching of a new round of negotiations following the World Trade 01-ganization (WTO) meeting in Doha. Agricultural issues are a prominent and controversial part of the new Doha round, as they became in the UI-uguay round when agriculture was included in a prominent way for the first time. In addition, the North American Free Trade Agreement (NAFTA). negotiations for the Free Trade Area of the Americas, the U.S.-Chile agreement, and other trade agreements have had or will have major impacts on agriculture. Thus, a better understanding of international problems, issues, and policies is essential for the sector and for development of domestic sector policies and programs, including agricultural legislation being developed to replace the I996 Federal Agricultural Improvement and Reform (FAIR) Act. Inter-national trade issues are important factors that affect legislative action. but international trade provisions, especially those of the WTO, are constraints that limit the scope of policies with respect to domestic subsidies, export subsidies, etc. The papers in this session contribute to a better uriderstanding of the complex and interrelated issues of domestic and foreign agricultural polices. They address three crucial aspects of trade and agriculture: (1) globalization and its effects on competitiveness. (2) foreign direct investment versus trade. and (3) exchange rate impacts on agricult~~ral tracie. They also indicate that these issues and problems are cotnplex. with varied. complex, and multidimensional options that cannot be easily resolved. There are several important topics that cannot be covered adequately in a single session. These include the environment, dornestic subsidies, export subsidies. and multifunctionality. Some of these issues are discussed in other sessions of these meetings.