21 December 2000

Export Restrictions and Taxes

Argentina, Australia, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Paraguay, Philippines, South Africa, Thailand and Uruguay submit the following proposal which deals with export restrictions and taxes in the WTO negotiations.
 

Background

Food security is of concern to many Members, but especially least developed and net food-importing developing country Members. These concerns and the impact that export restrictions on foodstuffs can have on food security are reflected in Article 12 of the Agreement on Agriculture. When such restrictions or taxes are used to limit exports of agricultural products, they raise concerns about whether the international market place can be relied upon to meet essential food and feed requirements. Tighter disciplines on export restrictions and taxes would contribute to assuring Members about their ability to access food and feedstuffs in world markets.

Tariff escalation in third markets hinders the capacity of exporting countries to develop processing industries. In particular it prevents developing countries from adding value to their exports. As a response to tariff escalation in third markets, some developing countries have taken recourse to restricting or taxing their raw material exports. Further substantial agricultural liberalization, including the elimination of tariff escalation, would therefore contribute to developing more effective disciplines on export restrictions and taxes. 

Overall, an effective multilateral trading system contributes to food security through improved resource allocation, the removal of barriers to production for domestic and export markets, increased numbers of potential suppliers, higher income levels and improved stability of price and supply. An important part of ensuring an effective trading system is appropriate disciplines on export restrictions and taxes. This would be consistent with the objective of creating a fair and market-oriented agriculture trading system and would promote economic development in developing country WTO Members.
 

Proposal

With a view to providing increased certainty of supply for food importing countries, in particular least developed and net food-importing developing country Members, and better opportunities for developing countries to develop processing industries, the Cairns Group proposes that the agriculture negotiations should:

· develop both improved disciplines on export restrictions and taxes and eliminate tariff escalation; and

· preserve Article 12.2 of the Agreement on Agriculture and provide additional special and differential treatment provisions to address the legitimate needs of developing countries, including least developed and net food-importing developing countries.

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^* This document cancels and replaces document G/AG/NG/W/93, dated 21 December 2000, in English only.