The Hagstrom Report

Agriculture News As It Happens


WTO allows developing countries to hold food

The World Trade Organization General Council on Wednesday approved measures to enable full implementation of the Trade Facilitation Agreement by allowing developing countries to continue to hold stocks of food.

An agreement was reached in Bali, Indonesia, last December that was supposed to allow changes to border and customs procedures to move forward, but India and a few other developing countries refused to go along with it unless they had guarantees that they could continue public stockholding of foods, which they maintain are necessary to maintain food security and help their farmers.

U.S. Trade Representative Michael Froman said in a news release Thursday that the approach agreed upon by the United States and India and adopted by the General Council included “adoption of a protocol enabling full implementation of the TFA; a decision on public stockholding for food security, clarifying that a “peace clause” against legal challenges to certain public stockholding programs will continue until a permanent solution on such programs is agreed and adopted; and a decision to extend until July 2015 the deadline for developing a work program covering all remaining issues in the Doha Round of negotiations.”

In the news release, Froman said the Trade Facilitation Agreement is “the first multilateral trade agreement in the WTO’s 20-year history” — a reference to the fact that since the General Agreement on Tariffs and Trade (GATT) was transformed into the WTO in 1995, no multilateral round of negotiations has been completed.

The Doha Development Round was launched in 2001, but has not been finished.

“The Trade Facilitation Agreement has the potential to fundamentally reform global customs practices and substantially reduce the costs and time associated with goods crossing borders,” Froman said. “It’s a perfect example of how breaking down barriers to trade can unlock new opportunities for developed and developing countries alike, and it's a particularly important win for small and businesses in all countries.”

“With this win under the WTO’s belt, we can once again focus our efforts on revitalizing the organization’s core negotiating functions,” he added.

Darci Vetter, the U.S. chief agricultural trade negotiator, said recently that the Trade Facilitation Agreement could be particularly helpful to agriculture because it would speed up border procedures for agricultural goods that could spoil if they do not reach their customers quickly.