18 - Environmental considerations in agricultural negotiations in the new WTO round

Summary

Introduction

The history of agricultural trade is well known. Articles XI and XVI of the GATT allowed countries to use both export subsidies and quota-based import restrictions to support farm incomes. The 1955 open-ended waiver granted to the United States effectively allowed that country to use any form of trade-restricting measures in agriculture. The terms of Switzerland's 1956 accession, which were similar to the US waiver, and the 1957 European Community Treaty of Rome with its Common Agricultural Policy (CAP) and variable levies, further contributed to undisciplined interventions in agricultural trade.

This lack of discipline allowed trade distortions to grow, as countries moved from net-importer to net-exporter status in key products and competition to provide subsidies to exporters intensified. Attempts to discipline these practices during the Kennedy and Tokyo Rounds for all intents and purposes failed, despite declarations of intent at the launch of each round. The Uruguay Round – driven by agricultural exporters' concerns over their lack of market access, budget concerns over the cost of domestic support programs, and fears of unbridled competition among export subsidizers – injected novel international discipline into the sector. The chosen route was not to unwind all previous departures from GATT/WTO principles but to develop a new structure of restraints that could be progressively tightened to further liberalize trade.

Environmental considerations entered little into these decisions.