Main policy areas
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Remarks
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Tariff quota administration
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- TRQs are applied by a number of countries (including the Czech Republic,
Poland, the Republic of Korea, Thailand, and the United States) where,
in general, they tend to restrict trade. Furthermore, in some cases,
problems in the administration of the quotas contributed to quotas not
being filled fully. In China, where TRQs will be introduced for the
first time in 2002, the quotas are expected to create new, very important
market access opportunities especially with regard to vegetable oils;
- Restrictive or insufficiently transparent administration methods
have been reported for some countries (preferential allocation to/by
state trading enterprises).
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Tariffs
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- During the last few years, several developing countries tended to
increase border protection (mainly by raising tariffs) in an effort
to shield domestic industries from international competition - which
started increasing in 1998, when international market prices commenced
a marked and steady decline. Furthermore, several governments increasingly
relied on import control measures as a complement to production policies
since less intensive use was being made of price guarantee schemes,
government procurement and other forms of direct market intervention.
Tariffs were applied in conformity with individual countries WTO
commitments. In some instances, countries raised tariffs, for the first
time, to levels close to the (relatively high) bound rates;
- However, in a number of countries, particularly developed ones, import
tariffs have been lowered (or import restrictions reduced) in pursuance
of a number of different objectives, including (a) honouring tariff
reduction commitments made under URAA or regional trade agreements;
(b) ensuring adequate domestic supplies and protecting consumers from
high prices; (c) improving access of crushers to imported raw materials;
and (d) continuation of general trade liberalization reforms;
- Tariff escalation is widely used as numerous countries try to promote
domestic crushing or refining industries with a view to reduce import
bills and promote domestic value addition;
- With regard to policy options currently under discussions at WTO,
the cocktail approach and reductions from applied rates
are likely to have the strongest impact on the sector;
- Convergence to ad valorem tariffs: should have a positive impact
as, currently, many complex duties are applied at the expense of transparency;
- Tariffs applied by developed countries generally do not overly penalise
developing countries; developing countries can be expected to resist
further tariff reductions unless domestic support and export subsidies
provided in developed countries are also reduced; developing country
import policies generally aim at enabling the sector to fully develop
its production and processing potential; developing countries could
benefit from improved market access (reduced tariff escalation) for
processed oilseed products.
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Amber box
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- Some developing country producers/exporters strongly criticise trade
distorting domestic support in developed countries where (relatively
high-cost) production and exports expanded, aided by support measures;
- Support provided in developing countries is traditionally low (due
to general liberalisation reforms, financial constraints etc.) and not
affected by reduction commitments; mostly ad hoc intervention in domestic
markets;
- Developed countries can be expected to insist on the framework of
the amber, green, blue boxes as well as on the non-trade distorting
character of certain measures.
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Export subsidies
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- Direct export subsidies/refunds are only used in a few countries;
- Indirect forms of export subsidy are used in a number of countries
(developed and developing; systematically and ad hoc): insurance and
guarantee programmes; export credit, etc;
- Possible abuse of food aid (vegetable oils and meals) is an issue;
- Reduction or elimination of export subsidies is not expected to create
particular difficulties in net food-importing developing countries.
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State trading enterprises
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- Most STEs in the sector are dealing with imports;
- While still operating in selected countries (in particular China),
STE interference in the sector has been progressively scaled back over
recent years and is expected to continue diminishing.
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Export restrictions and prohibitions
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- Used in a variety of developing countries and economies in transition,
though mainly in a temporary manner;
- In the sector, the need to assist the development of processed product
industries in developing countries is real and could justify the use
of such measures in those countries.
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Food security
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- Oilcrop-specific support and protection of subsistence farmers has
weakened over past years relative to other sectors, mainly due to cuts
in public spending; it has also lost its effectiveness due to increased
attractiveness of imports (following the fall in world prices);
- Consumption policies (in developing countries): ad hoc market intervention
continues to be used in several countries; but systematic subsidisation
is being phased out as governments tend to redirect their attention
to regulatory tasks;
- Developing countries: faced with rising import dependence, several
countries have stepped up their efforts to shield domestic industries
from international competition; most countries resorted to tariff measures;
temporary export restrictions are applied by some countries.
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Food safety
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- Concerns relate to contamination, toxic residues and adulteration
of edible oils, as well as GMO traceability in oils and meals; these
issues are much debated and of increasing concern to policy makers and
legislators in both developed and developing countries;
- Precautionary principle adopted by some developed countries
has come under attack by trading partners.
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Rural development
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- Of significance for developing and transition countries in the area
of non-trade concerns;
- Direct relationship between rural development and food security/rural
poverty concerns in developing countries with large numbers of small
holders in rural areas;
- Special provisions will be required to address this issue for the
developing countries, most probably within a development box
and even including some price/production intervention.
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Geographical indications
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- Not applicable except for olive oil produced and marketed within
the EU.
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Green box
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- No sector relevance as, in principle, green box supports are non-crop
specific. Even the recent US emergency payments have eventually been
classified under the amber box;
- However, there is strong disagreement with regard to the distortionary
effects of most arable crop support policies under the green box even
when they are decoupled.
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Blue box
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- Now only applies to EU direct aid payments for oilseeds; from 2002,
distortion effects are expected to be reduced in that oilcrop payments
will be gradually lower and aligned to those offered to other arable
crops. Whether the overall ceiling on area will still apply once full
alignment is reached remains unclear.
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Special agricultural safeguard
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- Although a number of developing and developed countries have reserved
right to use SSGs in relation to oilseeds and products, since 1995 only
two countries have actually taken action, with only small quantities
being involved;
- Use of this tool by developing countries is expected to remain limited
as, in principle, their industries tend to enjoy a high level of protection
through relatively high bound tariffs.
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