CCP: GR-RI-ME-OF 01/3-Supp.1

 

Point III.a of the Provisional Agenda

COMMITTEE ON COMMODITY PROBLEMS

JOINT MEETING OF THE
INTERGOVERNMENTAL GROUP ON GRAINS
(29TH SESSION)
INTERGOVERNMENTAL GROUP ON RICE
(40TH SESSION)
INTERGOVERNMENTAL GROUP ON MEAT
(18TH SESSION)
INTERGOVERNMENTAL GROUP ON OILSEEDS, OILS AND FATS (29TH SESSION)

Rome, 4-5 July 2001

FOLLOW-UP TO THE GUIDELINES FOR NATIONAL AND INTERNATIONAL ACTION ON RICE, LIVESTOCK AND MEAT AND OILSEEDS, OILS AND OILMEALS

Table of Contents

TABLES

TABLE 1: PADDY SUPPORT PRICES IN SELECTED COUNTRIES

TABLE 2: UNITED STATES - SUPPORT TO RICE PRODUCERS

TABLE 3: RICE FOOD AID SHIPMENTS (1998-2000)

TABLE 4: OILSEEDS , OILS AND FATS SUPPORT PRICES IN SELECTED COUNTRIES

TABLE 5: CONCESSIONAL TRADE IN FATS AND OILS

TABLE 6: EC SUPPORT TO THE BEEF SECTOR

TABLE 7: INTERNATIONAL ASSISTANCE TO AGRICULTURE AND TO THE LIVESTOCK AND MEAT SECTOR

I. GUIDELINES FOR NATIONAL AND INTERNATIONAL ACTION ON RICE1

A. GENERAL OBJECTIVES OF INTERNATIONAL COOPERATION

(i) Close cooperation to ensure food security of developing countries, as well as substantial progressive reductions in market distortive interference and a reduction of distortions and restrictions in the world rice market.

(ii) The broad objective should be to achieve a balanced situation in production, consumption and trade in rice based on the following principles:

  1. action should be beneficial to the world rice economy and should result in a stable world rice market, with supplies expanding at a sufficient pace to meet rising demand;

  2. special consideration should be given both to the interests of developing and low-income food deficit countries, especially those where rice is a staple food and to those developing countries whose economies are heavily dependent on rice exports;

  3. interference with normal commercial trade should be minimized, and importers' choice of source of supplies should not be restricted;

  4. measures should aim at promoting consumption of rice, except in circumstances of rice shortages;

  5. efforts of developing countries to develop their rice production potential should be supported.

B. PRODUCTION POLICIES

(i) Rice production policies should be sufficiently flexible to respond to new market situations. Domestic rice support policies should have minimal trade distortive effects and they should be harmonized with the Agriculture Agreement reached at the Uruguay Round.

(ii) Rice exporting countries should, during periods of over-supply of rice on world markets, avoid adopting measures which encourage an increase in the production in rice, unless a shortage of other grains occurs on the world market which warrants an increase in production of rice.

(iii) Developments in production policies and the measures taken to adjust supplies to demand on world markets should be subject to regular review by the Group so that if necessary, it may propose further remedial action.

(iv) International aid giving agencies and bilateral donors should in a manner consistent with the general objectives of international cooperation, assist developing countries in their efforts to raise their productivity and production of rice by providing increased technical and financial aid.

C. TRADE POLICIES

(i) Countries should not provide export subsidies to rice except in conformity with the Uruguay Round Agreement on Agriculture. Specifically, developed and developing countries should reduce the budgetary outlay on export subsidies on rice as well as the quantity of subsidized rice exports as stipulated by the Round.

(ii) Governments should provide information to the FAO Secretariat on the actual measures and reductions in rice subsidies undertaken so that these information could be consolidated and presented to the Group for its review and consultation for remedial action when any special difficulties arise.

(iii) With a view to improving international knowledge of current market trends, countries with a substantial interest in world trade should develop informal contacts and liaison between rice trade specialists.

(iv) In entering into longer term contracts for the exports and imports of rice, countries should consider that unforseen shortages can occur in exporting countries, which may make it difficult for a full compliance of the contract. When these situations occur, bilateral consultations should be undertaken to ensure that the needs of the contracting parties could be met to the extent possible within the terms agreed in the Uruguay Round Final Act.

(v) Governments are requested to use the opportunity offered in the Intergovernmental Group on Rice for the systematic exchange of information on trade policies, especially relating to the actions taken on improving market access and reducing export subsidies to enable the Group to keep developments in this field under regular review and to consult on proposals for remedial action when any special difficulties arise.

(vi) Developed countries should, where appropriate, make efforts to implement, improve and enlarge GSP schemes for rice and to focus in particular on the needs of low income food deficit countries.

(vii) Governments should consider assisting countries facing food, especially rice, shortages to obtain food aid in rice on grant terms or on highly concessional terms2 and to obtain short term assistance from international financial institutions for financing some levels of commercial imports.

(viii) Within the framework of increased economic cooperation among developing countries and recognizing that the increase in import demand for rice in the coming years is likely to be mostly in the developing countries, governments concerned should make special efforts to encourage the expansion of trade among developing countries.

D. INTERNATIONAL FOOD AID POLICIES

(i) Countries engaging in concessional or food aid transactions should follow the FAO procedures for notification, consultation and establishment of usual marketing requirements within the context of the FAO Principles of Surplus Disposal. In order to facilitate such procedures, exporting and importing countries should provide, if possible, to the FAO Secretariat - by latest March each year - export and import statistics on rice on a calendar year basis, distinguishing between commercial and food aid exports and imports respectively, and stating their destination (in the case of exports) and origin (in the case of imports).

(ii) Countries should ensure that food aid should not be used to circumvent the commitments agreed in the Uruguay Round Final Act and to distort trade resulting in market displacement for developing exporting countries which do not have the means to finance similar concessional trade programmes. In this regard, food aid should not be tied and should, as far as possible, be on grant terms or on highly concessional terms.

(iii) The greater use of rice in multilateral food aid schemes is favoured and where possible, such food aid should be channelled through the WFP.

(iv) Multilateral aid-giving agencies, such as WFP, and bilateral donors, where possible and appropriate should increase food aid levels of rice and promote " triangular transactions" to the maximum extent possible while ensuring that the benefits of such transactions are equitably spread among developing exporting countries.

E. RICE RESERVES

(i) Countries should take the opportunity, whenever the rice supply situation warrants, to evolve a concerted approach to the building and the holding of rice stocks, keeping in view the overall objectives of market stability and food security, as well as national targets.

(ii) International aid-giving agencies and bilateral donors should help interested developing countries to increase their rice reserves and to secure the required financial and physical resources for this purpose, within the context of national policies, programmes and targets.

(iii) Developed countries, where rice stocks have accumulated, should consider earmarking larger quantities for meeting emergency requirements, keeping in view the minimum target of 500 000 tonnes of cereals for the International Emergency Food Reserves.

(iv) Countries where surplus stocks have accumulated should also consider applying a policy of reducing production and promoting the domestic use of the surplus rice.

F. GUIDELINES ON ENVIRONMENT

(i) Countries should give due regard to the environmental implications of their policy actions in areas relating to rice production, trade and consumption.

(ii) International financing institutions and bilateral donors should assist countries in their efforts to improve and expand upon the use and adoption of environmentally friendly policy measures.

(iii) In encouraging developing countries to adopt environmentally friendly production, consumption and trade measures, international financing institutions and bilateral donors should give due consideration to the economic impact of these measures, especially on countries' costs of production and, in consequence, their competitiveness. Where possible, therefore, rice project proposals on environmental concerns should be based inter alia on an economic assessment of their impact.

(iv) Countries should ensure that the pursuit of improved environmental practices should not be used to circumvent the agreements on reducing trade barriers reached in the Uruguay Round.

(v) With a view to enabling the FAO Secretariat to improve the exchange of information on different aspects of environmental problems and policy developments concerning rice and the monitoring and dissemination of related environmental technology, countries should develop close contacts with the FAO Secretariat and provide it with the necessary information.

II. GUIDELINES FOR THE INTERNATIONAL COOPERATION IN THE OILSEEDS AND OILMEALS SECTOR3

A. SCOPE AND PURPOSE4

(i) The main purpose of the guidelines is to help harmonise national policies in the light of agreed objectives for the world oilseeds, oils and oilmeals economy. It is understood that acceptance of the guidelines would reflect the intention on the part of member countries to take them into account when considering the formulation of policies at national and international levels. It is also understood that acceptance of the guidelines would not subordinate national policies to a global blueprint. The role of the guidelines is rather to serve as an overall framework within which each country would develop its own policies affecting oilseeds and oils according to its circumstances on a voluntary basis. Assessments would be undertaken of the progress made towards achieving the agreed objectives and policies covered in the guidelines.

B. GENERAL OBJECTIVES OF INTERNATIONAL COOPERATION

(ii) The broad objectives of international cooperation should be to secure, within the context of a New International Economic Order, a balanced expansion of production, consumption and trade in the oilseeds, oils and oilmeals sector. In the achievement of these objectives, the interests both of producers and consumers, as well as of exporting and importing countries, should be taken into account; an appropriate balance should be aimed at between the interests of developed and developing countries, with special attention to sustaining the expansion of the sector in developing countries. In particular, national and international measures taken should:

  1. achieve and maintain reasonably stable prices, equitable to consumers and remunerative to producers;

  2. lead to a progressive improvement in access to markets and a steady expansion of world trade, particularly for the products exported by developing countries;

  3. facilitate greater participation of and increased exports from developing countries in a general expansion of world trade;

  4. aim at ensuring continuity of adequate exportable supplies of oilseeds, oils and oilmeals to meet the requirements of importing countries;

  5. assist developing importing countries to obtain their import requirements on reasonable terms;

  6. enable developing countries to develop more fully their production and processing potential in order to promote their greater contribution to the growing world supplies of these products and to improve their ability to meet consumption needs and their objectives in an expansion of world trade;

  7. pay special attention to the interests of the developing countries that are heavily dependent on the production and trade of commodities within the sector;

  8. promote the consumption of oilseed, oil and oilmeal products where per caput intake is low, so as to improve nutritional standards;

  9. promote harmonious development of the world market with a view to avoiding any destabilizing impact on international trade.

C. POLICIES REGARDING PRODUCTION, PROCESSING AND STABILITY OF SUPPLIES

  1. The objectives of national price and other production support policies for oilseed and oil crops should be to obtain reasonable incomes for farmers through remunerative prices for these crops, the protection of producers from excessive fluctuations in world market prices and, when appropriate, the provision of an incentive to increased production in developing countries. In setting support price levels within national production policies, governments should, as appropriate, take account, inter alia, of the world market situation. Policies should also pay due regard to consumers' interest in obtaining adequate supplies at reasonable prices.

  2. International aid-giving agencies and bilateral donors should consider assisting developing countries in their efforts to improve the efficiency of production, domestic marketing and processing industries within the sector by providing increased technical and financial aid.

  3. Recognizing that considerable year-to-year fluctuations in output, particularly of annual oilseed crops, are likely to continue, governments should adopt measures, where feasible and economically advisable, to improve market stability, such as appropriate national stocking policies in order to help stabilize domestic and international markets and to help ensure continuity of supplies for importing countries.

  4. International aid-giving agencies and bilateral donors should consider assisting interested developing countries to obtain the financial and physical resources needed to hold stocks of oilseeds and oils.

  5. Governments should, if a longer-term tendency towards over-supply develops, consider taking measures to promote consumption, including non-food uses, and to increase productivity so as to reduce unit costs of production.

D. TRADE POLICIES

  1. Governments should to the maximum extent possible avoid the imposition of any new tariff and non-tariff barriers to trade in the products of the oilseeds, oils and oilmeals sector.

  2. Governments should move towards the progressive reduction and/or elimination of tariff and non-tariff barriers to trade in products of the sector.

  3. Measures to improve access to markets should give priority to the progressive reduction and/or elimination of those tariff and non-tariff barriers which restrict the development of processing industries in developing countries.

  4. Governments concerned should, whenever feasible, extend and improve the benefits of the GSP schemes by such means as increasing the number of products covered in the oilseeds, oils and oilmeals sector, improving the degree of preference given and limiting the circumstances under which preferences may be suspended.

  5. Those governments and international organizations concerned should consider, within the context of relevant schemes, the extension of compensatory payment arrangements with the purpose of stabilizing export earnings of developing countries, particularly of those heavily dependent on the export of commodities within the sector.

  6. Within the framework of increased economic cooperation between developing countries and recognizing that the increase in import demand for vegetable oils during the coming years is likely to be mostly in developing countries, governments concerned should make special efforts to encourage the expansion of trade between developing countries.

  7. Interested governments and international organizations concerned should consider helping developing exporting countries increase their international competitiveness by improved marketing, including market information, market research and export promotion.

  8. Governments should make every effort to enable developing importing countries, and especially low income developing countries, to obtain their import requirements on reasonable terms, including the provision of food aid.

  9. Where feasible and economically advisable, interested governments should consider entering into long-term contracts for exports and imports over a period of years, especially if this would impart increased security of supplies, greater stability to world trade and/or favour trade between developing countries.

  10. In order to safeguard the interests of exporting and importing countries, all governments, whenever practicable, should undertake consultations in the appropriate manner and fora, particularly within the GATT, when either side takes action which would cause harmful interference with the normal patterns of international trade or which could adversely affect the development efforts of developing exporting countries.

  11. Governments should pursue, within the Intergovernmental Group on Oilseeds, Oils and Fats, the systematic exchange of information on trade policies to keep developments in this field under regular review and, without duplicating activities in other fora, to consult on proposals for possible remedial action when any special difficulties arise.

  12. With a view to avoiding overall imbalance between demand and supply in the oilseeds, oils and oilmeals sector, countries engaged in international trade in these products should, in formulating policies in this sector, take account of the conclusions and recommendations of the Intergovernmental Group on Oilseeds, Oils and Fats regarding the short, medium and long-term outlook for trade, as well as for production, consumption and prices of these products.

E. CONCESSIONAL SALES AND FOOD AID POLICIES

  1. Governments engaging in concessional sales and/or food aid transactions in commodities within the sector should follow the FAO procedures for notification, consultation and establishment of usual marketing requirements, within the context of the FAO Principles of Surplus Disposal.

  2. Taking account of nutritional needs, international agencies and bilateral donors should, where feasible, increase the participation of developing exporting countries in providing food aid in commodities within the sector through "triangular transactions" or by other schemes to finance purchases from developing exporting countries.

F. CONSUMPTION POLICIES

  1. Governments should avoid measures specifically designed to limit the total consumption of commodities in the oilseeds, oils and oilmeals sector and should adopt, where appropriate, measures to increase consumption of fats and oils when per caput intakes are low, so as to improve nutritional standards.

  2. Developing countries with persistently weak balances of payments should encourage, when appropriate, the consumption of fats and oils and oilmeals which can reasonably be produced and processed locally.

  3. Governments should give emphasis to research and development programmes to find new end-uses for oilseed, oil and oilmeal products, both for food and non-food uses, and should, where feasible, promote the use of oilseed and oil products in preference to synthetic substitutes produced from non-renewable resources.

III. THE LIVESTOCK AND MEAT SECTOR

A. GENERAL OBJECTIVES OF INTERNATIONAL COOPERATION

(i) The broad objective of international cooperation in the livestock and meat sector should be to secure a balanced expansion in meat production and consumption - particularly in countries where animal protein deficiency exists - and trade. The attainment of this objective should be beneficial to both producers and consumers and should create equitable conditions for sustaining the development efforts of developing countries. In particular, measures taken should:

  1. support the efforts of developing countries to develop their livestock and meat industry through integrated technical assistance, aid and investment programmes, including genetic improvement, research, training and extension, so as to help develop fully their production potential to satisfy the growing domestic demand for meat. Such development efforts should pay particular attention to promoting livestock production at the small farmers'level and to improving their standard of living, taking into consideration the development of indigenous technology and the sustainable utilization of natural resources.

  2. Improve consumption and nutritional levels and promote the efficiency of meat production and marketing, and thereby farm incomes, as well as the overall conditions of international trade in meat.

  3. Take into account the interests of both exporting and importing countries and the special contribution which the livestock and meat sector makes to the development process of developing countries.

  4. Aim at mitigating the impact of market instability on the incomes and foreign exchange earnings of countries engaged in international trade in livestock and meat, and in particular of the developing countries.

  5. Promote greater participation of developing countries in the international trade of meat, and in particular of the developing countries.

  6. ensure that meat and meat products marketed for consumption are safe and meet all relevant quality requirements;

  7. pay due attention to animal welfare concerns in the rearing, transportation and slaughtering of livestock, taking into consideration the special situation of small farmers and pastoralists in the developing countries.

B. NATIONAL MEASURES

(i) Since policies in other sectors, in particular feed, milk and wool may have important influences on the meat sector, governments should endeavour to ensure that such policies and policy instruments avoid any destabilizing effects on domestic and external livestock and meat economies, and are without prejudice to the meat imports especially from developing countries.

(ii) Improvements in the processing and marketing of meat should be encouraged as a means of facilitating a continuing adjustment of meat supply and demand and of reducing market instability and of expanding overall production and consumption.

(iii) In order to promote greater harmonization among national meat policies, the Intergovernmental Group on Meat should periodically review national policies affecting production, consumption and international trade of meat.

C. TRADE POLICIES

(i) Governments should endeavour to ensure that the consequences of instabilities arising in national livestock and meat industries do not harm the livestock sectors of other countries and in particular those of developing countries.

(ii) To the extent that an overall world imbalance between demand and supply of meat is due to developments within the livestock and meat industries of countries engaged in international trade in these products, an exchange of views should take place among governments of the countries concerned with a view to assuring under satisfactory conditions, both outlets for the production of exporters and continuity of supplies to meet requirements of importers. Such exchange of views should take full account of the need for developing countries with production potential to expand output and exports at remunerative prices as part of their development efforts.

(iii) In order to safeguard the interest of meat exporting and importing countries, consultations should take place in the appropriate manner and fora and in particular within the WTO, among governments of the countries concerned whenever either side intends to take action which could cause harmful interference with the normal patterns of international trade or which could adversely affect the development efforts of developing exporting countries.

(iv) When trade restrictions and other measures of a temporary and exceptional nature are introduced by importing countries, they should be in accordance with the procedures established by the WTO and they should pay particular attention to safeguarding the development interests of meat exporting developing countries; to this end, when necessary, special and preferential arrangements should be made by developed countries in favour of imports from developing countries.

(v) When accumulated stocks of meat are disposed of on concessional terms in foreign markets, such disposals should be carried out in accordance with the FAO Principles of Surplus Disposal and Consultative Obligations.

(vi) Importing countries should provide for the uniform and consistent application over time of their animal health and meat hygiene regulations, consistent with the WTO Agreement on the Application of Sanitary and Phytosanitary Meausres.

(vii) Governments should use the opportunity offered in the Intergovernmental Group on Meat for the regular exchange of information on national measures affecting international trade and for consultations on possible remedial action when any special difficulties arose.

D. ENVIRONMENTAL POLICIES

(i) National environmental policies on livestock and meat should adhere to the general principles of: non-discrimination between countries; transparency; necessity; legitimacy; proportionally and minimal restriction of trade. In particular, they should be applied without discrimination to domestically produced and imported livestock or meat products and should not be used as a disguised restriction on trade.

(ii) Governments should promote the development and adoption of environment-friendly and sustainable technologies in the production and marketing of livestock and meat products.

(iii) Developed countries should provide technical assistance and incentives to developing countries to help them to raise the level of environmental protection in their production and processing of livestock and meat.

_________________________

1 As adopted by the Group in 1971 and subsequently revised in 1979, 1994 and 1996.

2 i.e on terms no less concessional than those provided for in Article IV at the Food Aid Convention in 1986.

3 These Guidelines were adopted by the Intergovernmental Group on Oilseeds, Oils and Fats during its 14th Session in April 1980.

4 This reflects the understanding reached by the FAO Conference in adopting the FAO Guidelines on International Agricultural Adjustment in 1975.

 

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