Explain Agriculture Agreement

Shortly after his election, President Trump insisted that NAFTA be renegotiated. Canada and Mexico have agreed and negotiations are ongoing. Nafta has been effective for more than 20 years and the economy of the three North American countries has changed significantly since its inception. In agriculture, these include the demise of the Canadian Wheat Board, increased ethanol production from maize, increasing competition from the rest of the world, the signing of other trade agreements, and the strengthening of the integration of the economies of the three countries. As a result, the GATT continued to be governed by ”temporary” and ”provisional” measures and remained an agreement without a formal organization to implement it. The GATT signatories, formally designated as contracting parties (not members), applied the GATT in accordance with the Provisional Enforcement Protocols (AAE) and the secretariat that managed the GATT retained the title of Interim Committee of the International Trade Organization (ICITO). These ”temporary” arrangements remained in place until 1994, when the Uruguay Round Final Act finally put the World Trade Organization (WTO) into force. The Doha negotiations were ambitious. First, all WTO members (almost every country in the world) participated.

Second, decisions taken during trade negotiations had to be taken by mutual agreement – each country had to be approved. Third, there were no parcel sub-agreements. There was either a complete agreement or none. In other words, if not all countries approved of the whole agreement, there would be no agreement. When the agriculture negotiations began, the positions of the EC and the United States were still far apart. To underline its commitment to liberalization, the United States opened the negotiations by unrealistically calling for the ”zero zero” option. Introduced in July 1987, it proposed that the agricultural negotiations of the Uruguay Round were not easy, that the scale of the negotiations and their political sensitivity necessarily required a considerable amount of time to reach agreement on the new rules, and that a great deal of technical work was needed to create solid means to formalize commitments in policy areas that go beyond the framework of the previous GATT practice. The agreement on agriculture and the agreement on the application of health and plant health measures were negotiated in parallel and a decision on the possible negative impacts of the reform programme on the least developed developing countries and net food-importing developing countries was also part of the overall outcome.

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