Agriculture Reference
In-Depth Information
2008); but, crucially, rather than being due to subsidy reductions (i.e. reductions in
the numerator) this was due to the effects of escalating agricultural prices in boost-
ing the denominator. In 2009, after the food price bubble burst, the total estimated
level of support to agriculture within the OECD climbed again, to 38.67% of farmg-
ate sales.
The slow rate of progress in reducing agricultural subsidies in the developed
North occurred because of three intervening processes. First, the diiculty of reah-
ing consensus in the Uruguay Round meant that the AoA ended up specifying only
a relatively modest timetable for reductions in agricultural tariffs and subsidies. Lib-
eralizers (suh as the Cairns Group) begrudgingly accepted this outcome because
they regarded the inclusion of agriculture within the multilateral system as a 'win'
in its own right. Second, it was widely presumed in the mid-1990s that the conclu-
sion of the Uruguay Round would be followed quikly with the commencement of
a new Round. However, after false starts the eventual Doha Development Round
commenced in October 2001 - fully seven years after the Uruguay Round's comple-
tion. By this time, the multilateral system was bruised from institutional failures and
an increasingly sceptical public (as witnessed in the abortive 'Millennium Round'
meetings in Seatle, 1999). he Doha talks were consequently undertaken within
a very restrained set of aspirations. Third, developed countries adopted an array
of strategies to subvert the (already modest) requirements of the AoA. With re-
gards to tariffs, developed countries calibrated their reduction targets to artificially
high baselines, meaning that they could meet their obligations with relative ease
(a problem whih became coined as 'water-in-the-tarif'). With regards to domest-
ic payments, developed countries engaged in an elaborate process of 'box-shifting',
whereby they restructured their farm subsidies from 'amber' and 'blue' to 'green'
categories. Thus, in the EU, a process known as 'decoupling' saw the abolition of
many direct production payments and the creation of new, non-market distort-
ing farm payments designed to promote environmental services, heritage and rur-
al amenity. These 'Pillar 2' payments have come to represent a key component and
discursive justification for why the EU engages in agricultural support activities. As
suggested by Clive Poter, only in the past decade has the reshufling of EU subsidy
payments to ensure they are 'WTO-consistent' cohered as a discrete political project.
As Poter (2006, p192) further explains:
negotiators have invented a complicated new vocabulary whih establishes pro-
cedures for tarification and creates a system for estimating and classifying do-
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