WTO and Agricultural Trade – Some Issues and Perspectives

In the Uruguay Round Agreement, the rules governing agricultural trade were changed fundamentally. Members have agreed to convert all non-tariff agricultural barriers (NTBs) to ordinary tariffs, to bind all agricultural tariffs, and to subject them to reductions. Members have also agreed to establish tariff-rate quotas (TRQs) to preserve historical trade levels and to create some new trade opportunities in highly protected markets. Some reductions in agricultural tariffs also were achieved. Nonetheless, agricultural tariffs remain to be very high for some politically sensitive products in some developing countries, limiting the trade benefits from the new rules. The failure of trade negotiators, who met at Geneva to narrow their differences on the modalities of compiling detailed cuts in tariffs and agricultural subsidies, is no doubt a setback to multilateral trade negotiations. This paper analyses the impact of WTO agricultural trade policies on developing economies. An attempt is made to discuss the benefits and risks for agricultural trade associated with the changes in international trade. The paper also delves agricultural reforms that were introduced by the GATT prior to 1995. The paper examines whether the reforms were useful for the developing countries or not. By way of a summing up, some insights are set out to provoke analysis and debate on the controversial WTO talks.