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WTO Doha Round: The Agricultural Negotiations

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Abstract:

The pace of efforts to revive suspended World Trade Organization Doha Round trade negotiations has quickened as the July 2007 expiration for fast-track or trade promotion authority for expedited congressional consideration of trade agreement legislation approaches. Although technical negotiations have addressed specific formulas for reducing trade-distorting farm support and tariffs, high-level political discussions have yet to produce a satisfactory compromise among WTO members for future agricultural trade liberalization.

Negotiations were suspended in July 2006 when a core group of WTO member countries -- the United States, the European Union (EU), Brazil, India, Australia, and Japan -- known as the G-6 reached an impasse over specific methods to achieve the broad aims of the round for agricultural trade: substantial reductions in tradedistorting domestic subsidies, elimination of export subsidies, and substantially increased market access for agricultural products.

The WTO is unique among the various fora for international trade negotiations in that it brings together its entire 150-country membership to negotiate a common set of rules to govern international trade in agricultural products, industrial goods, and services. Regarding agriculture, because policy reform is addressed across three broadly inclusive fronts -- export competition, domestic support, and market access -- WTO negotiations provide a framework for give and take to help foster mutual agreement.

Doha Round negotiators were operating under a deadline effectively imposed by the expiration of U.S. trade promotion authority (TPA), which permits the President to negotiate trade deals and present them to Congress for expedited consideration. To meet congressional notification requirements under TPA, an agreement would have to be completed by the end of March 2007. TPA, which could be extended by Congress, preserves Congress's key role in approving trade agreements while providing the President with credibility to negotiate with trading partners who otherwise might fear that Congress would amend an agreement that had been negotiated.

As a result of the suspension of the negotiations, a major source of pressure for U.S. farm policy change will have dissipated. Supporters of farm bill changes were looking to a Doha Round agreement to require changes in U.S. farm subsidies to make them more compatible with world trade rules. Proponents of continuing farm subsidy programs appear strengthened by the indefinite suspension of the Doha talks. The United States must still meet obligations under existing WTO agricultural agreements, and some trade analysts think that, without a new trade agreement, there could be an increase in litigation by WTO member countries alleging they are harmed by U.S. farm subsidies.

This report assesses the status of agricultural negotiations in the Doha Round and will be updated as developments unfold.