Table Of ContentAGRICULTURE IN THE GATT
Agriculture in the GATT
Timothy E. Josling
Professor
Food Research Institute
Stanford University
Stefan Tangermann
Professor of Agricultural Economics
University ofGottingen
Germany
and
T. K. Warley
formerly Professor of Agricultural Economics
University ofGuelph
Canada
$£
First published in Great Britain 1996 by
« MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS
and London
Companies and representatives
throughout the world
A catalogue record for this book is available
from the British Library.
ISBN 0-333-65819-1
as First published in the United States of America 1996 by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue,
New York, N.Y. 10010
ISBN 0-312-16237-5
Library of Congress Cataloging-in-Publication Data
Josling, Timothy Edward.
Agriculture in the GATT / Timothy E. Josling, Stefan Tangermann,
and T. K. Warley
p. cm.
Includes bibliographical references and index.
ISBN 0-312-16237-5
1. Tariff on farm produce. 2. Produce trade—Government policy.
3. Agriculture and state. General Agreement on Tariffs and
Trade (Organization). I. Tangermann, Stefan. II. Warley, T. K.
(Thorald Keith), 1930- . III. Title.
HF2651.F27A244 1996
382'.41—dc20 96-2814
CIP
© Timothy E. Josling, Stefan Tangermann and Thorald K. Warley 1996
All rights reserved. No reproduction, copy or transmission of
this publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or
transmitted save with written permission or in accordance with
the provisions of the Copyright, Designs and Patents Act 1988,
or under the terms of any licence permitting limited copying
issued by the Copyright Licensing Agency, 90 Tottenham Court
Road, London W1P9HE.
Any person who does any unauthorised act in relation to this
publication may be liable to criminal prosecution and civil
claims for damages.
10 9 8 7 6 54 3 21
05 04 03 02 01 00 99 98 97 96
Printed and bound in Great Britain by
Antony Rowe Ltd, Chippenham, Wiltshire
Contents
Preface vii
List of Abbreviations ix
1 The GATT's Origins and Early Years 1
1 Planning for Postwar Economic Cooperation 1
2 The Havana Charter 4
3 The General Agreement on Tariffs and Trade 6
4 The Essentials of the Agreement 8
5 Agriculture in the Havana Charter and the
General Agreement 11
2 Early Encounters: 1948-60 21
1 Introduction 21
2 The Early Rounds 22
3 The Rules Revisited: The 1954-:5 Review
of the GATT 25
4 The Haberler Report 35
5 Committee II 38
The Dillon Round 42
1 Background 42
2 The Tariff Negotiations 45
3 Agriculture 46
4 Simultaneous Developments 48
5 Conclusion 50
The Kennedy Round 52
1 The Setting 52
2 Preparations and Prenegotiations 54
3 The Chicken War 57
4 The Round Delayed 58
5 Substantive Offers 60
6 Resolution 66
7 Overview 69
v
VI Contents
5 The Tokyo Round 72
1 Introduction 72
2 Overview of the Tokyo Round 76
3 Tasks and Proposals in Agriculture 86
4 The Results for Agriculture 89
5 Conclusions 98
6 Markets, Policies, and Trade Rules in Crisis:
1979-86 101
1 Markets in Crisis 102
2 Farm Policies in Crisis: The OECD Trade Mandate 105
3 Trade Rules in Crisis: The GATT Committee
on Trade in Agriculture 111
7 The Uruguay Round Negotiations 133
1 Background to the Uruguay Round 133
2 The Agricultural Negotiations 139
3 The Significance of the Agricultural Negotiations 162
8 The Uruguay Round Agreement on Agriculture 175
1 Structure of the Agreement 175
2 Market Access 179
3 Export Competition 194
4 Domestic Support 202
5 Sanitary and Phytosanitary Measures 208
6 Remaining Differences Between Agriculture
and Industry 214
9 The Future for Agriculture in the GATT 217
1 Assessment of the Post-Uruguay Round Situation 217
2 Continuation of the Process of Agricultural
Trade Reform 223
3 New Issues Facing the Trade System 232
4 Conclusion 242
Notes 244
References 275
Index 286
Preface
For many years, the three of us have shared a common interest in the
agricultural policies of the major developed countries and in the ef
fects of these policies on world agricultural trade. We have met often
at conferences, symposia and workshops on international agricultural
trade and policy, and have followed as analysts, commentators and
observers each of the three major GATT negotiations in which agri
cultural issues have been addressed - the Kennedy, Tokyo, and Uru
guay Rounds.
The original motivation for this book was to chronicle the story of
the agricultural negotiations in these successive rounds and thereby to
trace the evolution of the treatment of agricultural trade in the GATT.
We felt that the story of repeated attempts to bring trade in agricul
tural products more surely into a rule-based international trading system
should be recorded, not only for those who work in the area of agri
cultural trade but also for those with interests in international econ
omic and political relations, international business, and economic history.
In the summer of 1990, we journeyed to Geneva to meet with GATT
officials and members of national delegations to learn more about the
status of the negotiations on agriculture in the Uruguay Round. At that
time there was still the possibility of an agreement by the end of De
cember 1990, with an agricultural component which would have pro
vided the final chapter to the story. In the event the writing of that
chapter had to wait until the negotiations had concluded, over three
years later.
Meanwhile it became increasingly clear that the Uruguay Round would
so radically change the rules under which agricultural trade takes place
that it could not be treated as just another 'round' of negotiations.
Trade in agricultural goods would indeed - for the first time since the
inception of the GATT - be brought fully within a system of multilat
eral rules and disciplines. Accordingly, the scope of the book was
expanded to allow the resulting new rules to be discussed in more
detail and their implications to be explored.
In structuring the book we have followed a chronological sequence
- beginning with the creation of the GATT, continuing through the
1954-5 review of the General Agreement and the Haberler Report,
and dealing in turn with the Dillon, Kennedy, and Tokyo Rounds and
vn
Vlll Preface
the period following that, when the agricultural trade situation deterio
rated sharply. We devote separate chapters to the negotiations in the
Uruguay Round and the results for agriculture embedded in the Uru
guay Round Agreement. A final chapter ventures a look ahead at some
emerging issues and at the completion of the reforms initiated by the
Uruguay Round.
The perspective that we have taken is largely descriptive, avoiding
both quantitative analysis and censorious judgements, though undoubt
edly our own opinions on these issues are apparent. The reader, and
the passage of time, will have to judge whether our enthusiasm for
what has now been accomplished in bringing trade in agricultural products
into the rule-based GATT/WTO system is justified.
Writing the book was professionally satisfying and as close to fun
as a serious endeavour can be. Each author contributed both substan
tive chapters and a different perspective. All parts of the book were
collectively revised and harmonized, though some stylistic differences
undoubtedly remain. Senior authorship is not assigned, and our names
are listed in alphabetical order.
Throughout the gestation period of this book, we have worked with
colleagues in the International Agricultural Trade Research Consortium
- an organization that brings together economists interested in interna
tional agricultural trade matters - in various study groups and meetings.
Our appreciation is extended to these colleagues for the long and fruitful
discussions we have shared over the years of the issues surrounding
the GATT negotiations on agriculture. We view the book as a contri
bution to the mission of the Consortium, and we hope that it will sti
mulate studies on other aspects of trade policy in agricultural goods.
During the preparation of the book we have been supported and
encouraged by many people to whom we are deeply grateful. In par
ticular, David Blandford, William J. Davey and Robert E. Hudec each
read parts of an early draft and provided helpful comments. If we still
managed to smuggle some errors into the manuscript, they should not
be held responsible. In the final stages Harald Grethe provided invaluable
technical support, Henning Twesten proficiently worked on the index,
and Petra Geile skilfully brought the final manuscript into a proper
order and acceptable format. Part of Stefan Tangermann's work on the
book was generously supported by the Deutsche Forschungsgemeinschaft.
Finally, to our wives Anthea, Gabi, and Anita who sacrificed many
weekends and evenings of our company to the completion of the book,
we owe our lasting gratitude. To them we dedicate this, the fruit of
our labours.
List of Abbreviations
AMS Aggregate Measurement of Support
AoA Agreement on Agriculture
APEC Asian-Pacific Economic Cooperation Process
CAP Common Agricultural Policy
CCC Commodity Credit Corporation
CSE Consumer Subsidy Equivalent
CET common external tariff
CITES Convention on International Trade in Endangered
Species of Wild Fauna and Flora
CoA Committee on Agriculture
CSD Consultative Subcommittee on Surplus Disposal
CTA Committee on Trade in Agriculture
EAI Enterprise for the Americas Initiative
EC European Community
ECOSOC Economic and Social Council of the United Nations
EEA European Economic Area
EEC European Economic Community
EEP Export Enhancement Program
EFTA European Free Trade Association
EU European Union
FAC Food Aid Convention
FAO United Nations Food and Agriculture Organization
FOGS Functioning of the GATT System
FTAA Free-Trade Area of the Americas
GNG Group of Negotiations on Goods
GNG5 Negotiating Group on Agriculture
GNS Group of Negotiations on Services
HS Harmonized System
ICA Intergovernmental Commodity Agreement
ICCICA Interim Coordinating Committee for International
Commodity Arrangements
IDA International Dairy Arrangement
IDPC International Dairy Products Council
IGA International Grains Arrangement
IMC International Meat Council
IMF International Monetary Fund
IX
