Cairns Group Minister’s Statement on the WTO reform process in agriculture

The Cairns Group, of which Brazil is a founding member, issued today a Ministerial Statement stressing the importance of the continuation of the reform process of disciplines on agriculture at the World Trade Organization (WTO). The Group has worked to achieve an ‘ambitious, concrete and equitable’ outcome in agriculture, in the WTO’s Twelfth Ministerial Conference (MC12), which is scheduled to take place in Geneva, next November.

The Statement was released following the Informal Meeting of the Cairns Group of Ministers, which was held this morning with the participation of the WTO Director-General, Dr. Ngozi Okonjo-Iweala. In the Statement, among other themes, members call for a Ministerial Decision at MC12 that signals a ‘significant’ reform of agricultural trade-and-production-distorting subsidies, which will help promote the sustainable development goals (SDG).

According to the Organization for Economic Cooperation and Development (OECD) data, between 2018 and 2020, 54 of the world’s major economies granted a total of $720 billion in subsidies per year to their agricultural sectors – twice the support provided between 2000 and 2002 in nominal terms. It is estimated that by 2030 agricultural subsidy entitlements for WTO Members should total more than $2 trillion if an agreement to limit and reduce the sum of such entitlements is not reached.

In a context in which the international community faces high levels of public indebtedness and seeks to overcome the negative impacts of the COVID-19 pandemic, the reduction of distortive support policies will contribute to sustainable development strategies, especially those aimed at ending poverty and hunger, fighting climate change, and promoting income, employment and investments in rural areas.

The Cairns Group is a coalition of large agricultural exporting countries with the common objective of multilaterally supporting greater liberalization of trade in agriculture. Currently, members of the Group are South Africa, Argentina, Australia, Brazil, Canada, Chile, Colombia, Costa Rica, the Philippines, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, Thailand, Uruguay, and Vietnam, accounting for about 25% of the world’s agricultural exports. Ukraine is an observer of the Group since 2020.

The following is the full text of the Statement (source: https://www.cairnsgroup.org/news/statement/informal-gathering-cairns-group-ministers):

CAIRNS GROUP MINISTERS’ STATEMENT

23 June 2021

1. Ministers of the Cairns Group*, including Ukraine as an observer, met virtually on 23 June 2021 to discuss the importance of the continuation of the multilateral reform process in agriculture in the lead up to the WTO’s Twelfth Ministerial Conference (MC12). Cairns Group Ministers underlined that it is essential for MC12 to deliver an ambitious, concrete and equitable outcome in agriculture.

2. Reform of agriculture trade rules is long overdue. Article 20 of the Agreement on Agriculture mandated negotiations for the continuation of the multilateral reform process in agriculture. Agriculture remains the most protected and distorted sector globally. Reducing barriers to trade and market distortions is a critical pathway to enable countries to raise incomes and standards of living, provide employment and ensure sustainable development. In addition, rising global food insecurity, climate change and sustainable development challenges underline the urgency for such reforms.

3. Taking meaningful steps towards reform at MC12 to make agriculture trade more predictable, open, fair and market oriented would also form part of an essential response of the multilateral trading system to the global impacts of the COVID-19 pandemic and help advance global food security.

4. Cairns Group Ministers underlined the role of agriculture trade to achieve the 2030 Agenda and its Sustainable Development Goals (SDGs), in particular, SDG 1 “End poverty in all its forms” and SDG 2 “Zero Hunger”.

5. Ministers reaffirmed that development lies at the heart of the multilateral trading system and agricultural trade reforms must continue to support the economic development needs of developing Members.

6. The reform process must deliver substantial progressive reductions in support and protection, and not result in the maintenance of the status quo or a reversal of Uruguay Round commitments. Cairns Group Ministers reinforced their commitment to making progress in all three pillars of the Agreement on Agriculture – domestic support, market access and export competition – with a view to ensuring a balanced and progressive reform process that creates a level playing field for international trade in agricultural products and ensuring the historic decision at the 10th WTO Ministerial Conference in Nairobi to eliminate agricultural export subsidies is not undermined. Ministers recognised the contributions of Cairns Group members through the presentation of analytical documents, option papers and proposals in all three pillars.

7. Cairns Group Ministers called for a Ministerial Decision at MC12 that addresses agricultural trade- and production-distorting domestic support. This Ministerial Decision must be of sufficient ambition and specificity to enable meaningful reform of trade- and production-distorting domestic support entitlements. To this end, Ministers of the Cairns Group underscored that the Framework for Negotiations on Domestic Support should be the basis for this Decision.

8. In regard to the implementation of current notification obligations under Article 18 of the Agreement on Agriculture, we reaffirm the importance of strengthening compliance with existing transparency obligations, particularly with respect to domestic support. In this context, to assist these efforts, we call upon the WTO Secretariat to update and improve the analytical tool on Domestic Support.

9. The Cairns Group reiterated its commitment to work with other WTO Members and groups in a collaborative and constructive effort to secure a meaningful and ambitious outcome in agriculture at MC12, in line with the reform mandate set in Article 20 of the Agreement on Agriculture.

10. MC12 will be the WTO’s first Ministerial in four years and the first Ministerial since the onset of the COVID-19 pandemic. This is an important opportunity that we must grasp to deliver meaningful agricultural trade reform.

* Agreed by Argentina, Australia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, Philippines, Thailand, Uruguay, Viet Nam, Ukraine (Observer)