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New challenges: Markets

New challenges: Markets. food markets: from demand constrained to supply constrained rapid expansion of bioenergy dramatic price volatility growing market share of developing countries climate change impacts on food production. Share of non-LDC developing countries in world trade.

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New challenges: Markets

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  1. New challenges: Markets • food markets: from demand constrained tosupply constrained • rapid expansion ofbioenergy • dramatic price volatility • growing market share of developing countries • climate change impacts on food production Share of non-LDC developing countries in world trade

  2. New challenges: Policies • changes in agriculturalpolicy regimes • growing interest in policies addressing climate change and environment • experiences with implementing AoA • spread of RTAs

  3. Implications for priorities • Growing scarcity requires well functioning markets, progress in Doha Round urgently needed • Attention needed to burden on food consumers (in addition to constraining producer support in WTO) • Improving food security in poor countries ... demonstrates to developing countries what trade regime can do for them (DDA) • Report suggests action, for shorter and longer term

  4. Policy Action Proposed (1) Export restrictions • more transparency, consultations • procedure to identify legitimate reasons to restrict exports “to prevent or relieve critical shortages of foodstuffs” • food aid for countries in emergency exempted from export restrictions • constraints on export taxes

  5. Policy Action Proposed (2) Biofuels • Rules for reporting support to production and consumption of biofuels • Constraints on biofuel support levels Green Box • emphasise policies not distorting production/trade • focus on public goods • eligibility only after notification, with detail

  6. Policy Action Proposed (3) International co-operation and assistance • improve market transparency • small, targeted emergency reserves • social safety nets • improve productivity in agriculture, infrastructure • assistance to agriculture must not decline again

  7. Policy Action Proposed (4) A new instrument of financial solidarity between • support for farmers in well-off countries, and • measures to improve food security in poor countries • developed and emerging countries contribute relative to their farm support: yardstick could beoverall trade-distorting support (OTDS) [for info: 1% of OTDS ≈ US$ 2 billion ≈ ¼ of ODA to agriculture] • funds are used to improve food security in countries meeting agreed quantifiable criteria

  8. Conclusions • World agriculture and food system faces new challenges • Improving food security is crucial • Importance of Doha negotiations on agriculture has become even more obvious • There are several policy actions that can respond to the new challenges ... and demonstrate to developing countries what the trade regime can do for them

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