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The Uruguay Round Agreement on Agriculture has fundamentally changed the rules for international agricultural trade, and established quantitative constraints for agricultural policies of all WTO members. Although some countries ha...
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The Uruguay Round Agreement on Agriculture has fundamentally changed the rules for international agricultural trade, and established quantitative constraints for agricultural policies of all WTO members. Although some countries have tried to escapethe new disciplines, overall there has been substantial compliance, and implementation of the Agreement has proceeded smoothly. The next round of WTO negotiations on agriculture, to be launched in 1999, will have to clarify and strengthen some of the rules agreed during the Uruguay Round, but should mainly be devoted to negotiating further significant reductions. In addition, other issues that have emerged as contentious in the area of agricultural trade, and that will affect the next Round, will be discussed.
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A multiregion computable general equilibrium model is used to evaluate the regional, multilateral, and unilateral trade policy options of Mercosur from the perspective of the welfare of all potential partners in several proposed a...
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A multiregion computable general equilibrium model is used to evaluate the regional, multilateral, and unilateral trade policy options of Mercosur from the perspective of the welfare of all potential partners in several proposed agreements. The focus for Brazil is on poverty impacts. The results show that the poorest households in Brazil experience gains of 1.5-5.5% of their consumption, which are about three to four times the average gains for Brazil. Protection in Brazil favours capital-intensive manufacturing relative to unskilled labour-intensive agriculture and manufacturing. So trade liberalization raises the return to unskilled labour relative to capital and disproportionately helps the poor.
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Many factors shape the global network of bilateral trade including fundamental forces of supply and demand factors and government policies. This study uses the generalised gravity framework to distinguish among the different drive...
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Many factors shape the global network of bilateral trade including fundamental forces of supply and demand factors and government policies. This study uses the generalised gravity framework to distinguish among the different drivers that either deter or aid partner trade in land-intensive agriculture and labour-intensive clothing. The dataset used in the analysis includes bilateral trade among 70 countries in 1995, 2000 and 2005. Collectively, the 70 countries account for 85% of the world's trade in agriculture and 96% of its GDP. Empirical results lend support to the Heckscher-Ohlin explanation of trade, namely that relative factor endowments motivate cross-border trade. Results also show that tariffs are not always binding and bilateral free-trade agreements more often divert rather than create trade.
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The Doha round of multilateral trade negotiations has proceeded slowly. Some commentators consider that the current impasse in World Trade Organization negotiations could result in the failure of the round, and that this could eve...
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The Doha round of multilateral trade negotiations has proceeded slowly. Some commentators consider that the current impasse in World Trade Organization negotiations could result in the failure of the round, and that this could even be beneficial. Such a position cannot be endorsed, as few would benefit from this outcome. Since the beginning of the Uruguay round of multinational negotiations on agriculture, some countries (e.g. the Cairns Group countries) have pushed for total liberalization of trade in agricultural products. However there is nothing to guarantee that such an extreme free market approach would result in more balanced and fair agricultural markets. Other countries (including the EU, Switzerland, Norway, Japan and Korea) have based arguments for continuing government intervention and support on the idea of the "multi-functionality" of agriculture, or its importance in terms of environmental protection, preserving traditional rural lifestyles and other non-commercial considerations. An equitable agreement on agriculture needs to take into account aspects of both positions. The ways in which internal support measures, including so-called decoupled measures, can distort international markets need to be recognized, but there is still a place for some measures aimed at preserving socio-political and economic equilibrium in agriculture in individual countries. An equitable agricultural agreement needs to include: (1) complete dismantling of export subsidies by 2013; (2) maintaining internal support at current levels only if it does not lead to increased agricultural exports, abolition of "blue box" measures, and redefinition of "green box" measures so that many decoupled support measures are excluded but measures aimed at protecting farmers against catastrophic falls in income are still permitted; and (3) maintaining import tariffs at current levels but increasing minimum levels of access to domestic markets over an eight year period to 10% of national consumption.
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Agricultural market distortions remain a major focus of contention in world trade negotiations. Estimates of the effects of liberalising current agricultural trade restrictions indicate an approximately $385 billion increase in gl...
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Agricultural market distortions remain a major focus of contention in world trade negotiations. Estimates of the effects of liberalising current agricultural trade restrictions indicate an approximately $385 billion increase in global welfare, with the disproportionate share of the benefit being enjoyed by developing countries. In response to difficulties in adopting agricultural trade reforms, individual groups of countries have formed multiple bilateral and regional preferential trade agreements (PTA) to enhance trade among members. Few sectoral analyses exist of the effects on agricultural and food product trade of PTAs. This research uses a gravity model to isolate the effects of various PTAs on both intra- and extra-bloc agricultural and food product trade for three time periods: 1995, 2000 and 2004. Findings strongly support PTA benefits in terms of increased intra-bloc trade in both sectors. The findings also generally support trade creation in agricultural products. PTA membership was also associated with food trade creation in most cases, although diversion was observed for several associations composed primarily of developing countries.
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Using information from the United Nations Conference on Trade and Development's database, this study shows how non-tariff measures constrain the growth of Italian agrifood exports to the USA, Switzerland and Japan.
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A political economy model of protection is used to determine endogenously the intersectoral patterns of protection. Three propositions are derived that are consistent with the stylized patterns of tariff protection in rich and poo...
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A political economy model of protection is used to determine endogenously the intersectoral patterns of protection. Three propositions are derived that are consistent with the stylized patterns of tariff protection in rich and poor countries: (1) nominal protection rates escalate with the degree of processing, (2) protection is higher on average in poor countries, and (2) rich countries protect agriculture relatively more than they protect manufacturing, whereas poor countries do the reverse. Numerical simulations for archetypal rich and poor economies confirm that the endogenously determined structure of protection is broadly consistent with observed patterns of protection.
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This paper: explores the complex structures of recent free-trade agreements (FTAs) between the European Union and developing countries; surveys the main factors determining their economic effects; and presents quantitative simulat...
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This paper: explores the complex structures of recent free-trade agreements (FTAs) between the European Union and developing countries; surveys the main factors determining their economic effects; and presents quantitative simulations of the effects of these agreements. It is shown that limitations of product coverage (including that of food and agricultural products) substantially reduce the potential benefits of the agreements compared to full bilateral free trade, while only the Mexico, Chile, and Turkey agreements have trade-related commitments that are wider and deeper than the preferential reduction in tariffs. In the case of Egypt, existing levels of protection mean that it is moving toward regional free trade with many domestic distortions still in place, producing a significant loss for the Egyptian economy..
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How do the number of trade partners and the concentration of trade among partners affect the economic growth of a country? We refer to these characteristics as the structure of trade, and explore this question empirically in this ...
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How do the number of trade partners and the concentration of trade among partners affect the economic growth of a country? We refer to these characteristics as the structure of trade, and explore this question empirically in this study. We find that the structure of trade, independently of the level of trade itself, has an important effect on the rate of economic growth. The results of the study suggest that the number of trading partners is positively correlated with growth across all countries, and this effect is more pronounced for rich countries. Trade concentration is positively correlated with growth for all countries, and the effect is concentrated in poor countries. Previous work has overlooked these characteristics of trade, although we find them to be quite relevant and that they could lead to new ways of understanding the trade-growth relationship.
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Many trade negotiations involve large cuts in high tariffs, while allowing smaller cuts for an agreed share of politically sensitive products. The effects of these flexibilities on market access opportunities are difficult to pred...
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Many trade negotiations involve large cuts in high tariffs, while allowing smaller cuts for an agreed share of politically sensitive products. The effects of these flexibilities on market access opportunities are difficult to predict, creating particular problems for developing countries in assessing whether to support a proposed trade agreement. Some widely used ad hoc approaches for identifying likely sensitive products - such as the highest-bound-tariff rule - suggest that the impact of a limited number of such exceptions on average tariffs and market access is likely to be minor. Applying a rigorous specification based on the apparent objectives of policymakers in setting the prenegotiation tariff enables more accurate assessment of the implications of sensitive-product provisions for average agricultural tariffs, economic welfare, and market access under the Doha negotiations. The analysis concludes that highest-tariff rules are likely to seriously underestimate the impacts on average tariffs and that treating even 2 percent of tariff lines as sensitive is likely to have a sharply adverse impact on economic welfare. The impacts on market access are also adverse, but much smaller, perhaps reflecting the mercantilist focus of the negotiating process.Digital Object Identifier http://dx.doi.org/10.1093/wber/lhr001
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