A new version of a draft Cancun ministerial text is circulated

A revised draft Cancun ministerial text was circulated on 24 August by the Chair of the WTO General Council, Carlos Pérez del Castillo. Based to a large extent on the US- EC paper circulated on 13 August (see below), the revised text provides the WTO countries with a framework for establishing modalities in agriculture with respect to the three pillars (market access, domestic support and export competition). For each pillar, the revised text incorporates a number of special and differential treatment (S&D) provisions that were absent in the first draft. In terms of domestic support, the document (viz. Annex A, sections 1.6 and 1.7) proposes S&D provisions including: applying lower reductions of trade-distorting domestic support and longer implementation periods (cf. Article 6.2. of the Agriculture Agreement); exempting developing countries from the requirement to reduce their de minimis levels. As far as the market access pillar is concerned, the Chair recognises that 'developing countries shall have additional flexibility [!;] to designate Special Products' with smaller tariff reductions and no new commitments on Tariff Rates Quotas (cf. section 2.6). For developing countries, the tariffs reduction would be based either on a three-band Uruguay Round approach or a blend of the Uruguay Round and Swiss formulas, without a zero duty category. The draft text proposes that these Special Products should be determined under certain conditions but these are not elaborated. With regard to the agricultural safeguard mechanism for developing countries, the Chair also says that it would be 'subject to conditions and for products to be determined'. The Chair emphasizes that members would also 'take account of the importance of preferential access for developing countries'. With respect to export competition, the Chair takes up the US-EC proposal to remove export subsidies on some products 'of particular interest for developing countries'. In terms of S&D provisions, developing countries would have the right to exempt certain transport and marketing subsidies from export subsidy reduction (Article 9.4 of the Agriculture Agreement) until all export subsidies have been phased out by all Members. Furthermore, the text mentions that appropriate provision in favour of Least Developed Countries (LDCs) and Net Importing Developing Countries (NFIDCs). Other substantial issues are also mentioned in this draft text: recognition of the importance of trade preferences; the sectoral initiative on cotton; the issue of long-term decline and sharp fluctuations in the price of commodities. The Chair also indicates a list of 'issues of interest but not agreed' as introduced by the US-EC proposal including the Green Box criteria, the safeguard measure for developed countries, the implementation periods, the peace clause and non-trade concerns. Comment: In terms of reactions to the draft text, some developing countries (except the Cairns Group) recognise that some progress has been made even if additional S&D provisions are still needed. The EC along with Japan criticise the text saying it goes too far and does not adequately recognise non-trade concerns and the diversity of agriculture. Critics from the Cairns group emphasise that the text does not include the definite elimination of export subsidies or reductions on domestic support by product. Last but not least, the US along with the EC are claiming that less generous level of S&D provisions should apply for advanced developing countries, especially the major net food exporters (including Thailand and India). Even if the revised Cancun ministerial text goes further than the framework given in the US-EC proposal - especially putting the emphasis on the importance of S&D for developing countries - there are still blanks to fill in especially regarding the level of future undertakings (including schedules and figures).A revised draft Cancun ministerial text was..