WTO: G33 reopen talks on subsidies in December

Anthony Nwakaegho /NaijaAgroNet

A group of developing countries known as G33 plans to re-open World Trade Organization, (WTO) discussions on limits to support for farmers at the WTO Ministerial Conference in Bali, Indonesia in December.

The group said that the combined effects of the global economic slowdown and increasing climatic shocks are threatening food security in developing countries and want to exceed their agreed domestic support limits when they buy, stock and supply cereals and other food to boost food security among the poor, devoid of any legal challenge.

NaijaAgroNet learnt that the WTO rules do not prescribe limits on the amount of food that can be bought at market prices for food stocks, and it does not limit the amount of food that can be provided as domestic food aid at subsidized prices, except that WTO only disciplines buying cereals at administered prices.

However, developed countries and some developing countries are concerned that the G33 proposal which is backed by India, China and Indonesia could affect food security in neighbouring countries as these measures could lead to surpluses in stocks, which the G33 members might dump in the global market thereby disrupting global prices.

Chairman of India's Commission for Agriculture Cost and Prices (CACP), Ashok Gulati, said that India wants more leeway to provide support for its farmers and consumers because the government is launching a massive subsidized food scheme through a public distribution system that will reach two-thirds of its population of nearly 800 million people.

 He explained that a situation where India would be in a position to dump excess stocks could arise "once in 10 years as the larger distortion will be domestic."

NaijaAgroNet noted that a representative from one of the G33 countries at the WTO, who preferred not to be named, said not all the members of the group were supportive of the proposal and stressed that “India is already the largest exporter of rice in the world... Small exporters will lose their competitiveness because of Indian subsidies... Rice prices are already going down, and with further subsidies it can lead to a price crash.”

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