The World Trade Organisation (WTO) on December 19, 2015 agreed on a vital deal to get rid of dissuading agricultural export subsidies between developing and developed countries across the world.
This happened at the 10th Ministerial Conference held in Nairobi, Kenya since Tuesday, 15th, and the EU has come out to espouse the pact describing it as a “a landmark deal that is good for fairer global trade and good for development”
According to the release, both developing and developed nations will for the first time be competing in a level agricultural export platform, gratifying a “key priority for EU negotiators”.
In the five-day meeting epitomised with a series of intense negotiations, the EU had two of its representatives – Phil Hogan, Commissioner for Agriculture, and Cecilia Malmstrom, Commissioner for Trade – at the forefront of the push to have the deal passed.
Hogan and Malmstrom, while welcoming the deal, referred to it as a payoff for the long days and nights of debate during the conference and tipped the set binding controls to “level the playing field for EU exporters”. Also, “the food aid deal,” Malmstrom explains, “will mean less displacement of local African production, which means it’s good for African farmers and good for the migration agenda.”
The WTO Deal in Brief
Basically, the deal bars subsidies and any other practices that “unfairly” support agricultural export. The WTO will follow up the removal of these subsidies worldwide and hopefully help protect vulnerable farmers in developing countries from the exploitative effects of export subsidies.
The deal also aims at cutting down the extent and complexity of the procedures that farmers have to follow in order to benefit from the “rules of origin”.
The changes, as outlined in the WTO deal, will be implemented in phases in a bid to offer developing and least developed countries enough time to comprehend and adapt themselves to the new rules.
For the EU farmers, who are mainly specialised in the production and export of farm products such as sugar, wheat flour and dairy, the elimination of subsidies will lead to a profit margin upsurge, and consequently an increase in the amount of exports of the aforementioned products.