“Sensitive” farm quotas revealed

The global tariff-quotas—open to all suppliers—would have been:

  • Beef: 290,000 tonnes
  • Sheepmeat: 42,000 tonnes
  • Butter: 69,000 tonnes
  • Cheese: 79,000 tonnes
  • Sugar: 680,000 tonnes
  • Poultry: 200,000 tonnes

There are several catches, of course. These are “sensitive product” quotas that the EU would have opened up in return for keeping high barriers around the other 92% of its market for these products (quotas were set at 3-5% of consumption in the Uruguay Round of negotiations, so adding new quotas equal to about 4% of consumption would take import quotas to around 8% in total). There are few rules on quota administration in the draft Doha deal, but you can be pretty confident that EU quota-holders will secure most of the rents in these quotas—that is, the difference between the EU wholesale price and the landed, duty-paid price, if any. Also, based on past behavior, there is a risk some quotas would be administered in a way that ensured they would be only partly filled.

Very likely, the USA, Canada and Japan would also have opened up new quotas equal to about 4% (or less) of their domestic consumption of products such as pork, dairy, sugar and grains (more here and here).

Question: does this look like the ‘substantial improvements in market access’ that the Doha Round set out to achieve? Barriers to farm trade would have remained high as part of the deal on these quotas. The Doha round offered the EU, Japan and to a lesser extent the USA and Canada a way to buy an extension of their existing barriers (it offered developing countries still greater concessions on farm trade barriers). So the problems would have remained the same, but a little softer around the edges.

There’s no doubt, however, that these are attractive numbers for Australian sugar, meat, and dairy exporters.

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