Manila has rejected efforts of rich countries to implement deeper tariff cuts on farm products because they were lukewarm to a proposed scheme that will allow developing countries, such as the Philippines, to protect their domestic industries from harmful import surges.
In his speech before fellow farm ministers at the 11th World Trade Organization (WTO) Ministerial Conference (MC11) in Argentina, Agriculture Secretary Emmanuel F. Piñol emphasized that the Philippines will not agree to a new farm deal sans a concrete special safeguard mechanism (SSM) for developing countries and least-developed countries (LDCs).
“The Philippines, once more, wants to reiterate its firm decision that none of the priority of the WTO members provide sufficient political basis for us to support any concrete substantive outcome in this conference in the absence of a specific solution on SSM,” Piñol said during the first day of MC11 in Buenos Aires on December 12 (Philippine time).
A negative opinion from the Philippines is enough to block any new WTO deal because members of the multilateral trading body decide as a whole on a consensus basis.
“This minimum requirement is even critical for the Philippines, as members continue to evade the needed reforms in domestic support, especially phasing out trade-distorting support, including an interim commitment to limit supports at the product-specific level,” he added.
Piñol urged WTO member-countries to act upon the Philippines’s proposal on establishing SSM if they want to get Manila’s nod for any agricultural deal in the ongoing MC11.
“I therefore call on members with extreme urgency to act now and engage us on our proposal to have a specific and targeted solution on SSG for some members on the basis of our proposal,” he added.
During his speech at the plenary session, Trade Secretary Ramon M. Lopez said inequities in agricultural trade continue to exist, as a few WTO member-countries have maintained their large subsidies for farm products.
“It is high time that members made bold contributions today, once and for all, to address these gross imbalances and inequities in agriculture,” said Lopez, who heads the Philippine delegation to MC11.
“I therefore call on members to substantially reduce, toward elimination, trade-distorting subsidies by phasing out AMS [aggregate measurement of support] and limit supports at the product-specific level,” Lopez added.
The trade chief said an “effective SSM” must be created at the WTO, as the farm sectors of developing countries and LDCs have been harmed by heavily subsidized exports.
“After more than a decade of negotiations for SSM and ministers’ reaffirmation of our political commitment, developing countries and LDCs cannot get back home empty-handed once more,” he added.
SSM is a trade measure that will allow developing countries to raise tariffs temporarily to deal with import surges or price falls, according to the WTO. It has become one of the most contentious trade issues within the WTO, especially between developed and developing countries.
In 2004 WTO member-countries agreed that SSM will be established for use by developing countries, as indicated in the so-called July Framework. In the 2005 Hong Kong Declaration, WTO developing country members will have the right to recourse to SSM based on import quantity and price triggers.
However, 13 years after the SSM was first floated within the WTO, a concrete framework on it has yet to be crafted. Among the most contentious issues concerning SSM are the “trigger level” and the rate of tariffs that will be imposed.