WTO Guide

World Trade Organization
12 Specialized Agencies 13 Harvard Model United Nations India 2012

Harvard Model United Nations India 2012 A 12
an indication is key to letting the consumer make an
informed choice. While geographical indication can
often times be seen on agricultural products, they are
also found in products with special human factor.
89

An example of this would be Swiss watches or Swiss
knives. Because the watches or knives were produced in
Switzerland, the consumer perceives their quality to be
better than other products.
90

GEOGRAPHICAL INDICATION PROTECTION
Geographical indication is protected under
many national laws, including but not limited to
unfair competition laws, laws for certifcation marks,
or even laws specifcally mentioning the protection of
geographical indication. Tose who violate the laws that
protect geographical indication are subject to anywhere
from a fne to imprisonment.
91
QUESTIONS A RESOLUTION MUST ANSWER
1. Under what circumstances, if any, would it
be acceptable to temporarily violate established
protected intellectual property rights (i.e. during a
medical epidemic of a country)?
2. What guidelines should be in place to ensure a non-
biased and fair way to determine patent policy for
all countries? Or should countries be divided into
categories and then applied a certain set of policies?
3. In the set of determined patent policies, what areas
should be protected and why?
4. Because intellectual property rights are at times
simply ideas or research, how does the WTO plan on
ensuring their protection especially when traveling
across borders?
5. How does the WTO plan on monitoring intellectual
trafc on the Internet?
CONCLUSION
Two approaches exist to the defnition of information:
information as an objective series of topics, and
information viewed subjectively as a component of social
processes.
92
Because information is often times treated
as an item of property, the transfer of information can
often infringe upon global trade laws. To what extent
does a country protect its information from leaking out
to other countries? Should the regulation of information
be treated as a solid object and how does one take into
consideration of its uses and accessibility in trade?
Information in confdence, for example, can be traded as
property among those who know about its content and
could thus be potentially used as a point of exploitation.
Te freedom of idea is common to intellectual
property in all countries, but in a number of European
countries, Germany for one, ideas of artistic or inventive
merit require some assessment before recognition.
93
In
Britain, however, any work done oneself is regarded as
original and that is the only requirement. Judgment of
originality would be considered to subjective.
94

Many private and public organizations are packaging
information collected for internal purposes in order to
sell to external users. Tis has the advantage of making
some information available for the frst time, but the
disadvantage that it can be quite expensive. Access is then
only possible for those who can aford it, which many not
be in the public interest. Policies tend to concentrate on
how to foster the market and on the costs of providing
information
95
Conficts arise within intellectual property policy due
to many factors. One main factor is the rapid speed and
growth of technology. Because information can travel
to almost any destination with little efort, it makes
it easier to manipulate and make copies of it without
any detection.
96
Also, intellectual property is rising in
importance because many countries depend on it as a
source of wealth and infuence.
97

Take time to think about the issues surrounding
intellectual property. It is not as easy as it seems. What
are the exceptions of intellectual property protection, if
any? Should a country have the power to take measures
to deal with national emergencies that are correlated with
the lack of access to proper medicine, medicine found
under intellectual property protection.

TOPIC B:
AGRICULTURAL DEVELOPMENT AND
ITS IMPACT ON SUSTAINABLE DEVEL
OPMENT
INTRODUCTION
To frst highlight some key issues brought on by
the agricultural debate is the participation of developing
countries. Because the government provides much of
the agricultural subsidies given to the farmers from, it
signifcantly hinders developing countries from entering
global agricultural trade because they lack sufcient
fnancial resources to do so.
99
Trough a domino efect,
the farmers lack of ability to enter the trade market
will consequently lower his or her own income and the
chance to escape from poverty.
Te ultimate goal of this topic area is to
eventually produce guidelines and regulations that will
ensure developing countries their opportunity to enter
the global marketplace with the proper skills and abilities.
Also, delegates should seek to fnd out more efcient
methods in reducing the level of distortion on the
agricultural market. It is important to note that even if
developing countries enter the market, it must be made
sure that they enter in at the same levels as the other
countries already in the agricultural trade market.
HISTORY OF THE SITUATION
THE AGRICULTURE AGREEMENT
Te Agriculture Agreement, which seeks out to
reform trade and orient policies so that both importing
and exporting countries will both experience predictable
and reliable market transactions.
100
Applications of the
Agriculture Agreement include market access, domestic
support, and export subsidies. Members included in the
negotiations dealing with the Agriculture Agreement
pledge to comprehensive negotiations aimed at
substantial improvements in market access; reductions of,
with a view to phasing out, al forms of export subsidies;
and substantial reductions in trade distorting support.
101

Tis study guide will go into further detail about each of
the three sectors.
MARKET ACCESS
Market Access refers to the laws and regulations
that govern imports
102
, as well as the the long-term
objective of substantial progressive reductions in support
and protection.
103
Before the Uruguay Round, a
round of negotiations concerning a multitude of trade
issues, some agricultural imports faced quotas and other
restrictions. Tarifs have come to replace the quota
implementations and the other non-tarif measures
without compromising the level of protection. Tis
process is known as tarifcation.
104
For the European Union, their main concern in
association with market access is whether or not to
approve separation (decoupling) of payments to farmers
based on production.
105
Tese types of payments cause
the most distortion and in 2003, the EU agricultural
ministers made a step toward advancing trade negotiations
by partially decoupling certain products.
106

Te EU reform largely addressed one of the three
pillars of agricultural reform domestic support- but did
little in a second pillar market access. In the WTO
negotiations on market access, the United States and
the Cairns Group support a leveling, or harmonizing, of
tarif peaks, or high rates. In comparison, the EU and
Japan want fexibility to cut some items less than others
to arrive at an average total rate cut.
107

In 1995, a new system of tarifs and tarif quotas was
enacted. According to the Uruguay Round, developed
countries would cut tarifs by an average of thirty-six
percent over the course of six years. Developing countries
would make an average cut of twenty-four percent over
the next ten years. Least-developed countries did not
have to cut any of their tarifs.
108
Developing countries take great importance in the
reform of agricultural trade because only through changes
can they have the opportunity to step into the global
agricultural market. Teir main reasoning in calling
for change is because they argue subsidies promote
unfair competition between developed and developing
countries.
109
Te European Union and the United States,
two major portions of developed countries, sell their
agricultural products into the world trade market at low
prices because of the subsidies.
110
Tis makes it difcult
for developing countries to compete because they do
not have the resources to subsidize their farmers and are
placed at a disadvantageous position. African countries
are also calling for the termination to cotton subsidies.
111

In the same way agricultural subsidies hinder developing
countries and their farmers from entering the world
market, cotton subsidies destroy the market for the
African producers.
112

Te July 2004 Framework Agreement provided a basis
for which to continue the agriculture talks. On domestic
support, subsidies are to be reduced by means of a tiered
or banded approach applied to achieve harmonization
in the levels of support. Subsidizing countries will make
a down-payment of a 20% reduction in levels of support
in the frst year of the agreement. Tarif reduction will
utilize a tiered formula with a harmonization component,
but with some exceptions for import sensitive products.
Te European Union fnally agreed to the elimination of
export subsidies, considered a major negotiating goal of
the United States.
113

DISTORTION
With much talk about distortion in the agricultural
market, what exactly is distortion? Distortion is the level of
trade that is at an unusual, either higher or lower, level.
114

Tis can include higher or lower than normal prices and
higher or lower than normal amounts.
115
An example the
World Trade Organization gives on its website is the how
import barriers and domestic subsidies make crops more
proftable within the countrys own market. Because of
these higher prices, farmers are incentivized to produce
more. When the over-production spills over to the
world market where the price is not as high, then export
subsidies are required.
116
Governments give their support for farmers for three
main reasons: to make sure each country has enough
food to support its people, to protect farmers from
distortion caused be the weather and world prices, and
to preserve rural society.
117
However, because policies can
be expensive to enact and lead to unprecedented negative
consequences, what is the best way to meet these goals
with the least amount of distortion in trade?
DOMESTIC SUPPORT
Domestic support includes the subsidies and programs
that work to negotiate farmers rights (income support
and farm gate prices).
118
Policies that do not enforce
domestic support, or product subsidization, encourage
the act of over production, which can lead to market
distortion. Within the category of domestic support, the
Agriculture Agreement has further classifed it into those
programs that efectively stimulate production and those
that do not.
119
For those that do, trade has to be cut back.
From 1995, developed countries promised to cut back by
twenty percent over the course of six years.
120
Developing
countries agreed to cut back by thirteen percent over the
course of the next ten years. Once again, like in market
access, least-developed countries do not have to make
any change.
121
For the programs that cause minimal distortion to
trade, the Agriculture Agreement concluded that they
could be continued freely.
122
Programs that are considered
to be minimal distortion include disease control, food
security and direct assistant to farmers.
123
Export Subsidies
Export subsides are in place to ensure that the
market remains competitive, the driving force in a
trading market.
124
Under the Agriculture Agreement,
export subsidies are probibited unless it is specifed in a
members list of commitments.
125
Starting from 1995, developed countries had to cut
back on thirty-six percent of the value in export subsidies
over six years; developing countries must reduce by
twenty-once percent over six years, and no change in the
least-developed countries.
126
Main issue is distortion in trade, goal is to minimal
the disturbance. Te Agriculture Agreement also state
that developing countries are not required to lower
their subsidies and tarifs as much as the developed
countries.
127
Least-developed countries can completely
omit this process. Special rules also govern countries that
rely primarily on the exports of other countries for food as
well as the concerns for the least-developed countries.
128

CURRENT SITUATION
One of the criticisms concerning the Agriculture
Agreement is that small farmers are one of the key income
resources for developing countries.
129
By reducing tarif
protections for small farmers, developing countries
do not have sufcient funds are unable to pay their
farmers.
130
Developed countries, on the other hand, can
continue to pay their farmers subsidies.
Te NGOs have also criticized the Agriculture
Agreement for categorizing subsidies into the amber
box, the trade-distorting domestic subsidies, for being
reduced, and non-trading distorting subsidies, for being
increased.
131
According to the Tird World Network:
Tis has allowed the rich countries to maintain or raise
their very high subsidies by switching from one kind of
subsidy to anotherlike a magicians trick. Tis is why
Mickey Kantor signs the Final Act of the Uruguay Round at Marrakesh, April 1994.
after the Uruguay Round he total amount of subsidies of
OECD countries have gone up instead of going down,
despite the apparent promise that northern subsidies
will be reduce.
132
Martin Khor, the executive director
of South Centre, a organization of developing countries,
also argues that the green and blue box subsidies can
also be considered as trade distorting, stating that the
protection is better disguised, but the efect is the
same.
133
DOMESTIC SUBSIDIES
Domestic subsidies have been a point of
discussion because when there is too much of the
domestic subsidies, the agricultural sector then in turn
tends to over produce.
134
Te over-production of goods
becomes channeled into international markets while a
restriction is still placed on limiting foreign goods from
entering the internal market.
135
COUNTRIES THAT DEPEND ON FOOD IMPORTS
WTO member states under the Agriculture
Agreement agreed to reduce the amount of subsidized
exports. However, because many poor countries depend
on a supply of cheap food from other major production
nations such as the United States, their required level
of assistance is higher than other relative developing
countries.
136
While the poor countries will receive a
slight beneft in higher prices as a result of the reduction
in subsidized exports, it is still not enough for them to
completely make the adjustment independently.
137

GENERAL AGREEMENT ON TARIFFS AND TRADE
Te General Agreement on Tarifs and Trade (GATT)
was the predecessor before the establishment of the WTO
in 1995.
138
After much negotiation between countries to
create the International Trade Organization (ITO), the
result was the GATT instead.
139
One of the rounds under
the GATT was the Uruguay Round of 1986-1994, with
the others being Annecy Round of 1949, Torquay Round
of 1951, Geneva Round of 1955-1956, Dillon Round of
1960-1962, Kennedy Round of 1964-1967, and Tokyo
Round of 1973-1979.
140
One of greatest accomplishments of the GATT was
the creation of the WTO. Te existing seventy-fve
members of the GATT and the European Communities
became members of the newly formed WTO.
141
Since
establishment in 1995, ffty-two GATT members
have rejoined the WTO, and twenty-one non-GATT
members have also joined.
142
URUGUAY ROUND
Te Uruguay Round lasted from 1986 to 1994 and
was a round of negotiations on issues such as tarifs and
trade negotiations with 123 countries.
143
Its actions
began implementation under the control of the World
Trade Organization in 1995 and lasted until the year
2000, 2004 for the developing countries. Te Uruguay
Round had a few main goals: to reduce agricultural
subsidies, restrict foreign investment, begin processes
such as banking and insurance.
144
It is considered to be one of the largest negotiations of
any kind and although the Uruguay Round faced many
difculties, it persisted to become what would be known
as the largest trading reform since the end of World War
II.
145
DOHA ROUND
Te Doha Round began in 2001 and is the current
trade negotiation in the World Trade Organization.
146

Te main objectives of the Doha Round are to facilitate
global trade and lower trade restrictions. It also serves
to negotiate over topics such as agriculture, tarifs, non-
tarif barriers, etc.
147
Te Doha Round continued after
the end of the Uruguay Round when some countries
wanted to achieve greater trade liberalization.
148
Recently,
in the past couple of years, there have been conficts
between the developed nations (European Union, United
States of America, Japan, etc.) and the major developing
countries (China, India, South Korea, etc.). Te dividing
conficts between the countries range anywhere from
agricultural trade to industrial tarifs, and even service
and trade remedies.
149

One major event that lead to further negotiations
in the Doha Round include the terrorists attack on
the United States on September 11, 2001. Countries
and government ofcials saw trade negotiations during
the Doha Round as a means of tightening political
cohesion by bringing countries together.
150
During
the Doha Round, developing countries also took on a
more important role. Before, the main decision-makers
of the GATT and other trade negotiations were almost
exclusively developed countries.
151
However, the Doha
Round was the arena in which developing countries stood
up for their interests and refused to support negotiations
unless they also received benefts.
152

With the exception of actions on the Dispute
Settlement Understanding, trade ministers agreed that
the outcome of the negotiations would be a single
undertaking, which means that nothing is fnally agreed
until everything is agreed. Tus, countries agreed
they would reach a single, comprehensive agreement
containing a balance of concessions at the end of the
negotiations.
153

CANCUN MINISTERIAL
While there are also other ministerials such as the
Hong Kong Ministerial, the ffth Ministerial Conference
in Cancun, Mexico in 2003 was of signifcant importance
because it put the goals of the Doha Agenda back into
perspective.
154
Te Cancun Ministerial ultimately failed
with no ending agreement due to many reasons. One
of the reasons was irreconcilable diferences from the
Singapore Issues. On 1996 in Singapore, the frst WTO
ministerial conference worked to create working groups
on four issues trade facilitation, trade competition, trade
investment, and transparency of government involvement
also known as the Singapore issues.
155
Another reason
that led to the eventual collapse can be attributed to the
lack of fexibility between the participating countries.
156

Many of the participating countries were resistant to
other ideas and thus made discussion difcult. Last, but
not least, the large gap between the developed and the
developing countries made negotiations impossible.
157

On top of complex procedures, the Cancun Ministerial
did not produce any major results.
158

One creation that did come out of the Cancun
Ministerial was the Derbez text.
159
Tis text, although
never ofcially adopted, was looked upon as a possible
starting point for further negotiations. In terms of
agriculture, the Derbez text drew mainly from the
United States and the European Union, as well as a
Group of twenty-one proposals.
160
It called for a larger
cut in domestic subsidies, a mixed tarif approach with
better, more enticing terms for the developing countries,
and the elimination of export subsidies, done once again
in the interest of developing countries.
161

LOGISTICS OF THE DOHA
AGENDA
Te Doha negotiations
are in surveillance by the Trade
Negotiations Committee (TNC).
Negotiations typically are governed
through working groups and
other existing bodies in the WTO such as market access,
development issues, or trade facilitation.
162
AGRICULTURE NEGOTIATIONS
Key to understanding the
WTO agriculture negotiations is
to frst understand the diferent
boxes that have been associated
with subsidies. In accordance with
the trafc light colors, a green box
refers to being permitted, amber box refers to slow down,
and red box refers to forbidden.
163
Within the Agriculture
Agreement, there is no red box. Instead, there is a blue
box for limiting production.
A. AMBER BOX
Any domestic supports that
are not in the ball and green
boxes fall in the amber box. Tis
box includes domestic support
measures that cause distortion in
production and trade. An example would be to subsidize
directly to production quantities.
164

B. BLUE BOX
Te blue box can also be considered as the amber
box but with all the special provisions that aim to reduce
distortion. Tere are no current limits on spending for
blue box subsidies. Te blue box is seen as alternative to
the amber box and a way to move away from distortion.
165

C. GREEN BOX
Qualifcations of the green box include subsidies
that do not distort trade at all, or have very minimal levels
of distortion.
166
Te subsidies also cannot be funded by
the government or have price support methods. Usually,
programs that are targeted at a broad subject of products
are placed into the green box. Income support for
farmers can also be included in the realm of the green
box.
167
According to the WTO website, specifc subsidies
in the green box include: direct payments to producers,
decoupled income support, and government fnancial
support. However, not all countries are in accordance
with this view.
168
PROPOSED SOLUTIONS
REDUCTION METHODS
Tere are many ways to reduce tarif reductions.
Some are more commonplace than other tarif reduction
methods and some are based on formulas, but essentially
they all try to accomplish the same goal.
169
Tarif rates,
however, are subject to change depending on the
negotiating countries involved and their desired level
of tarif rates. Below are some possible methods of
reduction.
170

SINGLE RATE REDUCTION METHOD
In this method, all products with tarifs are cut to a
single rate. While this is the simplest way of reduction, it
is only mainly used for regional free trade in which the
tarif rate eventually becomes zero, or a number that is
very low.
171
Flat Rate Percentage Reduction
Tarifs are cut according to the same percentage for
all products regardless of what the initial tarif was.
172

An example may be that all tarifs must be cut by thirty
percent over the course of ten years.
Uruguay Round Approach
Te Uruguay Round concluded that developed
countries would have to reduce their tarifs by an average
of thirty six percent over the course of six years, while
keeping a ffteen percent minimum on each product.
173

In other words, the countries negotiated an average
percentage reduction over a certain number of years
with a specifed minimum amount of reduction.
174

Te Uruguay Round holds two main features: fat-rate
percentage reductions leads to a variety of numbers as
the fnal number in comparison to the harmonizing
reduction method, and the variation in individual
product tarif due to a combination between both average
and minimum reduction.
175

HARMONIZING REDUCTIONS
When steeper cuts are required for tarifs, harmonizing
reductions essentially harmonizes the rates by bringing
the tarifs closer together. In an example given by the
WTO, there can be diferent percentages for diferent
tarifs no cuts for tarifs between 0 and 10%, 25% cuts
for tarifs between 11% and 50%, 50% cuts for tarifs
above that, etc. A variation could include scrapping all
tarifs below 5% which are sometimes seen as a nuisance
with little beneft.
176
Another method for harmonizing
reductions is through mathematical formulas designed to
do so Swiss Method.
177
QUESTIONS A RESOLUTION MUST ANSWER
1. How does the WTO plan to use export subsidies as
a way to control the cost of export markets and transports
and make exports competitive?
2. Because many least-developed countries are
dependent on a consistent supply of food from other
industrialized and developed nations, how does the
WTO plan to deal with the lag between the initial high
priced imports and high priced exports? While the latter
would eventually be benefcial for poor countries, the
frst must cross the hurdle of overcoming higher priced
imports.
An example of the Uruguay Round Approach
3. How does market access such as tarifs or other
trade restrictions play a role in the agricultural market?
4. How do domestic support programs afect
agricultural trade? What are the diferent roles they play
between developed and developing countries?
5. How does the WTO plan to deal with other
problems that come with negotiations in the agricultural
sector (i.e. rural development, food security for developing
countries, and environmental protection, etc.)?
CONCLUSION
Trough this topic background guide, many issues
concerning the welfare of farmers to the welfare of
countries are introduced through the agricultural trade
market. What rules or regulations can the members
of the WTO set up in order to introduce a fairer state
of competition in the global market as well as more
attention for the struggling developing countries? Issues
that pertain to the agricultural market have a large efect
in establishing cohesion between the countries and may
even lead many countries out of poverty.

(Endnotes)
1 WIPO - World Intellectual Property Organization. Web. 1 June. 2011. <http://www.wipo.int/>.
11 WIPO World Intellectual Property Organizations. Web. 2 June. 2011. <http://www.wipo.int/treaties/
en/general/>.
12 WIPO World Intellectual Property Organizations. Web. 15 June. 2011. <http://www.wipo.int/
treaties/en/general/>.
21 Shapiro, Robert J., and Nam D. Pham. Economic Effects of Intellectual Property-Intensive
Manufacturing in the United States. (2007): 3. Web. 2 Aug. 2011. <http://www.sonecon.com/docs/
studies/0807_thevalueofip.pdf>
studies/0807_thevalueofip.pdf>.
23 WIPO - World Intellectual Property Organization. Web. 15 Sept. 2011. <http://www.wipo.int/>.
32 Fergusson, Ian F. CRS Report for Congress. (2008): 15. Web. 15 Sept. 2011.
<http://www.au.af.mil/au/awc/awcgate/crs/rl32060.pdf>.
Manufacturing in the United States. (2007): 15. Web. 2 Aug. 2011.
Data from the WTO website for further understanding:
Agricultural Products Share In Trade (2003)
58 World Intellectual Property Organization. What Is Intellectual Property. 19. Web. 15 Sept. 2011.
<http://www.wipo.int/freepublications/en/intproperty/450/wipo_pub_450.pdf>.
75 World Intellectual Property Organization. Understanding Intellectual Property. 10.
Web. 15 Sept. 2011. <http://www.wipo.int/freepublications/en/intproperty/895/wipo_pub_895.pdf>.
92 Eisenschitz, Tamara S. Information Transfer Policy: Issues of Control and Access. 17.
London: Library Association Pub., 1993. Print.
96 Eisenschitz, Tamara S. Information Transfer Policy: Issues of Control and Access. 19
98 World Trade Organization - Home Page. Web. 15 July. 2011. <http://www.wto.org/>.
99 World Bank Group. Web. 15 Sept. 2011. <http://www.worldbank.org/>.
101 Fergusson, Ian F. CRS Report for Congress. (2008): 9. Web. 15 July. 2011. <http://www.au.af.mil/au/
awc/awcgate/crs/rl32060.pdf>.
102 Fergusson, Ian F. CRS Report for Congress. (2008): 9. Web. 15 July. 2011.
107 Fergusson, Ian F. CRS Report for Congress. (2008): 9. Web. 15 July. 2011. <http://www.au.af.mil/au/
awc/awcgate/crs/rl32060.pdf>.
131 World Trade Organization - Home Page. Web. 27 July.. 2011. <http://www.wto.org/>.
132 Strengthening Efforts to Eradicate Poverty and Hunger Dialogues at the Economic and
Social Council. 27 July. NewYork, NY: United Nations (UN). Department of Economic
and Social Affairs (DESA). Office for ECOSOC Support and Coordination, 2007.
Print.
133 Khor, Martin. TWN Info Service on WTO Issues. (2003): 1. Third World Network. 2
July 2003. Web. 27 July. 2011. <http://www.twnside.org.sg/title/twninfo36.htm>.
134 World Trade Organization - Home Page. Web. 1 Sept. 2011. <http://www.wto.org/>.
148 Fergusson, Ian F. CRS Report for Congress. (2008): 1-23. Web. 15 Sept. 2011.

WTO Guide

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

WTO Guide

Uploaded by

Copyright:

Available Formats

World Trade Organization

12 Specialized Agencies 13 Harvard Model United Nations India 2012

You might also like