Linkages between Bilateral and Multilateral Negotiations in Agriculture

Agricultural trade policies in the new millennium

The 2001 Framework for Conducting Environmental Assessments of Trade Negotiations is being applied to multilateral, regional and bilateral trade negotiations and foreign investment promotion and protection agreements. This article provides an overview of the challenges and lessons learned during these assessments from the perspective of the environmental assessment of the Trade Secretariat for the Government of Canada. Recent efforts have focused on application of the Framework to investment negotiations, improving consultations and communications, and addressing the ongoing challenge of data limitations. The article closes with a discussion of some issues that require continued consideration by environmental experts and trade negotiators working in impact assessment of trade and investment negotiations.

The fact that trade, and especially agricultural trade, remains far from free is puzzling, since the superiority of free trade receives overwhelming support among economists (Gawande and Krishna, 2003; Rodrik, 1994). International trade scholars have devoted significant resources to forecasting the impact of trade policy reforms (for a survey of these studies see Congressional Budget Office, 2005), and their findings are relevant inputs for officials negotiating a trade agreement as well as for politicians in charge of ratifying it. The perceived gains and losses attached to different outcomes have been identified as a significant factor shifting the outcome of a trade agreement negotiation (McMillan, 1990). Less well-known are the factors that would impact the result of a negotiation round involving agriculture. While political scientists have devoted significant resources and developed numerous theories to explain the pattern of bargaining outcomes, the number of empirical assessments remains limited. Among the factors to blame for the low number of empirical evaluations is the scarcity of information regarding negotiation strategies and outcomes (Odell, 2002). The lack of research in this area is puzzling, since countries negotiating regionally and multilaterally have many times struggled to satisfactorily conclude negotiations due to a lack of consensus on agriculture. The potential gains that a reduction in agricultural protection worldwide could generate, and the limited knowledge on the ways negotiation outcomes can be affected, are the main motivations for this study. As stated by Hoekman and Anderson (1999) in reference to reaching an agreement on agriculture in the current WTO Doha Round of negotiations, “The potential gains from liberalization are large”, but “Getting there is another matter” (p. 175). This study focuses on U.S. trade negotiations with Western Hemisphere countries, with particular attention to sensitive agricultural products, about which the most heated bargaining occurs. Arguably as a consequence of the lack of progress at the multilateral arena, the U.S. has embarked on bilateral trade negotiations with several countries, but with a particular emphasis with Western Hemisphere partners. Thus, over the last 10 years it has ratified trade agreements with Chile, Peru, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua (the last six as part of the DR-CAFTA Agreement), and signed but not yet ratified agreements with Colombia and Panama. Following Trefler (1993), a simultaneous equation model is developed to estimate the correlation between the change in market access (ΔMA) as a result of free trade negotiations, and a number of political economy (PA) and negotiation context (NC) variables suggested by the endogenous tariff theory to be associated with the level of protection granted to a sector. The change in market access in the context of this study is represented by changes in import tariffs and tariff-rate-quotas negotiated as part of the preferential trade agreements (PTAs). While we acknowledge the increasing importance of non-tariff barriers (other than TRQs) as a way to afford protection from imports, PTAs usually do not include specific outcomes on NTBs, and therefore gauging the change in NTBs resulting from a PTA is not possible. Negotiation process variables (NP) primarily bargaining strategies, are seen by many scholars as important intervening variables to explain the pattern of market access achieved in bargaining. By focusing on sensitive agricultural products, this study controls for (NP) variables, since negotiations on sensitive agricultural products between the U.S. and its developing Western Hemisphere partners are assumed to have entailed the use of strong bargaining strategies on both sides. Political economy variables subject to be used are economic size, concentration ratios, import penetration ratios and their change, capital/labor ratios, and sectoral to total labor ratios, all argued to be positively related to the level of protection granted to a sector. Among feasible negotiation context variables are relative power of nations, foreign direct investment in the partner’s economy, unemployment rate, and tax structure (dependence on import policies as a source of revenues). The level of imports (IMP) is modeled to be a function of comparative advantage variables (CA) and the change in market access ΔMA. ΔMA = f(PA, NC NP) IMP = f(CA, ΔMA) The findings from the quantitative assessment are to be complemented with findings from selected case studies, thus expanding our understanding of the factors affecting the outcome of the bargaining activity over sensitive agricultural products in the context of preferential trade agreements.

The WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) established the first multilateral understanding of what constitutes a standard for ‘adequate’ and ‘effective’ protection of intellectual property rights, and established a new mechanism for monitoring and reviewing how these standards are met. The policy and legal framework defined by the TRIPS Agreement has, in the two decades since it entered into force, progressively gained acceptance as a legitimate, balanced and transparent set of standards. Since then, however, two parallel sets of negotiations have revisited the standards defined by TRIPS: the multilateral WTO accession negotiations, and bilateral and regional trade negotiations outside the WTO. In each case, TRIPS standards have been further elaborated, and timelines for their implementation altered, in a manner that produces a layering of rules upon the foundation of TRIPS. However, the institutional, legal and policy implications of these two lines of development contrast sharply. This chapter reviews the main lines of development of rules relating to intellectual property in the accession processes, and contrasts these with the parallel developments outside the WTO. It concludes with an analysis of the policy and practical lessons that can be derived from contrasting these two processes.

Multilateral trade negotiations during the Doha Round (DR) have faced great difficulties in reaching a conclusion, raising scepticism regarding the possibility of an acceptable deal. The slow pace of reforms in agricultural policies in the developed countries has reinforced this assessment. The debate about the prospects of the DR has focused on the impacts of liberalization on all trading partners. The argument of this article contains a critical review of liberalization as a guide to the organization of the international market and domestic food systems. The prevailing view of free trade is criticized with emphasis on the weakness and flaws of the multilateral arrangements, despite the results of the Bali Conference. Also, the need for change in the direction of national policies is considered, away from their liberal promises, with particular attention given to the recent food crisis and the challenges for a global food security agenda.

The environment and how Government policies relate to the environment are increasingly important issues for trade economists. The suggestion made throughout this volume is that the environment under which agriculture operates physically, legally, and institutionally plays a profound role in determining emerging trade patterns. Major efforts are underway to change the rules of international trade under multilateral and bilateral trade negotiations. The outcome of these negotiations will substantially alter the structure of trade in years to come.

As Association of Southeast Asian Nations (ASEAN) exports to the United States increased over time, some of those countries became subject to antidumping duties by the United States from 1985. The cumulation proviso introduced in the Trade and Tariff Act of 1984 made the relatively smaller exporters like the ASEAN countries exposed to the antidumping measures of the U.S. International Trade Commission (ITC). By industry, iron and steel shared about half of the decisions against ASEAN. The percentage of the U.S. ITC Commissioners' affirmative antidumping decisions against the ASEAN member countries was a little higher than that against the other countries. The Democrat Commissioners tended to take more affirmative antidumping decisions against ASEAN than the Republican Commissioners. I. Introduction The reductions in tariffs over the past half century have led the contracting parties and Members of the GATT/WTO to resort to practices other than tariff imposition which constrain trade. The restriction that came to be most often applied is antidumping, which is allowed under certain conditions by the GATT/WTO. In 1995, for instance, antidumping actions reported by the Members to the WTO Committee on Antidumping Practices reached some 352. In the same year, the United States completed 57 preliminary and final antidumping injury investigations on products imported from 16 different countries (U.S. International Trade Commission [ITC], 1996). Although the United States has been one of the largest users of administered protection like antidumping, the ASEAN members were not subject to the U.S. antidumping neasures until the first half of the 1980s. The United States began to take antidumping measures against some of the ASEAN members from 1985. Being highly dependent on international trade, they have been concerned with such measures. Even when the ASEAN members successfully defended themselves against the antidumping petitions, time and resources were wasted. This article intends to show the characteristics of the U.S. antidumping measures against ASEAN, which have rarely been studied in the literature. For this purpose, the WTO regulations on antidumping as well as the U.S. antidumping laws and policies are explained. With this background, the reasons for the upsurge in the U.S. antidumping actions against the ASEAN members are revealed. Furthermore, the U.S. ITC Commissioners' antidumping decisions are investigated to check whether they show partisan or sectoral characteristics. The structure of the article is organized as follows. In the next section, the WTO regulations on antidumping are briefly described. In section III, the U.S. antidumping law and the procedure of its implementation are explained. In section IV, the characteristics of the U.S. antidumping decisions against the ASEAN members are revealed. The U.S. ITC Commissioners' behaviour is also analysed depending on their affiliation with the parties. The final section summarizes the overall results. II. The WTO Regulations on Antidumping Although most international economists do not refute the superiority of free trade over protection in improving national welfare, policy makers in most countries actively practised some form of trade protection. Multilateral trade negotiations have brought down average tariffs to alleviate the trade barriers. The Tokyo Round in the 1970s began to alleviate the non-tariff barriers practised by the then GATT contracting parties. Important advances were made in the Uruguay Round negotiations to guarantee the freer and more transparent trade policies of the WTO Members: mandatory, not voluntary, nature of various Agreements on the non-tariff barriers; strengthening the dispute settlement mechanism; and comprising new areas such as trade in agricultural goods, trade-related intellectual properties, and trade in services.' However, despite the successive, multilateral trade negotiations, the uses of contingent protection such as antidumping certainly have been on the increase. …

The paper addresses current issues in Japan-U.S. foreign trade following the signing of the Japan-U.S. Trade Agreement and the Japan-U.S. Agreement on Digital Trade in October 2019. By providing an overview of Japan-U.S. trade relations, analyzing current trends in bilateral foreign trade and outlining basic terms of new bilateral agreements, the authors conclude that “path-dependency” in Japan-U.S. contemporary foreign trade persists and trade relations between the two countries are to a greater extent influenced by the U.S. trade policy which aims to assure a broader access of American companies to Japanese markets – the situation that was typical for bilateral trade relations since the 1980s. “Path-dependency” in Japan-U.S. trade relations, conventionally categorized by the existence of numerous trade contradictions, is pronounced in the unchanged goals, strategy and tactics of foreign trade negotiations. The United States maintains its “attacking” role and dominates in the bilateral trade negotiations, while Japan, despite its enhancing influence in the multilateral trading system and regional trade agreements, is forced to “self-defend” and make concessions to a more dominant partner in order to maintain its automobile exports to the United States at the expense of its national interests in other industries, particularly in the agricultural sector. Thus, new trade agreements are unlikely to cause significant structural changes in Japan-U.S. bilateral trade in the shortterm as the problem of persistent trade deficits remains. In order to break the vicious circle of “path-dependency” Japan is to actively cooperate with the economies of the European Union which have large amounts of trade deficits with the U.S., can serve as a mediator in the U.S. – China trade conflicts, as well with other Asian countries via mega-FTAs which possess potential risks to the United States. Further development of foreign trade cooperation will depend on the initiatives of new governments in both countries.

In spite of their growing importance in international trade as well as in bilateral and multilateral trade negotiations, services have only attracted limited attention from researchers interested in determinants of trade policies and trade cooperation. This paper seeks to account for countries' varying levels of market access commitments under the multilateral General Agreement on Trade in Services (GATS). I develop an argument suggesting how levels of democracy and factor endowments are associated with more commitments. The empirical analysis supports these propositions, and also suggests that relative size, as well as regulatory capacity, are positively linked to GATS commitments.

This thesis examines Thailand's international trade negotiations, using a political economy framework. It concentrates on the country's multilateral negotiations in the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) and bilateral negotiations with the United States on intellectual property protection. The objectives of this thesis are to analyse the role of the Thai private sector and the autonomy of the Thai government in the process of these negotiations. This study argues that, apart from the public sector, the Thai private sector also plays an important role in the country's trade negotiations. However, the level of its participation varies from one negotiating framework to another. Bilateral negotiations tend to draw more attention from the private sector, because they have more direct impact on individual businesses. This is a result of the high concentration of interest caused by the small number of negotiating issues and people involved in these negotiations. In the country's bilateral negotiations with the United States, Thailand's private sector actively engaged in the negotiating process through various kinds of lobbying activities. The Thai government had to respond to these activities and compromise interests among different groups. In contrast, the role of Thai private enterprises in the Uruguay Round negotiations was rather limited. This provided the Thai government with autonomy in formulating the country's negotiating positions and in implementing Uruguay Round commitments. This resulted in a higher degree of autonomy for the government in the Uruguay Round negotiations, compared with bilateral negotiations with the United States. Thailand's Uruguay Round negotiations and its bilateral negotiations with the United States carry some implications, both for government policy and agencies as well as for their relationship with private businesses. There have already been a number of changes not only in the Thai bureaucratic system but also in the general public's opinion regarding trade negotiations. Nevertheless, to improve the capability of Thai government officials in the negotiating process and to promote national interests, some further changes are still necessary.

This paper aims to help Asian trade negotiators by examining the processes and results of the Uruguay Round. Analysts argue that trade negotiations are based on mercantilistic rules. But the actual outcome of the Uruguay Round suggests that trade bargaining was not based on strict reciprocity. In terms of tariff reductions, Asian economies received more than they gave, but relative to tariff bindings, Asian economies gave more than they received. Asian economies that undertook trade reforms prior to the trade talks did not lose bargaining power. The paper also presents econometric evidence on the determinants of bargaining power of nations.

Regional trade agreements have increasingly become important as a medium for effecting trade liberalization. The trend is not expected to recede. There is not to suggest that multilateral trading system under the WTO has to be relegated. Regional trade agreements may be a good avenue to pursue market access reforms, but they do have an obvious limitation in making a foray into rule-making. They rely rather heavily on multilateral trade rules and on the expectation that these fundamental trade rules are implemented so as to build upon them within the preferential setting. This is evident when one looks at the treatment of subsidies, regulatory measures, safeguards and other trade remedy instruments within these regional trade agreements. This article examines the situation of exports and imports in ten major agricultural trading countries or territories to assess the share of preferential trade in the overall trade profile. While the situation varies across the group, a significant share of trade continues to originate in or destined for countries under (MFN) Most-favoured Nation terms. In a number of regional trade agreements, including those involving the ten major countries, various sensitive agricultural sectors like dairy, meats, sugar, cereals have either been exempted from tariff elimination or preferential tariff treatment has been offered through a minor reduction in high MFN tariffs or tariff rate quotas. Tariff reforms for a number of such sensitive agriculture sectors have proven to be difficult partly because of the linkage between tariff policies and governmental internal policies and subsidies granted to such sensitive sectors. This linkage hinders commitments on tariff liberalization for the relevant sensitive sectors, especially in a preferential setting where domestic subsidy reforms might not be feasible. In order to exploit the synergy between regional trade agreements and the multilateral trading system and negotiations, it has been suggested in this article to consider reforms of sensitive agricultural sectors within the multilateral negotiations where both tariff liberalization and subsidy reforms may be pursued together.

In the first part of the paper the author deals with some general aspects of the very complex process of trade negotiations. He explains that trade negotiations, bilateral or multilateral, are the basis for establishment of the international trade regime. In order to understand multilateral trade negotiations one should be familiar with its basis, which is composed of rules and procedures. Also, it is necessary to take into consideration the fact that these rules and procedures have not emerged at once but have been introduced in the process of adjustment to the needs of negotiators. In the second part of the paper the author considers the procedures in multilateral trade negotiations within the GATT/WTO international trade system.

The Uruguay round of multilateral trade negotiations (MTN), successfully completed, will drift into the history of post-war international commercial diplomacy. Along with it will go much of the sound and fury that characterized its arduous negotiations. During the course of the MN, it seemed for a time that the General Agreement on Tariffs and Trade (GATT) no longer expressed a political-economic consensus between the United States and many European states, and that negotiations within the institution, as exemplified most markedly over the issue of agriculture, served only to highlight divergent national priorities. The issue of agriculture captured the attention of observers, understandably, since it appeared to impede progress in the MTN as a whole and to bring the United States and the European Union2 to the brink of the largest trade war in the history of the post-war international trade system. With the benefit of hindsight, however, some important lessons of the Uruguay round become perceptible.

This article is designed to provide a critical analysis of the successes and failures of the World Trade Organization (WTO) in certain key areas of international trade during its first decade. The WTO, which came into existence on 1 January 1995, celebrated its tenth anniversary in 2005, with the WTO officials claiming that the past ten years had been a success for the organization. Indeed, it has seen an expansion of its activities in recent years and has thus become one of the most important international organizations. Nearly 150 states, developed and developing, small and big, powerful and weaker, have now become members of this organization. Towards the end of 2005 a major WTO agreement, the TRIPS, was amended in favour of public health and full liberalization of trade in textile and clothing also became a reality in 2005.However, the WTO, established as it was primarily to further liberalize international trade, is supposed to create a level playing field in a number of other key areas, including agriculture, in order for it to enable nations to compete on an equal footing across the board. Has the WTO lived up to its expectations over the past ten years? Has the level playing field become truly level in all major areas over the past decade? After examining these questions in some detail, this article argues that the WTO has limited success in some of the core areas and the playing field has not become as level as it should have been by the time it entered its second decade. The Doha Development Round of multilateral trade negotiations, which began in 2001, has not made any substantial progress.The Sixth Ministerial Conference held in Hong Kong in December 2005, the closing month of the tenth anniversary of the WTO, failed to make a breakthrough. Although the failure in Hong Kong was not as disastrous as was in the third conference in Seattle in 1999 or in the fifth conference in Cancun in 2003, the deadlock witnessed in Hong Kong, especially with regard to the liberalization of trade in agriculture, has put the WTO itself at a crossroads. Since the Hong Kong meeting a series of deadlines for various stages of negotiations for moving the Doha Round negotiations forward have been missed. A formal meeting on 1 July 2006 of the Trade Negotiations Committee, which comprises the entire WTO membership, resulted in a failure. The WTO members could not agree on formulas for reducing tariffs and subsidies, various flexibilities, and other disciplines, especially on the liberalization of trade in agriculture. Achieving a truly level playing field should be about balancing the interests of various groups of states as well as the respective environments and interests of different traders and consumers living in different countries and the WTO has a long way to go to achieve this objective.