What's does the Doha Round agricultural negotiation have to offer a large emerging economy like Brazil's:
A new OECD report (Review of Agricultural Policies in Brazil) suggests the potential the benefits of Doha Round. From the OECD web pages:
Where are the biggest potential policy gains for Brazilian agriculture:
Having substantially liberalised its own agricultural policies, the main source of future benefits to Brazil is reforms in other countries, where access to OECD country markets is the most important issue. Brazilian exporters are impeded by high tariffs in key markets, tariff escalation according to the degree of processing for several important commodities, unfavourable treatment under trade preference schemes and tariff-rate quota systems, and significant non-tariff measures (notably for livestock products).
What is the size of the potential benefits:
...the OECD says that if the US, the European Union and other OECD countries were to cut import tariffs and export subsidies on agricultural products, farmers in Brazil would gain from the resulting rise in international prices, with the larger commercial producers benefiting most.
The report estimates that a 50% cut in tariffs and export subsidies globally, together with a 50% reduction in domestic support to agriculture in OECD countries, would benefit the Brazilian economy – through higher incomes for consumers and producers - by some 1.7 billion US dollars, the equivalent of around 0.3% of GDP.
"...larger commercial producers benefiting most..." How to spread it around? Domestic policies are needed to complement developed country tariff and subsidy reforms:
Brazil’s reforms over the past 15 years have helped to reduce poverty overall, yet more than 60% of the rural population still has an income below the absolute poverty line of half the minimum wage, the report notes. A range of policies are needed for small-scale farmers to raise their incomes and benefit from the expected growth in Brazil’s share of world agriculture trade, for example programmes to upgrade farming skills and technologies.
Comments