The Cairns Group welcomes the engagement shown by Members in the past week to narrow the range of issues ahead of your revision of the modalities text. Your personal efforts in aiding Members in this process must be acknowledged.
While there are a number of difficult and outstanding issues to resolve, the process you have overseen has started to generate signs of an emerging negotiation, as well as signals of flexibility in some limited areas.
In domestic support, we assess that the architecture of possible disciplines has stabilised and the political decisions have come into sharper focus. Our position remains clear: if we are to deliver on reforms consistent with the mandate, it will require cuts at the higher ends of the ranges and strict product-specific disciplines, taking also into consideration the specific mandate for cotton. The down payments in reductions to trade-distorting support within your text are welcome additions and within the reach of key subsidising Members.
That said, the Green Box remains an important unresolved question, and we must ensure that this support remains genuinely non-trade distorting. Furthermore, in order to reach modalities, it will be important that the nature of domestic support disciplines attain a clarity equivalent to that obtained in other pillars of this negotiation.
In market access, Cairns Group members are pleased with recent signals that the elimination of the Special Agricultural Safeguard may be within reach. However, gaps remain across the pillar, so we are still some way from achieving the necessary clarity regarding access in all markets – whether it be in areas such as in-quota rates, tariff simplification, tropical and alternative products, or developing country market access.
On Sensitive Products, Cairns Group members welcome the reflection of the Group’s approach in your text, which remains the best guarantee of ambitious and clear expansion of quota access. Our ongoing discussion of partial designation has only continued to highlight its risks to ambition, and raised further concerns regarding the real scope of quota expansion in your text. The treatment of processed products remains a crucial issue which must be addressed. Unless we have clarity, transparency and predictability in the treatment of sensitive products, it will be very difficult to assess the overall balance and ambition of the negotiations. If we are to conclude modalities, it cannot be without confidence of substantial improvements in market access.
The outstanding issues in the export competition pillar are narrowing and political choices are clear. We welcome progress on export credits, including the removal of further exceptions to self-financing and 180 day terms. In food aid, we remained concerned to ensure that disciplines on monetisation eliminate commercial displacement.
The Cairns Group will remain engaged over the coming weeks to seek to identify a way forward in these keys areas, and looks forward to re-engaging in February on the basis of revised modalities. We favour a focused discussion on the revised text by the agriculture negotiating group and broader membership in order to further narrow unresolved issues ahead of a horizontal discussion. But we emphasise our full support to the process and our commitment to concluding as soon as possible modalities that will provide certainty regarding the substantial reforms in agriculture expected of this Round.