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WTO Public Stockholding Subsidies: Developing Nations'



  Oct 05, 2023

WTO Public Stockholding Subsidies


1. What is the issue regarding public stockholding subsidies at the WTO?

The issue revolves around developing nations' demand for a permanent solution for public stockholding subsidies. These subsidies are used to support food security programs, and developing countries, including India, have been seeking changes to existing WTO rules to provide greater flexibility in implementing these subsidies.
 

2. What is the stance of the European Union (EU) on this issue?

The EU has expressed its readiness to negotiate on the issue of public stockholding subsidies with a focus on "adequate safeguards." This indicates a willingness to engage in discussions aimed at finding a solution that addresses concerns while ensuring food security.
 

3. What is the position of the United States on this matter?

The United States has taken an inflexible stance and rejected the idea of expanding the Bali interim solution. This solution provides relief to developing nations from legal action if their subsidies breach the cap of 10% of production value. The U.S. argues that public stockholding subsidies have a detrimental effect on global food security.
 

4. How has India responded to the EU's willingness to negotiate?

India has appreciated the EU's readiness to negotiate on the issue of public stockholding subsidies. India has urged WTO members to initiate text-based negotiations based on a joint document supported by over 80 developing nations.
 

5. What was discussed during the WTO negotiating session on public stockholding?

Discussions on public stockholding took place during a special negotiating session on agriculture at the WTO. The aim was to bridge differences and work towards a potential outcome at the next ministerial meeting scheduled for February.
 

6. Why do developing nations, including India, seek changes to the existing subsidy rules?

Developing nations argue that the existing 10% cap on food procurement subsidies or the reference price based on 1986-88 data is inadequate for addressing their food security needs. They believe that these rules need to be revised to ensure the food security of their populations effectively.
 

7. What is the "peace clause" related to public stockholding subsidies?

The "peace clause" is part of the Bali interim solution reached in 2013. It provides protection to developing nations against legal actions in case their subsidies breach the 10% cap. However, it imposes certain conditions related to notification obligations and the impact on the food security of other countries, making it challenging for developing nations to utilize effectively.


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