CAP and world trade [Archived]


The European Union is fully committed to the World Trade Organization (WTO) process for reducing trade-distorting agricultural subsidies and a progressive reform of agricultural policies. However, it also expects its WTO partners to take into account the European model of agriculture, which puts great emphasis on non-trade concerns, such as environmental protection, food security and rural development.

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144 member states of the World Trade Organisation (WTO) agreed at their ministerial conference in Doha in November 2001 on a

mandate for negotiations on a range of subjects, including agriculture and services.

The Doha declaration sets 1 January 2005 as the date for completing all but two of the negotiations. Progress is to be reviewed at the Fifth Ministerial Conference in Cancun on 10-14 September 2003.

The negotiations take place in the Trade Negotiations Committee and its subsidiaries. Other work under the work programme takes place in other WTO councils and committees.  

WTO negotiations on agriculture began in early 2000, under Article 20 of the WTO Agriculture Agreement. By November 2001 and the Doha Ministerial Conference, 121 governments had submitted a large number of negotiating proposals.

Europe is the world's largest importer of farm products, and the largest buyer from developing countries, which is to a large extent the result of the trade preferences. The EU also imports far more from developed countries, such as the US or the Cairns Group, than it exports.

The EU recently decided to give imports from the 48 poorest countries, including farm products, unlimited duty-free access to EU markets. In addition, the EU proposes improvements in the conditions related to trade preferences. Nevertheless, the EU has been often accused by development organisations and its trading partners alike of distorting trade with its high agricultural subsidies in export refunds, at the expense of the developing countries.

Many Third World countries share the view that the WTO has been dominated by developed countries and that current trade agreements are unfair to poor nations. They complain the WTO has left tariffs high on farm products exported by many poor countries, while allowing rich countries to subsidise agricultural exports. Officials from poor countries also complain that rich nations have failed to live up to pledges to grant preferential access to goods from poor countries. Developing countries insist that unfair terms of trade and the lack of market access for agricultural products from poor countries are among the most important causes of poverty.

According to the United Nations Conference for Trade and Development (UNCTAD) , the world's 48 poorest nations are failing to benefit from free trade and globalization and instead face worsening poverty.

Development and environmental NGOs argue that - contrary to what free trade apologists claim - more trade has meant more global and national inequality and more rapacious use of the world's resources, resulting in increased environmental degradation.