Title: Doha Development Agenda in the European Union. Impacts on the agricultural sector
Authors: BURRELL AlisonFERRARI EMANUELEGONZALEZ MELLADO AIDA ARACELIMICHALEK Jerzy
Citation: ETSG 2011 Copenhagen, 13th Annual Conference 8-10 September 2011 p. 1-29
Publisher: ETSG (European Trade Study Group)
Publication Year: 2011
JRC N°: JRC66590
URI: http://www.etsg.org/ETSG2011/Papers/Gonzalez.pdf
http://publications.jrc.ec.europa.eu/repository/handle/JRC66590
Type: Articles in periodicals and books
Abstract: This paper aims to analyse the impacts of a possible conclusion of the Doha Development Agenda (Falconer proposal) on the European Union economy with the emphasis on the agricultural sectors. The analytical tool employed to analyse the consequences of DDA agreement is the global Computable General Equilibrium model GLOBE. It consists of a set of 113 single country SAM-based CGE models (linked by their trading relationships) that are aggregated into 14 trading blocks. The model distinguishes 23 product categories of which 18 product categories are agricultural or food-related and five represent the non-agricultural sectors: i.e. primary products, manufacturing, services, ‘trade’ and fuel. The model incorporates various important developments in CGE trade modelling occurred during the last 15 years (e.g. inclusion of preferential agreements, bilateral and multilateral TRQ, split of quota rents, flexible closure rules, etc.), and is calibrated with data from the Global Trade Analysis Project’s (GTAP) database version 7.1. Analysis of the impact of Doha Round agreements is performed on a basis of simulation of the reduction of ad valorem equivalents (AVE) of bound tariffs on various groups of agricultural products (e.g. sensitive products, special products, tropical products, etc.) and non-agricultural products (NAMA rules) for various countries depending on their status at the WTO (e.g. developed, developing, developing non-LDC, recently acceded member states, very recently acceded member states, least developed countries, small and vulnerable economies, NAMA flexibility rules – group 1, NAMA flexibility rules – Group 2, etc.). The AVE computed for both agricultural and non-agricultural products at HS-6 digit level for all 153 WTO members and several non-WTO countries using information from MAcMap-HS6, ver.2 were used inter alia to define a) sensitive products, b) special products, c) to establish a list of products exempted from 97% initiative for LDCs, d) to select products falling under flexibility rules, etc. Reduction of AVEs tariffs for aggregated groups of product categories distinguished in GLOBE was performed using the software TASTE. Our results confirm that, although the overall impact of a possible DDA agreement on EU welfare and GDP is positive, agriculture will suffer the biggest losses. Among especially affected agricultural sectors in the EU the most affected are: sugar, meat beef, vegetable and fruits. On the other hand, performed analysis visualises benefits of DDA agreement on the EU non-agricultural sectors as well as factor income in the food industries. Furthermore, considerable changes in trade flows among various trading blocks will occur. Our analysis shows that the chosen modality of treatment of sensitive products (i.e. tariff cuts 1/3, ½, 2/3 and expansion of multilateral TRQ) matters, and the highest tariff cuts for sensitive products may not necessary lead to the highest decrease in agricultural production.
JRC Directorate:Growth and Innovation

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