World Trade Organization (WTO) members have secured an ‘historic’ deal that scraps subsidies on farming exports.

WTO director-general Roberto Azevedo. Photo: WTO, via Wikimedia Commons

Concluding the 10th Ministerial Conference in Nairobi over the weekend, WTO members announced the ‘Nairobi Package’, a new deal especially designed to support the organization'’s poorest countries, particularly African nations and other developing countries.

WTO director-general Roberto Azevedo describes the abolition of subsidies for farm exports as '‘the most significant outcome on agriculture'’ in the organization'’s 20-year history.

After week-long negotiations, important decisions have been taken to improve rules on agricultural trade with the new deal opening up opportunities for the poorest and most vulnerable developing countries to better integrate into the global trading system.

European Commissioner for Trade, Cecilia Malmstrom, and European Commissioner for Agriculture, Phil Hogan, were involved in brokering the deal.

“"We'’ve had some long days and nights of intense negotiations. The WHO, meeting for the first time in Africa, has been able to deliver a good deal for developing countries,”" says Malmstrom in a statement.

"“The decision opens real opportunities for more trade and investment and reinforces the global trading system."”

The new deal builds on the agreement reached in Bali two years ago and improves the global environment for trade by stopping the use of subsidies and other schemes that unfairly support agricultural exports.

It also ensures that food aid for developing countries is given in a way that does not distort local markets and simplifies conditions for exporters from the poorest countries so their products benefits from trade agreements.

The European Commission also states the deal will give more opportunities for businesses from the poorest countries to provide services in the WTO'’s 164 member countries.

Developed countries have agreed to stop subsidies immediately, while developing nations must do so by the end of 2018.

“"In recent years, the EU has led the way in agreeing to renounce the use of export subsidies,"” says Commissioner Hogan.

“"Now, for the first time, there are binding disciplines on subsidies such as export credits, where our competitors are subsidising trade worth billions every year.

“"These new binding controls will level the playing field for EU exporters. Also, our competitors will not be able to circumvent these rules through use of state trading enterprises, a key demand for the EU.

“"We have also achieved our objectives on food aid and the special safeguard mechanism. The food aid deal will mean less displacement of local African production, which means it’s good for African farmers and good for the Migration agenda.”"

The WTO Ministerial Conference went on from December 15 to 19, and was the first such meeting to be held by an African nation. Kenya’'s Cabinet Secretary for Foreign Affairs and International Trade, Amina Mohamed, chaired the conference.

“"Tough calls had to be made but we did bite the bullet," she” says.

“"We have reaffirmed the central role of the WTO in international trade governance.”"

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