Draft for Discussion

T. Ademola Oyejide
University of Ibadan, Ibadan

The Uruguay Round (UR) of multilateral trade negotiations has created something of a record in the history of the series of trade negotiations as the first to explicitly specify a set of multilateral disciplines on the production and trade of world agriculture. The UR Agreement on Agriculture (URAA) was intended to limit several policy distortions that substantially affect the conditions under which both agricultural production and trade take place world-wide. As a first step, URAA's coverage - as well as the achievements within that - are inherently limited. It is partly for this reason that URAA itself contains a provision (Article XX) which mandates that new negotiations should be initiated by 1 January, 2000.

Countries of sub-Saharan Africa (SSA) should pay particular attention to and participate, actively in the new negotiations on agriculture for a number of reasons. These countries have a lot at stake in a world trading system whose multilateral agreements defines the broad rules under which agricultural production and trade will occur. For many of them, the agricultural sector remains pivotal to the overall growth and development of the economy. Just as it has for other regions of the world, the URAA is bound to have important implications for African agriculture. By the same token, a new of revised agreement on agriculture that emerges from the Millennium round will also affect the agricultural sector of many SSA countries. These effects can be expected from at least three directions.

First, a revised or new agreement on agriculture will define the broad market access conditions for African agricultural exports. Second, it will also determine the broad terms and conditions for the importation into Africa of a wide range of processed and unprocessed agricultural products. The third and, perhaps, more long-term effect could be associated with the challenges and constraints that the rules of the new world agricultural production and trading system may impose on the choice of agricultural development, strategy and policies by various African countries.

The desire to ensure that these effects are beneficial for the development of African agriculture should motivate an active and effective participation by African countries in the proposed new round since it is primarily through such involvement that they can ensure that their interests are fully reflected in the design of the new rules. In articulating their interests within the context of the new negotiations, however, African countries must begin with a clear understanding of the key characteristics of their agricultural sector, the demands placed on it by the aspirations for rapid overall economic growth, and the development strategy and policies which are required to enable the sector develop in the desired direction. A relation between these considerations and the external policy environment faced by African agriculture should begin to suggest the negotiating interests that African countries should articulate and pursue as well as the set of negotiating options with which they will be confronted.

This broad perspective guides the sequencing of the various parts of this paper. Thus, section II reviews the state of African agriculture, focusing in particular on its production and export performance and the proximate factors to which this performance can be ascribed. Since much of the disciplines embodied in URAA amount to attempts to liberalize (or at least limit certain policy distortions affecting) agricultural production and trade, section III explores the extent to which African agricultural production and trade regimes have been liberalized through both unilateral and multilateral initiatives. This section then goes on to ask what remains in the agenda of agricultural liberalization in SSA countries and whether the multilateral process can assist African countries in completing this agricultural reform agenda. In section IV, analytical attention shifts away from African domestic policy environment to a survey of external barriers facing African agricultural exports. Key among the issues discussed in this section are the main barriers in Africa's major markets (especially the question of tariff peaks and tariff escalation), the magnitude of the losses from preference erosion, and the consequences for African food import and food security of continued multilateral liberalisation of world agricultural production and trade. Section V derives a range of African negotiating interests and options from the analysis of the domestic policy environment and external barriers against African agricultural exports. In doing this, it identifies some unfinished business of the UR and unfulfilled promise of the URAA. It also suggests a more transparent and coherent definition of "special and differential treatment" (SDT) for the developing and least-developed countries in the WTO framework and a more consistent application of its provisions in the URAA would enable many African countries cope better with the demands of a multilaterally-disciplined global agricultural production and trading system. Section VI offers some concluding remarks.

The agricultural sector is strategic to the long-term growth and development of most SSA countries. In fact, the region's high dependence on the agricultural sector for income, employment and export earnings is one major reason for its relatively large stake in any multilateral negotiations that will define a new set of rules to govern global agricultural production and trade regime. A few numbers illustrate this dependence. For instance, the agricultural sector contributes about 35% of the region's GNP, accounts for up to 40% of total export earnings, and serves as the primary source of income for as much as two-thirds of the population of the typical African country. There are variations (in some cases, quite wide) around these averages, of course. Most notably in several African countries, the mineral and mining sector challenges agriculture's dominance, particularly in relation to foreign exchange earnings. These exemptions notwithstanding, the World Bank (1993) estimates that a one percent growth in overall economic growth due to the sector's stimulating effects on industry, transport, and other services. Based largely on this rather close link between the growth performance of African agriculture and that of the economy as a whole, another study (ADB, 1998, p. 31) argues that "transforming agriculture and expanding its productive capacity is a pre-requisite, possibly the most important precondition, for improving living standards in Africa."

But the transformation of African agriculture has not occurred. Hence, rather than stimulating overall economic growth the agricultural sector may have dragged it down in many African countries, at least until very recently. The growth performance of African agricultural production has been basically unsatisfactory, having deteriorated steadily over the 1960-1990 period. During the first third of this period, the volume of agricultural production achieved an annual average growth rate of 2.5%. This growth performance fell to an annual average of 1.4% to 1.5% over the next two decades. Since the average production growth rates were below the rate at which African population expanded over this period, the average annual growth rate of per capita output fell from 0.2% during 1960-70 to -1.1% in 1970-80 and fell further to -5.1% between 1980 and 1990. The output growth performance of African agriculture compares rather poorly with those of other developing regions over the 1960-90 period. In particular, over the last decade of this period, average annual growth rate of agricultural production in the East Asia and Pacific region was as high as 4.7%, that of South Asia was 3.0%, while Latin America and the Caribbean region's corresponding average annual agricultural growth rate was 2.0%.

Tentative evidence indicates, however, that the agricultural sector of many African countries has been going through a recovery phase in the 1990s. Thus, many of these countries were able to achieve real agricultural output average annual growth rates of over 2% during the first half of the 1990s, and during 1990-97, the growth rate of agricultural value-added in Africa, was well in excess of 4% per annum. But whether this apparent recovery can be translated into rapid and sustainable growth of the agricultural sector remains to be seen. Certainly, the usually observed pattern of importance of agriculture in GDP as development proceeds has not occurred in Africa. As Table 1 shows, agricultural value-added as a proportion of GDP fell from 18% to 16% in the developing countries between 1980 and 1997. The corresponding regional figures show a decline from 28% to 19% in the East Asia Pacific region, and a fall from 38% to 27% in South Asia over the same period. Latin America and the Caribbean region maintained the same 10% proportion in both 1980 and 1997. But in the SSA region, the share of agricultural value-added in the GDP actually increased from 22% to 25% over the 1980-1997 period. This suggests that in spite of its apparent recovery in the late 1990s, African agriculture has not performed as well as those of the other developing regions and, most probably as a result, African economies have failed to achieve the kind of structural transformation that seems to lie behind the decline in the relative significance of agriculture in the more rapidly growing economies of other regions of the developing world.

The performance of African agricultural exports parallels, by and large, that of agricultural production. Thus, the volume of agricultural exports fell from the early 1970s to the early 1980s; then it picked u from around the mid-1980s. There was, however, a steep rise in the unit value of agricultural exports during the first half of the 1970s, which powered a fairly rapid increase in African agricultural export earnings until 1977. But as the unit value fell back and exports declined through mid-1980, until both resumed an upward trend in the early 1990s.

Several characteristics of African agricultural exports deserve mention, since they underpin the sector's fragility. First, Africa is more heavily dependent on agricultural exports than any other developing country region. Second, African is also the most heavily dependent on a narrow range of agricultural export commodities. Table 2 demonstrates this historic and continuing lack of diversification. This table shows that the same set of nine commodities accounted for about 70% of the region's total agricultural export earnings between 1970 and 1995. The top three of these (i.e. cocoa, coffee, and cotton) contributed about 55% of total agricultural export earnings during 1970-79 and accounted for roughly 44% in 1990-95. This level of export concentration places great strains on many African countries which are, as a result, quite literally at the mercy of world commodity price fluctuations (Oyejide, 1993).

One might conclude from this heavy concentration on a narrow range of agricultural export crops that African's specialization would give the region an edge in world trade. But the reverse appears to have been the case. As Table 3 shows, Africa suffered dramatic market share losses in its key agricultural export commodities between the early 1960s and the mid-1990s. Thus, the region's market share for cocoa declined from 80% to 41% or about half of its original share of the world market. Similarly, Africa's world coffee market share tumbled from 26% to 15%; while that of cotton declined from 20% to 13% over the same period. But, of course, the most dramatic market share loss was experienced by groundnuts, from 70% in 1961/63 to a mere 2% in 1995. Of the nine commodities, tea showed the most gain in world market share, from 9% to 21%; while sugar achieved a marginal increase from 5% to 7% over this period.

On the import side, food products, particularly cereals, have dominated Africa's agricultural imports. Africa's cereal imports increased at an average annual growth rate of almost 18% during 1975-80. This growth rate decelerated to 3.7% during the next five years, but rose again to almost 5% in 1985-90 and to more than double this rate over the next five years. In addition, food aid receipts by African countries grew at an annual average rate of about 14% during 1975-80, rising to almost 20% in the next five years before falling back to around 15% up to the mid-1990s. UNCTAD (1998) shows that Africa's ration of trade balance to total trade in agricultural products fell systematically from 51% in 1996-98 to only about 10% in 1993-95; and concludes that "this worsening of the net agricultural export position of Africa was due to a rapid increase in food imports exceeding the growth in earnings from export crops". But the real driving forces behind this phenomenon are probably Africa's rapid population growth in the face of sluggish food production growth. Table 4 shows that, compared to other developing-country regions, Africa lags behind in food production. From a base of 100 in 1979-81, Africa's food production index rose to 143 in 1994-96, a figure that is well below the index of 169 achieved by all developing countries and only two-thirds of the East Asia and Pacific region's achievement. There is some evidence that, in addition to rapid population growth and urbanization that are fuelling increased demand for food generally, a shift is also occurring away from domestically produced foods to imported food varieties, particularly, wheat and rice (Teklu, 1996). This suggests that the region may experience even more rapid growth of food imports as incomes recover, given the typically high proportion of income spent on food consumption at Africa's low income level.

The tentative recovery noted above with respect to Africa's agricultural production and exports in the late 1990s should be placed in perspective, particularly in relation to the underlying productivity of the region's agricultural sector. While it may be tempting to conclude, as Ingco and Townsend (1998, p. 16) do, that "the reversal of the downward trend for many crops is the result of world market conditions, improved macroeconomic policies and deregulation of many controlled domestic markets, all resulting in an improved competitiveness for particular countries and crops in world trade", the importance of non-price factors for the sustainability of this reversal must be recognized. To the extent that low productivity remains the soft underbelly of African agriculture appropriate supportive policy measures will be necessary Tables 5 and 6 provide data to illustrate the relative productivity of African agriculture. First, as table 5 shows, this region's average agricultural value-added per agricultural worker during 1994-96 was 85% of the average for the developing countries as a group and only 17% of that of East Asia and the Pacific region. Similarly, Africa's average agricultural value-added per hectare of crop land was about a third of the average for all developing countries and only 13% of that of Latin America and the Caribbean region. Along the same lines, table 6 shows that in 1995, Africa utilized only 7% of land areas for cropping, compared to 11% for all developing countries and as high as 45% for South Asia. In addition, Africa's cropland is the least irrigated among all developing-country regions. The extent of Africa's dependence on rainfed agriculture is demonstrated by the fact that only 4% of this region's cropland was irrigated in 1994/96 compared to an average of 20% for all developing countries and as high as 35% for South Asia. The increasing erratic nature (in terms of quantity, timeliness, and frequency) of rainfall in many parts of Africa and the increasing incidence of droughts suggest that Africa's near total reliance on rainfed agriculture cannot be part of a long-term agricultural development strategy. As Larson and Frisvold (1996) suggest, a substantial growth in the use of organic fertilizer could be a crucial part of that strategy. In addition, there will be need for increased public and private investment on crop yield-enhancing measures such as agricultural research and development re-invigorated agriculture extension services, as well as substantially improved rural infrastructure. An important part of the concerns of African countries in negotiating new rules on agriculture in the context of the Millennium round should be the extent to which these rules permit them to use appropriate non-price support measures to facilitate the development of their agriculture sector.

The weak performance of African agriculture noted in section II above has attracted analytical studies and policy attention. Although the contributory factors identified and held responsible for African agriculture's unsatisfactory performance covers a wide spectrum, including such "usual suspects" as the risky natural environment, political and security problems, and land tenure system, the primary focus of policy attention has been the incentive structure generated by macroeconomic and sectoral policies. As World Bank (1994, p. 76) summarizes it:

"African farmers have faced the world's heaviest rates of agricultural taxation. ... African farmers, were taxed explicitly through producer-price fixing, export taxes, and taxes on agricultural inputs. They were also taxed implicitly through overvalued exchange rates which reduced the prices they obtained for their exports, and through high levels of industrial protection, which raised consumer prices".

The idea that much of the poor performance of African agriculture was due to excessive direct and indirect taxation of farmers by African governments thus formed the basis of much of the policy measures designed to liberalize agricultural production and trade regimes in Africa and implemented, with varying degrees of intensity and success, from the early 1980s.

The goal of these policy reform attempts was to establish an agricultural production and pricing regime which would have at least three key elements; i.e., unsubsidized and market-determined prices for all agricultural inputs and products, neutral taxation of agricultural and other sectors, and agricultural export crop prices set at border parity levels, where these are determined on the basis of market-clearing equilibrium exchange rates. While the movement towards the achievement has been uneven, both over time and across countries, it seems clear that considerable progress has been made, and as a result Africa's agricultural production and trading regimes were more liberalized in the 1990s that they were in the previous two to three decades.

These liberalization efforts have been carried out not in the context of a multilateral trade negotiation but through the mechanism of structural adjustment programmes (SAPs), a set of arrangements within which African countries undertook to carry out agreed policy reforms in respect of which the World Bank (plus, in some cases, other donors) provided analytical and financial support. Since SAPs typically cover macroeconomic and sectoral policy reforms, those implemented in many African countries have also included explicit trade policy components in the context of which a country's tariff structure (including both the agricultural and industrial components) was rationalized, compressed and liberalized. Various assessments of these trade policy reforms have noted significant achievements. Nash (1993, p. 38) shows that "protection of import substitutions by tariffs and non-tariff barriers in sub-saharan Africa as a whole had declined". In particular, the average level of protection fall by between 30% and 50% over the period from the mid-1980s to the early 1990s. Furthermore, according to World Bank (1994, p. 24):

"... since the mid-1980s, most African countries have moved from complete or nearly complete government control over imports to more open systems, and have substantially reduced the number of imports subject to quantitative barriers.

... the greatest progress has been achieved in replacing quantitative restrictions with lower and less dispersed tariff levels; more than half the countries now have average tariff rates of 15-20 per cent with the highest rates set at 35-40 percent and the number of tariff categories reduced to 4-5."

There is one major problem that this impressive record of African trade policy reform leaves unsolved. The tariff reductions which were achieved are not "WTO-bound" and can therefore be changed. In fact, accumulated evidence (e.g. Oyejide, Ndulu and Gunning, 1996) shows that African trade liberalization attempts were frequently reversed. A review of the commitment of African countries under URAA should therefore provide another perspective regarding the liberalization of the region's agricultural production and trade regimes. Table 7 shows ceiling binding tariffs, exceptions and other duties and charges drawn from the schedules of SSA countries with respect to agricultural products. According to this table most SSA countries have selected ceiling binding tariff levels in the range of 100-600%. Only five countries have set ceiling binding tariffs in the range of 30-40%, while another set of 13 countries have opted for ceiling bound rates of 60-99%. In addition to these already high ceiling binding tariff levels, many African countries have chosen to impose "other duties and charges" that are as high as 100%-250%. This table makes it clear that African ceiling binding tariff levels plus other charges are much higher than the tariffs which these countries actually apply to their import of agricultural products. In this sense, it is not unlike the situation in the more developed economies where "dirty tariffication" has led to very high post-UR tariffs on certain agricultural products. There is an important difference, however. While the African practice has the primary effect of damaging their own trade policy credibility, that of the OECD countries actually serves a protectionist purpose.

In the end, though, a more realistic comparative picture of the relative protection and support of agricultural products across different regions of the world emerges quite clearly from Table 8. This table shows that, after the implementation of the three key elements of URAA in 2005, the agricultural tariffs of SSA countries will average 13% which is much lower than the average of 20% for all developing countries and only about a third of that of the OECD countries. Furthermore, the SSA countries will continue to tax both agricultural production and export, while the OECD countries will still provide positive and large support levels for both.

Viewed nominally and from the African perspective, a full implementation of the market access element of URAA would appear to achieve significant results (Oyejide, 1997). While the tariff reductions URAA generates on agricultural products average 37%, tariffs facing African agricultural exports in the markets of the developed countries world be down by 32-48%. In particular, average tariffs on tropical products would have been reduced by 43% (including 25% reduction for cereals; 35% for coffees, cocoa and tea; 40% for oil seeds, fats and oils; and 48% for cut flowers). But while these reductions are impressive, they apply to existing tariff rates that are already quite low and may not therefore be expected to have any significant positive impact on African export volumes.

The post-UR multilateral trade regime poses problems for many African countries in several other directions. One of these concerns the impact of liberalization on food import prices. To the extent that agricultural export subsidies are effectively disciplined, food import prices could rise and, in turn, raise the food import bills of certain African countries. According to Harold (1995) the negative impact of this is likely to be minimal roughly 0.15% increase in the annual import bill of Africa's net food-importing countries. It appears, however, that this may be a gross underestimate. Greenfield, Nigris and Konandreas (1996) present an assessment by the FAO which projects a price increase in the range of 0-10% for most agricultural commodities as a result of the market effects of URAA, and suggest the food import bills of developing countries could rise by as much as 62% between 1988 and 2000. This assessment further claims that:

"Among the developing countries, the outlook for Africa raises some concern. ... The region relies on exports of a small number of traditional crops, particularly coffee and cocoa, the markets for which are expected to grow at best steadily. At the same time, the region will continue to be a heavy net importer of basic foodstuffs, the price of which would rise. ... The net effect of these changes is an increase in the gross food import bill from US$6 billion in 1998 to US$10.5 billion in the year 2000, US$500 million of which would be ascribable to the UR. ... For the 43 low-income food-deficit (LIFD) countries of this region, ... (the assessment projects) a rise in gross food import bills from US$3.5 billion to US$6.3 billion, with US$0.2 billion of the increase due to the UR".

The URAA recognizes this problem and makes explicit provisions for assisting the LIFD countries to cope with the effects of implementing the agreement on international food prices and the effects of reduced subsidies on the export of food from the developed countries. This assistance was to take several forms, including increased food aid, financial assistance to import food, and technical assistance to improve agriculture productivity infrastructure. But this WTO decision while containing the explicit offer of assistance fails to indicate what operational mechanisms and modalities would be used to deliver its promise. Meanwhile, certain post-UR trends are now quiet clear: food is steadily falling rather than increasing, the food import bills of LIFD countries in Africa are rising, and technical assistance to improve their agricultural productivity and infrastructure has declined.

The erosion of trade preferences previously enjoyed by many African countries will also impose a strong negative impact on Africa. The estimates of the losses associated with preference erosion vary. Yeats (1994) suggests non-fuel export losses of about US$160 million which was considered more than sufficient to leave Africa with "net trade losses as a result of UR tariff cuts. Weston (1995) suggests that losses associated with reduced preference margins will be experienced by many African countries and that, in total these losses could be as large as 1.5% of their total export earnings. Yamazaki (1996) computes and compares the values of pre-UR three key markets of the EU, US and Japan; this exercise shows that the value of African preferences in these markets will fall from US$675 million to US$509 million, representing, as 25% loss. In concluding Yamazaki (1996, p. 417) notes that "Africa's losses measured against its pre-UR benefits could be relatively small (25%), but not necessarily so in absolute size, given the low income level of many of the recipients".

There is a second element of preference erosion which also affects several African countries. The possible negative, in this area, would be the likely displacement of African producers (who currently benefit from some commodity protocols in the EU market) by agricultural products from temperate zone countries as a result of the URAA's prohibition of NTBs on agricultural products. Prime examples of these African countries are Mauritius and Swaziland (sugar), and Botswana and Namibia (meat). Exports of these African producers are likely to suffer price declines in the EU market as these protocols (associated with the Lome Convention) give way in the light of URAA provisions.

An analysis of post-UR tariffs on agricultural products in the OECD countries reveals two other areas in which African agricultural exports are likely to be constrained. First, tariff peaks (i.e. tariff rates above 12%) will remain high in these markets for many processed foods and food products (UNCTAD, 1997). Tariffs are in the range of 12% - 30% for many of these products which are of particular export interest to African countries. Furthermore, above-quota imports of many of these products attract tariffs that may by several multiples of the peak tariffs. Second, a substantial degree of tariff escalation has survived the UR process. This may constitute a hindrance to those African countries planning to diversify their agricultural exports by branching into further processing of their agricultural commodities. In relation to the food industry, for instance, FAO (1997) finds that agricultural exports of developing countries are largely concentrated in the first stage of food processing, while the most advanced food industry products make up 32.5% of the food exports of the developed countries. Tariff escalation in the developed-country markets appears to be one of the major constraints to the vertical diversification of the agricultural exports of many developing (including African) countries. The URAA and its implementation have not solved the two problems of tariff peaks and tariff escalation; they may in fact have worsened them.

The URAA has imposed a limited set of obligations on most African countries. This result is due to at least two reasons. First, the major agricultural policy distortions on which key elements of URAA focused (i.e. high import barriers, domestic support and export subsidies) are virtually absent in many African countries. Second, many of these countries are either "least-developed" or "developing"; these are country categories covered by certain provisions of "special and differential treatment" (SDT) which effect limit, in certain ways, the type and extent of commitments they are required to make as part of the negotiating process that produced URAA. In any case, part of the process of liberalization of production and trade regimes in Africa predated the UR which therefore had no direct influence on African liberalization. No effort was made to link African domestic strategies with multilateral negotiation process. The closest and most influential advisers of virtually all African countries, at the World Bank, during their unilateral liberalization suggested no such linkages, they even neglected the possibility of coordinated regional or sub-regional trade policy. In the event, rather the substantial unilateral liberalization achievements were never used to bargain for improved market access for African exports.

Part of Africa's interests in the new multilateral negotiations on agriculture would obviously include attempts to remedy those elements of URAA which have had negative impacts on the agriculture and economies of many African countries. The consequence of the liberalisation of world agriculture for international food prices and the food import bills of Africa's many low-income and food-deficit countries is one of these areas. African negotiating interest in this context is clearly not to try to reverse the liberalization trend, which is generally desirable, but to hold the WTO to its promise in respect of assistance to the affected African countries to cope with the situation. Operationalizing that promise requires clear articulation regarding the magnitude and modalities of the assistance.

Preference erosion is another area of negative impact on the basis of which many African countries can stake a claim for some compensatory compensation without attempting to block further global liberalization. But a more positive reaction would probably be to push for the realization of the proposal that all export products of the least developed countries be allowed to enter the markets of developed countries free of duty and quota restrictions. This special market access should adequately compensate the affected African countries without constituting a significant "burden" for the developed countries.

Beyond the negotiating interests that are directly associated with the negative impact of URAA, African countries should be interested in further market access improvements that result in the reduction of tariff peaks and elimination of tariff escalation, especially as they relate to agricultural products. A more diversified agricultural sector in Africa which can generate exports of processed agricultural products would be substantially assisted by the reduction of tariff peaks and elimination of tariff escalation.

What could African countries offer in return? While African countries have bound all agricultural tariffs as mandated by URAA, they have done so at very high ceiling rates that are, in many cases, several multiples of the applied rates. In addition, African agriculture could benefit from further liberalization and rationalization of its domestic trade and pricing policies. Achieving this objective by bringing the ceiling binding levels closer to the applied rates in the context of multilateral negotiations could be associated with two kinds of benefits. One is that it can be "exchanged" for some concessions and the second is that a multilaterally negotiated and bound liberalization process enhances its credibility and may, to that extent elicit quicker and more robust output and export supply response.

The development of an internationally competitive African agriculture requires a liberalized domestic pricing and marketing regime as well as improved access to export markets. But it needs more than these. African agricultural production and exports are also constrained by various structural, institutional, and environmental factors. The capacity of African agricultural producers and traders to respond to favourable changes in the incentive structure is held down by poor infrastructure, low productivity, inadequate research, training and the dissemination of knowledge about new production technologies and crop varieties as well as pest and disease control systems. Policy initiatives to deal with these constraints should attempt to involve as much private investment as possible but will inevitably involve increased public resources, given that African agriculture is dominated by small farmers. Some of the necessary support will clearly be allowed under URAA, but some may also fall foul of the "law", especially if African countries are held to the low levels of aggregate measures of support already reported. Given the importance of this issue, African countries may need to find refuge in a re-thinking of SDT and its provisions in the context of re-negotiating the URAA. This could have several elements. First is the need to classify countries into the "least-developed" and "developing" categories on the basis of more objective development and trade-related criteria. The subsidies Agreement already recognized the inadequacy of the United Nations definition of "least-developed" countries by adding the so-called Annex VII countries (with per capita income of US$1000 of less) to the list of least-developed countries exempted from certain elements of its obligations. A more objective set of criteria for identifying the least-developed countries, based on some income and trade competitiveness threshold, would undoubtedly include most African countries. Second is the need to move away from the use of "transitional periods" and towards the adoption of appropriate graduation criteria which are also based on the same set of income and trade-competitiveness thresholds. As applied in current UR agreements, transitional periods appear haphazard; the length of time specified in particular cases bear no clear relationship to either the adjustments required or the human and institutional capacity building required for achieving an appropriate level of readiness to carry out the corresponding WTO obligations. Thus, an important negotiating interest for African countries would be to redefine SDT and its provisions in the URAA so that they can permit the application of appropriate support systems to African agriculture without which changes in the incentive structure would be largely ineffective.

(to be added)

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Source: World Bank, World Development Report, 1980-1997

Source: African Development Bank, African Development Report, 1998

Source: World Bank, Commodity Trade and Price Trends, 1997 and African Development Bank, African Development Report, 1998

Source: World Bank, World Development Report, 1998/1999

Source: World Bank, World Development Report, 1998/1999

Source: World Bank, World Development Report, 1998/1999

Source: Compiled by Dickson Yeboah, April 1996, WTO Geneva.

* Paper prepared for the Conference on Agriculture and the New Trade Agenda in the WTO 2000 Negotiations holding in Geneva, Oct. 1-2, 1999.