The Agreement on Agriculture, also known as the AoA, is a treaty that was created by the World Trade Organization (WTO) in 1995 as part of the Uruguay Round of negotiations. The AoA aims to liberalize global trade in agricultural products by reducing trade barriers, such as tariffs and import quotas, and to establish rules for agricultural trade.
The AoA is a significant agreement for both developed and developing countries, as it has a significant impact on their agricultural policies and economies. The AoA is based on three main pillars: market access, domestic support, and export subsidies.
Market access refers to the reduction of tariffs and non-tariff barriers on agricultural products. The agreement requires all WTO members to grant access to their markets for imported agricultural products. Developed countries agreed to reduce their average tariff rates by 36% over six years, while developing countries agreed to reduce their average tariff rates by 24% over ten years.
Domestic support refers to the financial assistance that governments provide to their domestic agricultural sectors, such as farm subsidies. The AoA sets limits on domestic support in order to prevent governments from distorting international trade by artificially inflating or deflating prices. Developed countries are required to reduce their domestic support by 20% over six years, while developing countries are not subject to the same reduction requirements.
Export subsidies are payments that governments give to their farmers to encourage them to export their agricultural products. The AoA aims to eliminate export subsidies gradually, with developed countries required to reduce their export subsidies by 36% over six years and developing countries by 24% over ten years.
The AoA has been both praised and criticized since its creation. Supporters argue that the agreement has opened up new markets and increased competition, leading to lower prices and greater efficiency. However, critics argue that the agreement has led to the loss of jobs and income for small farmers, particularly in developing countries.
In conclusion, the Agreement on Agriculture is a significant treaty that aims to liberalize global trade in agricultural products by reducing trade barriers and establishing rules for agricultural trade. While the agreement has had a significant impact on the agricultural policies and economies of both developed and developing countries, it remains a contentious issue that is debated by supporters and critics alike.