IFPRI seminar 26 Apr 2021 – Evolving factors shaping trade in agriculture and food

Points made by Pascal Lamy

Intro: July 2008: ag ssc rejection by the US was the straw that broke the DDA camelback

13 years later: ag nowhere to be seen in the WTO big agenda

what happened? has trade in ag become irrelevant? have soldiers left the battleground?

 no, none of these; as Jo Swinnen could say: “it’s the political economy, stupid”; that’s where a lot has changed; not all (I), but a lot (2), hence the necessity of a new agrifood international trade agenda (3)

1- What has not changed: the complex relationship betw ag & internat trade

  • on one side: open mkts remain essential for food security, availability, affordability, hence keep addressing obstacles to trade
  • other side: economics of trade opening in ag different; benefits of comparative adv les obvious: capital (land) not mobile, weather changes, socio cultural specificities on supply side (rural employment) or demand (diets habits), hence more protection (tarifs, subs x2/manufact)

2- What has changed: quite a lot, which makes the relationship even more complex

  • other shaping factors have gained importance:
    • environment externalities (emissions, biodiv, soils, hydrosphere)
    • impact global warming
    • nutrition, health (sugar, fats, NCDs)
    • culture (GMOs, animal welfare, meat)
    • tech (biotech, breeding, GPS, bioreactors… CGIAR centers production
  • support as a trade distortion has lost importance (LT prices trend up with nutritional transition away from staples, support DDCs now > DCs – total PSE now 600 Bn from which 200 CN)

all in all -> a different political economy of the relationship betw agrifood system and int trade; should lead to a…

3- A new agrifood trade agenda: shift focus from protection to precaution (expl diff + grey zone):

  • xport restrictions disciplines (cf imp safeguards)
  • revisit support pros and cons considering multifunctionality/ farm to fork /whole agrifood system (GNP50%>agri)
  • establish forum for comparability of env or other precautionary measures (CBAM or equivalent for soil, water footprint of ag, health), sort of “food codex” with WTO (convening?) FAO, WHO, ITC etc.
  • more resources on standards harmonization, certification, beyond SPS incl capacity building for DCs

Conclusion: a full plate for the trade research side of IFRI for the years ahead, assuming IFPRI survives the 1 CGIAR reform…

More info of the event on the website