Trade and development: Difference between revisions

Revision as of 12:53, 23 September 2021

Revision as of 10:08, 25 November 2021

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====Barriers to trade====

* High [[tariffs]] are imposed on agriculture: in high-income countries, the average tariff rate on agriculture is almost double the tariff for manufactures. And more than one third of the European Union's agricultural tariff lines, for instance, carry duties above 15% [http://www.WorldTradeOrganization.org/english/res_e/booksp_e/special_study_6_e.pdf]. Tariff peaks within agriculture occur most frequently on processed products and temperate commodities, rather than the major export crops of [[least developed countries]] (unprocessed fruits and vegetables and tropical commodities). However, many developing countries in temperate zones have the potential of competing as lower-cost producers in temperate commodities. Thus liberalization could open up new development-through-trade possibilities.

* Strong tariff escalation is typically imposed on agricultural and food products by high-income countries. This strongly discourages the development of high [[value added]] exports, and hinders [[Agricultural diversification|diversification]] in particular as well as development in general. In high-income countries, tariffs on agricultural products escalate steeply, especially in the EU and Japan. ('Tariff escalation' is the imposition of higher import tariffs on processed products than the tariffs applied to unprocessed ingredients. <ref>{{Cite web|url=https://www.wto.org/english/thewto_e/glossary_e/tariff_escalation_e.htm|title = WTO &#124; Glossary - tariff escalation}}</ref>)

* Complex tariffs make it more difficult for developing country exporters to access industrialised-country markets because of the disadvantages developing countries face in accessing, and in their capacity to process, information. Not only are price signals distorted, they are often unclear, subject to change (for example seasonally) and difficult to interpret. [http://www.unctad.org/en/docs/c1em8d3.en.pdf]

* [[Tariff-rate quota]]s (TRQs), introduced by the Uruguay Round with the aim of securing a minimum level of market access, have performed poorly. Average fill rates have been low and declining, from 67% in 1995 to 63% in 1998, with about a quarter of TRQs filled to less than 20%. The low fill rate may reflect high in-quota rates. Overall, the UR tariffication process which produced them has not resulted in the increased market access developing countries hoped for.