Special Edition-07.pdf - Lahore School of Economics

162
Naheed Zia Khan
Before exploring the implications of the size and significance of
agricultural subsidies of developed countries, it will be helpful to have an
overall idea of the players’ stakes in the international market for agricultural
products. Table-6 presents the share of leading exporters of agricultural
products in the world receipts from agricultural exports between 1980-
2002. The most significant development to be noted is that the US share
declined by about 3% in 10 years to 1990, and the EU share increased
markedly during the same period. This may be explained by Greece,
Portugal and Spain, all having a comparative advantage in agriculture,
joining the EU, then the European Community. 10
Table-6: International Trade in Agricultural Products: Leading
Exporters (1980-2002)
World export of agricultural products
Country/Group
(% share in total export receipts)
1980 1990 2000 2002
EU15 32.8 42.4 39.6 40.1
US 17.0 14.3 12.9 11.8
Canada 5.0 5.4 6.3 5.6
Brazil 3.4 2.4 2.8 3.3
China 1.5 2.4 3.0 3.2
Australia 3.3 2.8 3.0 2.9
Argentina 1.9 1.8 2.2 2.2
Thailand 1.2 1.9 2.2 2.0
Indonesia 1.6 1.0 1.4 1.5
Malaysia 2.0 1.8 1.5 1.5
New Zealand 1.3 1.4 1.4 1.4
Russia - - 1.4 1.3
Chile 0.4 0.7 1.2 1.2
India 1.0 0.8 1.2 1.1
Source: WTO (2003)
Russian Federation.
10 This observation provides food for thought for why after 1990 the US became
interested in the expansion of NAFTA. Also, on the issue of farm subsidies the two
powers, EU and the US, were likely to make or break the UR negotiations. Each insisted
that an unsatisfactory deal will be rejected, even if that means no deal at all (see “GATT:
The Eleventh Hour” The Economist, December 4, 1993).