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Policies issues affecting trade in fibre and products

Joint Meeting of the 36 th Session of the IGG on Hard Fibres and the 38 th Session of the IGG on Jute, Kenaf and Allied Fibres Salvador City, Bahia, Brazil, 16-18 November 2011. Policies issues affecting trade in fibre and products

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Policies issues affecting trade in fibre and products

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  1. Joint Meeting of the 36th Session of the IGG on Hard Fibres and the 38th Session of the IGG on Jute, Kenaf and Allied FibresSalvador City, Bahia, Brazil, 16-18 November 2011 Policies issues affecting trade in fibre and products Suffyan KoromaTrade and Markets DivisionFAO, Rome, Italy suffyan.koroma@fao.org

  2. Outline of presentation • Introduction – Jute+, Abaca, Coir & Sisal (JHFs) • Competitiveness related issues • Trade related policies • Tariffs structure • Non-tariff measures affecting trade • Other (export competition and domestic support) • Data and information needs to monitor trade policy and market development including conducting regular market projections

  3. Competitiveness • Rising demand – • Tight supplies and rising prices • composite fibre market (environmental friendliness and regulation, rising prices of petrol ….but trade regime is likely to be complex!!) • ease in information flow and technology transfer • diversified end uses and increasing potential • Research and experimentation needs • renewed focus on domestic and regional markets (RTAs, policy harmonization, GSPT) ……however, old bottlenecks are still present • Price instability and reliability of supplies • Climatic conditions • relative prices of competing crops – especially in smallholder systems • Competition from synthetics and also from other fibres in emerging composite application • weak domestic policies – policies mostly favor food crops

  4. Trade related polices Key Policy issues • The WTO Agreement (tariffs, NTBs, etc….!) • The phasing of the MFA in 2004 • GSP preferences granted by developed countries & those among developing (LDCs) countries • Regional Trade Agreements and domestic policy harmonization

  5. Final Semi Raw 2009 2009 2009

  6. Final

  7. 1998 1998 2009 2009 1998 2009 1998 2009

  8. Non-Tariff Barriers In general, NTBs refer to all non-tariff restrictions on trade in goods, services and investment. These include border measures (customs procedures, etc.) as well as behind-the-border measures flowing from domestic laws, regulations and practices.

  9. NTBs – some reported!!! • Stringent requirements that increase cost of trade • Packaging and labeling (e.g. can’t use methyl bromide as it is banned and suitable alternative(s) costly) • SPS • Special certificate of origin and addition documentation at port of entry • Testing of products during exporting process • Blended products are required to indicate % of certain fibres • Classification of products can be ad hoc leading to higher duties • Private standards such as health, safety, use of child labor, working hours, wages and benefits, freedom of association, environmental compliance, etc.

  10. Other Trade-related policies • Export subsidies and domestic support • JHFs not subject to reduction commitments under WTO • Relevant for some competing crops/products but need to do further research as issues are not clear and related information is difficult to obtain • Product specific policies needs to be reported by Members

  11. The way forward • Efforts should be made to engage with trade partners in bilateral, regional and multilateral negotiations to dismantle the remaining tariffs, especially tariff escalation. • In the case of NTBs, although minor progress has been made on some fronts – in terms of reporting and monitoring, no concrete actions or road map to their phasing out have been agreed at the multilateral level. For those on SPS grounds which are sometimes justifiably imposed, concerned exporters should seek support in enhancing their capacities to meet those standards. • JHFs producers would need to ensure that existing supply-side and marketing constraints should be overcome. These should be addressed on several fronts: • Through operationally effective policy, capacity and institutional building, investment in research and development along the JHFs value-chain and on market enhancing infrastructure • The focus should not only be limited to improving the agronomic conditions for JHFs but should include research and development on new and prospective end-uses, building on the current heightened environmental concerns over the use of synthetic substitutes.

  12. and Finally.… • Addressing the recommendations of the Consultation in the area of trade and trade related measures; • Re-design of the current questionnaire used to collect data to include policy related information/measures affecting trade and market development; • Structure of the website for the scope of the information related to trade; tariffs, NTBs, etc; • Conduct comprehensive studies to update information on trade and market dynamic for the JHFs sector including market prospects and opportunities in the fibre composite market for the fibre products covered by the joint group.

  13. Thank you

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