Fair conditions of competition: The end for export subsidies
Since July 2013 the exportation of farm products has no longer been subsidised in the EU and hence in Germany. The so-called export refunds were phased out and ultimately abolished. It would only have been possible to reintroduce the instrument of export refunds after the reform of the common agricultural policy in 2013 in the event of extraordinary market crises.
This would have been possible for products from the cereals, rice, sugar and beef sectors, for milk and milk products, pigmeat, eggs and poultry meat and for certain processed products originating from agricultural raw materials. Export refunds were not, however, reintroduced after the reform of the common agricultural policy in 2013.
In the course of the negotiations on the agricultural reform, the Federal Ministry of Food and Agriculture (BMEL) had pushed hard for export refunds to be dismantled fully and immediately in the interest of fair conditions of competition, in particular for developing countries.
In the years before the EU export refunds had declined sharply because of the stronger market orientation of the Common Agricultural Policy: Whereas more than 10 billion euros were paid out in 1993 when there were just 12 member states, the figure dropped to a mere 146 million euros in 2012- with 27 member states.
The federal government had urged the EU to actively seek to abolish export refunds and regiment measures having equivalent effect within the World Trade Organisation WTO, too. As early as during WTO negotiations in 2005 the EU conceded to abandon all export refunds in the context of an overall outcome of the Doha Round provided that all other suppliers on the global market would give up their export support mechanisms such as export credits and food aid for the systematic disposal of surpluses.
It was possible to achieve this objective in December 2015 at the 10th WTO Ministerial Conference held in Nairobi. It was agreed that upon expiry of certain transitional periods all export subsidies worldwide were to be abolished. In addition, it was agreed to regiment export credits and food aid and to apply the same rules to state trading enterprises. The measures adopted in Nairobi will make an essential global contribution to fairer and more rule-based agricultural trade worldwide.
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