Creating a trading system for development: Assessing market access proposals for agriculturalproducts in the WTO

Abstract

Recent WTO negotiations have revived interest in “market-access-for-development” packages that tie deeper tariff cuts in agriculture to flexibilities for low-income members. This paper develops a quantitative framework to evaluate whether such proposals can simultaneously expand trade, safeguard food security, and foster value-chain upgrading in developing countries.

Methodology:

Calibrating a partial-equilibrium model on bound and applied tariffs, ad-valorem equivalents of TRQs, and new data on trade costs for 46 agricultural products in 119 WTO members, we simulate three prominent market-access proposals:

(i) the G-33 call for Special Products and an expanded Special Safeguard Mechanism;

(ii) the Cairns Group formula for proportional tariff reductions with longer staging for LDCs; and

(iii) the EU–ACP initiative that consolidates preferences in exchange for tighter disciplines on export subsidies.

Findings:

We find that:

The G-33 option yields the smallest global welfare gains (US$5.2 billion) but preserves policy space for 90% of low-income members’ tariff lines;

The Cairns formula maximises export revenue for Latin American and African suppliers (+US$12.4 billion), yet erodes preference margins for ACP countries;

The EU–ACP hybrid strikes a balance, raising developing-country tariff revenues by 3% and cutting non-tariff distortions by one-third.

Sensitivity analysis:

Sensitivity analysis shows that the inclusion of an indexation clause for import surges and a plurilateral transparency mechanism for SPS measures is critical to prevent backsliding.

Conclusion:

We conclude that a development-oriented trading system must embed calibrated flexibilities rather than uniform liberalisation, and outline a rule-based architecture that links graduated market access to verifiable supply-side support.

IPRAA WORKING PAPER 32

JEL Classification: 

Keywords

We are a leading independent, nonpartisan research organization dedicated to advancing evidence-based policy solutions for sustainable economic development in Africa.

Subscribe to our Newsletter

Stay connected with IPRA’s quarterly newsletter featuring the latest news, book releases, and original content.

Newsletter Form (#4)

Become a Non-Resident Fellow

Copyright © 2025 Institute of Policy Research and Analysis. All rights reserved.