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Agricultural Subsidies in Syria |
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The Syrian Minister of Agriculture and Agrarian Reform requested NAPC to contribute to the assessment of the compatibility of its agricultural subsidy programs with the WTO. NAPC referred to the FAO Project GCP/SYR/006/ITA, to receive the assistance of international expertise in developing and assessing options for subsidization of agriculture consistent with WTO regulations. FAO contracted Mr Bruce Huff, an agricultural economist and former agricultural policy advisor to the government of Canada and OECD, to undertake this work during the month of July. He examined the current set of subsidies policies for Syrian agriculture, and then developed and evaluated a series of options involving tariffication, input subsidies and direct decoupled payments. The results were presented in a workshop to stakeholders on July 27, including the Deputy Minister of Agriculture and Agrarian Reform, the Head of the Commission reviewing agricultural policies, advisors to other ministries, and producer organizations. The final report provides information on the impact of the options, and proposes that Syria uses direct payments, possibly with requirements for continued production, for cotton. A tariffication approach is proposed for wheat, sugar beets, and tobacco and other importable commodities. The conclusions drawn and recommendations made by the expert regard the necessity of current policies revisions, especially with reference to the following main issues. Firstly, there are a number of agricultural support programs operating in Syria, which provide considerable support, that are not acceptable to the WTO. These include the quantitative import barriers such as bans, restrictive licensing requirements, and monopoly importers. Such restrictions have to be converted to tariffs, providing ‘equivalent’ levels of protection. As well, Syria would be required to guarantee a minimum level of access, generally through a lower or zero tariff. Secondly, the WTO allows state trading enterprises such as those operating in Syrian agriculture, but they must conform to WTO rules and these agencies will likely come under pressure to be more open and transparent on market transactions and losses. Finally, the report urges Syria to increase the competition in the marketing and processing sector to lower costs and improve quality. It indicates the need for new stakeholder information programs and new policies to cope with and benefit from increased market price fluctuations. The study indicates the need for more medium and long term loans to allow the desirable adaptation of the agricultural sector to the new international market environment. It notes that the currently provided subsidies in the area of food security, infrastructure, research and extension are compatible with the WTO regulations. |