Agreement on Agriculture Summary

April 3, 2022

The Agreement on Agriculture (AoA) was signed in 1994 by member nations of the World Trade Organization (WTO) with the goal of liberalizing trade in agriculture, reducing trade distorting subsidies, and increasing market access for agricultural products. The agreement has had a significant impact on global food systems and rural economies, as well as raising concerns about its effects on small-scale farmers and food security.

The AoA is divided into three main pillars: market access, domestic support, and export competition. Market access focuses on reducing tariff barriers and increasing quotas for agricultural products, allowing for more open trade. Domestic support refers to the subsidies and other forms of government support provided to agricultural producers, which can distort markets and affect trade. The AoA seeks to reduce the trade distorting effects of these subsidies, while allowing for certain forms of support to continue. Export competition addresses export subsidies, which can give certain countries an unfair advantage in international trade.

One of the most significant outcomes of the AoA has been its impact on small-scale farmers and rural communities. The agreement has led to greater competition in domestic markets, often resulting in lower prices for locally produced goods. This can be particularly tough for small farmers who may not have the resources to compete with larger, more industrialized operations. Conversely, the AoA has provided opportunities for some developing countries to expand their exports and access new markets, leading to economic growth and development.

Critics of the AoA argue that it has led to an overreliance on exports, creating vulnerabilities in food security and exposing rural economies to volatile global markets. They also point out that the agreement has not done enough to address the social and environmental impacts of industrial agriculture, including deforestation, water pollution, and climate change.

In recent years, there have been calls for a renewed focus on the local and regional food systems, with greater support for small-scale farmers and agroecological approaches to agriculture. The Covid-19 pandemic has highlighted the importance of local food systems and the need for greater resilience in the face of global crises.

Overall, the AoA remains an important agreement with both positive and negative effects on global food systems. As we navigate the challenges of the 21st century, it will be important to balance the benefits of trade with the need for social and environmental sustainability, as well as the concerns of small-scale farmers and rural communities.

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