Abstract

The Food and Agricultural Policy Research Institute (FAPRI) received a request in mid-February to analyze the proposed changes to agriculture and agricultural trade made by Arthur Dunkel. These changes essentially fall into three areas. 1) Export Competition. Subsidies are subject to reduction in two ways. Expenditures are to be reduced by 36 percent and quantities exported with the benefit of subsidies are to be reduced by 24 percent from 1986-90 average levels. 2) Internal Support. Using a world reference price based on the 1986-88 average levels, internal supports as measured by an aggregate measure of support (AMS) are to be reduced by 20 percent from 1986 levels. Credit will be given for support reductions made since 1986. 3) Market Access. Import restrictions are to be converted to tariffs and reduced across the board by a simple average of 36 percent. Tariffs on individual commodities are to be reduced by at least 15 percent. Where import barriers are in place, either minimum access of 3 percent of domestic consumption in 1993, rising to 5 percent in 1999, or minimum access of 1986-88 average import levels is to be provided, whichever is greater.