THE EFFECTS OF ALTERNATIVE PROPOSALS ON EXPORT SUBSIDIES TO AGRICULTURAL PRODUCTS IN THE CURRENT WTO ROUND

The paper is aimed at assessing the impact of reducing and/or eliminating EU export subsidies within the next WTO round. The Global Trade Analysis Project (GTAP) model and database are employed to study the effects of the two main proposals put forward in the Doha Round on this matter by the EU and the US. Results of the simulations confirm the common knowledge that the elimination of EU export subsidies would imply increasing prices, exports and production for several net exporters of agricultural products. At the same time, such effects are all relatively small in size, particularly on trade, production and welfare, even under the more radical scenario that simulates the elimination of export subsidies. Despite some net importing countries would suffer from a more expensive import bills, benefits may arise for some of them in terms of incentives to substitute imports with domestic production. This is the case of the Mediterranean region, and to a lower extent of Sub Saharan Africa.