Likely impacts of the GATT [General Agreement on Tariffs and Trade] agricultural agreement on African agricultural trade and development

The AA is important for Africa because agriculture accounts for about 30% of African Gross Domestic Product, 75% of employment, and two thirds of all exports. Part 1 synthesizes existing literature on the probable impact of the Uruguay Round and the AA on developing countries, with particular attention to Africa. Part 2 examines the expected impact of the GATT/AA on the agricultural trade of six African countries: Morocco, Senegal, Cote d"Ivoire, Kenya, Malawi, and South Africa. Conclusions are as follows. (1) The AA is likely to have a slightly negative impact on African exports, especially to the European Union, due to preference erosion. Overall, the AA is likely to cause more preference erosion than trade creation for Africa. (2) The AA"s impact on the quantity and cost of African imports also will be small in the near term. (3) The AA"s impact on African agricultural trade policy is positive but undramatic. Most of the tariff and subsidy requirements of the World Trade Organization (WTO) and the AA have been components of structural adjustment programs in most of Africa for the past 10 years. (4) Despite the limited nature of its near-term impact, the AA is important because it lays the groundwork for future trade liberalization. (5) Given the eroding value of trade preferences, African exporters will need to rely less on special treatment and more on improved quality and promotion to expand their agricultural exports. (6) African countries should learn how to make WTO bodies and the dispute settlement mechanisms work for their interests, particularly to combat non-tariff barriers on their exports to Organization for Economic Cooperation and Development (OECD) countries. (7) Africa should begin preparations for future rounds of negotiations. Each African country needs to prepare its own analysis of those trade measures that it considers to be significant barriers to its exports. (8) Because the acceptability of domestic production subsidies and export subsidization is likely to wane in OECD countries over the next decade, Africa should be preparing for a future of higher international food prices. (9) African countries can maximize their benefits from the international trading system by engaging in unilateral liberalizations that are outside of the framework of multilateral negotiations. Implications for USAID interventions are discussed in conclusion. Appendices include agricultural case studies for six African countries. (Author abstract, modified)