Discussion Paper No. 66 of 2007 on Special Products Under WTO Negotiations: The Case for Kenya

Abstract

There is need to identify agricultural products that may be designated as Special Products (SPs) for the purpose of receiving Special and Differential Treatment (SDT) under World Trade Organization (WTO) provisions. Special Products for Kenya have been selected using indicators contained in the draft possible modalities on agriculture, circulated by the Chairman of the WTO Committee on Agriculture in June 2006. The indicators relate to contribution of a particular product to a country’s food and livelihood security, and rural development. Overall, 11 products were found to qualify for designation as Special Products. These are: maize, sugar, wheat, milk and milk products, rice, meat and meat products, oil crops, cotton, horticultural products (vegetables and fruits), irish potatoes and millet. About 145 tariff lines accounting for about 20 percent of total agricultural tariff lines relating to these products were found to qualify for designation as Special Products. This is within the limits so far proposed under WTO negotiations. The paper recommends that Kenya be allowed to self-designate the identified Special Products and that developing countries be allowed some flexibility to substitute the selected Special Products whenever national priorities change. It further recommends that Kenya negotiates for exemption of all identified Special Products from tariff reduction. In the event that exemption of all identified Special Products is found not to be acceptable to other WTO members, then the country may seek exemption for only a few products, particularly those that have relatively low tariffs and are very important for food security, for protecting the livelihoods of the poor, and for rural development needs.