Agriculture in the GAAT. An assessment of the USA's 1989 proposal
1991
Guyomard, H. | Mahe, L.P.
This article provides an assessment of the USA'S 1989 GATT proposal for farm policy reform. The implications of the proposal for the EC and the USA are investigated through a simulation over a five-year period. The proposal required tariffication of all supports and the phasing out over five years of export subsidies and over 10 years of other measures (tariffs, deficiency payments). It would have hurt farm income and the trade balance considerably more in the EC than in the USA, but budget savings would have been larger in the EC. Overall the burden and the pace of adjustment resulting from this proposal would have weighed much more heavily on the EC than the USA. This analysis stresses the weakness of the EC's position due to the excessive use of export subsidies in the conduct of the CAP.
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