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Special Safeguards and Agricultural Trade Liberalisation

by David Harris, D.N. Harris & Associates

July 2008

RIRDC Publication No 08/125 RIRDC Project No DAH-4A

Summary
In the Uruguay round of multilateral trade negotiations provision was made for the introduction of special safeguards (SSGs) on imported products that were subjected to the tariffication process. The safeguards are designed to add extra import duties to the existing ordinary customs duties if a specified trigger level is breached. The aim of the measures was address concerns of importing countries about the potential for major disruptions to their domestic market from a surge in imports. The WTO special safeguards are an import restriction. Market access for a range of products in the major developed economies  is potentially subject to SSGs. There are two types of safeguards based on price and quantity based formulas. In some cases SSGs have been invoked on a regular basis. There are concerns about the measures operating as an additional layer of permanent import protection that is not consistent with the notion of a safeguard. The current Doha round of trade negotiations has some prospects for an improvement in market access conditions through reduced tariff rates. If this is achieved there is the potential for a greater incidence of SSG actions if the existing provisions are retained. The trade disruptions could stifle opportunities for longer term trade growth from negotiated improvements in market access conditions. This study was undertaken to evaluate the design and operational effects of the WTO safeguard provisions. It considers the role of SSGs as a transitional measure for market access reforms like tariffication. The study should be a useful contribution to the design of Special Safeguard Mechanisms (SSMs) for developing countries in the Doha trade negotiations and the possible use of safeguards in free trade agreements.

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