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French Version

Public, private sector officials discuss united front for tariff levels (Daily Star)

Talks include program of agricultural subsidies
Agriculture offer includes subsidy levels that are higher than current ones

Private and public officials in the agriculture sector have to agree on the framework for negotiating the levels of tariffs and subsidies that can be maintained when Lebanon joins the World Trade Organization (WTO), officials said Thursday.

The agriculture committee of the International Chamber of Commerce held a meeting on Thursday between public and private sector officials to discuss the outcome of Lebanon’s second Working Party meeting held in the Geneva-based organization earlier this month.

Lebanon had presented at the meeting its initial tariff offers for industrial and agricultural goods as well as its offer on services, which are the key platforms for negotiating entry to the WTO.

The offer on agriculture included tariff levels that are higher than the currently applied ones and suggested maintaining existing agricultural subsidies, such as the Export Plus program run by the Investment Development Authority of Lebanon.

Fadi Makki, director-general at the Economy and Trade Ministry, who attended the second Working Party meeting in Geneva, said Lebanon’s negotiating team would have to work with private sector officials to decide the extent to which the government can lower its tariffs during negotiations with the WTO. “We will have to decide on the lowest level we could reach or (will have to) propose a different offer,” said Makki.

The team negotiating Lebanon’s entry in the WTO decided to base its tariff offers on higher levels rather than the current ones due to the broad tariff cuts introduced in 2000. That left the average unweighed tariff rate at around 5 percent.

In the agriculture sector, where most tariffs on imports are around 70 percent, the ministry raised the level to 90 percent in order to leave some room for negotiation.

Makki said some WTO members might ask for more cuts in tariff rates on agricultural imports, which would leave Lebanon with two choices. “We can either propose a tariff rate quota that raises current tariffs after a certain import level is exceeded, or we can introduce a seasonal tariff ­ a sort of an agricultural calendar ­ which allows the Agriculture Ministry to raise tariffs during seasons vital to farmers,” Makki said.

Makki added that WTO members at the second Working Party meeting agreed to let Lebanon maintain Export Plus ­ a $33 million export subsidy program introduced in 2001 and which is due to expire in 2004 ­ as well as other subsidies. “We are allowed to grant subsidies up to 10 percent of our agricultural input, or around $150 million a year,” said Makki.

But other private sector officials at the meeting said the government’s negotiating platform did not address some of their demands, and some asked the government to offer higher tariff levels.

“When we presented our tariff offers for the agro-industry, we did not know that the Agriculture Ministry was trying to reinstate sugar subsidies, a move that will hike up our costs,” said Atef Idriss, head of the Syndicate of Lebanese Food Industries in Lebanon. “Had we known about this, we would have presented higher tariff levels,” Idriss added.

Other officials said that the agriculture sector cannot benefit from the country’s entry into the WTO due to the lack of a clear government agricultural strategy.

Agriculturist Imad Bsat said that there still is a lack of coordination between the private and public sectors over the terms of negotiating an entry into the WTO, which is expected to take place in early 2005.

Beirut 22-12-2003
Dania Saadi
The Daily Star

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