Export subsidies to be terminated

Published under: Solberg's Government

Publisher Ministry of Agriculture and Food

In a White Paper on globalization and trade, presented in Norwegian Cabinet today, the Norwegian Government proposes to terminate all agricultural export subsidies by the end of 2019.

- Today, Norwegian consumers subsidize Jarlsberg cheese sold abroad, with more than 130 million NOK annually. It is unreasonable that Norwegian consumers should pay for offering dairy exports at lower prices in foreign markets. We therefore wish to phase out export subsidies by the end of 2019, says Minister of Agriculture and Food Sylvi Listhaug. 

- Norway is one of very few countries to still use export subsidies, and there is a broad international consensus to end such trade distorting and protectionist measures. Consequently there is now a broad consensus in the national political community to end export subsidies, Listhaug says. 

- It is too early to say, what changes this will lead to in the industry, but it is important that the industry adapts to a situation that we have anticipates for some time says the Minister of Agriculture and Food.

- Tine can use surplus milk to develop new products in demand among Norwegian consumers, they may continue to export covering their own expenses, or reduce the quantity of milk produced in Norway, says the Norwegian Minister of Agriculture and Food, Sylvi Listhaug. 

The specific steps of the export subsidy wind down will be detailed in the National Budget, the Annual Basic Agricultural Tarif Agreement and the ongoing development of agricultural policy. In 2013, the cost of subsidizing export of 12 962.5 tonnes of cheese was 132 million NOK. 

Generally, use of export subsidies the use is banned by the WTO, but exceptions have been made for certain agricultural products. Norway has already terminated export subsidies for e.g. poultry, eggs, beef and mutton. 

Along with Canada and Switzerland, Norway has been one of the few countries still to use export subsidies for selected products. Other countries, including the United States and New Zealand, use various other measures to promote national exports. 

There is broad international agreement that export subsidies and other export support with comparable effects are to be terminated. In the Ministerial Declaration adopted at the 2005 WTO ministerial meeting, Norway agreed to end export refunds by the end of 2013 as part of the Doha Round. Since this round of negotiations has not been finalized, this decision is yet to be fully implemented. In anticipation of that round to be completed, at the ministerial meeting in 2013 the member countries of the WTO agreed to commit themselves to exercise "maximum restraint in the use of all forms of export subsidies", and all members who have not yet completed reforms were encouraged to do so.