Experiencias internacionales de microfinanciamiento para el hábitat

Before the simulation of any scenario, several elements are included in the refer- ence situation in order to have a realistic baseline: the end of the Multi-Fibers Agreement (2005), the United States’ 2002 Farm Bill and the end of the imple- mentation period of China commitments as a new WTO member (2005). All the tariff simulations are applied at the HS6 level taking into account all relevant information (Bound tariffs, MFN applied tariffs and preferential applied tariffs), then aggregated to the model nomenclature (Table 1.2) using the reference group weighting scheme in order to avoid biased tariffs due to tariff aggregation (Bou¨et et al., 2002).8 _{Starting from the 2001 protection data provided by MAcMapHS6-}

v1 (used in GTAP6), we move to the 2004 level of protection (MAcMapHS6-v2),

7

Regarding border protection, the database used to construct the scenarios of trade liber- alization at the product level is MAcMapHS6 (Bou¨et et al., 2004). The base year for the first version of MAcMapHS6 (v1) is 2001 and for it second version the base year is 2004.

8

The reference group weighting scheme used to aggregate MAcMaps’ tariffs was developed by Bou¨et et al. (2002). For that purpose, authors have defined 5 groups of countries according to their GDP per capita, imports per capita and also exports per capita. Trade of these five groups of reference is used as weight to aggregate tariffs in order to avoid biased tariff due to other aggregation schemes.

and then we apply realistic trade policy changes.

Starting from this common ground, different baselines, used later as counter- factual, are built:

• (R1): the “business as usual” situation, with a Mercosur without Venezuela.

• (R2): (R1) + a successful DDA

• (R3): (R1) + the Venezuela accession

• (R4): the Venezuela accession plus a successful DDA (R1) + (R2) + (R3)

The accession of Venezuela to Mercosur has two main aspects: Venezuela adopting the Mercosur Common External Tariff (CET), and a trade liberaliza- tion between Venezuela and its new Mercosur partners. However, we keep the current preferences between Venezuela and the Andean Community constant. This regional integration is implemented during the seven years between 2007 and 2014. Argentina and Brazil will eliminate their tariffs by 2010, and Uruguay and Paraguay will do the same by 2013. Venezuela will start its tariff elimination by 2012 (tariff cut for non-sensitive products) and will finish it by 2014 elimi- nating tariff for sensitive products (chemical and petrochemical products, paper products, automobile, etc.) at the full completion of the agreement.

The Doha scenario considered here is similar to Lamy’s 20-20-20 proposal.9

This expected compromise can be described as following: a Swiss formula with a coefficient 10 for developed countries and 20 for developing ones in Non-Agricultural Market Access (NAMA). The G20 proposal in agriculture: a tiered formula for tariffs,10 _{a new ceiling for domestic support in the North, and the phasing out of}

9

G-20,Swiss 20andbelow USD 20 billion overall trade-distorting supports. G-20 refers the cut into farms tariffs proposed by this group, a Swiss formula with a coefficient of 20 for reducing developing country industrial tariffs, and reducing the ceiling for the US overall trade-distorting supports to below USD 20 billion (Bridges, 2006)

10

A tiered formula with inflexion points at 20, 50 and 75 percent, using average tariff cuts of 45, 55, 65 and 75 percent. For developing countries, the inflexion points are placed at 30, 80 and 130 percent and the average cuts at 25, 30, 35 and 40 percent. Final tariffs are capped at 100% for developed countries and 150% for developing countries.

export subsidies at the 2013 horizon; a Special and Differential Treatment making LDCs exempted from any tariff cuts and asking them to just continue the binding process (Fontagn´e et al., 2007). Other exclusions and flexibilities are introduced: a series of developing countries will not liberalize their manufacturing sectors due to a low initial binding rate (the so-called “Paragraph 6” countries of the NAMA framework); small and vulnerable economies (including Paraguay and Bolivia) are conceded zero liberalization. A final exception is that South Korea is treated as a developing country for agriculture and as a developed country for the NAMA. Next, we address the issue of special and sensitive products, in order to exam- ine the “variations” around the central scenario. “Sensitive products” and “special products” have to be defined for each country.

For both the agricultural and manufacturing sectors, sensitive products are defined following a political criteria in line with that proposed by Jean et al. (2005). We make the assumption that tariffs are currently higher where political sensitivity is the highest, and that governments take into account the effective impact on the formula of the applied tariffs and the price impact for domestic producers and consumers. In agriculture, sensitive products can appointed by all countries and are subject to a smaller liberalization than ordinary products. In NAMA, sensitive products are totally excluded from liberalization but this option is restricted to developing countries. In agriculture, developing countries are entitled to have some special products related to food-safety issues that will also be excluded from liberalization. More precisely, to define these products we compare situations in which normal rules and specific treatments are applied. As special products are concerned, we exclude 10% of the HS6 positions from liberalization, giving priority to the list of positions selected on the basis of their caloric contributions.11 _{Thus sensitive products are defined as 4% of the HS}

11

5% of agricultural HS6 lines are chosen according to the caloric contribution of their trade. Using the FAO data about caloric contribution per unit per product, we match with bilateral trade (volume) at the HS6 level from BACI database. These products are ranked following this indicator and 5% of their tariff lines are consider in prority to choose special products. Finally, the choice of special and sensitive products is done following their political relevance (Jean et al., 2005). The difference between special and sensitive products in the Doha scenario is that

headings with the highest sensitivity indicator.12 _{For these products, we apply}

half of the formula effect on bound rates. When HS6 positions entail TRQs, we apply 2/3 of the formula (mimicking an increase in the quota). For NAMA, the sensitive products of developing countries can cover 10% of their HS6 positions and up to 10% of their trade. For sensitive and special products, no capping at the HS6 level is considered.

The DDA commitments are fully implemented after four years for developed countries (2008-2012) and seven years for developing countries (2008-2014).