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Analytical Note, November 2009 The Special Safeguard Provision (SSG) in the WTO's Agreement on Agriculture is an instrument that is regularly used by a number of developed countries to protect their agricultural sector. Most developing countries do not have access to the SSG. The Special Safeguard Mechanism (SSM) has been proposed by a large number of developing countries in the Doha Round so that they too can avail of a similar and an even more effective safeguard mechanism than the SSG. Unfortunately, the conditions for the SSM have been so diluted as to make it difficult to use, and in many aspects less effective than the SSG. This paper provides a detailed comparison between the two instruments. Analytical Note, November 2009 This paper begins by highlighting the frequency of price declines experienced by developing countries. It then touches on the use of the price-based Special Safeguard Provision (SSG) by developed countries. The paper then looks at the conditionalities of the WTO Agriculture Chair's December 2008 text (TN/AG/W/4/Rev.4). These include exclusion of en route shipments from the price-based SSM coverage; the trigger and remedy, and the omission to take into account the value declines in ad valorem duties when prices drop; the cross-check; and the exclusion of preferential trade from SSM coverage. An analysis of these conditionalities is provided. Some of these clauses, if agreed upon, will severely curtail countries' ability to invoke the price-based SSM. In addition, once invoked, the remedies, as they are currently drafted, are not likely to be effective in shielding domestic producers from price volatilities. South Centre Analytical Note - November 2008 The Special Safeguard Mechanism (SSM) is often quoted as one of the main controversial points that lead to the failure to the WTO mini-ministerial process in July 2008. Technical divergences relate to key aspects of the design and operation of the mechanism but also strong political divergences among exporters and importers. The purpose of this note is to explain the rationale and origins of the SSM and the main contentious issues in the current debate. |