Define WTO Blue Basket And WTO Yellow Basket

WTO Blue Basket

In addition to green box measures, the following subsidies are excluded from obligations to reduce domestic support for national agriculture, such as direct payments under production restriction programs (the WTO’s blue basket).

In accordance with paragraph 5 (a) of Art. 6 Agreements direct payments under production restriction programs are not covered by obligations to reduce domestic support if:

  • (I) such payments are tied to fixed areas and yieldsor
  • (Ii) such payments are made on a basis of 85% or less of the base level of production; or
  • (Iii) payments in the livestock sector are made on the basis of a fixed number of livestock.

The measures of the blue basket are in their orientation and in their meaning close to the measures of the green basket, defined above in paragraphs 9–10 adj. 2 to the Agreement. These measures have been actively used by economically developed countries for a long time in order to prevent overproduction of agricultural products.

WTO’s Yellow Basket

The calculation of the value of the baskets is carried out at the WTO on a national scale based on the results of the calendar (trading and financial) year.

The WTO assumes that all budget agricultural expenditures of the current calendar year that do not meet the criteria of the green and blue baskets should be sent to the yellow basket. But before that, they must go through the dc minimis “filter”.

In accordance with paragraph 4 (a) of Art. 6 of the Agreement, levels of internal support, referred to in the WTO working language as de minimis measures, are not included in the total amount of the yellow basket and are not subject to reduction in the following cases:

  • a) if the internal support associated with a particular product does not exceed 5% of the total cost of its production during the relevant year;
  • b) if domestic support notrelated to specific products does not exceed 5% of the total value of agricultural products produced in the country during the relevant year.

The so-called 5% barrier is set by the WTO for economically developed countries. For developing member countries in accordance with paragraph 4 (b) of Art. 6 of the Agreement, the minimum percentage for this indicator is 10%.

As already emphasized, the terms “yellow”, “green”, “blue” baskets, de minimis, are used in the working language of the WTO. In the language of official documents of the WTO, the term “yellow basket” corresponds to the indicator Current Total Aggregate Measurement of Support – “current total aggregate measure of support

P agricultural / gross agricultural output at current prices.

In fact, de minimis is a total of the fourth basket of the WTO and the third (along with the “green” and “blue”), not falling under the regime of restrictions. (Unfortunately, this circumstance is still not taken into account in many analytical materials and departmental documents published in domestic publications and the Internet. In the end, this methodical ignorance does not facilitate the adoption of adequate decisions on the directions, forms and mechanisms of state support for domestic agricultural producers conditions of the country’s membership in the WTO.)

According to WTO rules, the level of current total AMS in each calendar (trade, fiscal year) shall not exceed the maximum permissible level of AMP, calculated using the index Base of Total the Aggregate the Measurement of Suppor – “base total aggregate measure of support” ( “base total AMS”),

The value of the baseline total ILA is calculated over the agreed baseline (baseline) period and serves as a guide, a reference point when determining the maximum allowable level of the AMP (yellow basket) in each current year.

For countries that were at the origins of the creation of the WTO, when calculating the index of the base total ILA, the period 1986-1988 was determined as the baseline period. As for the countries joining the WTO, the definition of a base period for them is the subject of separate negotiations within the framework of the accession issue.

by Abdullah Sam
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