OECD Review of Agricultural Policies

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English
ISSN: 
1990-004X (online)
ISSN: 
1990-0058 (print)
http://dx.doi.org/10.1787/1990004x
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These reviews present a comprehensive overview and assessment of subject countries’ agricultural policies combined with OECD estimates of the level of support provided to their farm sectors. They also examine such issues as welfare impacts of liberalisation; agricultural commodity markets; grain stock estimates; labour and food safety.

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OECD Review of Agricultural Policies: Brazil 2005

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English
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Author(s):
OECD
31 Oct 2005
Pages:
226
ISBN:
9789264012554 (PDF) ;9789264012547(print)
http://dx.doi.org/10.1787/9789264012554-en

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This Review measures the level and composition of support to Brazilian agriculture, and evaluates the effectiveness of current measures in attaining their objectives. The study finds that Brazil provides much lower support to its agricultural sector than most OECD countries. However, a large and increasing share of that support is provided in the form of credit subsidies; support which could be more productively oriented to areas such as research and extension, training, and the development of rural infrastructure. A greater focus on such long-term investments could help Brazil to address the two major challenges confronting its agricultural sector: the need to sustain improvements in international competitiveness, and at the same time draw poor smallholders into the development process. At the international level, the report finds that, having substantially reformed its own agricultural policies, the main source of future benefits to Brazil will be reforms in other countries, where access to OECD country markets is the most important issue. Yet while trade liberalisation offers important benefits for the majority of households, those gains need to be placed in the context of the broader opportunities and adjustment pressures confronting both commercial farmers and smallholders.

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  • Highlights and Policy Recommendations
    Brazil provides relatively little support to its farmers. Producer support, as measured by the PSE, accounted for 3% of the gross value of farm receipts in 2002-04 – a rate comparable with that of New Zealand (2%) and Australia (4%), and far below the OECD average (30%). The highest support levels are for import-competing staples (wheat, maize and rice) and cotton, ranging between 6% and 17% for these products.
  • The Policy Context
    Over the past 15 years the Brazilian economy has undergone dramatic structural reforms and achieved much greater macroeconomic stability. The agricultural sector has both contributed to these reforms and benefited from them, with production and exports growing rapidly, particularly in recent years. Yet although economic growth has helped reduce the incidence of poverty, low incomes remain a concern, especially in rural areas, and there has been little progress in reducing income inequality.
  • Policy Evaluation
    This chapter provides an overview and evaluation of agricultural policies in Brazil. Section 2.1 describes the basic objectives that underpin agricultural policies and how those objectives have changed since the abandonment of import substitution policies. It also documents the institutional mechanisms through which policies are implemented. Section 2.2 chronicles the evolution of domestic policies, including credit policies and market interventions, the main elements within the current policy framework; while Section 2.3 examines how Brazil’s trade policies have evolved.
  • Policy Effects
    This chapter focuses on two agricultural policy issues of importance to Brazil. One is the market access barriers confronted by Brazilian exporters, including tariffs and non-tariff barriers applied by both OECD countries and in other markets; the other issue is the size and distribution of the prospective gains from the removal of those barriers in the context of multilateral trade reform.
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