What Triggers a Special Agricultural Safeguard (SSG)?: Analyzing the Use of SSGs by the EU and the US

Abstract

The special safeguard (SSG) is an exception to the market access (MA) commitments under the World Trade Organization (WTO) Agreement on Agriculture (AoA) that has caused disagreement in WTO trade negotiations. It allows the member countries that have reserved the right to their use the imposition of heightened tariff rates on selected agricultural commodities in specified cases of a surge in import volume or a fall in import price. This thesis quantitatively analyzes the invocation of price-based SSGs by the European Union (EU) and the United States (US) during 1995-2023, and whether developing countries’ exports have been adversely affected by the price-based SSGs invoked by the EU and the US. A panel data framework is applied to a probit model for binary response to estimate the effects on the response probability, that is the probability of a SSG action being taken, from selected economic factors. The regression results suggest that real GDP, the relative import price, import growth and the COVID-19 pandemic have affected the EU’s decision to invoke a price-based SSG. The relative import price, import growth and domestic production volume are estimated to have affected the decision of the US to invoke a price-based SSG. Developing countries’ exports are implied to have been adversely affected by the price-based SSGs invoked by the EU. No such effect is found from the price-based SSGs invoked by the US