Agricultural policy (AP2011) Reform and the WTO: Potential Impacts on Swiss Agriculture

Abstract

This article analyses the impact of the planned Swiss package of agricultural policy measures AP2011 and the tariff reductions scheduled as part of the WTO Doha Round, with special emphasis on effects in the dairy and meat sector. The simulations are carried out using an extended partial equilibrium model. This article discusses the anticipated impact of changing structural conditions on production, processing, consumption, prices and exports in the milk market. If account is taken of the Bilateral Agreements between Switzerland and the EU providing for liberalisation of the common cheese market, raw milk production increases by 10.5 %, whereas the milk price shows a significant drop to around 60 centimes per kilogram of milk. The abolition of subsidies will result in comparatively more milk being processed into high value-added products. All WTO scenarios have a negative impact on the dairy and meat market. The results reveal that Pork meat is sensitive to the tariff reduction formula under the WTO draft proposal.Partial equilibrium model, simulation, AP2011, WTO, dairy industry, Agricultural and Food Policy, International Relations/Trade, Livestock Production/Industries,