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Switzerland and LiechtensteinWT/TPR/S/208 Page 97

the customs territory, such as rice, coffee, and cocoa; mixtures of raw materials; raw materials filled in retail packing;  raw materials processed into unusual foodstuffs;  and imported mixtures not falling under HS Chapters 4 and 11.

12.

Switzerland and Liechtenstein have made commitments under the WTO Agreement on Agriculture to reduce export subsidies on a number of products.8  Accordingly, outlays for export subsidies have fallen, and remained far below the agreed maximum levels for most product categories (Table IV.6).  Nevertheless, Switzerland remains an important user of export subsidies for dairy products and processed agricultural goods.

Table IV.6

Export subsidies, 2004-06

(Sw F million)

Products

Actual outlays

Commitment levels

2004

2005

2006

2004

2005

2006

Dairy products

44.41

36.28

31.7

284.0

284.0

284.0

Cattle for breeding, and horses

6.62

5.66

5.06

22.4

22.4

22.4

Fruit

16.8

8.3

8.9

16.8

16.8

16.8

Potatoes

0.7

1.2

1.2

2.3

2.3

2.3

Processed products

114.9

90.0

90.0

114.9

114.9

114.9

Source: WTO documents G/AG/N/CHE/37, 4 October 2006 and G/AG/N/CHE/42, 25 March 2008.

13.

OECD estimates confirm a continued and gradual reduction in the level of support since the last TPR of Switzerland and Liechtenstein.  However, production and trade distorting policies still account for more than half of that support.  Over the period, the support has become less     commodity-specific, as unspecific payments and payments to commodity groups were introduced or increased to compensate for the reduction of market price support.  The level of support to producers declined from 71% in 2002-04 to 60% in 2005-07;  this remains 2.3 times higher than the average level of support in the OECD (Table IV.7).  The share of the most distortive forms of support (output and variable input-based support) fell to 75% in 2005-07, compared with 88% in 1986-88;  the share of the least trade-distortive support (payments not linked to production) was 21.6%.  Producer and consumer prices at the farmgate are on average two times higher than world prices.  The implicit tax on consumers decreased further from 58% in 2002-04 to 44% in 2005-07.  Support for general services has changed little and is currently at around 6.7 % of total support to agriculture.  In 2005-07, total support to agriculture was 1.4 % of GDP, down from 1.8% in 2002-04 and about 36% of the level estimated for 1986-88.  The largest share of producer support in value terms is directed to beef and veal, followed by pig meat and milk.9

14.

Imports of agricultural products are subject to licensing requirements for the purpose of tariff quota management, as well as for health, sanitary, phytosanitary, or compulsory reserve stock (Chapter III(2)(vi)(b), (x)(c), and (vii)).  Rice, wheat, sugar, wheat, and oils are subject to compulsory reserve stocks (Chapter III(2)(vii)).  Imported goods produced in a manner prohibited in Switzerland, e.g. eggs from battery hens, must be labelled as such (Chapter III(2)(x)(b)).10

Table IV.7

Estimates of Swiss support to agriculture, selected years

(Sw F million)

Average

2004

2005

2006

2007a

8 WTO Schedule LIX:  Switzerland and Liechtenstein, 15 April 1994.

9 OECD database 1986-2006, "Producer and Consumer Support Estimates:  Switzerland".  Viewed at:   http://www.oecd.org/document/59/0,3343,es_2825_494504_39551355_1_1_1_1,00.html.

10 Article 18 of RS 910.1, and RS 916.51.

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