This report aims to provide a short but deliverable list of issues that affect the agribusiness sector in the BRICS countries.
2. Priorities identified by the Working Group
The Agribusiness sector is key in all BRICS economies. The BRICS Governments should recognize the importance of private sector by accepting advice on issues related to agricultural activities in the BRICS.
The Agribusiness Working Group of the BBC could serve as an advisory body to the meetings of the BRICS Ministers of Agriculture and Agrarian Development, presenting recommendations and advise to BRICS officials on business sector priorities and concerns.
This measure is essential for the BBC to realize its mission of ensuring regular dialogue between the business communities of the BRICS nations and the Governments of the BRICS countries.
In this context, the Agribusiness Working Group appreciates the opportunity to present the priorities identified by the private sector in the context of the BRICS multilateral dialogue, as below.
2.1. Promotion of innovation, technologies and ecosystem services
Aware of the growing demand for food, fuels, forests and fiber (4Fs), investments in innovation and technologies are required towards the development and deployment of bio-products and more products resource-efficient (use less water, land).
According to Food and Agriculture Organization (FAO) current investment in biotechnological research tends to be concentrated in the private sector and oriented towards agriculture in higher-income countries where there is purchasing power for its products. In view of the potential contribution of biotechnologies for increasing supply of the 4Fs and overcoming the challenge of the growing global demand, efforts should be made to ensure that BRICS members benefit more from biotechnological research. Thus:
- A “technology and innovation” fund could be established amongst members to promote and develop strategic projects that could support scientific research to promote the rational use of natural resources, reduce CO² emissions and deal with adaptation of species to help solve the problems related to climate change;
- Establishment of a government and private sector forum to discuss regulatory aspects of development and deployment of biotechnologies aiming to share experiences among countries and improve national frameworks for regulation of biotech A solid and robust regulatory framework focused on biosafety and risk assessment analyses would certainly increase civil society (including market, final consumers) understanding and need for the development and use of biotechnologies;
- Encourage communication about biotechnologies (including transgenic and bio-products) and constant dialogue between public sector, private companies and civil society to increase public awareness and understanding around the topic. Thus, whenever the need arises, this Working Group could act as a facilitator by providing forums for discussion and knowledge sharing;
- Valuation of carbon benefits as well as sustainable development benefits, including the agriculture, forestry and land use sector; promotion and incentives of greenhouse gas emission reductions and removals; and
- Recycling – efficient development of the circular economy for job creation and poverty alleviation – create platform for shared experiences around what works and what doesn’t – also how to develop policy with no unintended consequences.
2.2. Climate change negotiations
Considering the impacts related to climate change and the upcoming United Nations Conference of the Parties to the Convention on Climate Change to be held in Paris this year (COP 21), the promotion of cooperation and greater integration among BRICS on this issue should be done by:
- Improving and promoting existing carbon market mechanisms, such as the Clean Development Mechanism of the Kyoto Protocol and other emission trading schemes in order to guarantee the liquidity of certified emission reductions combined with environmental integrity;
- Promoting zero net deforestation and large scale enhancement of forest carbon stocks for multiple uses in a way to considerably increase carbon stocks and the availability of sustainable wood for the market; and
- Establishing and promoting global biofuel standards, in order to stimulate renewable fuel sources and a stable market to consumers and producers as an important alternative to fossil
2.3. Trade and investment facilitation
Since the global crisis of 2008-2009, world economic growth has been led by developing countries, especially the BRICS.
One of the consequences of this economic growth is the increased demand for agribusiness products, such as food, feed, fiber and biofuels. Moreover, economic growth allied to population growth in developing countries leads to increased urbanization and per capita income. This results also in further growth of consumption of animal protein, compared to vegetables and grains, because meat consumption is linked to the income level of the population.
Nowadays, sanitary, phytosanitary, technical and bureaucratic barriers greatly hamper trade, investment and partnerships among the BRICS. Therefore, the Agribusiness Working Group:
- Encourages BRICS Governments to agree to cooperate on regulatory issues across the industry to support investment and trade;
- Supports the establishment of regulatory cooperation mechanisms by BRICS countries;
- Supports greater integration amongst regulatory authori The process of regulating the compliance with these standards and regulations should be elaborated within the BRICS countries;
- Encourages the BRICS Governments to promote actions aiming to reduce barriers to trade on agricultural products between their members;
- Seeks greater integration of value chains of the five countries through mutual trade liberalization, large cross-investment, facilitated movement of people and regulatory convergence;
There are also opportunities to win-win partnerships that leverage the enormous synergies and complementarities among the BRICS economies in agriculture, industry, services and energy. The BRICS better governance would also be an alternative to the Mega-Regional Trade Agreements (Trans-Pacific Partnership – TPP and Transatlantic Trade and Investment Partnership – TTIP). In addition, it would allow greater access to markets by reducing trade barriers and increasing transparency in the processes (win-win situations), leading to stronger partnerships and more investments.
2.4. Definition and promotion of biomass energy
Except traditional energy, renewable energy (solar energy, nuclear energy, biomass energy, etc.) should be encouraged. Biomass energy is a kind of renewable energy, and it comes from forest, agriculture, wastewater, etc. It is very important for
the governments of the BRICS countries to have a unified definition on biomass and promote development as well as the adoption of biomass energy.
2.5. Promotion of combined heat and power system (CHP)
There are many industries which consume both steam and power, and pulp and paper industry is one of them. In forest industry especially pulp and paper industry, CHP is proved to be highly efficient in energy conservation. Therefore, China Paper Association recommends the working group helps raise the awareness of this energy conservation system among the BRICS governments in order for the member countries to support the adoption of this system legislatively, administratively as well as financially.
2.6. Multilateral trade negotiations
In regards to the multilateral trade negotiations at WTO, member countries aim at the conclusion of a fair and balanced agreement of the Doha Round. The negotiations have been delayed for too long and it is essential to have progress in agriculture and all other areas. The BRICS countries, composed in its majority by developing nations, should be the ones promoting the negotiations and the conclusion of the Doha Round.
In that sense, this Working Group claims for cooperation between the governments to resolve pending issues and major concerns on agriculture as well as other areas, with a view to reach an agreement for the urgent revitalization of the multilateral trade system.
In order to move forward, this Working Group recommends the following actions by their governments on each issue related to WTO negotiations on agriculture:
(2) Domestic support:
Amber Box: Reduce the AMS limits to the numbers accorded in 2008;
Blue Box: Full elimination of the subsidies on this box;
Green Box: Reevaluate the rules of the subsidies’ classification and increase the transparency on the notification process for the green box.
(3) Bali Package:
Tariff Quota Administration: Monitoring the implementation of the agreement;
Public Stockholding for Food Security Purposes: Seek for a permanent solution by 31 December 201 This solution should include an appropriated definition on the rules on stocks building process, so there is transparency on the measures adopted by the BRICS members on production and international commercialization of the products.
(4) Reforms on the SPS Agreement:
Measures Notification System: Promoting efficiency on the SPS measures notification;
Private Standards as Technical Barriers to Trade: Propose clear rules as regarding to the utilization of private standards by government;
Recognition of the Position of the Specialized International Organizations: Promoting recognition of the guidelines and technical opinions of specialized organizations such as the World Organization for Animal Health (OIE) and the Codex Alimentarius.
(5) Trade and Environment:
Negotiation of New Rules: Avoid that new rules on environment are turned into barriers to trade.
(6) Implementation of New Bilateral and Regional Agreements:
Proliferation of New Rules: Create a mechanism that is able to ensure transparency in implementation of new agreements.
2.7. Technology exchange
Recognizing that BRICS countries share a tradition in agricultural goods production, the maintenance – and the deepening – of the already technological and knowledge exchange is largely desirable. The Working Group will put efforts in identifying opportunities in areas of mutual interest, based on the comparative and competitive advantages, and specificities of each country.
An interesting example of this knowledge exchange is ethanol production and consumption. In fact, Brazil relies on a 40-year experience in developing the largest program in the world to substitute fossil for renewable clean fuels. Cooperation opportunities in this area could be in various links of the supply chain such as:
- Agricultural sector – technological transference and adaptation for sugarcane varieties and agricultural management;
- Industrial processing and other technologies, such as second generation production;
- Logistics and distributions, including blending processes and pipelines;
- Knowledge exchange on the automobile industry, such as flex-fuel, diesel running on ethanol, et;
- Public policies, including knowledge exchange on sustainable practices; and
- Direct invest
The Agribusiness Working Group recommends the use of the NDB for infrastructure projects that will contribute to the development of the agribusiness sector, according priorities attached to this report.
Current Coordination: Brazil Section
Coordinator: Brazilian Tree Industry (Ibá)
- Brazilian Tree Industry – Ibá
- Brazilian Confederation of Agriculture and Livestock – CNA
- Brazilian Sugarcane Industry Association – UNICA
- Brasil Foods – BRF
- Brazilian Association of Citrus Exporters – CitrusBR
- Brazilian Beef Exporters Association – ABIEC
- Awaiting indication from Russia Business Council Chairman
- Awaiting indication from India Business Council Chairman
- China Paper Association – CPA
- Paper Manufacturers Association of South Africa – PAMSA