Groundnut Trade Liberalization: A South-South Debate?

John Beghin (), Holger Matthey, Ndiame Diop and Mirvat Sewadeh

Center for Agricultural and Rural Development (CARD) Publications from Center for Agricultural and Rural Development (CARD) at Iowa State University

Abstract: We use a new partial-equilibrium, multi-market international model to analyze trade and agricultural policies affecting markets for peanut/groundnut products. The model covers four goods in thirteen countries/regions, including a large set of developing countries. Welfare is evaluated by looking at consumers' equivalent variation, quasi-profits in farming, quasi-profits in crushing, and taxpayers' revenues and outlays implied by distortions. We calibrate the model on recent historical data and current policy information. We analyze several groundnut trade liberalization scenarios in deviation from the recent historical baseline. Trade liberalization in groundnut markets has a strong South-South dimension, opposing India and, to a lesser extent, China to smaller developing countries mainly located in Africa. In the former, current policies, exacerbated by their market size, depress the world prices of groundnut products. Under free trade, African exporters present in these world markets would gain because they are net sellers of groundnut products. In India, consumers would be better off, with lower consumer prices resulting from the removal of prohibitive tariffs and large imports of groundnut products. The cost of the adjustment would fall on Indian farmers and crushers. In China, crush margins would improve because of the large terms-of-trade effects in the oil market relative to the seed market. China's groundnut product exports would expand dramatically. Net buyers of groundnut products in OECD (Organisation of Economic Co-operation and Development) countries would be worse off. We draw implications for Doha negotiations.

Keywords: distortion; Doha; groundnuts; negotiations; oil; peanut; protection; trade liberalization. (search for similar items in EconPapers)
Date: 2003-11
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.card.iastate.edu/products/publications/pdf/03wp347.pdf Full Text (application/pdf)
https://www.card.iastate.edu/products/publications/synopsis/?p=502 Online Synopsis (text/html)

Related works:
Working Paper: Groundnut Trade Liberalization: A South-South Debate? (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ias:cpaper:03-wp347

Access Statistics for this paper

More papers in Center for Agricultural and Rural Development (CARD) Publications from Center for Agricultural and Rural Development (CARD) at Iowa State University Contact information at EDIRC.
Bibliographic data for series maintained by ().