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Reviewing Agricultural Trade Policies

To Promote Intra-OIC Agricultural Trade

69

The intra-group trade within the Arab group shows an increasing trend, i.e. trade diversion from

the non-OIC group to the Arab group countries, reflecting possible impacts of Pan-Arab trade

agreement.

The share of the OIC as an export destination for the OIC member countries is quite low. The

reason that OIC is not a preferred export destination for most of the OIC countries is mainly due

to high tariff protection, particularly for the agricultural exports originating from OIC countries

which do not benefit from the existing regional trade agreements with non-OIC countries.

The Arab group applies lowest tariff protection on imports of agri-food products and fish

originating from the OIC countries. The Asian group applies lowest tariff protection on imports

of agricultural raw materials originating from the OIC countries. The countries usually favor

utilization of producer oriented and consumer oriented policies on agricultural trade rather

than trade oriented policies.

There are five major product groups with a potential for intra-OIC trade promotion: sugar, oil

seeds, feeding stuff for animals, live animals and meat.

Among the potential product groups for intra-OIC agricultural trade promotion, exports of

“sugar”, “oil seeds” and “feeding stuff for animals” are facing highest intra-OIC tariff protection

as determined by weighted average applied tariff rates. The lowest tariff protection for the

promotion of intra-OIC trade in potential product divisions is observed at “live animals” and

“meat.” The tariff rates for meat are lowest among the potential country matches. Bilateral tariff

rates for meat are much lower than the intra-regional tariff rates within the OIC, thus offering a

potential for trade promotion across OIC trade partners through appropriate trade policy tools.

Among potential country matches for promotion of OIC trade for the potential product groups

identified above, bilateral trade coverage is quite low, pointing out need for efforts to overcome

this and promote trade among OIC member states.

The share of OIC countries as export destination for their top three export products is generally

lower than the share of OIC countries as export destination of their overall agricultural exports

except for exports originating fromBahrain, Kazakhstan, Kuwait, Oman, Qatar, S. Arabia, Senegal

and Somalia, an indication that OIC is not a major export market of the top export products of

most of the OIC countries.

The reason that the OIC market is not a preferred export destination for most of the OIC

countries is due to high tariff protection of the OIC member countries, particularly for

agricultural exports. Among the 57 OIC countries, only Bahrain, Iraq, Kuwait, Libya, Maldives,

Qatar, Uzbekistan and Yemen are imposed by lower than average weighted average tariff rates

for their top 5 agricultural export products.

Due to the trade diverting effect of the regional trade agreements, some products exported by

OIC member states are negatively discriminated; i.e. “tobacco” exports originating from

Bangladesh, “cigarettes containing tobacco” exports originating from Turkey and “other fish

prepared whole in pieces but not minced” exports originating from Albania are subjected to the

highest tariff rates in intra-OIC agricultural trade.

The review and analysis of agricultural trade flows and policies presented in this report reveal

that most recent data are not available in certain cases, partially confirming COMCEC’s (2014)