export subsidy

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export subsidy

a direct payment, or tax concession, made by the government to firms to encourage them to increase their EXPORTS. This is done in order to generate greater foreign exchange earnings, thereby assisting the balance of payments and helping to create additional domestic jobs.

export subsidy

a direct payment, or tax concession, or low-interest ‘soft loan’ made by the government to domestic firms to enable them to reduce their EXPORT prices. Although the widespread use of export subsidies by a country can increase its exports and assist its balance of payments, such subsidies are viewed as an ‘unfair’ trade practice by the WORLD TRADE ORGANIZATION and are likely to lead to retaliatory action by other countries. See COUNTERVAILING DUTY, BEGGAR-MY-NEIGHBOUR POLICY, COMMON AGRICULTURAL POLICY.
References in periodicals archive ?
Parliament's industry committee asked the government to pay export subsidies that are 18 months overdue to support the competitiveness of Egyptian manufacturers in foreign markets.
The sugar industry urged the government to reinstate export subsidies after a steep fall in global sugar prices.
There's a good case to be made that export subsidies are a good policy, conferring some of the benefits that economists typically associate with free trade.
MANILA, Philippines Trade Secretary Ramon Lopez has called on World Trade Organization (WTO) members to eliminate trade-distorting domestic support and export subsidies to ensure that marginalized sectors would not be left behind by globalization.
Rabbani said that the World Trade Organisation had once agreed that export subsidies for agriculture would be abolished.
These cover an agricultural Special Safeguard Mechanism (SSM) for developing countries, public stockholding for food security purposes, a commitment to abolish export subsidies for farm exports and measures related to cotton.
It also mandates developed countries to prohibit cotton export subsidies immediately and for developing countries to do so at a later date.
MEMBERS of the World Trade Organization (WTO), including the Philippines, moved to scrap agricultural export subsidies, providing a fresh whiff of agreement even as the global grouping continued to be divided on the direction of worldwide trade reforms.
A number of countries are currently using export subsidies to support agriculture exports," reports the WTO.
To utilize trade for food security, reducing import barriers and trade-distorting domestic supports and prohibiting export subsidies are recommended.
domestic farm supports and eliminate export subsidies, according to a new report by the Congressional Research Service.
This is another move strongly supported by Germany and other liberal-minded member states towards full abolition of export subsidies in the EU.