State Trading Enterprises: Some Legal and Conceptual Issues

State trading may become an important issue in the current WTO negotiations on agricultural trade as witnessed by some of the recent proposals for negotiating agendas. On the premise that state trading enterprises can hinder market access in importing countries and can affect export competition, it has been proposed that state trading enterprises should be pan of the negotiations. We consider the current status of state trading enterprises in the GATT framework and summarize the list of concerns relating to the effects which they may have on agricultural trade. Drawing on some recent research, we show that state trading enterprises are likely to influence market access and export competition under trade liberalization when measured relative to a benchmark of imperfect competition.