Bridges Weekly Trade News Digest • Volume 6 • Number 21 • 4th June 2002
Agriculture: Members Warm Up For Mid-June Talks On Export Competition
Agriculture: Members Warm Up For Mid-June Talks On Export Competition
At a 3-4 June informal prep-up meeting of the WTO Committee on Agriculture (CoA) on export competition, the US called for a five-year deadline to eliminate agricultural export subsidies. This demand comes at a time where the US is being heavily criticised by its trading partners for boosting farm spending by some 80 percent in line with its new farm bill. The informal meeting took place to prepare for the first substantive negotiating session in the modalities phase, to be held from 17-20 June (see BRIDGES Weekly, 3 April 2002).
In the informal prep-up meeting on export competition — i.e. export subsidies, export credits, state trading enterprises, food aid, and export restrictions and taxes — US chief negotiator Allen Johnson said the US fully supported negotiations aimed at reducing export subsidies, improving market access and cutting trade-distortive domestic support as mandated by the Doha Declaration. "Our proposal is to eliminate export subsidies in five years," Allen told a press conference after the two- day informal discussion at the WTO. According to Allen, Members mainly addressed the issue of export subsidies, with some Members such as the Cairns Group of agriculture exporting countries proposing even shorter deadlines. "We are clearly open to that," Allen said.
EC opposes deadline
The EC — which trading partners target as a heavy user of export subsidy regimes — is rejecting any timetable for the full elimination of export subsidisation. Other developed country Members voiced their opposition to firm periods as well, with one delegate arguing that "the wording of the Doha Declaration clearly states that there will be no elimination of export subsidies during the ongoing round." Article 13 of the Doha Declaration provides for negotiations aimed at "reductions of, with a view to phasing out, all forms of export subsidies". In the previous two years of negotiations under the so-called built-in agenda, the EC has repeatedly linked discussions on export subsidies to progress in the debate on disciplining the use of export credits, of which the US is a main user. Furthermore, Cairns Group member Australia has frequently been under pressure by some trading partners, as its use of state trading enterprises are considered to be trade-distorting by other Members.
At the 3-4 June informal CoA meeting, the US, which has traditionally aligned itself with the Cairns Group, proposed a deadline of five years for phasing out export subsidies the first time. The Cairns Group has previously suggested a three-year deadline.
On export competition, the Cairns Group calls for the elimination of all forms of export support as well as the subsidy element of unfair export competition measures such as export credits and non- commercial transactions.
Other issues
Other issues on the agenda at the prep-up meeting included food aid and export restrictions. Some Members want food aid to be controlled by an independent body such as the World Food Programme (WFP) to ensure that producing countries are not using it as a tool to dump their farm surpluses on developing country markets. Regarding export restrictions, some developing countries said they consider these to be a necessary tool to address their food security concerns by blocking uncontrolled exit of agricultural exports. On the other hand, some developed county net-food importers such as Japan called for further disciplines on export restrictions, as limited access to food exports is seen by them to impede their non-trade concerns.
"US Urges WTO To Set Farm Export Subsidy Deadline," REUTERS, June 4; ICTSD Internal Files.