| 8/20/2003 Cool Reception for U.S. - E.U. Trade Deal - 8/15 Agriculture Law There are many details yet to be worked out by the two countries and they must convince the other WTO members the plan will work. This is set to be a tough task, as ambassadors from developing countries, whose support is vital, gave the proposal a cool reception after U.S. and EU officials presented the document to a WTO meeting yesterday. "This seems to be an attempt to pry open the developing-country markets without any clear commitment on the part of (the United States and EU) to open their own markets," Indian Ambassador K.M. Chandrasekhar told reporters. "I think it isn't feasible for us." Australian Ambassador David Spencer welcomed the fact that the United States and EU made a proposal, but said it was "really an accommodation of their own interests, not the remainder of the members'." " At first glance (the proposal) falls short," said Brazil's ambassador to the WTO, Luis Felipe de Seixas Correa. "We have to be very careful not to use as a basis anything that falls short of the level of ambition." "The formula" for reducing import tariffs "isn't clear," Seixas Correa said. "The numbers make all the difference and the deadlines make all the difference." China set out three demands that must be met before it can accept a joint US-EU proposal on agricultural market access. First, China said the formula must eliminate tariff peaks and tariff escalation, in which tariffs are higher on processed than raw products. Second, it said the agriculture deal must retain a special safeguard mechanism for developing countries as well as language allowing these countries to make less substantial tariff reductions on a list of "special products" deemed important to a developing country's livelihood, rural development or food security concerns. Third, China said the level of ambition in market access in an overall agriculture deal should be linked closely to the other two main areas of the agriculture talks, in which members are discussing substantial reductions to trade-distorting domestic support and reductions or the elimination of export subsidies. The proposal's authors acknowledged that it needed more work, but said it still was important. "While we believe that this provides an important step in the process, we don't pretend that this solves all the issues," U.S. chief agriculture negotiator Allen Johnson said. EU Director-General of Trade Peter Carl said the proposal was meant, "to demonstrate leadership." This is the first time a trade agreement has included limits on payments to farmers based on acreage rather than production - a system considered less trade-distorting. In addition, payments based on production, which are already limited, also would be reduced. Differences over agriculture have threatened to waylay the upcoming WTO meeting scheduled for Cancun, Mexico, in September. Developing countries have insisted that they would not consider giving ground in areas of interest to the United States and Europe, such as reducing tariffs on industrial goods, unless they stop subsidizing farm exports. Related Link: http://www.agriculturelaw.com |
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