Farm Ministers Fail to Split Difference in Tariffs, Subsidies Issues

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Last updated at: (Beijing Time) Sunday, July 28, 2002

Farm Ministers Fail to Split Difference in Tariffs, Subsidies Issues

Agriculture ministers from five major farm trading economies failed to narrow gaps on agricultural tariffs and subsidies at their two-day meeting from Friday to Saturday in Nara, west Japan.

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Agriculture ministers from five major farm trading economies failed to narrow gaps on agricultural tariffs and subsidies at their two-day meeting from Friday to Saturday in Nara, west Japan.

The ministers from Australia, Canada, Japan, the United States and the European Union (EU) agreed, however, to continue talks to lead the rest of the world toward farm policy reform, while movingahead with their own efforts.

"There were some differences, but I think this meeting will help promote WTO farm negotiations with the participants deepeningunderstanding of each other's views," Japanese Agriculture, Forestry and Fisheries Minister Tsutomu Takebe told reporters at the closure of the so-called "quint" farm ministerial meeting Saturday .

The "quint" ministers discussed how to proceed with the World Trade Organization (WTO) farm negotiations scheduled to set overall targets and rules for members' farm policy reforms by March next year as part of a three-year trade round launched last November in Doha with the deadline set for Jan. 1, 2005.

But Takebe and EU Commissioner for Agriculture, Rural Development and Fisheries Franz Fischler confirmed their opposition to US proposals on farm tariff and subsidy cuts.

Takebe said the proposals fail to address nontrade concerns, require more reform from importers than exporters and lack a commitment to slash export credits.

Fischler branded the proposals as unbalanced. "If you read these proposals, we are seeing that others should move more compared with movement on the US side. This is not a very good basis to find a common compromise in the negotiations."

In the same day, US Agriculture Secretary Ann Veneman defended the proposals, saying they are intended "to move the negotiations forward by outlining specific goals."

The United States proposed at the beginning of the meeting thatthe WTO farm trade talks should target cutting all tariffs to no more than 25 percent, capping trade-distorting domestic subsidies at 5 percent of farm output and scrapping export subsidies over a five-year period.

"We would hope that countries will consider very, very carefully the kind of approach that we have set up in our proposals," Veneman said, adding that Washington's farm policy hasreceived support from Australia, New Zealand and other farm-exporting countries.

Veneman said the United States is ready to reform its export credit system. "We've specifically stated that we are willing to negotiate specific reforms on export credits."

Australian Agriculture, Fisheries and Forestry Minister Warren Truss generally supported the US proposals, describing them as "constructive," but added export credits should be abolished.

Japan and the EU are calling for nontrade considerations in an attempt to maintain some protection for their farmers, while the United States, Australia and Canada are all keen to open up the world's farm markets to expand their exports.

Japan, whose agriculture centers on rice growing, has strongly protected its market by applying high tariffs to rice imports beyond the minimum access quota and providing subsidies for farmers to adjust production.

On the issue of farm subsidies, both Veneman and Truss called for Japan to sever the link between such subsidies and production.

"We believe that you can address the multifunctional aspect of agriculture" by taking a policy that neither affects trade nor haslinkage with production, Veneman said.

Japan, meanwhile, agreed with the EU and Australia on opposition to a new US farm law designed to increase subsidies to US farmers. Canada has also expressed concerns.

Australia, which plans to host next year's "quint" meeting, is very critical of the US law, saying it would affect its export competitiveness.

Source: Xinhua News Agency

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