France slams US proposal for farming subsidies

12th October 2005, Comments 0 comments

PARIS, Oct 11 (AFP) - French foreign minister Philippe Douste-Blazy on Tuesday criticised a US plan to cut US and European agriculture subsidies, advanced in the latest round of world trade talks, as containing "unrealistic demands".

PARIS, Oct 11 (AFP) - French foreign minister Philippe Douste-Blazy on Tuesday criticised a US plan to cut US and European agriculture subsidies, advanced in the latest round of world trade talks, as containing "unrealistic demands".

"These declarations by our US partners must not in any way be conditioned by unrealistic demands on others, especially on the very sensitive issue of access to the agriculture market," Douste-Blazy told journalists in Paris.

The 148 nations in the WTO are edging towards a December treaty-drafting meeting in Hong Kong with crucial issues still unresolved after four years of foundering talks.

Agricultural subsidies have long been the target of critics, who say they enable producers in rich countries to offload goods cheaply, meaning unfair competition for poor farmers.

The United States and the EU have been pushing each other for concessions on agricultural trade and have been under pressure from developing countries to do more to open their markets.

On Monday, US trade chief Rob Portman and his European Union counterpart Peter Mandelson released new plans to cut support for their farmers.

They billed their porposals as a means of breaking a deadlock in the WTO's Doha Round talks, amid gloom over efforts to draft a multilateral accord cutting subsidies, customs duties and other barriers to world trade.

But both Japan and France immediately slammed the US proposal.

The US delegation at World Trade Organization talks Monday in Zurich put forward a proposal for cuts in agricultural subsidies  that would slash 60 percent from the subsidies it pays its farmers -- but only if the European Union and Japan cut their own support by 83 percent.

Under the US plan, rich nations would end farm subsidies by 2023, after a phase-out starting in 2008.

"The United States has made announcements through the press yesterday (Monday) in the agriculture area. These announcements have to be accompanied by concrete reforms as the European Union has done," Douste-Blazy responded.

The European Commission, the executive arm of the European Union, has put forward a rival proposal that would reduce the EU subsidy by 70 percent and reduce trade tariffs in the sector by up to 60 percent.

The variant proposed by Mandelson foresees a 70 percent reduction, plus a cut of up 60 percent in EU customs duties on farm goods, another bone of contention.

Douste-Blazy was also critical of European trade commissioner Mandelson, who he said should "abide" by a set of restrictions EU member states had placed on the European Commission before the latest talks.

France is especially interested in the developments at the negotiations because its farmers are among the leading beneficiaries of the European subsidies. It was instrumental in having the other EU countries impose limits on the European Commission in terms of how far it could negotiate on the subsidies.

Japan is also determined to protect its farmers from far-reaching liberalisation in the WTO talks.

Key developing nations in the World Trade Organisation said Tuesday they would unveil their own plan to jump-start talks.

The G20, which groups WTO heavyweights such as Brazil, China, India and South Africa, said Tuesday it was honing its counter-proposal for release in coming days.

"The numbers that the G20 will be putting on the table will imply real cuts" in payouts to farmers in rich countries, said Celso Amorim, Brazil's foreign minister.

The G20 ministers said the US and EU proposals were a good first step but the US plan has also come in for criticism for focusing on permitted, rather than real, spending.

If rich countries continue generous subsidies for their farmers then parallel moves to remove tariff and other trade barriers mean little because prices would still be artifically low, said Indian Commerce and Industry Minister Kamal Nath.

"Market access with artificial prices is not the level playing field which is the bedrock of the WTO," Nath said.

"The proposal of the US doesn't lead to real cuts. It's a postdated cheque that will reduce water, not real budgetary outlays," Nath said. In WTO-speak, "water" refers to flexibility in permitted spending.

But US Agriculture Secretary Mike Johanns rejected that argument.

"These are very real cuts, they have a real impact in dollars," he told reporters.

Portman added that the US plan could be negotiable.

"The United States is willing to look at any proposal, consider any alternatives. We are willing to be entirely open minded to get the Doha round moving," Portman.

A failure in the negotiations this week could jeopardise the WTO's crucial gathering in Hong Kong in just over 60 days' time, which is meant to approve the outlines of a multilateral accord cutting subsidies, customs duties and other barriers to world trade.

The 148 trading nations in the WTO are desperate to avoid a replay of their 2003 bust-up at a summit in Cancun, Mexico, which mired their talks for more than a year.

Copyright AFP

Subject: French news

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