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Zoellick pushes for drop in EU farm subsidies

(Tuesday, Oct. 28, 2002 -- CropChoice news) --

Knight Ridder News Service: If actions speak louder than words, then the world's most developed economies have some explaining to do.

While rich nations constantly are preaching the gospel of freer trade as the way for their poor counterparts to improve their lot, seldom do the well-to-do follow their own advice when it comes to subsidizing domestic agriculture.

"It is a scandal that farmers in rich countries are subsidized by their governments to produce sugar at 50 or 60 cents a pound, while farmers in poor countries like the Philippines and the Caribbean receive 5 cents a pound because the surplus sugar produced by richer countries is dumped on world markets," said Dryden Spring, a representative of the private-sector advisory council to the Asia-Pacific Economic Cooperation (APEC) forum.

APEC continues through Sunday in this luxury resort town.

"Agriculture is a thorny subject, because we are talking about tariffs of hundreds of percent," said Spring, a New Zealand trade negotiator and former head of that nation's dairy board.

"But like every other industry, agriculture must perform."

The business council wants wealthy economies of the 21 member APEC states to eliminate tariffs and subsidies by 2010, and for their poorer brethren to follow suit by 2020.

U.S. Trade Representative Robert Zoellick fielded questions about how his nation would comply.

Washington just five months ago passed a landmark farm bill extending $171 billion in support to American growers over the next decade.

Nevertheless, the United States is a staunch supporter of lowering trade barriers in accordance with APEC and World Trade Organization goals.

"There's been a lot of misinformation," Zoellick said Thursday. "I've been trying to dispel a lot of propaganda."

Zoellick said American farmers are willing to give up their price supports -- but only if their competitors in the European Union and Japan do the same.

"The United States has come forward with its proposal. The Europeans and the Japanese have not," he said.

While American growers enjoy export subsidies of $19 billion, Washington proposes to reduce that figure to $10 billion, Zoellick said.

He called on the European Union, with $65 billion, to reduce its subsidies to $12 billion.

American farmers have agreed to reduce tariffs from 12 percent to 5 percent, but want Europe to bring its 30 percent tariffs down by more than two-thirds.

"The 21 APEC member economies are saying to the major agricultural export subsidizer, the E.U., it's time to step forward," Zoellick said.

Also Thursday, leaders of nations and corporations tackled an urgent global dilemma: How to open borders to trade while closing them to terrorists.

But violence kept Russia's president away as his Pacific Rim counterparts came to this strip of luxury resorts for the conference.

Vladimir Putin canceled his visit and meeting with President Bush after Chechen separatists took hundreds of hostages in Moscow.

Bush had hoped to use the meeting to win Putin's support for threats of force against Iraq.

In the post-Sept. 11, 2001, world, terrorism sends markets plunging, and the global economic slump forces politicians to rethink priorities.

"You can't trade in an insecure world," said Nelson Cunningham, managing director of Kissinger McLarty Associates, a Washington consulting firm.

"APEC has been hijacked by the terrorists."

Secretary of State Colin Powell said APEC members would soon launch "a package of bold joint actions to make the flow of trade, finance and communication more secure."

He said richer countries would help poorer ones with the resources they need to implement the measures.

"To drive growth and generate prosperity," Powell said, APEC nations need to tighten security, "particularly our security from global terrorism."