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'Agri shield' blocks U.S. farm exports

(Thursday, April 10, 2003 -- CropChoice news) -- AgBioIndia:

The United States is finally beginning to feel the pinch. For a country, which has always talked of a level playing field and then grossly abused the trading system for its own economic advantage, serves it right. Several countries have used the 'agriculture shields' to block unfair and unwanted farm imports from the US. At $ 200 million a year in lost agricultural opportunities, the US is worried.

Tariffs are the 'agriculture shield' that we are talking about. Devinder Sharma had earlier called for an "Agriculture shield" for developing countries (see AgBioIndia bulletin: Zero tolerance for farm subsidies, Feb 12, 2003). Sharma's argument is that following Mexico's announcement of an "agriculture shield" program aimed at ensuring that the country's farmers are not harmed by unfair competition from the United States, developing countries need to unilaterally adopt the shield programme. 'Agricultural shield' program includes compensatory tariffs on some food products. Such tariff complies with World Trade Organization policies allowing nations to take protective action when the viability of agricultural sectors is threatened by foreign competition.

What the US calls as 'unfair', is in reality fair. After all, with the 2002 Farm Bill providing an additional federal support of $ 180 billion in the next ten years to the miniscule population of American farmers, which the US calls as "non-trade distorting", developing country farmers have been left crying. If that is not "cheating", how is the imposition of tariffs to block such unwanted imports 'unfair' ?

There is therefore a serious attempt to force WTO member countries to phase out these tariffs under the ongoing AoA negotiations. Developing countries must guard against any effort to dilute their only safeguard mechanism.


1. US Farm Exports Face Trade Barriers -- ENS

US Farm Exports Face Trade Barriers


WASHINGTON, DC, April 2, 2003 (ENS) - US agricultural imports are being treated unfairly by the European Union, Russia, China, Mexico, Australia, Japan, Taiwan and Venezuela, according to the latest annual report from the Office of the US Trade Representative. Issued Tuesday, the report says the US lost agricultural export opportunities worth $200 million a year.

"Bringing down barriers to trade promotes growth and prosperity, for the United States and for the world," said US Trade Representative Robert Zoellick. "American workers, businesses, and farmers expect a level playing field abroad. The Bush administration is committed to identifying unfair barriers to US exports and to working aggressively with our trading partners to eliminate those barriers." The persistence of trade barriers affirms the need for the United States to remain actively engaged in promoting and enforcing trade liberalization at all levels, said Zoellick.

The U.S. will pursue its interests globally, in the ongoing World Trade Organization (WTO) negotiations; regionally, through the Free Trade Area of the Americas negotiations; and bilaterally, through free trade agreements with trading partners such as Chile, Singapore, Morocco, Australia, the five members of the Central American Common Market, and the five members of the Southern African Customs Union.

Since the European Union imposed a moratorium on imports of agricultural biotech products in 1998, US corn [maize] exports to the EU have declined by 55 percent, the USTR report says. US poultry exports to Russia have decreased by almost 45 percent since import restrictions on US poultry went into effect. Russia is the top US export market for poultry, and the import restrictions helped contribute to a $500 million decline in US poultry exports to the world last year.

Other examples the USTR gives of unfair treatment of US agricultural exports include Chinese tariff-rate quotas on imports of wheat, corn, rice, cotton, barley, oilseed and vegetable oils.

Mexican anti-dumping duties on beef, rice, swine, and apples, an illegitimate tax on beverages containing high fructose corn syrup, and restrictions on fruit and dry beans, are issues the USTR complains about. A "dramatic increase" in trade barriers to agriculture was reported for Mexico over the past year, the report says.

The World Trade Organization is holding negotiations on altering international agricultural trade rules, but the organization's member governments missed a March 31 deadline for establishing "modalities" in the agriculture negotiations.

These modalities are targets, including numerical targets, for achieving the objectives of the negotiations, as well as issues related to rules. They will set parameters for the final agreement in the agriculture negotiations, for example how far import duties should be cut, and subsidies reduced or eliminated, and over what periods of time.

Along with almost all the other negotiations under the Doha Development Agenda, so named for the place where they began in Doha, Qatar, the agriculture talks are scheduled to end by January 1, 2005. This timetable was agreed in November 2001, at the Fourth WTO Ministerial Conference in Doha.

Zoellick and U.S. Agriculture Secretary Ann Veneman expressed disappointment but not surprise that the deadline passed without agreement. The negotiators can work through the problems and "should not settle for insignificant changes," they said in a joint statement Monday. The WTO negotiations are attempting to find ways for wealthy nations to reduce their agricultural subsidies, the issue at the core of the current round of negotiations at the WTO. The developing nations would benefit if amounts to $300 billion a year in subsidies paid by rich nations to their farmers were reduced.

If the developing nations, most of which have economies based on agriculture, are not satisfied with the agricultural talks, they may withhold agreement to the opening of markets favored by the industrialized nations, especially in services like banking, telecommunications and information technology.

Veneman and Zoellick said jointly, "The U.S. proposal to reform the world agricultural trade takes a long stride toward the goals we should be seeking, and which were detailed in the Doha mandate. We want to eliminate export subsidies. We want to cut other subsidies that distort farm production by $100 billion, in the process harmonizing the amount of permitted subsidies at much lower levels - moving toward fairer, more equal treatment on the path to eliminating these subsidies, too. We want to cut global agricultural tariffs by 75 percent, with no tariff higher than 25 percent."

WTO Director-General Supachai Panitchpakdi also expressed disappointment over the failure by WTO member governments to agree on a framework for future agriculture trade reform, but he said progress in the global trade negotiations can still be achieved provided governments continue to work towards bridging their differences. "The Doha Development Agenda negotiations are a single undertaking," said Panitchpakdi. "No element of them will be agreed until all areas are agreed. But significant progress in some areas often provides negotiators with an incentive to overcome their differences even on the most politically sensitive questions."

In a press briefing Monday, Zoellick said he still believes the Doha round of negotiations could be completed on schedule by January 2005. Looking ahead to the WTO ministers' meeting scheduled for September in Cancun, Mexico, he sought to play down the missed March 31 deadline and wide differences that remain over agriculture.

"This is not the first time a deadline has been missed, and it won't be the last," he said.

Zoellick said he found no evidence that the Iraq war was hurting the WTO negotiations. If anything, he said, the war should reinforce the need to help developing countries expand their economies through open trade.

The AgBioIndia bulletins are an effort by the Forum for Biotechnology & Food Security to bridge the yawning gap in our understanding of the politics of food. We believe these bulletins will create wider awareness and understanding of the compexities of the crisis facing Indian agriculture and food security. We will keep you posted on the intricacies and games being enacted in the name of eradicating hunger.

It is a non-commercial educational service for non-profit organisations and individuals. Subscribers are welcome to contribute information.

You can view previous issues at http://www.agbioindia.org/archive.asp