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Sunday, 11 November, 2001, 09:53 GMT
Roadblocks to a deal
European Agriculture Commissioner Franz Fischler
Europe's farming chief says agriculture is not just a trade issue
Ben Brown

The world trade talks taking place in the Gulf Arab state of Qatar may break down over the most traditional of issues - agriculture.

Ministers from 142 countries of the World Trade Organisation are hoping to agree a plan to expand world trade, aimed at restoring confidence to a world economy teetering on the brink of recession.

The draft declaration is neither just nor fair to the viewpoints of many developing countries

Murasoli Maran
Indian minister of commerce of industry
But as negotiations aimed at launching a new trade round entered their second day, European Union ministers were talking tough about their objections to the planned draft agreement which calls for negotiations on agriculture "aimed at reductions of, with a view towards the phasing out, all forms of export subsidies."

France's economy minister and former prime minister Laurent Fabius said that "no European" could accept this wording, and that "we cannot have an agreement at any price."

His attendance at the Doha meeting is a sign of how seriously the French are taking the issue.

"Non-trade concerns"

Meanwhile Franz Fischler, the EU's agriculture commissioner, was attempting to rally other WTO members to support the EU position that agriculture was a unique sector where "non-trade concerns" should be given priority.

These include concerns about rural development, the environment, and food security which "would not be satisfied through market measures" and may require government subsides.

And he said that too many concessions would risk a "negative reaction from civil society which is very worried about the effects of unchecked trade liberalisation".

Mr Fischler said that 39 other countries supported the EU's position - although many of them are highly dependent on the EU for aid, such as Burundi, Ivory Coast, and Gabon, or hoping to join the EU, such as Hungary and Poland.

Norway, Switzerland, Japan and Korea - whose agriculture is also highly protected - also joined in the statement.

The UK trade minister, Baroness Symons, said she recognised that there would be difficult negotiatons within the EU to persuade other countries to adopt a more "forward-looking" approach.

But some international organisations are keen for Europe to move.

Speaking in the UK on BBC TV's Breakfast with Frost programme, World Bank chief James Wolfensohn pointed out the imbalance in development terms.

"We are giving $50bn a year in aid to developing countries," he said. "But we're giving $350bn a year in subsidies to agricultural producers."

Many developing countries, who have the most to gain from the liberalisation of agriculture, are reluctant to sign any deal unless there is movement on this issue.

India objects

But is it not just the EU that is digging in its heels.

India, the traditional leader of the developing country group, has expressed serious reservations about the whole plan for expanded trade talks.

Indian Minister of Commerce and Industry Murasoli Maran
India: proposed deal is useless to the developing world
"The draft declaration is neither just nor fair to the viewpoints of many developing countries," the Indian minister of commerce of industry, Murasoli Maran, told the conference.

"In the areas of investment, competition, trade facilitation and government procurement, basic questions remain even on the need for a multilateral agreement," he added.

India and other developing countries argue that they do not have the capacity to include these new areas - most of them proposed by the EU - in negotiations, and that any deal would impinge too much on domestic laws and policies.

Anti-dumping issue

And the United States - which is leading the drive for agricultural liberalisation - has also made clear that it has an area in which it is not prepared to make concessions.

It is resisting calls to examine the question of "dumping", the set of trade rules that give the United States to impose high tariff duties on products it believes are being imported at below the price of production.

Many countries, including Japan, Brazil and the EU, believe that the US uses these anti-dumping measures to protect its uncompetitive domestic steel industry from foreign competition.

But US Trade Representative Robert Zoellick said that "support for further trade liberalisation depends on our ability to ensure that a bargain on market access is not undercut by foreign subsidies."

Any weakening of anti-dumping laws would face serious opposition in the US Congress, which has not yet approved trade promotion authority - vital if the Bush administration is to be able to negotiate a trade deal without Congress having the right to examine every clause in detail.

In the end, each of the nations at the trade talks will have to decide whether to tackle one of their strong domestic lobbies in order to reach a meaningful agreement on trade.

So far, there is little sign of that happening.

See also:

10 Nov 01 | Business
China admitted to WTO
09 Nov 01 | Business
Protesters barred from trade summit
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