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Last Updated: Monday, 9 February 2004, 06:16 GMT
Farmers decry US-Australia pact
Sugar cane
The US remains unwilling to allow free entry for Australian sugar
Many of Australia's farmers are up in arms against the free trade deal their government has signed with the US.

The deal, reached after two weeks of last-ditch talks, opens up US markets to many Australian goods.

But it leaves key tariffs on Australian farm goods untouched while giving US farmers free access - factors which Australian farmers see as a sell-out.

The "hypocritical" decision meant farmers were the "sacrificial lamb", farming leaders said.

Industry gains

The negotiations had overrun three deadlines by the time they were concluded on Sunday.

It took a phone call between Australian Prime Minister John Howard and President George W Bush - allies in the US-led war on Iraq - to clinch the deal.

The agreement, Mr Howard said, "will add enormous long-term benefits to the Australian economy" by scrapping tariffs on 99% of US manufacturing exports to Australia and 97% of the manufactured goods flowing the other way.

The US Trade Representative, Robert Zoellick, said the cut in duties was "the most significant immediate cut in industrial tariffs ever achieved in a US free trade agreement".

Trade between the two countries is worth $28bn, with the US enjoying a $9bn trade surplus, the USTR said.

'Hypocrisy'

But the cuts in industrial tariffs were not matched by market access for Australia's farmers.

Australian beef producers will see the tariffs they face phased out slowly over 18 years - while the sugar cane industry has been left out altogether.

The US, on the other hand, will see the $400m it pays annually in tariffs vanish immediately.

US farmers are seen as important to President Bush's re-election campaign in November's election.

"I came to the conclusion that it would have been against the national interest to give up a deal that is going to be of enormous benefit to the rest of the economy because we couldn't get something on sugar," Mr Howard told Channel Nine TV in Australia.

But farmers saw it differently.

"We feel we've been chosen as the sacrificial lamb to allow virtually every other industry to improve their income proposals," said Jim Pedersen, chairman of the Australian Cane Growers' Council.

And the National Farmers' Federation accused both Australian and US governments of being hypocritical.

"The US is a huge agricultural exporter and demands access to overseas markets, but continues to hide behind a veil of protection in its own market," said Peter Corish, president of the NFF.




SEE ALSO:
US seals Australia trade pact
08 Feb 04 |  Business
Sugar sours Australia trade talks
26 Jan 04 |  Business
Australia raises interest rates
05 Nov 03 |  Business
Apec summit heads for trade clash
17 Oct 03 |  Business
Australia's media fears free trade
12 Jun 03 |  Business


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