Agriculture talks falter

The EU wants the right to inspect food imports for safety

Deep differences between the European Union and many developing countries have emerged as trade talks aimed at liberalising agriculture resumed in Geneva on Thursday.

The Cairns group of major agricultural exporters - including Australia, Canada, Argentina, Brazil and South Africa - renewed demands for the complete removal of export subsidies for agriculture.

"Export subsidies are one of the most egregious policies that bedevil the agricultural trade. They clearly distort and disrupt markets," Peter Hussin, Australia's chief trade negotiator, said.

But the European Union said that its massive system of farm support - the 55bn euro ($52bn, £34bn) Common Agricultural Policy - must be maintained.

It pointed out that it was in the process of switching subsidies to direct aid to farmers, which it argued did not breach world trade guidelines.

The EU also defended its policies on animal welfare grounds, which it says meant it required extra subsidies.

And it insisted that it should have the right to apply the precautionary principle, which would allow the EU to ban the import of agricultural products until they have been proved to be safe.

Disagreements over agricultural trade were one of the issues that derailed the attempt to launch a new trade round in Seattle last December.

Unfinished business

The previous round of trade talks, the Uruguay Round, almost ran aground on the issue after the US also insisted on the "zero option" on subsidies.

Under the deal that was eventually agreed, countries would be allowed to renew their call for further cuts in agricultural subsidies from 2004.

Australia said it would like to see a 50% cut in subsidies in 2004.

Argentina added that "if there is no change (in the EU position) on 31 December 2003, the EU has a huge problem."

The Cairns group praised the US for tabling its own reform proposal at the meeting.

The proposal calls for elimination of agricultural export subsidies, reductions in tariffs used to block farm imports and reform of "state-trading enterprises".

That is an attack on the role of the co-operative boards widely used by countries like Australia, New Zealand, and Canada to market their products overseas.

But the EU attacked the US proposals as "disappointing."

"The US wants others to do more whilst they do less," said EU Deputy Director General for Agriculture David Roberts.

The agricultural trade talks will not formally begin until next March, under the deal agreed in 1995.

They are due to take place whether or not a new trade round takes place.