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WTO reaches agreement on new trade round

The 142 member countries of the World Trade Organization have agreed to launch a new round of trade negotiations that is expected to open more markets and bring greater prosperity to American farmers. Or will it?

An exhausted Ann Veneman told agricultural editors participating in a conference call that she was “very pleased” with the results of the negotiations on agriculture at the WTO Ministerial Conference in Doha, Qatar.

“We went into the negotiations with a draft text from the chairman — the so-called Harbinsen text,” the agriculture secretary said. “And we held that text with the Cairns Group and isolated the Europeans. In the end, we only put in some small, clarifying language about not prejudging the results to help the Europeans politically.”

Veneman, who had been up for more than 24 hours on the final day of the negotiations on Nov. 14, was referring to the Cairns group of 12 countries led by Australia and Canada.

The United States, the Cairns Group and other nations basically forced the European Union to agree to include reductions in exports subsidies on the agenda for the new round.

The secretary said reducing subsidies is one of the “three pillars” of the agricultural portion of the new round along with increased market access and reductions in trade-distorting domestic support programs.)

“The significant thing is that we got the word ‘phase-out’ in with export subsidies,” she said. “As you know, the Europeans use 70 times more export subsidies than the United States. So it is certainly to our farmers' benefit to be able to reduce or eliminate those subsidies.”

She said export subsidies would include export enhancement or bonus programs and not the marketing loan.

Increasing market access is critical, she noted. “Tariffs around the world average 62 percent compared to 12 percent in the United States. Our farmers will benefit from increased market access, and that will be our key objective here.”

The Bush administration, she said, “strongly believes that increased trade opportunities will bring greater prosperity for our farmers and ranchers,” said Veneman, who added that increased trade provides broader access to foods, services and equipment that are important to farmers in their operations.

Farm organizations applauded the agreement, for the most part. “The goals set out in the declaration will enhance the export opportunities for U.S. cotton, cottonseed and cotton products around the world — if achieved,” said James Echols, National Cotton Council chairman.

But Echols, a cotton merchant, expressed concern about some aspects of the declaration pertaining to manufactured goods. “It contains language that suggests that developing countries won't to make the same type of tariff concessions that the United States will be expected to deliver,” he noted. We believe strongly in requiring other countries to open their markets to the same extent the U.S. market is opened.”

Other observers were less optimistic. “All they have is an agreement that they will talk for another four or five years,” said a senator attending the Senate Ag Committee's mark-up session on a new farm bill. “Where's the breakthrough in that.”

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