The offer has been on the table since last October - the United States would cut export subsidies by 53% if the rest of the world would open their doors for market access. In a press conference from the World Trade Organization talks in Geneva today, Ag Secretary Mike Johanns restated that position noting that the offer on the table isn't carved in stone, but U.S. negotiators are still waiting for some kind of movement from other countries.
"We made it very very clear at the time that that strong ambition, that bold offer, was dependent upon a strong response in market access. That is the key," he told reporters today. "We have made no bones about it since then. We have talked over and over again about the importance of market accessEvery study you read will tell you that the real opportunities for the globe lie in improved market access."
Much of the U.S. talk about WTO negotiations focuses on how the Doha Round could impact the 2007 Farm Bill. Johanns noted today that the farm bill needs to be reformed for a number of reasons, not simply because of the WTO. "I believe reform is appropriate. I don't say that again just because I came to the office and one day thought it up. We did Farm Bill forums across the United States. I did 21 of them myself in 21 statesand we heard a lot from farmers about reform, about the needs that they have."
He notes that only about 40% of U.S. farmers receive a subsidy and 60% do not receive any government support, but did come to the forums to discuss reforms in a lot of areas ranging from the need for investment in research to phytosanitary/sanitary practices, and other issues.
"So those farmers who are very legitimately at the table for the farm bill discussion are bringing these issues and saying we think it's important that you consider the important contribution we make to the world economy. I think that's a fair comment," he said.
Johanns notes the farm bill will be written in Congress, and adds "it must be predictable, it has to be equitableit has to be beyond challenge."
As the conference opened this week, WTO Director Pascal Lamy proposed an approach that would limit U.S. ag support spending to $20 billion, which is actually higher than what was spent last year. Johanns notes that the overture by Lamy was made to the media and it "was not an overture made in a negotiating session or a discussion session. I read it with interest, but that would be about the extent of my thoughts on it."
When challenged further on ag spending, Johanns detailed what a 60% cut in amber box payments - part of the October offer - would mean to ag spending in the United States. "I means we would go from $19 billion to $7.6 billion. I can tell you that in 2005 we estimate that these [amber box] programs will cost $12.5 billion. So even if you go beyond bound to what we are actually going to use, this is a real cut," he notes.
In trade discussions so far, the European Union has not brought forward a new proposal, but has restated the G20 position of market access, yet Johanns questions some of the finer points noting that the EU will not define "sensitive products" which would remain protected in their proposal. That prevents negotiators from knowing the true extent of the EU offer, Johanns notes.
Johanns adds that U.S. negotiators came to work at the meeting, a point he reiterated throughout the press conference. "We came here to do everything we could to contribute to a successful Doha round and that's what we're going to endeavor to do."