The World Trade Organization talks are on the brink of failure. Western Producer reporter Barry Wilson provides a first-hand account of the key issues from Geneva.
GENEVA – The U.S. Congress cast a pall over World Trade Organization talks in May when it approved the country’s new farm bill.
Approval of the bill, which guarantees tens of billions of dollars
in new farm subsidies over the next five years, came at a time when WTO negotiators were trying to forge a new subsidy-cutting trade deal.
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The Capitol Hill vote, strong enough to overturn two vetoes by president George Bush, was seen by negotiators as a signal that the U.S. administration’s support in Geneva for subsidy cuts was not credible.
Negotiators expressed the view that they would be reluctant to sign a WTO deal that made sensitive political compromises if they were uncertain whether the U.S. would ratify it.
The current Congress dissolves at the end of the year and Bush’s pro-free trade administration exits in January. Campaign rhetoric in the race to replace Bush often has been less enthusiastic about trade liberalizing deals.
“There are people who say that and it is understandable so it is around,” WTO agriculture negotiations chair Crawford Falconer said in a June 24 interview.
“While I think it (the farm bill) has undoubtedly complicated an already complicated equation, it hasn’t so far fatally killed it off. But there clearly are some who will say, ‘why should I reveal my bottom line because I don’t know that you (America) can deliver this,’ so that debate takes place.”
Falconer said the real impact of the American farm bill decision, and the fact that any WTO deal would be dealt with not by this administration and Congress but by their unknown successors, will be known only if a ministerial meeting is called at which politicians are asked to make compromises.
U.S. officials insist the administration will live by any commitments it makes in Geneva and will convince Congress to amend the farm bill to comply with WTO commitments.
In Rome during a world food summit in early June, U.S. agriculture secretary Ed Schafer was asked to reconcile American WTO commitments with the newly enacted farm bill.
“Well, the subsidies issues I think are dealt with appropriately at the (WTO) Doha development round,” he told reporters.
“We’ve made a commitment to try to see that round complete and would hope to get it accomplished this year. The effort for the United States subsidies of course is in relation to market access, and as we look at the market access and availability opening up, then we will deal with our current farm legislation with the United States Congress to confirm the agreements that we made on subsidies during that Doha Round.”
Skeptics scoff at the idea that U.S. politicians represented in Congress would reduce subsidies to hometown farmers in the interests of a trade deal signed by Washington.
WTO director general Pascal Lamy said in a June 23 interview in Geneva that the farm bill is proof positive that a WTO deal is necessary.
“The farm bill is evidence that the U.S. will never change its farm policy without the Doha Round, as long as Congress has to deal with a farm bill that stands on its own.”
The only time in recent memory when a farm bill restrained subsidies was in 1996 when the U.S. was trying to comply with the last world trade agreement, he said.
“So for those who want this to change, and there are plenty around the WTO table starting with Canada, there is no other way to get it than through the WTO.”
