MADRID, 9 September 2003 — The European Union will defend its current agricultural subsidies while at the same time showing a constructive spirit at this week’s world trade talks in Mexico, Spain’s Economy Minister Rodrigo Rato said yesterday. Under the auspices of the World Trade Organization, nearly 150 developed and developing countries will meet in the Mexican resort of Cancun between Wednesday and Sunday to review progress in a round of talks to free up world trade further.
The main sticking point of the ministerial meeting is expected to be agriculture, with developing countries pushing for sharp cuts in rich-country farm subsidies, but resisting proposals to lower their own often highly protective farm tariffs. Rato said the EU was committed to facilitating international trade but would defend its subsidy system. “Europe has made an important offer on agriculture ... which should be valued as a clear effort ... to facilitate trade,” Rato told journalists.
EU farm ministers agreed in June a package of agricultural reforms that Trade Commissioner Pascal Lamy said would give him more room to maneuver in the WTO talks — but some critics have been skeptical about whether the world’s biggest agricultural subsidizer has really embraced significant change.
US Trade Representative Robert Zoellick, in a commentary in the Wall Street Journal Europe yesterday, reiterated Washington’s objectives and referred to a subsequent agreement between the United States and EU on farm subsidies.
“After encouraging the EU to reform its Common Agricultural Policy, we thrashed out a draft framework to cut agricultural subsidies and tariffs. This approach commits to deeper cuts than achieved in the last global trade negotiations — if others give American farmers a fair chance to compete, too. And we have worked with all our trading partners to craft a balance of interests.”
World Bank President James Wolfensohn, writing in The Financial Times yesterday, noted that world trade negotiations had been deadlocked for much of the past two years over issues such as market access in agriculture and labor-intensive sectors, intellectual property in medicines and special treatment for developing countries.
German Economy and Labour Minister Wolfgang Clement said in a newspaper interview published yesterday that the EU could make further concessions in the reform of its system of agricultural subsidies at the meeting.