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Europe Keeps Hope Alive For Fair Trade

Europe Keeps Hope Alive For Fair Trade

Hopes for a set of fairer global trade rules, including lower punitive barriers on food exporting nations, have been kept alive by the overnight European Union agreement on agricultural reform, Progressive Deputy Leader, Matt Robson, said today.

At present each European cow, subsidised to the tune of US$2.57/day, has a higher standard of living than the 2,800 million people living on under US$2/day. These are the very people who need a fair chance to export their way out of poverty.

European Union farm spending, which significantly distorts global trade, takes nearly half of its entire annual budget of almost 100 billion euros (approx NZ $200 billion.)

European Union country ministers agreed in principle overnight to significant changes to the trading bloc's agricultural subsidy policies, a step that is critical to the chances of progress at the current Doha Development Round of multilateral trade talks under the auspices of the World Trade Organization.

Matt Robson said the half a century old Common Agricultural Policy was one of the biggest stumbling blocs to unlocking barriers to development in Third World commodity producing nations and one of the biggest hindrances to New Zealand exporters and potential exporters.

"The European Union currently subsidizes its farmers by astronomical numbers. This distorts international markets which robs the opportunities of food exporting nations of a fair go to growing their own exports.

"One element of the proposed EU reform package is to introduce new types of subsidies divorced from output which in turn might add impetus to pressure on the United States to also reduce its own massive payments to U.S. corporate interests.

"There is a huge amount of work to be done yet before we have a fair set of international trading rules which don't penalize food exporting nations. But the first reports coming out of Europe overnight suggest that there will be progress at the Doha Round in the right direction," Matt Robson said.

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