Agriculture and the WTO: Lessons from Europe

Agriculture and the WTO: Lessons from Europe

Franz Fischler, the European Union’s Commissioner for Agriculture, Rural Development and Fisheries, has told journalists in Washington that he is committed to tabling concrete proposals on reforming the EU’s support system for sugar.

Touching upon the stalled WTO talks, and what he called necessary farm policy reforms in rich countries, the Commissioner said the EU’s overhaul of the Common Agricultural Policy (CAP) had been somewhat underrated.

“The EU farm policy has completely changed, especially as a result of the June 2003 reform. At the moment, our Common Agricultural Policy represents less than 1 percent of total EU public expenditure, a figure that has been steadily declining in recent years. We will continue our reforms. Before summer, I will table proposals on how to make the EU’s sugar regime more market oriented and trade friendly, and I expect the EU to take a similar decision on EU support for cotton, tobacco and olive oil in March,” Fischler said.

WTO and developing countries The Commissioner underlined that the failure of Cancun was a missed opportunity, which left no winners but only losers, especially the developing countries. Developing countries have to get a better deal. In recent months and weeks, the EU has repeatedly moved from its initial position.

“We have shown a lot of flexibility. We have reformed our farm policy. Trade distorting farm support in Europe has come down by a whopping 70 percent in the last decade. Reforms in the right direction have to be recognised, not penalised. If the different impact of different farm policies on world markets, prices and developing countries is ignored, why bother to reform?” the Commissioner said.

Fischler welcomed the recent initiative of U.S. Trade Representative, Bob Zoellick, to re-launch the WTO talks by reaching out to developing countries. “He could have been slightly more outspoken about also tackling forms of export subsidies the US uses. The US spent US$ 3.2 billion in 2003 for export credits to give their exporters an unfair edge on the world market, billions are spent on export promotion under the guise of ‘food aid’,” he said.

“Even free traders like Canada, Australia or New Zealand’s distort trade by maintaining state trading monopolies. All these export promotion tools harm developing countries, so they have to go, as well, not only European export refunds” Fischler said.

To read Commissioner Fischler’s speech, go to the Delegation’s website – http://www.delaus.cec.eu.int/pressandinformation/speech_Fischler_FTA.htm