(July 29) While prodding Congress to wrap up negotiations on trade promotion authority, U.S. trade negotiators July 25 unveiled an ambitious proposal designed to give new momentum to World Trade Organization agricultural negotiations.
“Our proposal lays out our vision for reforming and liberalizing global trade in agricultural goods,” said U.S. Trade Representative Robert Zoellick.
The proposal aims to scrap all export subsidies after five years, reduce worldwide average agricultural tariffs from 62% to 15% and reduce domestic subsidies to 5% of agricultural production.
Mark Powers, vice president of the Northwest Horticultural Council, Yakima, Wash., said he was pleased with the U.S. trade proposals.
“It was aggressive and a good starting point,” he said. “It was a comprehensive proposal, as it had to be to move the negotiations forward,” he said.
Robert Guenther, vice president of government and public affairs for the United Fresh Fruit & Vegetable Association, Alexandria, Va., also called the proposal a well-timed salvo for trade reform.
However, he said the produce industry would like to see a call for the complete elimination of domestic supports.
“We have no domestic support, and we are competing with other countries with large domestic support,” he said.
Chief agricultural negotiator Al Johnson said he expects the comprehensive proposal will find a good reception from many WTO trading partners.
The exceptions could be Japan and Europe. The U.S. proposal asks for swifter reductions in tariffs and subsidies from countries with the highest agricultural tariffs, and Japan and Europe are in that group.
DIFFERENCES WITH URUGUAY ROUND
That accelerated reduction for high-tariff countries contrasts to the Uruguay Round agreement, which mandated all countries to reduce agricultural tariffs at the same rate — no matter how high they were in the first place.
The Uruguay Round of multilateral trade talks was the first in five decades that included agriculture, and Johnson said U.S. agriculture needs to reap more benefits from the Doha round.
“The Uruguay Round approach isn’t good enough; it’s natural that those countries with the most distorting practices have the farthest to go,” he said.
Zoellick said he thought the proposal was ambitious in scope and timetable. He noted that much of the agricultural negotiations are scheduled to be largely complete by March.
He said trade is undeniably important for agriculture, as 96% of the world’s population lies outside the U.S. and one of three acres is planted for export markets.