Wednesday, March 07, 2007

Subsidies, revisited

Yes, they're still in the farm bill:

India, E.U. urge U.S. to cut farm subsidies for Doha Round success
By John Gregerson on 3/7/2007 for Meatingplace.com
India and the European Union want the United States to cut its farm subsidies to ensure success for the Doha Round of World Trade Organization talks, according to Indian news wires.

"I am a bit disappointed to see the new U.S. farm bill. There is no change in treatment of two important sectors, sugar and dairying," European Commissioner for Agriculture Mariann Fischer Boel told reporters. "These sectors need to be reformed."

Boel warned that the subsidies are stumbling blocks to the successful conclusion of the Doha round — meaning negotiations to hammer out a multilateral free-trade agreement among World Trade Organization member countries.

Boel, who is on an official visit to India, said, "The current draft of the new U.S. farm bill pushes in the right direction, but not far enough."

She added that the European Union is committed to the multilateral trade talks, but cuts in trade-distorting subsidies have to be reciprocal, indicating the European Union has proposed a cut of 70 percent in its ceiling on trade-distorting subsidies. She said it also has offered to phase out export refunds by 2013 and roughly halve the agricultural import tariff to 12 percent from 23 percent.

"The next 60 days are extremely critical for WTO negotiations," said G.K. Pillai, India's commerce secretary. "The situation requires extremely delicate handling."

Talk about cutting subsidies continues, but I'm being cynical today: I don't think it's going to happen anytime soon. Doha has collapsed. (We're not the only ones to blame, but we should . . . consider our role.)

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