Iowa Public Television

 

U.S. Makes Major Concession at WTO Talks

posted on July 25, 2008


In its latest assessment of the balance of trade, the Commerce Department reported earlier this month that America's cavernous trade deficit narrowed to $59.8 billion in May as exports, including industrial supplies and consumer goods, climbed to record levels.

Exports of American-made goods and services totaled $157.6 billion in May, up nearly 1 percent from April.

Expanding U.S. trade has been a key priority for the Bush Administration. Despite the successful negotiation of several bilateral trade deals, a much-heralded global agreement liberalizing trade has been elusive.

This week though, as China took a seat for the first time at the World Trade Organization negotiating table, the U.S. made a significant concession on domestic farm subsidies.

U.S. Makes Major Concession at WTO Talks Pascal Lamy, WTO Director General: "Overall, I would characterize the consultations as constructive, with a strong commitment to engaging directly and in good faith. However, I must emphasize that the progress has been modest yet."

Member nations of the 153-country World Trade Organization met in Geneva, Switzerland this week for the latest chapter of controversial global trade talks. Developed and developing countries have spent more than seven years attempting to hash out new rules for worldwide trade including agriculture. While global gridlock has plagued previous WTO meetings, America's chief trade negotiator made headlines this week with a major concession.

U.S. Trade Representative Susan Schwab offered to slice an additional $1.4 billion in government subsidies to American farmers. The concession comes only months after the U.S. Congress passed a sweeping five-year farm bill. Bush Administration concessions and subsequent agreement from WTO members would require considerable reworking of the 2007 farm bill. But it does not appear current Doha Round talks will reach a timely conclusion.

Many developing countries have long felt federal subsidies severely hamper efforts to build economies in poor regions of the world. In exchange for dramatically lower domestic subsidies, the Bush Administration hopes to pressure emerging economies in India and Brazil to open their markets for industrial goods. But Brazil's foreign minister had stiff words for American negotiators saying the U.S. offer lacked ambition.


Tags: deficit foreign relations news trade