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US, EU Trade Chiefs Discuss Global Trade Deadlock

posted on March 3, 2006

While the U.S. may strive toward independence in one area – like energy – it doesn't mean the country seeks isolation in all arenas. Far from it. There are, for example, painstaking efforts to work out agreements with other countries for trading everything from cars to crops. This week progress was achieved with one trading partner. The United States and Colombia agreed to eliminate tariffs and other barriers for goods and services to flow between the two countries. In his announcement of the agreement on Monday, U.S. Trade Representative Rob Portman praised the accord, saying free trade with Colombia will create opportunities for U.S. agriculture and help foster economic development in the South American country. Columbia became the 15th country to sign a free trade agreement with the U.S. since 2001. Meanwhile key World Trade Organization negotiators continue to work on an agreement liberalizing global trade.

US, EU Trade Chiefs Discuss Global Trade Deadlock

The U.S. and European Union continue to mull over ways to break the global trade deadlock --something they, and the rest of the 149-member countries, have failed to accomplish since world trade talks began more than four years ago. Some of the sticking points include European agricultural tariffs and United States domestic farm subsidies.

Rob Portman, U.S. Trade Representative: "All countries lose if there's a failed Doha Round."

U.S. Trade Representative Rob Portman and European Union Trade Commissioner Peter Mandelson held talks recently on the unresolved issues.

Rob Portman, U.S. Trade Representative: "What the U.S. is asking for is balance in regards to agriculture. Every country must do its part."

The EU has pushed the more "advanced" developing countries like Brazil and India to do their part by opening their markets to significantly more imports. Mandelson, in the recent talks with Portman, insisted no further agricultural offer will be made by the EU unless it is given an incentive to do so.

Peter Mandelson, EU Trade Commissioner: "Europe and the U.S. can and will offer leadership, but this must be part of a connected leadership. If we have more serious offers in industrial tariffs and services. If we have a commitment by others, including emerging economies. We have to see more evidence than we've seen to date."

Also making demands are U.S. commodity groups. Sixteen major agricultural commodity groups including the American Soybean Association, the National Corn Grower's Association and the National Cattlemen's Beef Association, sent a letter this week to Portman and Agriculture Secretary Mike Johanns to secure gains in market access for each major U.S. agricultural commodity.

In the letter, the commodity groups said, "Our producers find it difficult to support a final WTO agreement that requires substantial reductions in trade-distorting domestic support for U.S. farmers, while allowing its largest and fastest-growing competitors in the world to continue to further stimulate their competitive export sectors." The "competitors" they refer to include Brazil, Argentina and Thailand.

Rob Portman, U.S. Trade Representative; "After meeting with four congressional committees in the last two weeks, I can tell you Congress is keenly aware that our agriculture proposal has real consequences. We see a major gap being the U.S. proposal while still on the table, it's difficult to sustain until we can demonstrate to our farmers and ranchers that there will be fairness in terms of access to other markets."

The next WTO talks are scheduled for March 10 through 12 in London, with the major agricultural powers of Australia, Brazil, India and Japan joining the U.S. and EU in the discussions.


Tags: European Union news trade