Iowa Public Television


Farm Subsidies Remain Hot Topic At Global Trade Negotiations

posted on June 18, 2004

The U.S. current account trade deficit rose a whopping 14 percent in the first quarter of the year and now stands at a record 145-billion dollars. The government reports U.S. exports also grew in the first quarter, but not enough to keep up with rising imports.

To champions of free trade, the numbers underscore the need to liberalize global trade policy and open foreign markets. But that's no small task.

U.S. trade policy increasingly is under attack, both from the Third World and from long-established trading partners. Often at the root of those disputes is farm trade, which on more than one occasion has brought talks to an end. But to get a unified voice on world trade, diplomats know the agriculture dilemma also must end.

Farm Subsidies Remain Hot Topic At Global Trade Negotiations Subsidies remained the hot topic during the United Nations Conference on Trade and Development in Sao Paulo (sow-PAUL-oh), Brazil, this week. Global trade negotiations have been stalled since talks derailed at the World Trade Organization meeting last September in Cancun. Developing nations claim farm subsidies in developed countries create an unfair trade barrier and prevent them from raising living standards.

Brazil is the leading coordinator of the so-called G-20, an alliance of mainly agricultural producer countries from Asia, Africa and Latin America. The coalition, which helped disrupt the Cancun talks last year, was created to combat the inequities between richer and poorer nations.

In an attempt to break the continuing standstill, U.S. Trade Representative Robert Zoellick met with officials from Brazil, Australia, Europe and India before the current forum started to quote, "accomplish what we didn't accomplish in Cancun."

The European Union hopes to reach an agreement with the World Trade Organization by July, which would mean several changes in international agricultural markets. According to EU officials, negotiators for the 147-nation WTO are trying to reach a framework for a trade deal that would slash subsidies, tariffs and other barriers for rich and poor countries alike.

The United States and the E.U. already have shown signs of readiness to make changes, but both Washington and Brussels have stressed that the concessions are conditional on poorer countries agreeing to open their own markets.

Tags: agriculture European Union news trade