Cairns group slams EU on farm subsidies

SINGAPORE (JP): The Cairns group of agriculture-exporting countries yesterday blasted the European Union (EU) for supporting farm subsidies which the group said grossly violated trade agreements.

"We call upon them to refrain from the reintroduction or intensification of such measures (subsidies), which clearly distort agricultural world markets and have a significant adverse effect on the trading opportunities," the group said in its declaration issued here yesterday.

The declaration was separate to the World Trade Organization (WTO) ministerial declaration, which was issued here yesterday at the closing of the WTO ministerial meeting.

The Cairns group did not specify any countries in its declaration but clearly referred to West European countries which subsidize their farm exports.

Philippine Trade and Industry Secretary Cesar Bautista said the group was disappointed by the EU's objection to Argentina's proposal to start discussions on farm issues in 1997.

EU officials argued that initial discussions on farm issues were unnecessary because formal talks on farm trade would begin in 1999, as mandated by the WTO agreement on agriculture.

Because of opposition from the EU, Japan and South Korea, the WTO ministerial declaration did not include a separate paragraph on agriculture, which was mentioned in a paragraph on the built- in agenda.

The Cairns group wanted the WTO to mandate the committee on agriculture to start preparations next year for the resumption of farm negotiations in 1999.

After failing to include this in the WTO ministerial declaration, the group stated it would continue its own preparatory program to help member countries understand the agriculture issue.

"The work program provides a sound basis for launching the new negotiations in 1999 which will lead to agriculture becoming fully integrated into the WTO rules on a comparable basis to the industrial sector, including by disciplines on agricultural export credits and the elimination of export subsidies," the Cairns declaration said.

Australia, New Zealand, Argentina, Brazil, Colombia, Chile, Uruguay, Fiji, Canada, Thailand, Malaysia, Indonesia, the Philippines and Hungary make up the Cairns group.

The group and the United States are campaigning hard to free farm trade, and have endorsed faster elimination of agriculture barriers.

Liberalizing farm trade has been a contentious issue since world trade talks began because it is politically sensitive in some countries. (rid)