US reveals $16b a year farm subsidies
Geneva, October 14:
The United States revealed that it had paid out an average of $16 billion a year (euro11.3 billion) in subsidies to its farmers between 2002 and 2005.
US officials said Washington had formally notified the World Trade Organisation (WTO) in Geneva of its trade distorting domestic farm support payments in that period for the first time. They ranged from $10.1 billion of ‘overall trade distorting support’ in 2003 and peaked at $18.9 billion last year, according to charts given out by US agricultural envoy Joe Glauber in Geneva.
WTO members are required to notify the organisation of their domestic farm support to ensure they are within permitted levels.
The levels of farm support granted mainly by rich nations are the core of the troubled Doha Round of global trade talks.
WTO negotiators this summer proposed a limit of between $12.8 billion to $16.2 billion a year on overall trade distorting support paid out by the US, along with compromise proposals for other countries.
The compromise was part of a drive to seek agreement in the negotiations on cutting barriers to agricultural, industrial and services trade, which have been plagued by deadlock since they were launched in the Qatari capitals Doha in 2001. “Even the upper end of the range results in effective cuts in our overall trade distorting support,” Glau-ber said, underlining Washington’s ‘flexibility’.
“We have made a lot of movement we think on overall trade distorting support, and the acceptance to negotiate within this range is movement of some six billion or so from our initial offer in October 2005,” he added.
The WTO proposals would modify the current system, where the US has committed itself to observe a limit of $19.1 billion on just a portion of overall trade distorting support known as the ‘amber box’. These include measures to support prices, or subsidies directly related to production quantities.
Washington’s amber box payments peaked at $12.9 billion in 2005, according to the new US data. Developing and emerging countries say subsidies paid mainly by wealthy economies distort world prices and unfairly undercut poor nation farm exports.