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Real trade reform: Betting the farm on it
While the outcome to last week’s world trade talks in Geneva left something to be desired, the meeting did prove one thing: U.S. agriculture is standing tall on its commitment of improved market access for U.S. farmers and ranchers. With only several weeks left to negotiate a framework agreement or call it quits, U.S. agriculture is betting the farm on real trade reform.

The American Farm Bureau Federation has said from the beginning that U.S. agriculture needs a balance of market access and domestic support before it accepts a final World Trade Organization agreement. The bottom line is that the United States put forth a proposal in October of last year to cut domestic supports. The bold U.S. offer got the ball rolling in the negotiations, but it has yet to be matched by the European Union and other countries by means of improved market access. Contrary to what others say, the U.S. proposal will have a real impact on our farmers and ranchers. And yet we are still waiting for other countries to step up to the plate.

Why should the U.S. continue to negotiate with itself by putting even more on the table when other countries aren’t even coming close to matching our current proposal? So, here we are less than three weeks away from a looming deadline of having to reach an agreement, and we are still unsure if the EU and others are going to play ball.

While other nations like to fuel the flames by suggesting that U.S domestic supports are hindering developing countries’ ability to trade, third-party studies by the World Bank and the Organization for Economic Co-operation and Development show that the most important thing developed countries can do to benefit developing countries is to make deep cuts in agricultural tariffs. According to OECD, gains to developing countries from agricultural reform come almost entirely from tariff cuts rather than domestic support reforms.

And yet, we are still waiting.

Farm Bureau’s economic analysis of major WTO proposals, including those made by the G-20, the European Union and the U.S. show, as AFBF President Bob Stallman is fond of saying, that many countries’ flexibilities are nothing but protectionism by another name. In short, all of the proposals fall well short of being acceptable to U.S. agriculture.

Negotiators had an opportunity last week to try yet again to put together an agreement that all WTO members could support without any one member having to bear the burden of disproportionate costs. If we are lucky, we may get another shot at it in several weeks, keeping in mind that there is a lot of work to be done in the meantime.

But if the EU and others can’t match the U.S. proposal with market access, the U.S. is ready to walk away from the negotiations. Because while we might be betting the farm on real trade reform, we’re not about to give it away for free.

-Tracy Taylor Grondine
Director of media relations
American Farm Bureau Federation

This farm news was published in the July 19, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.