Bridges Trade BioRes • Volume 3 • Number 6 • 3rd April 2003

AGRICULTURE MODALITIES: DEADLINE MISSED, EYES NOW ON CANCUN

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AGRICULTURE MODALITIES: DEADLINE MISSED, EYES NOW ON CANCUN

During a 31 March wrap-up meeting of the WTO Committee on Agriculture (CoA), Chair Stuart Harbinson formally declared that Members’ efforts to agree on agricultural modalities by the end-March deadline had failed. Nevertheless, Harbinson said he would continue consultations on technical issues such as tariff formulas and Strategic Products for developing countries after the mid-April Easter break, and that further CoA special sessions had been scheduled for June and July. While Harbinson is hoping to have the modalities established before the next WTO Ministerial meeting in Cancun (September), some sources noted that it is more than unlikely that modalities could be agreed before trade ministers meet in Mexico.

Harbinson made clear that Members would have to work even harder in the coming period to develop the basis and framework for the necessary compromises. "To achieve this will require greater appreciation by all sides of the sensitivities and expectations of others," he added. At a news conference following the formal plenary session, Harbinson further declared that the "ball is clearly in Members’ court now," as he felt that he had done all he could in terms of hammering out a draft compromise text for possible modalities. "I need a clearer signal from Members that they are in a more receptive mood to have another look at a new piece of paper," he added.

The US blamed Members such as the EU and Japan for the failure. Hinting at the internal EU mid-term review of the Common Agricultural Policy (CAP) starting in June this year, the statement called on EU member states to endorse the CAP reform proposals presented last year by EU Agriculture Commissioner Franz Fischler (see BRIDGES Weekly, 17 July 2002) so as to "give the [European] Commission more flexibility to meet the mandate of the ‘Doha Development Round’". Australian Trade Minister Mark Vaile also lashed out at the EU, blaming it for "continuing to oppose efforts to bring about genuine reform of agricultural trade".

The EU, however, countered that it had done its homework with regard to moving the WTO agriculture talks. "The EU modalities proposal represents a middle way between extreme positions," EU Agriculture Commissioner Franz Fischler said. Fischler also defended the EU’s major use of export subsidies, stating that "bogus food aid," export credits (both mainly used by the US), and the pricing practices of certain state trading enterprises" (as in the case of Australia) also would have trade-distorting effects.

ICTSD reporting; "Agriculture: trade diplomats downplay impact of missed deadline in WTO agriculture negotiations," WTO REPORTER, 1 April 2003; "Australia blames EU, Japan for missed WTO farm deadline," DOW JONES, 1 April 2003; "WTO farm talks: ‘We will plough on’, Fischler says," EU PRESS RELEASE, 31 March 2003; "European Union to challenge Australia’s protectionist food import regime at WTO," EU PRESS RELEASE, 31 March 2003.