Bridges Weekly Trade News Digest • Volume 6 • Number 30 • 13th September 2002
ITC Will Study Effects Of Eliminating US Farm Tariffs
Members of the Bush administration have asked for an independent study by the International Trade Commission (ITC) concerning the impact of removing tariffs on farm goods from 33 countries in the Western Hemisphere. The study will take place as part of Bush’s plan to create a free trade zone with every country in the Hemisphere, excluding Cuba, by the end of his term in 2005. The request for the study has caused some serious concern among US farmers, as it includes certain goods that have been highly protected in the past, including peanuts, sugar and orange juice. At the same time, the administration asked that the ITC prepare a study to see what the impact would be if tariffs on farm goods were reduced by half or even eliminated by all Members of the WTO, a move that various WTO trading partners have been pressuring the US to make for some time. These reports are expected to be finished by November 15 (which corresponds with the ‘mini-ministerial’ set for Australia, at which agriculture is expected to play a key role, see related article). Under the provisions of the recently passed Trade Promotion Authority (TPA) legislation (BRIDGES Weekly, 6 August 2002), the Bush administration, when negotiating trade agreements, is required to conduct a review before tariffs can be reduced on "sensitive" products.
"US to Study Impact of Eliminating Farm Tariffs," REUTERS, 30 August 2002; "Zoellick: Farm Tariffs May Go," WASHINGTON POST, 5 September 2002.
GOVERNMENTS & NGOS CRITICISE EU FOR SUGAR SUBSIDIES
In response to increased criticism of subsidies to their sugar farmers, an EU official indicated that they "are the world’s biggest importer of sugar," and that roughly 95% of their imports from 2000 came from developing countries. The 23 August response came on the heels of the latest Oxfam trade report, entitled "The Great EU Sugar Scam", which adds to recent calls by the world’s top two sugar exporting countries, Brazil and Australia, on the need to reform the sugar regime, which is depressing world prices and destroying market opportunities for more efficient producers (many of whom are developing countries). Joined most recently by Thailand, the three top sugar exporting countries have now indicated that they are considering challenging these "trade- distorting" subsidies at the WTO which they view as export subsidies. Such criticisms lie at the heart of the WTO’s ongoing agricultural negotiations, which were intensified under the latest mandate given at the last Ministerial Conference in Doha (see BRIDGES Weekly, 15 November 2001). The sugar case would mark the first challenge at the WTO of the EU’s Common Agricultural Policy (CAP) — which is allowed to function as it does in part through deals cut at the end of the last round of negotiations making allowances for certain policies in place to persist.
The Oxfam report can be found at http://www.oxfam.co.uk/policy/papers/27sugar/27sugar.html
"Australia and Brazil attack EU sugar subsidy," THE GUARDIAN, 17 August 2002; "EU defends sugar policy in face of Oxfam attack," REUTERS, 23 August 2002; "EU defends aid for sugar producers," YAHOO NEWS DIGEST, 26 August 2002; "Thailand Mulls Filing WTO Complaint On EU Sugar Subsidies" DOW JONES, 29 August 2002.