EU moves to keep trade talks alive

Date: 03/11/05

The European Commission will be pressing for the world's five leading agricultural traders to agree a common approach to regulating farm subsidies and market access next week, despite claims by France that the EU executive is going beyond a negotiating mandate given to it by the Council of Ministers.

Peter Mandelson and Mariann Fischer Boel, the commissioners for trade and agriculture, have urged that the EU, US, Brazil, India and Australia sign up to a joint position when their representatives meet in Geneva on Tuesday (8 November). They want these 'five interested parties' to agree on how the central issues facing agriculture - export subsidies, domestic farm supports and market access - should be tackled, to boost the chances of a successful outcome to December's ministerial conference of the World Trade Organization (WTO) in Hong Kong.

Aides to Mandelson have sought to downplay the significance of objections from France to the way the Commission has been handling the WTO negotiations.

Earlier this week a French foreign ministry spokesman said his country had "serious questions" about the "compatibility" between the latest offer from Mandelson on agricultural trade and the negotiating mandate which EU governments have given him for the WTO talks. This followed a warning by President Jacques Chirac that Paris may veto a WTO deal negotiated by the Commission.

Mandelson's proposal was presented to a meeting that he requested with EU ambassadors last Friday (28 October). It recommended that the highest agricultural tariffs levied by industrialised countries should be cut by 60% and average tariffs by 46%. Subsidies deemed 'trade distorting' would be cut by 70% (see box).

A Commission trade official conceded that the offer was "at the limit" of the negotiating mandate laid down for Mandelson by the Council of Ministers but that it was "within the mandate". The Commission's remit requires it not to go beyond the agreement on reforming the Common Agricultural Policy reached by EU governments in June 2003.

Under that deal, the governments nonetheless gave the Commission "margin for manoeuvre" in making offers during the Doha Round of world trade talks but stated that this could only be used on the condition that "equivalent agricultural concessions" were obtained from other WTO members.

"Mandelson is not going to go off on a suicide mission by alienating member states," said one official. "At the same time, he has a clear responsibility as EU negotiator to put forward something that will sustain the talks."

France is the most vociferous critic among EU governments of the Commission's proposals. It has led a group of 13 states, including Ireland, Poland, Belgium, Spain, Hungary and Italy, which have raised concerns about concessions offered by Mandelson. But Adolfo Urso, the Italian min- ister for trade, described the Commission's latest plan as "a step in the right direction".

The likelihood of the latest offer winning approval from the five interested parties appears slim at this stage. The US, Brazil and Australia are seeking further concessions from the EU on top of those contained in Mandelson's proposal. The commissioner, though, has described the offer as final.

But Pascal Lamy, the WTO director-general, has said the proposal was "a serious offer which merits serious discussions".

Fischer Boel said that a "skilful balance" had been struck between the Commission's negotiating mandate and the WTO's 2004 'framework agreement'. The latter stated that there should be "substantial new market access" in agriculture as a result of the Doha Round's conclusion.

The Committee of Professional Agricultural Organisations in the European Union (COPA) said it feared that Mandelson had exceeded his negotiating mandate. COPA's trade analyst Shelby Matthews said that the effect of his latest offer would be to increase imports and drive European producers out of business.

But anti-poverty advocates are calling on France not to hamper efforts to improve the access of produce from developing countries to Europe's markets. "Every delay reduces the chances of a deal being done that will lift people out of poverty," said Celine Charveriat from Oxfam.

Article reports that Peter Mandelson and Mariann Fischer Boel, the European Commissioners for Trade and Agriculture, urged that the EU, US, Brazil, India and Australia sign up to a joint position when their representatives were to meet in Geneva on 8 November 2005. They wanted these 'five interested parties' to agree on how the central issues facing agriculture - export subsidies, domestic farm supports and market access - should be tackled, to boost the chances of a successful outcome to December's WTO Ministerial in Hong Kong.