Fischler to take on US plans to boost farm aid

Date: 02/05/02

THE European Commission is poised to mount a World Trade Organisation (WTO) challenge against US plans to massively increase spending on agricultural subsidies.

Farm chief Franz Fischler said yesterday (1 May) that America's new Farm Bill would breach WTO limits on the amount of 'production distorting' agricultural subsidies that can be allowed.

'This proposed legislation marks a blow for the credibility of US policy in the WTO, where the US has presented a trade-oriented agenda wholly inconsistent with the new bill,' the Austrian commissioner said.

'We cannot negotiate on the basis of 'do as I say, not as I do.''

Key representatives of the US Congress and Senate have endorsed the bill's six-year plan, which would see farm subsidies rise by some 70.

But it requires approval by the full Congress and President George Bush before it can be enacted.

If passed, an extra €5.3 billion per year would be allocated to the country's farm sector.

The EU's anger is shared by Australia. Warren Truss, the country's farm minister, has already warned Washington that Canberra would refer the bill to the WTO.

'Any of the measures which do not comply with WTO rules, we will challenge,' he said.

Fischler argued that the draft law runs counter to commitments on reducing subsidies made at last November's ministerial conference on world trade in Doha, Qatar.

'This risks calling into question the reform promises of Doha.

'At a time when all developed countries have accepted the direction of farm support away from trade and production distorting measures, the US is doing an about turn and heading in the opposite direction.'

The European Commission is poised to mount a World Trade Organisation challenge against US plans to massively increase spending on agricultural subsidies.