FAIRER TRADE

by MONITOR
DURING his speech at the UN's recent 60th anniversary summit, President Bush surprised many people by saying that in the interests of the developing world he would abolish all US farm subsidies if other counties would do the same. In reality it wss an empty gesture because he knew there would be no comparable offer from other rich countries. Nonetheless it pointed up the important and scandalous fact that most of the leading powers in the world pay their farmers to over-produce and often dump their surplus supplies on Third World countries at prices they cannot compete with. So it is interesting that similar offers, and apparently serious ones, have been made in concert this week by the United States and the European Union in advance of the crucial meeting of the World Trade Organisation at Hong Kong in December. The US trade representative, Robert Portman, told a preliminary meeting in Geneva that his country was ready to cut its farm support programmes by 60 per cent by 2013 provided that the EU responded with an 80 per cent reduction. As if waiting for his cue Peter Mandelson, the EU's Trade Commisioner, welcomed the US initiative and announced a plan to cut Europe's farm subsidies by 70 per cent and, for good measure, to put a ceiling of 10 per cent on industrial tariffs. In international trade negotiations the devil is always in the detail and several developing countries and aid agencies quickly said that the US and EU offers were more devilish than most. Still, there is little doubt that agriculture is the key to progress with freer trade across the board being sought by the so-called Doha round of talks due to be completed at the coming Hong Kong meeting. Progress has been stalled for some time and, at the very least, the US and EU initiatives might serve to open up negotiations again before the Doha round has to be declared a failure.