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Economy

Global talks on trade raked as 'one-sided'

By PHILIP BRASHER and JERRY PERKINS

09/16/2003

The collapse of global trade talks Sunday in Mexico was regrettable, but it was unfair of poor countries to insist on deep cuts in U.S. and European Union farm subsidies without opening their markets to imported food, Iowa lawmakers and farmers said Monday.

"Some participants seemed to be more satisfied with hollow rhetoric than real negotiation," Sen. Charles Grassley, R-Ia., said in a blast at the developing countries.

Grassley, chairman of the Senate Finance Committee, suggested that some of the 22 developing nations could pay a price when they negotiate individual trade agreements with the United States.

"The United States evaluates potential partners for free-trade agreements on an ongoing basis," he said. "I'll take note of those nations that played a constructive role in Cancun and those nations that didn't."

Developing countries say the $300 billion in subsidies that richer countries give to their farmers drives down commodity prices and makes it hard for farmers in poorer countries to make a living.

U.S. cotton subsidies have drawn the harshest criticism. However, a recent report from Oxfam, a British relief and development organization, also targeted U.S. corn subsidies, claiming that Mexican farmers are struggling financially because they can't compete with imports of cheap U.S. grain.

Sen. Tom Harkin, D-Ia., said developing countries must be willing to cut tariffs and remove other barriers to imports from richer countries.

"A one-sided deal that fails to level the playing field for U.S. farmers simply will not fly in the U.S. Congress," said Harkin, the senior Democrat on the Senate Agriculture Committee.

Craig Lang, a dairy farmer from Brooklyn and president of the Iowa Farm Bureau Federation, was in Cancun for the talks. He was disappointed that the negotiations broke down.

"No deal is better than a bad deal, however," he said. "Maybe it's time for a breather."

George Naylor, a farmer from Churdan who is president of the National Family Farm Coalition, said he was glad the talks ended.

While he was in Cancun, Naylor marched in several protests against the World Trade Organization. The organization should not have the power to impose its rules on any country's agriculture, he said.

"Every country deserves food sovereignty, and the WTO should leave agriculture alone," Naylor said.

Ron Heck, a soybean farmer from Perry who is president of the American Soybean Association, said, "What we are seeing here at the negotiations is a group of developing countries, led by Brazil, making one-sided demands of developed countries but refusing to put their own policies on the table."

Iowa State University economist Bruce Babcock said it would be tough to get the global negotiations back on track.

"It's not clear the EU is going to give up anymore," he said. "I'm not sure the U.S. is going to move forward anymore."

He said consumers, not farmers, stood to gain the most from a new trade agreement because lower trade barriers and subsidies would drive down food costs.

U.S. farmers can afford to give up only so much of their subsidies without assurances that exports will increase, said Lang, the Iowa Farm Bureau president. "Unless there is increased market access, there's not a whole lot for us," he said.

Bob Stallman, president of the American Farm Bureau Federation, said, "We're willing to sit down and negotiate reductions in domestic supports . . . but we weren't going to do it as unilateral disarmament."

Mark Ritchie, an Iowa native who is president of the Institute for Agriculture and Trade Policy in Minneapolis, said the Cancun talks "were neither a success nor a failure."

"The talks will be more complicated, but eventually we'll have much better agricultural trading rules," he said. "I'm very optimistic about the prospects for long-term reforms being made to agricultural trade rules that will be good for U.S. farmers."

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