Business calls for radical liberalization of world farm trade
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| Farm exports are a key issue for the Doha round |
Paris, 26 November 2002 - International business has called on governments to agree a far-reaching programme to liberalize agricultural trade under the Doha Round trade negotiations.
The International Chamber of Commerce said in a statement: "Improved access to international markets and increased trade in agricultural products will ultimately benefit all countries and stakeholders."
The ICC statement, issued by its Commission on Trade and Investment Policy, called for sweeping tariff reductions and the progressive elimination and ultimate prohibition of subsidies.
"We encourage governments to phase out agricultural price-support mechanisms, export subsidies and all other trade-distorting agricultural support measures," the statement said.
Governments should supplement such reduction with policies that promote private sector initiatives, particularly those directed at improving farm competitivenesss, the rural economy and product quality.
"There is evidence that even under open market conditions, 70-80% of food supply will be produced locally. An efficient national food system is therefore essential."
The business statement came amid growing concern over lack of momentum in negotiations on agricultural trade in the World Trade Organization, which are due to be completed by the end of 2004.
For developing countries, a deal on agriculture that would enable them to compete more effectively and secure improved access to the markets of the industrialized world is a make or break issue in the Doha Round.
The developing countries see the European Union's Common Agricultural Policy, which provides billions of Euros in subsidies to European farmers, and recent farm legislation in the United States, as severe impediments to their agricultural exports.
The ICC statement said: "The major goals of WTO negotiations on agriculture should be to create new market access opportunities and to ensure that the benefits of an open market system reach developing countries."
The statement said: "Government intervention in the agricultural sector remains intrusive, to the detriment of developing countries." It quoted figures from the Organization for Economic Cooperation and Development (OECD), showing that total support to agriculture in 2000 amount to $327 billion US dollars or 1.3% in the OECD area, which includes the world's leading industrial economies.
"The vast majority of this support goes to a minority of large agric
ultural producers rather than to small family farms, in the form of a transfer from consumers and taxpayers."
The ICC trade experts argued that export subsidies and other trade-distorting domestic support measures tend to destroy markets in developing countries by driving down world prices to levels where local farmers cannot compete. Such measures also encourage economically and ecologically unsustainable production.
Click here for the full text of the ICC policy statement Agricultural trade and the Doha Development Agenda.