The next several months are critical to determining “how fast and how far” the U.S. can move toward its goal of eliminating export subsidies over five years in the World Trade Organization (WTO), the chief U.S. ag negotiator says.
In that time, Allen Johnson, chief agriculture negotiator for the Office of the U.S. Trade Representative, hopes to see trade liberalized and tariffs decreased with the European Union (EU) and see more countries realize the benefit of biotechnology. He believes the negotiations have implications for the future of a bulging world population over the next 50 years.
At issue are tariffs. The European Union “outspends the U.S. 5 to 1 in domestic agriculture support; 100 to 1 in export subsidies,” Johnson says. Last summer, the U.S. offered to eliminate $100 billion in trade-distorting domestic support, he says.
The U.S. plan at the WTO negotiations would eliminate all export subsidies over the next five years. The EU plan proposes a 45 percent cut in export subsidies. The chairman of the WTO negotiating group on agriculture drafted a proposal that phases out export subsidies from 50 percent of subsidized trade over six years, phases out the remaining export subsidies over 10 years and front-load percentage reductions.
U.S. leaders say the proposal is a possible first step, but doesn't recognize the imbalance of domestic supports.
Johnson, who spoke at the 2003 Commodity Classic in Charlotte, N.C., said with the world population projected to grow by 77 million people each year through 2050, trade negotiations are crucial for feeding the world. India and China will experience a third of that population growth.
“Most economic growth comes through liberalized trade policy,” Johnson says. “All countries have to come along.”
In the long run, poor nations pay the highest price for inequities of trade barriers and the lack of innovation, Johnson says. “Trade and productivity gains (are needed) in order to buy food and meet the general requirements of economic growth,” Johnson says.
While it's important to recognize that the U.S. is the fastest-growing, high-income country in the world, “it's more important to recognize if the world is going to be safe for democracy, people are going to need to eat. There's nothing more destabilizing than to go without eating.
“We have many opportunities with biotechnology to address the challenges of the environment and food quality” and quantity, Johnson says. Some countries are realizing the benefits of biotechnology, but “change is tough in some places. The others who are blocking these changes are hurting the world.”