The Doha round of trade talks, which started in 2001 with the goal of opening world markets, began again this week after a two-year hiatus. The negotiations thus far have revealed a significant struggle in balancing the needs of both wealthy and developing nations.
A major focus of the talks is the amount of subsidies paid to U.S. farmers. On Tuesday, following a similar proposal by the European Union, the United States offered to cap farm subsidies at $15 billion. Though lower than the original proposal of a $16.5 billion cap and far lower than the current ceiling of $48.2 billion, the leaders of developing nations were not impressed.
Leaders in India and Brazil, who feel that farmers in poorer nations are squeezed out of the market by subsidies, are not happy with the direction the talks are going. Indian Commerce Minister Kamal Nath said that the U.S. proposal was “hardly an offer.”
“We need to talk real cuts,” he said. Brazilian delegates simply said “nice try” and that the new level was “still too high.”
U.S. leaders are facing fire from home as well. Though the intent of the deal is to open important new markets in developing countries for American farmers, many believe that richer nations, such as the U.S. and European countries, will get the short end of the stick. After making concessions that will affect millions of farmers, there is no guarantee that the poorer nations will open their markets to the extent necessary for a truly fair exchange.
Those in the agricultural sector are unhappy with the concessions made by U.S. representatives at the talks. Kent Conrad, a Democratic senator from North Dakota, said supporting the decision to cap subsidies was “not negotiating in the interests of hard-working family farmers.”
Other U.S. concerns include the lack of consideration of some of the biggest factors influencing American agriculture, such as labor issues, environmental and health factors and biofuels and energy.
National Farmers Union President Tom Buis stated that the economy is vastly different than when the talks started in 2001.
“We are in a new era that requires new thinking,” he said in a statement to President Bush last week that urged him to accept “no trade deal” rather than a “bad trade deal.”
Most are highly skeptical that these negotiations will produce a profitable and workable plan, but a little hope remains. Razeen Saly, director of the European Centre for International Policy said, “The odds are still against a successful conclusion, but the main five or six players might pull some kind of rabbit out of the hat.”
While the final outcome of this deal still remains to be seen, several questions come to mind: Is the United States sacrificing the interests of the American farmer to strike a deal? Will the U.S. concessions hurt our agricultural sector? Will these open markets bring new cash home? I would like to know your views. Please feel free to comment below.
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