The Hindu : Business : G-20 to devise strategy for farm trade talks

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Wednesday, Mar 16, 2005

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G-20 to devise strategy for farm trade talks

By Our Special Correspondent

The Union Minister for Commerce and Industry, Kamal Nath, with the Minister of State, E. V. K. S. Elangovan, addressing a press conference on the ministerial meeting of the G-20 alliance in New Delhi on Tuesday. — Photo: Ramesh Sharma

NEW DELHI, MARCH 15. The Group of 20 developing countries will hold their first major conclave since last year here on March 18 and 19 to finalise their strategy on critical agriculture issues for the on-going negotiations in the World Trade Organisation (WTO). The meeting will prepare a formal document laying down the approach of the G-20 to crucial issues like tariffs and export subsidies of developed countries.

According to the Commerce and Industry Minister, Kamal Nath, the meeting will take stock of the state of play in the negotiations in Geneva since the WTO Framework Agreement concluded in July last year. He said these negotiations had so far focussed mainly on the technical aspects of agriculture issues but political inputs were now needed to break the logjam on these matters among WTO members. "The articulation of a common approach and strategy of the G-20 ministers would be a very useful guide to the negotiators in Geneva as they proceed ahead in these negotiations,'' he said.

Towards level field

Briefing the media on the meeting, he said though this was a diverse group with differing interests, it had managed to take a broad approach supportive of developing country interests.

Highlighting the importance of this meeting, the first major one since the conference in Sao Paulo last year, he said a few countries should not be allowed to set the rules for multilateral trade. He said the G-20, though a diverse grouping, would formulate strategies to ensure level-playing field for developing countries.

He said the meeting would examine crucial areas like formula for tariffs reduction in agriculture and the special and sensitive products that needed to be pushed in WTO negotiations. It would also seek to peg a date for ending export subsidies of developed countries, which had resulted in artificially low prices of farm products from developed countries denying market access to developing countries.

In this context, he quoted several studies including the one by Oxfam and another by a U.S. based institute on the huge subsidies being paid to farmers in the developed countries.

Farm subsidy issues

The Oxfam study has stated that producers in six European countries were given $1 billion subsidy in 2003 so that their products could be dumped in world markets at artificially low prices.

Similarly, he said the other study showed that in 2003, American wheat was exported at 28 per cent below the average cost of production. The corresponding figures for corn and soyabean, cotton, and rice were 10 per cent, 47 per cent and 26 per cent respectively.

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