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EU not blocking WTO talks, says dairy chief

By Chris Mercer , 27-Apr-2006

It is unrealistic to expect the European Union to make more big concessions at the upcoming World Trade Organisation talks, argues the European Dairy Association against critics of Europe's stance.

Joop Kleibeuker, secretary general of the European Dairy Association, said the European Union had made its fair share of concessions to get World Trade Organisation (WTO) talks moving.

"The others cannot expect that the EU will do more to come closer to their position," he told DairyReporter.com, adding Common Agricultural Policy reform and a pledge to wipe out export subsidies by 2013 were proof of Europe's good intentions.

Debate on how to break the deadlock in WTO trade talks has re-emerged ahead of the next formal meeting between the major trading blocks in July.

The European Union has faced down fierce criticism from campaigning groups and other countries for its refusal to move further on cutting subsidies and open up its agriculture markets to developing countries.

A committee of British Members of Parliament (MPs) added to the weight of criticism of the EU's position, in a report published Thursday.

The MPs, of the Select Committee on International Development, said the EU must improve its offer to lower trade tariffs and subsidies in agriculture, and its offer "should not be made dependent on the actions of developing countries". The EU had argued that developing countries should open up their services markets.

The dairy association's Kleibeuker said, however, that America's position on market access was "seen more and more by everybody as unrealistic".

He said the EU was not standing alone, and that European Dairy Association discussions with developing countries, including Brazil and India, had found they were not so in favour of market access along the American model.

A major problem in comparing the EU and US proposals is that both are keen on different areas depending upon where their advantage lies.

The US prefers tariff cuts because it is keen on market access, while the EU feels more secure with domestic subsidies because it believes it has made more progress in this area.

One of the biggest disputes between these two blocs remains over so-called 'sensitive products'; a list of products, likely to include dairy, that would not be subjected to the most stringent tariff cuts.

The US has proposed that only one per cent of tariff lines should be protected as 'sensitive', while the EU has proposed eight per cent. Some aid agencies have said anything more than two per cent could reduce gains from trade liberalisation by up to 70 per cent.

European dairy firms have already faced intense pressure over the last year from price cuts on commodities, such as milk powders and butter, under the EU's CAP reform.

Joop Kleibeuker said he thought a compromise could be reached on tariff lines, and that the European Dairy Association "accepts the trend towards trade liberalisation in the world".

Pascal Lamy, director-general of the WTO, this week denied trade talks were stalling, following last December's abortive ministerial in Hong Kong. "We may have missed the deadline but we are not in deadlock," he said.

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