CIAA wish list for WTO revival

Related tags Ciaa European union International trade

Flying the flag for market liberalisation Europe's food and drink
industry body has reinforced its support for a revival of WTO
negotiations. But the group also lays down conditions.

In September the round of trade talks at Cancun, Mexico collapsed with rich and poor countries in a clash over farm aid as developing nations held out for a better deal.

During the talks, a coalition of more than 20 developing countries, led by Brazil, India, China and South Africa, threatened the traditional dominance of rich countries.

The principal complaint of the so-called G21 centred over the approximately €300 billion in annual subsidies that rich governments pay to their farmers, which, they say, locks the developing world out of international markets.

But according to representatives from Europe, the bloc had gone far enough to encourage talks and promote agreement. "On agriculture, the EU stood ready to eliminate export subsidies on products of interest for developing countries and we offered to significantly reduce trade distorting support to farmers, after a painful process of internal reform of our agricultural policy,"​ said Pascal Lamy, European Commissioner for trade, at the time.

Three months on, the CIAA - Confederation of the food and drink industries of the EU - confirmed the industry's commitment to the multilateral process and expressed "its support for a rules-based multilateral trading system that promotes improved market access and defines clearer and fairer agricultural trade rules"​.

"The CIAA shares the general outcome of the EU reflection process,"​ said Jean Martin, the CIAA president, alluding to the recent reform of the Common Agricultural Policy (CAP) pushed forward by Agiculture commissioner Franz Fischler and Europe's efforts to become more flexible on the global stage, in particular with developing countries.

"We consider that a constructive approach needs to be taken now with the aim of resuming negotiations quickly in which the EU should take a driving position,"​ he added.

For the CIAA, key issues on which progress should be achieved at the multilateral level are: agriculture, trade facilitation, enhanced protection of geographical indications within the TRIPS agreement and improved dispute settlement procedures.

Although backing a revival of talks, the CIAA underlined areas where flexibility is unlikely.

"The three pillars of the agriculture negotiations must be dealt with in a coordinated way. CIAA cannot accept to negotiate, at this stage, an end date for the general phasing out of export refunds."

Touching on the topic of raw materials - an issue of price that is currently affecting all players in the food processing - production chain, the CIAA added: "There should be no phasing out of export refunds for processed food products without parallel reductions in raw material prices, otherwise EU industry would lose its competitiveness."

In addition, the group said that support measures "having no or only minimal effect on trade should be excluded from any additional discipline"​.

The CIAA position is clear, but whether the G21 - the group of developing countries that emerged in Cancun - will agree that Europe is making constructive, flexible steps to improving multilateral trade is another question.

A recent report published by US-based think-tank the International Food Policy Research Institute (IFPRI) shows that protectionism and subsidies by industrialised nations cost developing countries about $24 billion (€22bn) annually in lost agricultural and agro-industrial income.

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