22, 2003: The European Union is not about to take
the rap for the failed world trade talks, recently held in
Cancun, Mexico. So says Franz Fischler, the member of the
European Commission with responsibilities for agriculture.
During a visit to Guelph last week, Fischler gave a spirited
defense of the European Union's recently reformed Common Agricultural
Policy (CAP) and EU's view that they are well on the way to
a trade-friendly farm policy.
The Doha Round of trade talks is in trouble, not because
countries are unwilling to reform their farms policies. As
Fischler pointed out, the EU has just agreed to the most dramatic
reform of their CAP since the EU was created. The United States
did a dramatic about-face in its latest Farm Bill and is underwriting
U.S. farm production with billions in direct subsidies. Even
here in Canada, farm policy is in the midst of a major rewrite.
With much grumbling, provincial governments are signing onto
the Agricultural Policy Framework and its objective to make
Canada the world leader in food safety, innovation and environmentally-responsible
The Doha Round is in trouble because the previous agricultural
trade talks, the Uruguay Round, relied heavily on defining
various farm subsidies as more or less trade distorting. It
created a concept of boxes -- red, amber, green and blue -
with red denoting those policies that must be stopped. It
established the principle that farm support systems are not
equally trade distorting. The E.U., U.S., and Canada redesigned
programs to qualify for the less trade distorting designations;
and now all claim to have policies that are the least trade
The Doha Round is in trouble because farm policy cannot be
reduced to trade policy.
Consider the agreement by EU member states on the principle
of severing the link between farm payments and farm production.
It allowed Fischler to argue that the CAP will become less
trade distorting. At the Guelph meeting, Fischler identified
the primary motivation for the change, "From 2005 onwards,
the majority of farm payments will no longer be linked to
production. Instead, they will come in the form of a single
payment that is dependent not on production, but on our farmers
providing the broader services that our citizens demand of
agriculture: food safety and quality, environmental maintenance,
and animal welfare."
EU farm policy is about the broader social role of their
farmers. Fischler pointed out that farming maintains their
countryside, the capital for their tourist industry. Without
farmers, maintaining the landscape translates into hefty public
Trade talks are about fixing markets. Farm subsidies have
an impact on markets but they are about the social fabric
of the countryside.
Text of Franz
Fischler's talk in Guelph
Summary of the EU's
Common Agricultural Policy reform
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