Draft text continues promotion of agriculture dumping
ANALYSIS: IATP President Mark Ritchie explains what the first draft proposal to come out of Cancun would mean to farmers

CANCUN, Mexico, September 13, 2003: minsterial reaction from IATP: The draft Cancun Ministerial text released this afternoon largely represents the continued promotion of the U.S.- EU proposal and would do nothing to address the widespread practice of agricultural dumping. In fact, by proposing no timeframe for reductions in all forms of export subsidies, in article 3.6, this text is a step back from earlier proposals.

In addition, the text suggests that the Peace Clause will be extended. This would make it much more difficult for developing countries to challenge export dumping in the WTO.

“The last WTO agreement, signed in Marrakech, led to a near doubling of dumping by companies exporting out of the United States. This proposed text would lead to even greater levels of dumping, not less as demanded and promised in the Doha talks. This will simply intensify the global commodity crisis that is crushing farmers around the world,” said Mark Ritchie, President of the Institute for Agriculture and Trade Policy. “What we’re seeing is more of the same failed approach to trade – where the U.S. and EU get to continue dumping agricultural products onto the world market.”

“The Peace Clause directly undermines countries’ ability to enforce the anti-dumping provisions of the WTO,” said Ritchie. “It absolutely should not be on the table for extension. If it is extended it will be a huge step backward for development. This is not a development agenda – it’s an export dumping agenda. Good for the buyers of commodities, like the soft drink industry and industrial feedlot operators, but a disaster for farmers and consumers.” said Ritchie. “

“There is a simple solution for anyone who wants to see a successful outcome of these negotiations. All countries, north and south, could agree to phase out export dumping over the next ten years. The net effect could be a near doubling of global prices in coffee, corn, cotton, and other basic commodities bringing great benefit to farmers, peasants, and rural communities worldwide” said Ritchie. “In addition to increasing export dumping, the Uruguay Round also permitted the US government to actually increase the level of spending on farm programs. This proposed text would do the same by moving almost all current US subsidies into a Blue, Green or other box that would be exempt from serious reform and allow for over 10 billion dollars per year in potentially new subsidies.”

The draft also gives special treatment on tariffs to developed countries – while depriving developing countries of some of the same benefits.