WTO Negotiators Push On Despite Passing April 30 Deadline

Trade negotiators have missed an April 30 deadline on the details of eliminating export subsidies and reducing tariffs, putting more pressure on negotiators to finalize details of the agreement in coming months. Negotiators in Hong Kong last year had set an April 30 deadline to agree to formulas -- also known as modalities -- for eliminating export subsidies and reducing domestic subsidies and tariffs. The agreement was seen as the major accomplishment of the Hong Kong meeting.

"WTO members have already committed to eliminating export subsidies, a step that is extremely important to the dairy industry," said Clay Hough, IDFA senior vice president and general counsel. "We urge the negotiators to continue their talks in a timely fashion. If no consensus is reached later this year, we risk losing what is already on the table."

WTO members currently disagree on how much to cut both tariffs and the direct subsidies that protect farmers. Discussions are also stalled on the topic of high tariffs on industrial goods.

Timing is critical, because a Doha agreement would need to be approved by the U.S. Congress, and July 1, 2007, marks the expiration of Trade Promotion Authority, which authorizes the president to send free-trade legislation to Congress for an up-or-down vote. Most trade experts believe that if a deal on modalities cannot be completed in the next few months, there will not be time to complete an overall agreement and gain approval in the United States.

IDFA strongly supports the U.S. WTO proposal, which recommends cutting trade-distorting domestic farm subsidies by 60%, substantially reducing tariffs and eliminating export subsidies.

"IDFA remains in close contact with U.S. trade officials to communicate member interests and will continue to stress the importance of reaching an agreement," said Hough. "We've been told by government officials that an ambitious Doha agreement remains a priority for the administration."

U.S. Trade Representative Robert Portman recently was nominated as director of Office of Management and Budget. His deputy, Susan Schwab, is slated to replace him; her appointment will require Senate confirmation.

In an effort to keep the talks moving forward, Ambassador Portman and Schwab will travel to WTO headquarters in Geneva this week to assure officials that there will be a smooth transition and to demonstrate the continuing U.S. commitment to complete an ambitious Doha agreement.

Posted May 1, 2006