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US willing to adjust farm supports if others do

US is willing to adjust domestic agricultural supports in exchange for increased market access.

business Updated: Sep 12, 2003 19:50 IST

The US has indicated it is willing to adjust domestic agricultural supports in exchange for reduced support in other countries and increased market access for US agricultural goods, particularly in developed countries.

The US Department of Agriculture under secretary JB Penn made this disclosure in reply to questions at a briefing during the World Trade Organisation (WTO) ministerial meeting in this Mexican resort town.

He acknowledged that US tariffs on some products -- sugar, peanuts, tobacco, dairy products -- "are much higher, but we have said that everything is on the table (in this round of negotiations) and if others are willing to liberalise, then we are quite willing to talk about our sensitive products as well".

The average tariff on food and agricultural products in world trade is 62 per cent, but it is in the 12 to 15 per cent range in the US, said Penn.

At the same briefing, Deputy US Trade Representative Peter Allgeier, when asked about the employment effects of trade reform, said he could not provide precise numbers on the effect on jobs.

But he said there was the potential to raise the standard of living of millions of people, particularly in developing countries, and to achieve greater efficiency in all economies.

Trade reform, Allgeier said, would "enable countries to participate more fully and more productively in what is rapidly emerging as a global sourcing economy, where parts of a product are produced in different countries and then they are assembled and distributed throughout the world".

Meanwhile, the World Bank has estimated that a deal at Cancun could produce income gains of as much as $520 billion by 2015, lifting 144 million people out of poverty. WTO's director general Supachai Panitchpakdi has said failure to reach any agreements at the meeting would deal a blow to the world economy.

The European Union (EU), which spends about $100 billion a year on farm subsidies, has reaffirmed its willingness to eliminate some export handouts that particularly harm developing countries.

But EU Trade Commissioner Pascal Lamy said the importance of agriculture in Europe meant it "cannot simply be integrated into world trade like other sectors".

First Published: Sep 12, 2003 12:30 IST