- The Washington Times - Wednesday, September 21, 2005

U.S. farmers run the risk of losing cotton, rice, corn and other subsidies through litigation at the World Trade Organization unless countries strike a new global trade deal, Agriculture Secretary Mike Johanns said yesterday.

“The status quo … has real risk to it,” Mr. Johanns told the Senate Agriculture Committee.

The WTO’s 148 members since 2001 have been negotiating an agreement to open markets, reduce government subsidies and boost economic prospects for the world’s poorest countries.

The talks have largely stalled since last summer, but Mr. Johanns and U.S. Trade Representative Rob Portman yesterday told members of Congress they hope to put together an agreement by next year.

Farm trade remains one of the main sticking points. Developing countries want the United States, Europe, Japan and other wealthy nations to stop paying farmers to produce and export crops. They argue the payments create too much supply and effectively lower global prices, robbing them of income.

Brazil has pressed the argument at the WTO and won separate cases against U.S. cotton subsidies and European Union sugar subsidies.

Mr. Johanns yesterday noted that other nations are looking at cases against U.S. rice and corn payments.

“These things are there and they are real,” he said.

The Bush administration already has proposed rolling back some cotton payments to comply with the WTO ruling, though Congress has not implemented the recommendation. Brazil is considering tariffs worth $3 billion in retaliation.

U.S. subsidies for all crops are estimated at $19.5 billion for 2005. The 25-nation European Union pays its farmers closer to $60 billion.

The Bush administration has pledged to eliminate all subsidies and tariffs if other countries do the same. It has been adamant, though, that countries such as India and Brazil open their markets in return for a reduction in farm payments.

“We are not going to move unilaterally on anything,” Mr. Portman said.

Lawmakers are following the talks closely because negotiations in Geneva are likely to affect U.S. farm legislation. The current program of subsidies expires in 2007.

Senators warned the administration not to commit to changes that would hurt farmers.

“No deal is better than a bad deal,” said Sen. Saxby Chambliss, Georgia Republican and Agriculture Committee chairman.

Mr. Portman, Mr. Johanns and counterparts from Europe, Brazil and India are scheduled to meet today in Paris to discuss the WTO talks. The United States and Europe last week said they agreed to use a Brazilian proposal to open up markets, but must work out some of the finer details.

Brazil has led a group of developing nations, called the G-20, in opposition to rich-country farm payments.

The WTO’s members are holding a summit this December in Hong Kong with the goal of outlining a final trade deal.

Mr. Portman said he hoped that Congress would be able to approve the agreement in early 2007.

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