21 June 2002

Beckett dismisses US farm bill as unhelpful

By Isabel Daviesand Stephen Howe

DEFRA secretary, Margaret Beckett, has described the passage of the recent US Farm Bill as "catastrophically unhelpful" despite claims from the US that it strengthens the EUs hand in forthcoming trade talks.

She told a National Consumer Council conference in London on Wednesday (June 19), that although she still believed that the US intended to negotiate to reduce agricultural support in the next round of WTO talks, the Bill sent a worrying message.

"There isnt any doubt it has sent an extremely damaging signal across the developing world," she said. "It has also been a damaging signal within the EU, where, of course, inevitably all those who have been against [CAP] reform have seized on the notion there is no drive for reform."

But this was a mistake, she added. "It is a policy which nobody likes anymore, which is distorting our agriculture, which is destroying our environment and it has to change."

Valuable ally

But Ann Tutwiler, president of the Washington-based think tank the International Policy Council on Agriculture, Food and Trade said the latest US Farm Bill could prove a valuable ally for UK farmers.

"The Farm Bill, with its $20bn (£13.6bn) of support for farmers, will make it much easier for EU negotiators to defend the present level of farm support during the latest round of the World Trade Organisation talks which begin this week," said Mrs Tutwiler speaking exclusively to farmers weekly.

The US initiative could also refocus the debate on the direction of EU support. "Europes recent emphasis on linking support payments to environmental and welfare conditions could become significantly less important in the WTO negotiations after the latest US Farm Bill," she said.

The Bill, which has effectively introduced a deficiency payment system to protect farm incomes, could include $3bn (£2bn) of drought aid for producers.

US farmers have welcomed the proposals as have most companies in the ancillary industries, which can continue buying commodities at low farmgate prices, suggested Mrs Tutwiler.

But not all farmers will benefit, she said. "There is one major disadvantage – it could increase land values making life tougher for new entrants."

Meanwhile, US negotiators at the world trade talks in Doha are focusing on reconciling support payments made under the Bill with the aim of fostering freer world trade.

"The trade-off will be that if US farmers want greater access to world markets, they may opt for lower, or no, direct payments in return," said Mrs Tutwiler.

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Margaret Beckett believes theUS Farm Bill is unhelpful.