WTO access will add pressure to UK farm incomes – NFU

Improved market access for agricultural goods under the World Trade Organisation will put extra pressure on British farmers’ incomes, but will do little to make poverty history.

Outlining the likely impact of the ongoing Doha Development Round, NFU president Tim Bennett told the Oxford Farming Confernce that, since the UK exported relatively little outside the EU, there was little to gain from increased access to other countries’ markets.

“On the other hand, increased access to our market is bound to put further pressure on our prices and, in some cases, lead to higher imports,” he told the conference. Beef, dairy and poultry could be dramatically affected.

But opening EU markets would not be the panacea for alleviating poverty in Africa that some people suggested. “There are several conspicuous flaws in this argument,” said Mr Bennett.

For example, the EU already provided duty free access to the world’s poorest countries through the everything-but-arms agreement in 2001. The EU now absorbed 70% of all imports from least developed countries, compared with 17% to the US.

Indeed, free trade would make the poorest countries in the world poorer. “The World Bank recognises that the main beneficiaries from liberalisation will be developed countries such as the US, Australia and New Zealand, and increasingly Brazil and Argentina.

“Trade will provide an opportunity for developing countries, but they will only be able to take it if they have stable and uncorrupt governments, land reform, a fair tax system and functioning markets.”

On domestic supports, Mr Bennet explained that the EU was already ahead of the game in supporting its farmers in a non-trade distorting way. The onus was now on the US to contain its countercyclical payments on cereals and oilseed which were particularly trade distorting.

And, while the recent Hong Kong WTO talks had paved the way for the elimination of export subsidies by 2013, it also recognised the need for parallel treatment of other forms of export support such as commercially motivated food aid.