Today was the real start of the negotiations here. And surprisingly, it did not start in the Green Room where negotiations are scheduled to take place, but in the Press Room!
U.S. Trade Representative Susan Schwab wanted the whole world to know about the new U.S. offer: to cut their annual farm subsidies to US$15 billion.
Not that anyone was surprised by the figure, it was widely expected. Maybe what is most surprising were the conditions attached: more market access for U.S. products and a new version of the infamous “peace clause!” An extended Peace Clause would protect U.S. farm programs from legal challenge at the WTO.
IATP thinks this new proposal is absurd. With prevailing high prices, the U.S. will have no trouble meeting the target. Our recent analysis of the Farm Bill and the WTO agriculture proposal outlines how both essentially retain the status quo by expanding the types of subsidy programs eligible for the Blue Box. Adding to this, the request for immunity from legal challenge is really pushing it!
So far, the proposal hasn't received an enthusiastic response from other countries. A trade official from India stated that the offer "doesn't pass the laugh test."
Celso Amorim, the Brazilian negotiator, commented when he came out of the Green Room that this is “insufficient” but that “it’s a start.” Maybe this is not surprising either. But it tells a lot about how far Brazil has departed from its initial ambitions for the Doha Round.
IATP will provide more analysis on the U.S. agriculture proposal in the coming days.
