Agweb.com | April 11, 2002 | by Julianne Johnston
The Grain Growers of Canada and the Canadian Federation of Agriculture are calling on the federal government to introduce a program that compensates producers for the economic injury that foreign subsidies have caused Canadian growers.
In a joint statement, the groups said, "The Uruguay Round Agreement on Agriculture has left far too much room for other countries, particularly the United States and European Union, to target spending huge amounts of money on their farmers resulting in a severe deterioration in grains and oilseeds prices. Agriculture and Agri-Food Canada (AAFC) estimates that 25 per cent of the drop in prices between 1995 and 2000 can be attributed to the impact of EU and U.S. subsidy programs, estimated at a loss of roughly $1.3 billion."
The groups say this amount represents income that Canadian grains and oilseeds farmers have been forced to surrender to foreign subsidy programs implemented in the U.S. and the EU. "It affects all grains and oilseeds producers' bottom lines, regardless of their size, location, management style or crop mix," they said. "Distortions caused by foreign policies also ripple through the existing safety net programs and undermines their effectiveness as tools to mitigate income risk. This economic injury is compounded by the fact parts of Canada suffered serious weather-related crises in 2001."
"We believe it is the responsibility of governments to recognize and compensate growers absorbing this injury," said the groups. "Farmers are unable to hedge against the policy distortions created by U.S. and EU programs nor are they able to negotiate international trade deals. Farmers cannot be held accountable or responsible for what they cannot reasonably control. Meanwhile, policy developments in both the EU and U.S. show little sign of subsidies being reduced, and instead threaten to spread injury to other commodities like pulse crops."
The trade injury compensation being called for by the GGC and CFA, would "sunset" once the federal government has reached an international trade deal that disciplines subsidies and levels the playing field internationally. Ideally, this would be the result of the current WTO negotiations scheduled to conclude in 2005, they add.
The CFA and GGC said they fully support the objectives of the Agriculture Policy Framework (APF) agreed to by the Federal and Provincial Agriculture Ministers last June, to build a successful and sustainable long-term agriculture policy. "Trade injury compensation supports these objectives by remedying a serious gap in existing risk management programs and providing the stable foundation on which the APF will need to rest if it is to benefit all sectors of the Canadian agri-food industry," they add.
"Trade injury compensation will lift the injury burden off Canadian producers, will level the playing field between Canadian growers and foreign competitors, and will bridge to when the WTO process concludes to enable the APF to be implemented to capture the benefits of Canada's competitive advantage," they concluded.Agweb.com:
