Ag Secretary Ann Veneman has outlined an ambitious US proposal for reforming the rules of global agricultural trade. In Nara, Japan, participating in the Fifth Quint Ministerial, she noted the meeting comes at an important time in the ongoing agricultural trade talks and allows an opportunity to build upon the momentum of the successful Doha Development Agenda. Veneman said the US proposal would substantially reduce global trade barriers, slash trade-distorting subsidies and eliminate export subsidies. Specifically, the US is calling for all WTO members to reduce all tariffs using a formula that would reduce high tariffs more than low tariffs and result in no tariff over 25% after 5 years. It also calls for substantial increases in tariff-rate quota (TRQ) quantities and tightened rules on TRQ administration. The proposal, also unveiled in Washington, D.C. by US Trade Representative Robert B. Zoellick, will be presented to members of the World Trade Organization (WTO) next week in Geneva, Switzerland. Zoellick added, the proposal "lays out our vision for reforming and liberalizing global trade in agricultural goods." Subsidies would be deemed either trade distorting or non-trade distorting. Non-trade distorting support remains without limit, but trade-distorting support would be capped at 5% of a country's value of agriculture output. The proposal calls for elimination of export subsidies over 5 years, phased down in equal amounts, and new disciplines on state trading enterprises. Currently, the EU can support its farmers at a rate that is approximately 25% of the value of its agricultural production, Japan can provide support equal to 40% of its value of production, but the US is limited to less than 10% of the value of its production. In addition, USDA says, the EU spends over $20 billion in trade distorting "blue box" programs while the US spends zero.:
