Trade Minister Mark Vaile today welcomed research by the Australian Bureau ofAgriculture and Resource Economics (ABARE) that highlights the distorting impact of foreign export and other subsidies applied by the European Union and United States to agricultural trade. 

The OECD estimates that overall agricultural protection has not fallen significantly since the peak levels experienced in the peak period 1986-88 according to ABARE in its latest Current Issues report (July 2001).

Yesterday (23 July) in Geneva, the Cairns Group of agricultural exporters put forward a detailed proposal for the phased elimination and prohibition of all agricultural export subsidies.  

"Export subsidies are, by deliberate design, the most trade-distorting form of support measure," Mr Vaile said.

"The Uruguay Round negotiators recognised the job of cleaning up agriculture trade was a long way from finished.  This is why they provided for mandated agriculture negotiations which are now underway in the World Trade Organisation (WTO).

"The Government's approach to these negotiations, which we are pursuing in conjunction with the Cairns Group of agricultural exporters, is that trade in agriculture must be put on the same footing as trade in other products."

Mr Vaile endorsed the ABARE findings that the EU and the US had met their current WTO export subsidy commitments by switching support payments into exempt categories of domestic subsidy programs.  Some of these programs still have a significant impact on international markets despite their domestic focus,

"The Australian Government is fully alert to the loopholes in the existing rules.  I am committed to closing these off to help ensure future access to international markets by Australian farmers cannot be white-anted by shuffling subsidies between programs," Mr Vaile said.

Contact:
James Baker (Ministerial) 02 6277 7420
Nicole Guihot (Departmental) 02 6261 1555