Trade Talks Suspended

July 28, 2006 - Trade negotiators at the World Trade Organization (WTO) DOHA Round remained deadlocked leading to the decision by Pascal Lamy, director-general of the WTO, to suspend the five-year-old talks aimed at dismantling market barriers and stimulating global economic growth. The WTO had aimed to seal an agreement this year.

Susan Schwab, U.S. trade representative, commented, "Ten months ago, the United States put forward the most bold agriculture proposal advanced to date to cut both tariffs and trade-distorting domestic supports. The proposal would have required substantial reform of the agricultural sectors in the United States and the European Union - which has average agricultural tariffs twice those in the United States and domestic supports three times greater than the United States - as well as greater opening of the fast-growing advanced developing economies.

"Most recently, the EU attacked the United States for failing to propose even more dramatic cuts to domestic support while at the same time insisting on the right to lavish more than twice as much trade distorting subsidies on its farmers."

According to Secretary of Agriculture Mike Johanns, the EU's current tariff on high-quality beef is 80 percent, one of the highest such tariffs in the world, and their best offer was to lower it to a still huge 61 percent.

"Ambassador Schwab was right to hold firm and accept nothing less than real concessions. I commend her for her resolve," said Sen. Max Baucus (Mont.), expressing the view of many lawmakers. "It has become increasingly apparent that our trading partners - especially the EU and certain advanced developing countries - are unwilling to offer meaningful access to their markets, especially for U.S. agricultural exports."

The American Sheep Industry Association (ASI) requested that market access for sheep meat be included as a priority in the WTO negotiations providing a more equal footing for trade around the world and equity for domestic agriculture producers.

"ASI has provided testimony before Congress regarding the serious inequity that exists between the domestic sheep industry and that of the EU in terms of import protection. The strict tariff rate quota essentially caps imports of lamb meat. There is absolutely no question that sheep producers in the EU have a dramatic advantage compared to U.S. producers," stated ASI executive director, Peter Orwick.

"The United States has no economically significant barriers to imports of lamb. In fact, the United States continues to be the largest export market for Australian lamb as it has been for decades. With the tariff rate quotas on lamb in the EU, that market has not experienced the same level of increasing pressure from competitors," added Orwick. "The administration chose well to not accept an agreement with little change in market access".
Staff contact: Peter Orwick, est. 33

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