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Chirac states he was ready to talk

French President Jacques Chirac said Friday he was ready to compromise in stalled negotiations to reform the EU's on (US$50 billion) farm subsidy program designed to cut waste and strengthen Europe's hand in world trade talks.

Chirac said at an EU summit in Greece, the country that holds the EU presidency, he asked Prime Minister Costas Simitis to suspend the negotiations by the European Union agriculture ministers in Luxembourg until next Wednesday.

"It was clear that an agreement was not possible," Chirac told a news conference.

He said he hoped a suspension would help the search for a solution "that is all the more important in view of the" world trade talks that will be held in Cancun, Mexico, in September.

Three days of haggling by the agriculture ministers ended in deadlock, after France led resistance to proposals that would mean farmers would no longer automatically get more handouts for producing more food.

Ministers will meet again Wednesday, in a third attempt this month to overhaul the much-criticized system.

The decades-old link between output and subsidies is blamed by reformers for creating mountains of surplus food that is dumped on world markets, undercutting competitors and squeezing producers in poor countries.

However, France, backed party by Spain, Ireland and others, says too radical a change will force European farmers off the land, threaten food supplies and erode a cherished rural lifestyle.

They rejected a compromise put forward by the EU's head office that included allowing countries to keep aid tied to output levels for up to 25 percent of subsidies for cereals and 30 percent of beef subsidies.
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