Sun, Oct 30, 2005 - Page 11 News List

EU makes offer to slash tariffs

`BOTTOM LINE' A top EU trade official said the proposed reductions of an average 46 percent to its agricultural tariffs were likely to be the best the world would get for now


The EU has offered to reduce average agricultural tariffs by 46 percent, its steepest ever farm tariff cuts, in a proposal aimed at breaking a deadlock in world trade talks.

The EU said Friday it would reduce the highest tariff rates by 60 percent and eliminate all subsidies for farm exports if trading partners made similar moves at a World Trade Organization meeting in December. The EU did not give a time frame for the proposed cuts.

"Unlike many WTO countries, Europe actually applies these tariffs so the cuts are deep and real," EU Trade Commissioner Peter Mandelson said. "This will drive down our tariffs across the board."

The proposal improves on the EU's previous offer to cut tariffs on the most protected products by about 50 percent, and would also reduce tariffs on sensitive products such as beef, chicken, and sugar -- though it did not say by how much.

The US said it was disappointed, and that the tariff reductions were far lower than other countries were seeking and allowed substantial loopholes.

"We are a little discouraged today by the EU proposal," US Trade Representative Rob Portman said. "I believe it is a modest step in the right direction, but I just believe it's inadequate to meet the promise of Doha."

Portman said he's hopeful that negotiations will continue between now and the round of meetings in Hong Kong.

"This is not a time for take-it-or-leave-it proposals -- that includes the US, frankly. We need to be prepared to negotiate in good faith."

Portman said he understood the pressure that EU trade negotiators are under as "some member states in the EU are wanting to continue significant protections for EU farmers."

But he noted US officials face similar pressures at home.

French reaction to the offer was cautious, after the nation warned on Thursday that it would veto any world trade deal that made too many concessions on agriculture.

The French government has not made any official comment.

But a government official who spoke on the usual condition on anonymity said "doubts remain" about whether the offer was within the EU mandate. The government is waiting for the EU to demonstrate that the offer abides by the mandate, the official said.

Mandelson described the offer as "Europe's bottom line," saying it was at the outer limit of the negotiating mandate given to the EU by its 25 national governments.

He said the EU was not prepared to take risks with the livelihoods of farmers in Europe and developing countries who would be hurt by more severe tariff reductions.

The EU is asking its trading partners to agree on agriculture by Nov. 8 to pave the way for talks on other sectors.

The 148-country WTO remains split on a new trade pact that aims to increase market access for poorer countries, boost the opening up of services sectors and to reduce farm subsidies.

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