Subsidies Could Scupper G8 Moves to Reform World Trade

Western Mail (Cardiff, Wales), July 18, 2006 | Go to article overview

Subsidies Could Scupper G8 Moves to Reform World Trade


Byline: By STEVE DUBE Western Mail

Farm subsidies could again scupper hopes of a breakthrough in world trade talks at the Russian summit. Oxfam says the massive subsidies paid to the biggest farmers and companies in Europe and America could scupper efforts by the G8 leaders to kick-start the stalled Doha Round of the World Trade Organisation talks.

'G8 leaders say they want a successful conclusion of the Doha round. However, it is their own unfair agricultural subsidies that are contributing heavily to the WTO's current crisis,' said Oxfam's Make Trade Fair spokesman, Luis Morago.

'These subsidies continue to promote over-production and dumping, hurting poor farmers in developing countries.

'The G8 isn't going to rescue a failing WTO round unless it deals with the scandal of its own inequitable and harmful agricultural subsidies.'

Latest European Commission statistics show that in 2004 about pounds 20bn from the Common Agricultural Policy was paid in direct subsidies to farmers - and more than 50% of it went to the largest 7% of European producers.

Nearly 2,500 big farmers in Europe received an average of about pounds 366,000 each.

In the UK, 31% of the biggest farm producers got 84% of payments, and 460 individual producers shared pounds 147m.

The UK Government vetoed proposals to limit the amount any individual could receive when the subsidy system was reformed into the Single Farm Payment two years ago - although only the UK and Luxembourg have put the reforms fully into effect.

In France, 72% of payments went to 29% of farmers, and 20 individual producers received a total of pounds 6.8m. In Germany, 14% got 65% of payments.

And in Italy, 1.6% received 34% of payments, and 200 producers shared pounds 92m.

Under the US Farm Bill, 10% of America's biggest agricultural producers received more than 72% of all subsidies - while six out of ten farmers received nothing.

Mr Marago said the figures made a mockery of claims that the European CAP and the US Farm Bill were geared toward small farmers and rural development.

'Developing countries only joined the Doha round because they were promised this problem would be solved, but the EU and the US offers could even make things worse. This is why developing countries are resisting a WTO deal now,' he said. …

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