Schumacher Tells Europe It's `Isolated' on Subsidies

January 6, 2000

On the issue of export subsidies, "Europe is clearly isolated," Under Secretary August Schumacher told the Oxford Farming Conference in Oxford, England, Wednesday. "The rest of the world" disagrees with Europe in its stand against eliminating export subsidies over time, he says.

"Not only are developing country concerns about trade-distorting policies valid, they were substantiated at the Seattle ministerial by the European commission's inability to convince some of its member states on the fundamental issue of `eliminating' export subsidies over time," Schumacher told the conference.

He also scored a European claim that U.S. farmer payments are twice the level of support provided to European Union farmers. "In reality, most recently available data published by the (Organization for Economic Cooperation and Development) show that EU production supports on average for 1996-98 provide 39% of EU farm income, while U.S. production supports on average for the same period provide only 17% of U.S. farm income."

OECD data show that the EU provides nearly 10 times more production support per acre than the United States, he added. The EU provides $324 per acre compared to $34 in the United States.

"Developing countries are looking to the United States, the EU and Japan for leadership in developing rational agricultural policy," Schumacher continued. "The United States has shown it by greatly reducing its export subsidies, especially on grains. What about the EU? High European subsidy levels continue to distort international agricultural trade."

The trade aspects of biotechnology also need to be addressed, said Schumacher. "We still think that a biotech working group is the best way to address this issue...the trade aspects of the agricultural biotechnology issue should also be addressed in the WTO (World Trade Organization) context as well as bilaterally."

In a report from Oxford, England, where Schumacher spoke, REUTERS quotes Schumacher as telling reporters that one problem in Europe where food safety is concerned is that there is no equivalent to the U.S. Food and Drug Administration. U.S. consumer satisfaction with genetically modified food products is due largely in public confidence in FDA investigations on biotechnology, he said. The EU is expected to create a community-wide food safety body over the next few years.