December 4, 2000

A group of agriculture associations along with food processors and marketers has called on U.S. Trade Representative Charlene Barshefsky to make sure agricultural interests are protected under the U.S.- China trade agreement and not abrogated when China accedes to the World Trade Organization. One issue is China's effort to get "special treatment" for its agricultural subsidies, the groups said.

"We strongly urge USTR to negotiate an agreement that will put strong disciplines on China's domestic support for agriculture," they told Barshefsky. "In addition, we continue to support strong provisions on import licensing and trading rights and the prompt implementation of the tariff reductions as scheduled in the bilateral accession agreement."

China is proposing that its subsidies on agricultural inputs and investment be exempt from discipline, under the provisions of the agreement and that Chinese spending on other amber box programs be subject to the 10% de minimis threshold rather than the 5% threshold that applies to the United States. "Input subsidies are one of China's principal means of supporting its farmers," the groups said. China could wind up being allowed to remove "all discipline on domestic subsidies. Likewise, the application of the 10% de minimis threshold would permit China to increase substantially trade-distorting subsidies to producers after accession," the groups said.

Given the degree of state control over the Chinese economy, the provisions governing import licensing and trading rights "are among the most important in the U.S.-China agreement. It is essential that strong provisions on import licensing and trading rights be included in the WTO accession agreement."