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Zoellick Urges EU to Accept Agricultural Policy Reform

Washington -- World Trade Organization (WTO) negotiations are unlikely to move forward unless European Union (EU) member states go along with types of agricultural policy reforms proposed by the EU governing body, U.S. Trade Representative Robert Zoellick says.

In April 22 remarks to an annual conference of the Export-Import Bank of the United States, Zoellick expressed hope that EU countries will align their foreign policies and economic interests with those of the international economy, the WTO, and the developing world by accepting the main features of Common Agricultural Policy (CAP) reforms proposed by the European Commission.

In July 2002 the commission put forward a proposal to spend less money on agricultural market subsidies and more on rural development. Under the proposal, support would be shifted away from boosting production and toward meeting tough environmental, animal welfare, and food safety standards. The EU is still debating the plan.

Earlier Zoellick had said that while the EU's CAP proposals are not sufficient to advance the WTO talks, they are "definitely" necessary. At the end of March WTO members missed the deadline for agreeing on modalities, or specific details and time frames, for the agriculture negotiations.

Zoellick said that he and negotiators from some other countries believe that the WTO negotiations need to focus now on a limited number of issues -- especially on market access in agriculture, consumer and industrial goods, and services -- to move forward before the WTO ministerial meeting in Cancun, Mexico, in September. While agriculture is the "critical" issue, he said, the United States wants to "see what else we can do to push along negotiations in other areas." He said U.S. negotiators working with other countries are trying to find areas of common interest to advance the process.

On another issue, Zoellick said his office is working on initiatives that would boost development in, and U.S. trade with, Middle Eastern countries in the aftermath of the successful U.S. military campaign in Iraq.

He said the United States needs to capitalize on an impetus for change emerging in the region as a result of demographic and social changes, as well as the growing awareness of regional developmental problems. Zoellick said he hopes that a free trade agreement (FTA) the Bush administration is negotiating with Morocco will provide an incentive for other countries in the region to introduce reforms that would make them potential candidates for closer economic relationships with the United States.

He said the Bush administration is supporting customs reform and a better intellectual property regime in Egypt as a way of moving that country towards a potential FTA. In 2002, Zoellick was the first U.S. trade representative to visit Egypt. He said that a number of countries in the region, including Egypt, have signed trade and investment framework agreements with the United States, agreements which might be a good starting point for any FTA negotiations.

Zoellick suggested that other countries, such as Saudi Arabia, could create an opportunity for intensifying trade with the United States and other partners by moving closer to WTO membership. Negotiations on Saudi Arabia's application to join the WTO have been in progress since 1996.




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