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Doha paper falls short for Meat New Zealand

A EU/US paper on agriculture trade reform is a vital step towards a Doha Round agreement but doesn't measure up for New Zealand's red meat industry, said Meat New Zealand Chairman Jeff Grant.

"Potentially the Doha process offers significant improvements in trade opportunities for New Zealand's red meat industry" said Grant. "But I'm deeply concerned that some of the tariff reduction formulas proposed in this paper could allow WTO members like the US and EU to exclude meat from meaningful tariff cuts."

The paper proposes three levels of tariff cuts, ranging from duty-free to the so-called import sensitive, which is subject to minimal reduction in tariffs. Grant said the paper's 'sensitive' products category allows countries to nominate sensitive agricultural products and thereby avoid any meaningful reduction in tariffs. "If meat and dairy were relegated to this sensitive category, it would damage the heart of the New Zealand economy."

"This is totally unacceptable and just carries on discriminating against meat and other so-called sensitive agriculture products. The US and EU proposal lacks detail, and doesn't measure up to the benchmark of the Doha mandate." said Grant.

"Being so geographically remote, and with 80% of our red meat exported, New Zealand's $5.25 billion meat export industry relies heavily on freeing up trade." Grant said. "The current proposals being put by the EU/US do nothing for sheep and beef farmers in New Zealand."

The Doha mandate commits trade ministers to ambitious reforms in three main areas: market access, domestic support and export subsidies. The EU/US paper is designed as a compromise deal to reach agreement on the formulas to determine cuts in tariffs and other supports like export subsidies. The main thrust is that if the US gives way somewhat on market access, the EU can give way on trade-distorting domestic subsidy.

The new formulas for tariff reduction proposed in the paper combine gradual, flat-rate tariff reductions, and the 'Swiss Formula' that reduces tariff rate peaks quickly. 'Sensitive' products would be subject to the gradual flat-rate approach, while others would be reduced by the Swiss formula, or be put in a duty-free category. The proportion of tariff lines in each category are yet to be agreed, but will be the same for each country, although members could choose which specific products go where. The percentages that go into the formulas have yet to be agreed.

Grant said: "It is encouraging that the two largest players in world agricultural trade, the EU and US, have stepped up to take a leading role in finding solutions," said Grant. "But it is important that they show leadership without dictating an outcome which suits themselves at the expense of others."

Grant says he is reassured by the unwavering commitment of the New Zealand Government and the wider Cairns Group to honouring the Doha mandate for ambitious agricultural reform.

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