High stakes on WTO table
That is how many are interpreting the EU’s negotiating stance in the WTO world trade talks.
Ministers who have the interests of EU farmers at heart must watch commissioners Peter Mandelson and Mariann Fischer-Boel carefully.
There are many in Europe who would thank them for negotiating a deal which would abolish almost all commodity agriculture in the EU, forcing farmers to take up speciality production.
Just how close that possibility is can be seen from Ireland’s Minister Mary Coughlan’s statement that “agriculture must not be sacrificed for the sake of a new trade agreement”.
She said the EU has gone extremely close to the limit of its negotiating position, and has pledged to fight against the giving away of more ground, which could necessitate a new reform of the CAP.
She wants to keep decoupled direct payments exempt from WTO reductions, export subsidy equality on all sides in the negotiations, and agreed phasing out of export subsidies carried out over the longest possible period. She wants maximum protection of the EU food market, particularly for ‘sensitive products’.
However, the horsetrading in Hong Kong is likely to develop along completely different lines.
The ideal deal between the senior negotiating partners, the EU and the US, would be a world carve-up giving free reign to the US to continue as the No 1 agricultural commodity producer of the world, protected from competition with third world produce, while the EU’s well developed food processing industry works on happily with imported, cheap raw materials, leaving its farmers to produce premium priced specialities like organic or handmade foods.
Mariann Fischer-Boel has already said many of the EU’s smaller farms have no choice but to supply the safe food with excellent taste which is demanded by wealthier populations, and she said not everyone can be a winner in the bulk market with products like butter or skim milk powder or beef.
She said intervention buying and export refunds are there “for the time being” only.
The only concession Trade Commissioner Mandelson has made to farmers is that he will not use world trade talks to push through new reforms of the CAP.
Beyond that, he rejected a French proposal that his negotiating positions be subjected to oversight by EU capitals.
Having his negotiating proposals scrutinised, analysed and agreed by a technical committee assessing the social and economic impact on Europe would stop the world trade talks in their tracks, he said.
He said some of the member states need a reality check on the state of negotiations. Is the end of commodity foods production in the EU part of that reality? Who knows?
Following the French fuss, Mandelson must confirm to EU member state governments that he is not exceeding the flexibility granted to him by the Council of Europe.
And the council has said it will meet as often as necessary, to provide ‘necessary guidance’ to the Commission during the WTO ministerial conference in Hong Kong in December, which is seen as the last chance for a global trade deal in the current WTO negotiating round.
Farmers can only hope the council can watch over Mandelson’s shoulder and rein in any giveaways that could eventually end, for example, most of Ireland’s €7 billion per year food, drink and horticulture exports.
It’s worrying that their future is so dependent on someone who likes sailing close to the wind.
In the summer, the threatened shortage of ladies’ underwear due to the EU limiting imports from China was a policy and public relations disaster for Mandelson. But he’s used to putting his foot in it, having had to resign from British Prime Minister Tony Blair’s cabinet not once, but twice.
In 1998, it was found he bought a home in London, assisted by an interest-free indefinite loan from a millionaire Labour MP whose business was covered by Mandelson’s department. Mandelson didn’t declare the loan to the government or his mortgage company (the latter is an offence under British law).
He was out of government for only 10 months, but had to resign again in 2001, when it was claimed he sought British citizenship for a controversial Indian businessman.
Maybe his turbulent past makes him the right choice for EU Trade Commissioner, but his EU allies will have to watch him as closely as the US and WTO negotiators.
