"If we are to have a successful outcome to the Doha Round, the US will need to propose more ambitious cuts and disciplines in trade-distorting domestic farm subsidies," said Commission Spokesman Michael Mann on 1st February 2007, in a first reaction to proposals for a new US Farm Bill tabled a day earlier.
The draft bill, which would set US farm policy for the next five years, proposed to cut agriculture spending by at least $10 billion over this period and shift funds towards more WTO-compatible programs. But, it made only modest moves to cut generous government subsidies.
The Doha negotiations on a global trade pact are currently hanging in the balance partly because of US refusal to meaningfully reduce agricultural subsidies.
"We had hoped the administration's proposal for the new farm bill would signal this more clearly," said Mann.
Nevertheless, he welcomed the “modest shift” towards less trade-distorting subsidies, and added: "This is not the end of the story," explaining that the plan is just a "first steer to Congress" and that further changes are not precluded.
Oxfam, a staunch opponent of rich countries’ farm subsidies, said that the draft bill was "an encouraging step towards meaningful farm programme reform" and that it would allow more funds to be directed towards America’s most vulnerable farmers, while causing less harm to poor farmers in developing countries.
Commission sources told EurActiv that the proposal was not a bad sign for the Doha Round, as it shows that the US remains committed to bringing its farm policy more in line with WTO rules. They particularly welcomed the proposed shift from ‘in kind’ food aid to cash and certain changes to US export credit programmes, following a 2004 WTO ruling that a US support programme for cotton was illegal.
"The bill is a good sign, but not good enough," they said.
