The success of the next round of trade liberalization talks depends on tackling the thorny issue of agricultural tariffs and support. That is no secret; agriculture has preyed on the minds of trade negotiators for decades, but they have successfully delayed consideration of the question for years. The most recent retreat occurred recently at ministerial talks held in Tokyo. The failure to make progress bodes ill for the success of the Doha Round. If future growth and prosperity depend on continued growth in trade, then the agricultural sanctuary must be breached.
Foreign Minister Yoriko Kawaguchi presided over the three-day conclave attended by representatives of 22 nations and regions. Negotiators were trying to meet a self-imposed deadline of March 31 for setting numerical targets on the reduction of tariffs and subsidies, "an awesome challenge," acknowledged a World Trade Organization spokesman. Instead, they clashed over a draft proposal drawn up by Mr. Stuart Harbinson, chairman of the WTO Agricultural Negotiations Committee.
The Harbinson proposal calls for minimum cuts of between 25 percent and 45 percent as well as average reductions of 40 percent to 60 percent on all farm tariffs. It did not impose ceilings on those duties. In addition, the draft also calls for domestic agricultural subsidies to be cut by 60 percent over five years, while export subsidies would be phased out entirely within nine years. The draft was aimed at navigating between the 36 percent average tariff reduction endorsed by Japan and the European Union on one hand, and the uniform 25 percent ceiling on all farm tariffs sought by the United States and Australia on the other. Yet, by splitting the difference between the two camps, the draft satisfied no one. Representatives could not even agree on whether to use the proposal as a basis for negotiations. So, the talks are back to square one.