*EPF513 09/12/2003
Transcript: Transcript: U.S. Urges Others at WTO to Make Agriculture Offers
(Group of 21 developing countries must be willing to negotiate, Allgeier says) (3400)

A group of developing countries making demands on wealthy countries in World Trade Organization (WTO) negotiations to eliminate agricultural subsidies must be prepared to give up something as well, Deputy U.S. Trade Representative Peter Allgeier says.

Allgeier made the remarks at a September 12 morning briefing in Cancun, Mexico, where trade ministers from 148 countries are working on frameworks for bringing negotiations launched at Doha, Qatar, in 2001 to a successful conclusion by the end of 2004.

According to Allgeier, U.S. Trade Representative Robert Zoellick reiterated at a late September 11 meeting that the United States is willing in agriculture to eliminate export subsidies and drastically reduce domestic supports and tariffs and then asked the group of 21 developing countries what they are willing to offer.

"And this is a question that is particularly important for the more advanced developing countries within that group of 21," Allgeier said, "those who have been most insistent in articulating their wish list."

When the facilitator, or chairman, of the working group on agriculture submits his text as a point of departure for negotiations later September 12, he said, the group of 21 countries will have to begin negotiating.

"It's quite easy to unite around a set of demands," Allgeier said. "It's a lot more difficult to negotiate when there has to be give and take, particularly when you have a very diverse group."

He also asserted that a number of other developing countries disassociated themselves from the group of 21.

The group of 21 comprises Argentina, Bolivia, Brazil, Chile, China, Colombia, Costa Rica, Cuba, Ecuador, Egypt, El Salvador, Guatemala, India, Mexico, Pakistan, Paraguay, Peru, the Philippines, South Africa, Thailand and Venezuela.

At the same briefing, chief U.S. agriculture negotiator Allen Johnson said the United States is willing under certain circumstances to extend a provision of the existing WTO agriculture agreement called the "peace" clause. This provision, expiring at the end of 2003, prohibits challenges to agricultural subsidies under any other WTO agreements.

"We see that there is value in extending the peace clause but ... it has to be in the context of moving this process forward," Johnson said.

Following is the transcript of the briefing:

(begin transcript)

Deputy U.S. Trade Representative Peter Allgeier
Chief Agriculture Negotiator Allen Johnson
9:30 a.m. Press Briefing
World Trade Organization Fifth Ministerial Meeting
Cancun, Mexico
September 12, 2003

DEPUTY USTR PETER ALLGEIER: Thank you for joining us. As you know the process is continuing among the five groups that have been set up by Secretary Derbez. Generally they have been following a similar format. Yesterday I think that all of them had some version of open, informal meetings. These are very important in this organization of 146 -- it's now 148 members -- for purposes of transparency and also for a sense of inclusiveness in the decision-making process. In addition, of course, the various chairs hold some smaller group meetings, hold what are called confessionals with individual delegations, to help them get a sense of where the center of gravity might be in each of these areas.

The United States, of course, continues to participate constructively in these, supporting the chairs, and in addition we are holding meetings outside of that process with various delegations. Ambassador Zoellick, for example, today is meeting with Germany, with Costa Rica, with the Republic of Korea, with Botswana, just to name a few to give you a sense of the variation in the meetings that we are having. And the purpose, of course, of these meetings is to find a basis for negotiating frameworks in each of the areas.

I know that a number -- most of you -- are quite interested in the agriculture negotiations, which is why Ambassador Johnson is here. Generally there, the chair is continuing in a manner similar to the other chairs, having consultations with the expectation that he will at some point produce his own paper. And that would be the paper from which delegations would be expected to negotiate. And it will be very, very important at that stage that all delegations are prepared to negotiate.

Just to remind people: Negotiation means give and take. It is not simply a question of making demands or taking. And I raise this question because in one of the meetings last night that Ambassador Zoellick had with the Group of 21 that was organized by -- the meeting was organized by Chairman Yo. He went through the three pillars in agriculture of what the United States is proposing and what we are prepared to do in the context of a negotiation, and asked what are the members of the Group of 21 prepared to do. What will they contribute to these negotiations? And this is a question that is particularly important for the more advanced developing countries within that Group of 21 -- those that have been most insistent in articulating their wish list.

The Group of 21 has shown that it can unite in making demands; the question is, are those countries able to move into a negotiating mode, along with the other 120 countries in this organization. And that was underlined at a meeting last night with a larger group of countries in which many countries, including many developing countries, indicated that they have views that are not identical to the Group of 21, and making it clear that the spokesman for the Group of 21 is not a spokesman for most of the developing countries.

So, just to remind people that this is an organization of 148 countries and all views need to be factored into the decision-making process here. I think that I would stop at this point, and then see whether you have any questions, either for me or for Ambassador Johnson.

Megan Devir, Fiji Television. Q: Can you tell us what the U.S. reaction to the amendment proposed by the G-9 yesterday has been?

AMBASSADOR ALLEN JOHNSON: Pardon me?

Megan Devir: The U.S. reaction to the amendment proposed by G-9 yesterday.

JOHNSON: Well, we think -- as Ambassador Allgeier just said -- we think that all these contributions are important parts in this discussion. In fact, one of the points that was made last night by the G-9 was that they wanted to make sure that their views were included in the consideration by the facilitator and by other members. So in that sense, we consider it to be constructive. The important thing, though, is we need to just sort of generally keep in mind that some countries came to Cancun ready to ask for things in domestic support or export subsidies. Some came ready to ask for things in market access. United States is one country that came here ready to both ask for things as well as give things in both areas. And so that is the constructive dialogue that we really need in the next couple of days if we are going to succeed, and, frankly, that is what we need in order for the round to succeed and for development and growth to occur. And so the G-9 paper, I think, is a contribution to that process. Again, you have to recognize that part of the process is opening up markets. That's what this is about.

Clovis Rossi, from the Brazilian Daily, Folha de Sao Paulo. Q: Mr. Allgeier, the U.S. is complaining about the G-21. The European Union before you complained about the G-21. The G-21 is complaining about the U.S. and the EU. Lacking 48 hours or less to the end of this conference, with all these complaints, is it possible to reach an agreement on agriculture?

ALLGEIER: Well, that was the reason I posed the question about countries' readiness to negotiate. The United States has indicated very clearly what we are prepared to do, and I am sure that Ambassador Johnson will be happy to go over in detail for you our proposals in the three pillars. They are very ambitious with respect to eliminating export subsidies, substantial reductions in domestic support, and significant opening of markets. And so, that is out there. Ambassador Zoellick spelled that out in quite a bit of detail, not just in his meeting with the Group of 21, but in his other meetings. And so, then the question is, "All right, what is it that other countries are prepared to do in each of those three pillars?" And so, if countries are prepared to negotiate in a give and take on those three pillars, then we certainly can finish this in the time that is allotted.

Elizabeth Becker, New York Times. Q: The European Trade Commissioner, Mr. Lamy, just had a press conference before you all, and he said in response to one question, "What would you like from the United States?," that essentially, their proposal is the equivalent of the reform of the 2002 Farm Bill, and he thought that you would agree that this is what you are willing to offer. Do you agree with that assessment of your offer today on agricultural reform--on the reduction in domestic subsidies, that it would be a real reform of the 2002 Farm Bill?

JOHNSON: I will be happy to answer that question, but let me just comment on the last question quickly. It is incumbent upon all the members to try to make this round succeed, and we all have a responsibility for making that happen. There are many -- as we move to the next step in the next couple of days which are going to be very critical -- many in this organization and within the G-21 that want to see this succeed. So I don't accept sort of the blanket reference to the G-21. I think there are a lot of people in that group that are working very constructively, trying to make this work and we are obviously trying to work with them and having meetings with them.

Regarding the other question, we have been very clear from the beginning that we are ready to cut domestic support and substantially reform our domestic support policies. We are ready to eliminate export subsidies. We are ready to open our markets. But what we need to see is a movement towards harmonization, since the United States has significantly less subsidies. Europe's subsidies are about three or four times ours. The average global tariff is about five times ours. So we need to see everything moving towards harmonization on the way to substantial improvement in market access and substantial reductions in trade-distorting domestic support and eliminate export subsidies. So we are ready to go there with all these things, but we can't do it if others aren't ready to move as well.

Flavio Alves, O Estado News Agency. Q: Could you elaborate more on your comment that you don't think that the G-21 should be the spokesperson or voice of developing countries and why?

ALLGEIER: Well, because at the last count, I thought there were upwards of 100 developing countries or more in this organization, and they obviously are not represented by the G-21. And you don't have to take my word for it, but a number of them said that explicitly in meetings last night.

Doug Palmer, Reuters. Q: I just wondered. I was talking to someone from the U.S. manufacturing sector last night and he was expressing concerns that in the NAMA talks that many developing countries were still holding back, still reluctant to agree to reductions in their tariffs. I just wondered what is your assessment of what is going on in those negotiations and are you worried that countries are waiting too long in that area, waiting for an agriculture agreement and then you won't have time to wrap up other areas such as manufacturing that you need for an overall framework.

ALLGEIER: Ok, thanks. There are actually a number of aspects to that. First of all, we certainly interpret the Doha mandate in the non-agricultural market access to be one of having negotiations that will result in real improvements in market access that will allow there to be changes in trade flows and expansion of trade. And that certainly is the orientation that we take into the group on NAMA, on non-agricultural market access. I think that there are many developing countries that certainly in the way they have expressed themselves in the meetings thus far, are very, shall I saw, cautious, reluctant, hesitant to make significant openings in their markets. And certainly those developing countries that have done that -- and this has been recorded and confirmed by the World Bank -- who have done that over the last decade, have seen that their growth levels have been three or four times that of countries that have remained [closed]. So we will continue to push for greater openness in the non-agricultural market access area.

The other thing in terms of the timing: Certainly, our chairman, Minister Tang from Hong Kong, made it clear last night that we should be working on the NAMA issue -- and I assume the other chairs are saying the same sort of thing to their groups -- we should be working on the NAMA issue on its merits. We can't completely avoid looking to the side and seeing what is going on in the other groups. But he has really stressed that we need to take that to the point where if the other issues, and particularly agriculture, fall into place, then that our piece would be able to fall into place rather quickly. I think that many, many of the countries have taken that to heart. We'll see how that plays out in the next day or two.

Suzanne Ouellet, Radio Canada. Q: Are you concerned that the blocs get entrenched on the agriculture issue? I am talking about the G-21, G-9, Pascal Lamy says Europe is a G-25, so is there bloc entrenchment? The different blocs getting entrenched in their own position, with no one willing to move?

ALLGEIER: Well, that remains to be seen, and that's why I raised this question earlier. For example, in agriculture, when the chairman's text comes out, whether the various members of the Group of 21 will actually negotiate. And of course that makes it a little more difficult. It is quite easy to unite around a set of demands; it's a lot more difficult to negotiate where there has to be some give and take, and particularly if you have a very diverse group, then how you reconcile giving and taking in a very diverse group is difficult. So certainly we hope that these groupings will all be oriented toward moving towards the center of gravity, toward common ground, but that will be the dynamic within each group.

Ian Swanson, Inside U.S. Trade. Q: Mr. Fischler, after the press conference today, repeated to reporters that he thinks that the peace clause needs to be extended at this meeting, that if it isn't extended, it could actually cause the round of negotiations to lag, I think he said, to even go on for an extra couple of years. What is the U.S. view on this right now? Does U.S. see any merit in finding an agreement to extend the peace clause here in Cancun?

JOHNSON: Our position on this issue has been basically that we see that there is value in extending the peace clause, but it has to be in the context of a substantial -- we recognize that from the participation of the membership, it has to be in the context of moving this process forward. And let's keep in mind what happens if this process does not move forward in the coming days. It probably means we are going to lose a lot of time in moving these negotiations forward, which means we are going to miss an opportunity to cut subsidies. We are going to miss opportunities to substantially improve market access -- which really means we are missing opportunities for economic growth and development. So we look at that in the context of the broader negotiations in terms of saying, "In a package that is moving this process forward, this is one of the things that need to be talked about."

Richard [inaudible] Q. You said that last night Mr. Zoellick asked the G-21 countries what they were prepared to give. You seem to be implying that they responded that they were not willing to give anything. Could you tell us what their response was, and what your understanding is of what they are prepared to give?

JOHNSON: Well, I think it's fair to say that they were able to present a very comprehensive view of reviewing what their paper has been in terms of what their demands were. When it came to decide, O.K., what are you ready to offer, in order to --again, it is not just good for us, in terms of creating market access, it is good for developing countries, as well. We really did not get any substantive response. So that is the key point that we are at here. As we look forward to the Chairman drafting something toward the next step of the process, countries really need to decide: Do we want to try to move this process forward, or continue to block it moving forward and trying to come to a successful meeting here in Cancun? Again, this has been a discussion that did not just start here in Cancun. It started back when we were all in Geneva last month, which is: We really need parties to be moving toward compromise and trying to accommodate a successful conclusion. So far with that group, we have not been able to see that.

Andrew Walker, BBC. Q: Could you identify any of the countries that last night said explicitly that the G-21 does not represent them?

JOHNSON: There were several countries that were represented by the G-32, for example, and to be honest with you, I don't remember what their names were, but there is the G-32 group out there, there is the G-9 group out there, and there is, I think actually, maybe Mauritius was one of the ones that made this comment. So there were several countries that were making a point of saying they wanted to be part of this process, and that they didn't want the G-21, basically, to be their representative for developing countries when it came to discussions with the chairman or with other countries.

[inaudible question]

JOHNSON: The G-32 is really a group of developing countries that have come around, focusing on things like SP and issues like that. I know that Honduras is one of them. I know that -- to be honest with you, I have not seen the list of it -- but I know that Honduras is one of them, Nicaragua is one of them. I am not sure who some of the others are. You should go ask -- what I would do if I were you, I would go talk to Honduras and ask them who some of their members are.

ALLGEIER: Last question right here, in front.

Quant [inaudible]. the Brazilian newspaper, O Estado. Q: Mr. Allgeier, you said that you would be prepared to accept elimination of export subsidies. Just to make it clear: Did you mean total elimination or elimination for some products, as is indicated in the common proposal?

ALLGEIER: The U.S. position consistently has been the elimination of export subsidies, period; i.e., all export subsidies.

JOHNSON: Just to be clear on that last point. Well, on two things. One is, we are ready to move forward on eliminating some, phasing them down and eliminating them all. And we're ready to put our own subsidies on the table. That's one of the things that we have been very clear about. But regarding the G-32, I just want to be clear on that: That is not the G-21, that is separate, a different group of countries.

ALLGEIER: Thank you very much. Thank you.

(end transcript)

(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)

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