Deputy USTR Allgeier's Letter to Financial Times on EU and Agricultural Subsidies

Sir,

Christine LaGarde, the French trade minister, says that trade-distorting subsidies in agriculture must be dismantled ("Big cuts in farm tariffs are no solution to poverty", November 21). Frankly, we agree and we are pleased France is ready to push the other European Union member states to be more aggressive on agriculture.

What Ms LaGarde fails to tell readers is that the EU spends three times what the US does on trade-distorting domestic subsidies and still the EU has not offered cuts on par with ours. She also omits to say that the U.S. proposed 2010 as a date certain for the elimination of export subsidies -- we are still waiting for the EU to meet this challenge.

We also agree that the focus of the Doha Development Agenda should be development. But France is blocking the very market access that is key to generating growth and alleviating poverty in the developing world. Just in agriculture, the World Bank forecasts market access will yield 93 percent of all the benefits in that sector.

The US agriculture proposal provides for deep tariff cuts and substantial improvement in market access for all products. By contrast, the EU's tariff cut is small -- as so many have observed -- and it includes numerous exceptions that further weaken its impact.

According to the 2005 World Bank Global Monitoring Report, the U.S. is the most open market for low-income developing countries. This report shows the index of restrictiveness against imports from low-income countries was 6 for the U.S., 7 for Canada, 15 for the EU and 24 for Japan -- demonstrating that the U.S. is the most open to developing countries.

Peter Allgeier,
Deputy US Trade Representative,
U.S. Mission to the World Trade Organization