From: Reuters
Published May 26, 2008 02:24 PM

Farm bill attracts criticism at WTO talks

GENEVA (Reuters) - Several countries at the World Trade Organization (WTO) criticized the new U.S. farm bill on Monday for raising farm support when the WTO is trying to reach a deal to cut agricultural subsidies.

"A few of them had a go at the new farm bill," said New Zealand's WTO ambassador Crawford Falconer, after WTO members met to review the revised proposals he issued last week for a farm deal in the WTO's Doha round.

The countries criticizing the $289 billion U.S. farm bill, passed last Thursday and overriding a presidential veto, included Burkina Faso, speaking for cotton producers, Canada, Paraguay and Bolivia.

Falconer said the new bill did not directly affect WTO negotiations, but agreed it would have a negative affect.

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"It's another factor which complicates everybody's life, there's no doubt about that politically," he said.

If WTO members, including the United States, agree a deal including reductions in farm support, and the U.S. Congress ratifies it, Congress would have to amend the farm bill to bring it into line with the new WTO rules.

Canada said that under certain assumptions the United States could hit its proposed limit for overall trade-distorting support with one product under the new bill, a participant in the meeting said.

Given that food prices are likely to fall back from their current record highs in the coming years, the new farm bill will trigger support earlier than the present one, the senior negotiator for a major developing country told reporters.

But the new bill could also encourage developing countries to try to bank what has been agreed now, rather than let negotiations drag on into a new U.S. administration next year.

Under current proposals, which Washington has indicated it could accept, the U.S. ceiling for overall trade-distorting support would fall to $13-16.4 billion from an estimated $48.2 billion now.

(Reporting by Jonathan Lynn; editing by Tim Pearce)

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