"In the interest of trying to preserve prospects for reviving the Doha Round and salvaging the progress that has been made to date, the United States refrained from responding to the finger pointing by some that greeted the WTO Director-General Lamy’s decision to suspend the talks. However, yesterday’s statement by the European Union alleging that the United States failed to show flexibility in the Doha agriculture negotiations and attempting to divert blame for the stalemate is false and misleading. It cannot stand uncorrected.
"Ten months ago, the United States put forward the most bold agriculture proposal advanced to date to cut both tariffs and trade-distorting domestic supports. The proposal would have required substantial reform of the agricultural sectors in the U.S. and the EU – which has average agricultural tariffs twice those in the US and domestic supports three times greater than the U.S. – as well as greater opening of the fast-growing advanced developing economies.
"As widely acknowledged at the time, it would have dramatically opened protected agricultural markets, affording developing countries new export opportunities and going a long way to fulfilling the promise of Doha. It was also widely acknowledged to have restarted the talks that had been stalled for some time.
"Unable to endorse the US proposal given substantial opposition from France and a few other member states with strong farm interests, the EU attempted, alternately, to criticize the U.S. proposal as too ambitious or too weak. (In a sadly telling comment, an EU trade minister was quoted in the Financial Times yesterday saying "The fear from French farmers is stronger than the ambitions of European retailers.") Most recently, the EU attacked the United States for failing to propose even more dramatic cuts to domestic support while at the same time insisting on the right to lavish more than twice as much trade distorting subsidies on its farmers.
"During the recent G-6 meeting the US made clear that it was ready and willing to demonstrate greater flexibility in the area of domestic supports if the EU and advanced developing economies demonstrated greater flexibility in market access. We came to Geneva ready to make a good deal that achieved an ambitious outcome – in agriculture, industrial goods, and services – if the EU and others showed flexibility by putting real market access on the table for the first time. Unfortunately, they did not. Indeed, during recent discussions it became clear that the EU was in fact offering even less market access than originally thought, through their intended use of loopholes. And then, to compound the irony, yesterday the EU simultaneously waived around their "improved" offer and announced it was removing the offer from the table.
"The United States took the Leaders’ mandates for flexibility in St. Petersburg seriously. But the U.S. cannot, and will not, negotiate with itself. In view of the EU’s lack of movement at the G6, the United States reluctantly had to agree with Director-General Lamy’s assessment that the differences among G-6 members remained unbridgeable.
"The United States has sought to conduct this negotiation without resorting to blamesmanship and finger pointing. We are deeply disappointed that the European Union failed to exhibit similar restraint and hope that this will not jeopardize the few chances we have left to save the Doha Round. For our part, we will focus our efforts on working with other WTO Members to put the negotiations back on track."