Western Canadian farmers are being asked to give up a great deal and get little in return at the ongoing World Trade Organization (WTO) negotiations in Geneva, the chair of the CWB’s farmer-controlled board of directors said today. The text of the draft framework agreement on agriculture was provided to WTO members last night.
“This would be a very bad deal for western Canadian farmers,” said Ken Ritter. “Instead of creating a more level playing field, farmers are being asked to make significant concessions in exchange for vague promises about reducing trade-distorting support in other countries.”
The draft text calls for specific restrictions on the CWB, including giving up its government guarantees and putting the single desk on the negotiating table, but sets only a general direction for reductions of domestic support and trade distorting practices of other countries. This comes despite the fact that agricultural support policies in the U.S. and European Union are widely acknowledged to be major causes of trade distortion.
“Farmers have the right to choose what kind of grain marketing system we have,” Ritter said, noting that the draft text language pertaining to the CWB reflects the position of Canada’s principal wheat competitors – the U.S., the EU and Australia. “Our foreign competitors should not be allowed to dictate the way farmers market their grain, especially since we have always operated in full compliance with international trade rules.”
Ritter also noted that any perception of unfair subsidies associated with the CWB could be addressed through overall disciplines on export subsides, export credits and domestic support – which would apply equally to all WTO member countries.
“Western Canadian farmers aren’t unreasonable,” Ritter said. “We have made major concessions in the past as a consequence of trade negotiations. But to ask us to once again make concessions while big players like the EU and U.S. continue to protect their bloated subsidy systems is too much.”
Ritter said the CWB would continue to work with the Government of Canada to ensure Western Canadian farmers’ concerns are addressed in this round of negotiations. The CWB has been in contact with key government ministers and senior Canadian trade negotiators throughout this process.
“We’re pleased with the Government of Canada’s continued support,” Ritter said. “We urge them to stand by their commitments and not sign a deal that would jeopardize the financial interests of Western Canadian farmers.”
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. As one of Canada’s biggest exporters, the Winnipeg–based organization sells grain to more than 70 countries and returns all sales revenue, less marketing costs, to Prairie farmers.
Background
The pillars of the agriculture negotiations are: domestic support, market access and export competition (export subsidies, export credit and food aid).
What is on the WTO table is the elimination of export subsidies, disciplines on export credit and food aid, disciplines on trade-distorting domestic support.
The CWB has three government guarantees: on initial payments, on borrowing and on export credit. The first two guarantees are domestic support policies, which would be subject to the same disciplines agreed to on domestic support for all WTO members.
On domestic support, the focus is on disciplines, not elimination. The U.S. and EU have no intention of eliminating their own domestic supports and have, in fact, structured their positions around the continued operation of current domestic support measures.
The U.S. is attempting to negotiate domestic support provisions that may not result in real spending cuts. In contrast, the new framework agreement would result in an actual, significant loss for western Canadian farmers. This is not only unbalanced, but inconsistent with principles of what constitutes legitimate domestic support.
Disciplines negotiated on export credit would apply to the CWB’s export credit guarantees.
The CWB supports the elimination of export subsidies. There are no export subsidies involved in CWB operations.
There is no need for separate disciplines on state trading enterprises (STEs). Singling out export STEs puts disproportionate restrictions on the CWB alone.
The CWB is a fair trader. An April decision by the WTO wheat panel clearly and unequivocally dismissed U.S. allegations against the CWB. The panel ruled that the CWB has no incentive to act on any basis other than commercial considerations.
“In view of the CWB’s current governance structure, which gives western Canadian producers control over the CWB...the CWB has an incentive to maximize returns to the producers whose products it markets,” read the panel report, also noting that there is no day-to-day involvement in CWB operations by the Government of Canada.
“This would be a very bad deal for western Canadian farmers,” said Ken Ritter. “Instead of creating a more level playing field, farmers are being asked to make significant concessions in exchange for vague promises about reducing trade-distorting support in other countries.”
The draft text calls for specific restrictions on the CWB, including giving up its government guarantees and putting the single desk on the negotiating table, but sets only a general direction for reductions of domestic support and trade distorting practices of other countries. This comes despite the fact that agricultural support policies in the U.S. and European Union are widely acknowledged to be major causes of trade distortion.
“Farmers have the right to choose what kind of grain marketing system we have,” Ritter said, noting that the draft text language pertaining to the CWB reflects the position of Canada’s principal wheat competitors – the U.S., the EU and Australia. “Our foreign competitors should not be allowed to dictate the way farmers market their grain, especially since we have always operated in full compliance with international trade rules.”
Ritter also noted that any perception of unfair subsidies associated with the CWB could be addressed through overall disciplines on export subsides, export credits and domestic support – which would apply equally to all WTO member countries.
“Western Canadian farmers aren’t unreasonable,” Ritter said. “We have made major concessions in the past as a consequence of trade negotiations. But to ask us to once again make concessions while big players like the EU and U.S. continue to protect their bloated subsidy systems is too much.”
Ritter said the CWB would continue to work with the Government of Canada to ensure Western Canadian farmers’ concerns are addressed in this round of negotiations. The CWB has been in contact with key government ministers and senior Canadian trade negotiators throughout this process.
“We’re pleased with the Government of Canada’s continued support,” Ritter said. “We urge them to stand by their commitments and not sign a deal that would jeopardize the financial interests of Western Canadian farmers.”
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. As one of Canada’s biggest exporters, the Winnipeg–based organization sells grain to more than 70 countries and returns all sales revenue, less marketing costs, to Prairie farmers.
Background
The pillars of the agriculture negotiations are: domestic support, market access and export competition (export subsidies, export credit and food aid).
What is on the WTO table is the elimination of export subsidies, disciplines on export credit and food aid, disciplines on trade-distorting domestic support.
The CWB has three government guarantees: on initial payments, on borrowing and on export credit. The first two guarantees are domestic support policies, which would be subject to the same disciplines agreed to on domestic support for all WTO members.
On domestic support, the focus is on disciplines, not elimination. The U.S. and EU have no intention of eliminating their own domestic supports and have, in fact, structured their positions around the continued operation of current domestic support measures.
The U.S. is attempting to negotiate domestic support provisions that may not result in real spending cuts. In contrast, the new framework agreement would result in an actual, significant loss for western Canadian farmers. This is not only unbalanced, but inconsistent with principles of what constitutes legitimate domestic support.
Disciplines negotiated on export credit would apply to the CWB’s export credit guarantees.
The CWB supports the elimination of export subsidies. There are no export subsidies involved in CWB operations.
There is no need for separate disciplines on state trading enterprises (STEs). Singling out export STEs puts disproportionate restrictions on the CWB alone.
The CWB is a fair trader. An April decision by the WTO wheat panel clearly and unequivocally dismissed U.S. allegations against the CWB. The panel ruled that the CWB has no incentive to act on any basis other than commercial considerations.
“In view of the CWB’s current governance structure, which gives western Canadian producers control over the CWB...the CWB has an incentive to maximize returns to the producers whose products it markets,” read the panel report, also noting that there is no day-to-day involvement in CWB operations by the Government of Canada.
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