Cairns Group Role Explained By NZ Minister

PRESS RELEASE

11 November 2001

CAIRNS GROUP ROLE EXPLAINED BY NZ MINISTER

Agriculture had been left out of international trading reform for more than 50 years, and it was time for a catch-up, Trade Negotiations Minister Jim Sutton said today.

He told a press conference, called by the Cairns Group of agricultural exporting nations at the World Trade Organisation meeting in Doha, Qatar, that while the average bound tariff rate for manufactured goods had fallen from 50 per cent to less than 4 per cent during the past 50 years, the average bound tariff r ate for agricultural products was still more than 40 per cent.

"It's time to have a catch-up for agriculture. It's time that these countries here, from the Cairns Group, benefited from the international trading system the way industrialised nations have.

"We're not asking for anything other than that agriculture be treated in exactly the same way as other sectors are treated already."

The Cairns Group of agricultural trading nations groups 18 countries, including New Zealand, Australia, and most South American and south-east Asian countries.

After this morning's meeting to discuss tactics for negotiations at the WTO meeting which begins in earnest tomorrow after this evening's opening, the Cairns Group published a communique emphasising the fundamental importance of agricultural trade reform to the future of the world trading system.

Cairns Group ministers said they expected the WTO meeting to agree to an ambitious negotiating mandate, including clear benchmarks and timetables, leading to the full integration of agriculture within WTO rules and an end to discrimination against it in the WTO framework.

"Only then will agricultural producers be able to compete fairly on the basis of their comparative advantage."

Mr Sutton said New Zealand thoroughly endorsed the Cairns Group's message to other WTO members.

"Enough is enough. It was only in the last round of world trade negotiations, the Uruguay Round, that agricultural trade was included for the first time.

"New Zealand, Australia, other Cairns Group members, and the developing world need market access on fair terms."

After intense questioning from many European-based journalists, Mr Sutton defended the Cairns Group stance on agriculture and the need for reform.

He said Cairns Group members were well aware of the European Union and Japanese positions on the need for agricultural protection and subsidies, which were based on a concept called multifunctionality. That concept meant that it was acceptable to give farmers trade-distorting subsidies because they would then provide environmental measures for the countryside, maintain rural employment, and similar things, thus impacting negatively on efficient agricultural exporters such as New Zealand.

"These things are legitimate areas for public policy. Cairns Group members are also concerned about the environment, the need to maintain rural employment, and to keep the countryside attractive. But if you want your rural areas' fences painted white or your hedgerows trimmed, then pay farmers subsidies to do those things. Don't pay them production subsidies in the hope that some of the money will be spent on paint."

Mr Sutton said it was quite clear that such subsidies encouraged farmers to inefficiently produce things that were not wanted by consumers. That surplus production is then dumped into international markets, depressing prices for unsubsidised farmers in other countries.

"We need to stop that. Agriculture needs to be treated as other products are, so that we can all concentrate on producing what we do best."

The Doha meeting began at 5.30pm on November 9 (3.30am November 10 NZ time) and was opened by the Emir of Qatar.

It runs till November 13.

ENDS

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