EU seeks united front as WTO crunch talks loom

Emergency talks have been called in Luxembourg last Tuesday after France accused EU trade chief Peter Mandelson of overstepping his brief to negotiate in the name of member states when he recently proposed big cuts in farm subsidies.

Dismissing such criticism, Mandelson vowed on Friday that he would only bargain with the full support of all EU member states.

“I support the calling of this meeting as a welcome opportunity to continue to provide transparency to the member states and to reassure them that the conduct of the negotiations ... is within the mandate,” he said.

Mandelson was on the defensive after French President Jacques Chirac, who has long staunchly defended France’s generous farm subsidies, sent a “personal” letter to European Commission President Jose Manuel Barroso calling for negotiations to be carried out in close contact with the members states.

“What the president of the republic is asking is that the negotiations take place in transparency and in close negotiation with the commission and member states,” his office said.

French ire stems from a proposal Mandelson has made in World Trade Organisation negotiations to cut EU farm subsidies by 70 per cent and to reduce EU customs duties on farm goods by 60 per cent.

Mandelson had to put his chips on the bargaining table after Washington also proposed making deep cuts in its farm subsidies.

The Luxembourg meeting, which comes ahead of high-level talks at the WTO in Geneva on Wednesday and Thursday, will give Mandelson a chance to explain his proposal to his critics as the negotiations get tougher ahead of the Hong Kong meeting in December.

An accord on cutting farm aid is broadly considered to be pivotal for an overall deal at the Hong Kong ministerial gathering, where members are to approve the broad outlines of a global trade liberalisation deal that was called for by WTO ministers in Doha, Qatar in late 2001.

So far, the EU and the US have shot down each others’ proposals to cut farm subsidies, claiming the other needs to make a bigger effort.

In Brussels, officials say that the EU should not have to cut subsidies as much as Washington because of deep reforms to its Common Agricultural Policy (CAP) in 2003, which broke the long-standing link between the level of assistance and farm production.

EU agriculture subsidies, which gobble up some 40 per cent of the bloc’s budget, are a subject particularly dear to Paris because France swallows up alone about a quarter the funds.

Despite the huge sums involved, specific information on which farmers benefit is one of the best kept secrets in the European Commission and most member states, although a loose network of independent experts is trying to change that.

Jack Thurston, who heads the European project from the German Marshall Fund, said: “The EU is generally quite open about how it spends its money but not on the CAP.”

However, Terence Wynn, a member of the European Parliament’s agriculture and budget committees, was hopeful that light will soon be shed on the subsidy darkness, saying: “Twelve years after trying to get information from the member states and the (European) Commission, we are finally getting some of it.”

“France is the big target” of the probe because the country gets so much of the total, the British MEP said.

Wynn hailed the publication of a report earlier this year in Britain that showed that some of the biggest beneficiaries of EU farm subsidies in the country were the Queen and Prince Charles as well as big real-estate holders and agri-food groups like Tate and Lyle.

Thurston said it was thanks only to a new law in Britain on public disclosure of information that light had been shed on the figures there.