27 March 2007 |
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| Australia's trade reform approach benefits US farmers |
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| A new ABARE report has shown that US agricultural exports could increase by US$8.6 billion (in 2006 dollars) in 2020 if an outcome based on Australia's "5 and 5" approach to agricultural trade reform were achieved in the WTO multilateral trade negotiations.
The findings are contained in ABARE's new report, Trade implications of the 2007 US farm bill proposals, released today by Phillip Glyde, Executive Director, ABARE. Mr Glyde explains that the report analyses the prospects for enhanced US agricultural trade. Under a multilateral trade reform outcome based on Australia's "5 and 5 approach" – a negotiating proposal that seeks an additional 5 per cent cut to agricultural tariffs in WTO countries and a further US$5 billion reduction in US overall trade distorting support – US production and exports of fruits, vegetables and meat would increase. These industries are among the two-thirds of US agriculture that does not currently receive government support. Under such an outcome the boost to the US economy is estimated to be US$9.6 billion (in 2006 dollars) in 2020. In addition, world agricultural trade is estimated to expand by US$96 billion (in 2006 dollars) in 2020, compared to business as usual. With the provisions of the current US farm bill due to expire in September 2007, debate on replacement farm bill legislation is currently underway in the United States. "Analysis undertaken in this report indicates that the potential effects of the US Administration"s 2007 farm bill proposals, while a step in the right direction, are likely to be modest at best. There is scope for further reforms to US agricultural policies," Mr Glyde said. In the absence of multilateral trade reform, the 2007 US farm bill proposals are expected to result in only marginal increases in US production and exports of fruits and vegetables, while US production and exports of meat and "program crops" (those crops that receive US Government support) are likely to decline slightly over the short to medium term, relative to business as usual. |
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| For media interviews and comment, please contact Dr Don Gunasekera, Chief Economist, ABARE, on 02 6272 2040 or mobile 0411 026 985 For free downloads of the report, Trade implications of the 2007 US farm bill proposals, please visit the ABARE web site www.abare.gov.au or phone Publications on 02 6272 2010. For general media enquiries, contact Maree Finnegan, Media Coordinator on 02 6272 2260, mobile 0417 689 567 or email mfinnegan@abare.gov.au. |
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