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Parliamentary Question No.133

To ask the Minister for Agriculture, Fisheries and Food the communications or meetings he has had with EU Trade Commissioner; his future plans for same; and if he will make a statement on the matter.- David Stanton.

For ORAL answer on Tuesday, 20th May, 2008.

Ref No: 19587/08 Lottery: 50 Proof: 129


The Minister for Agriculture, Fisheries and Food: (Brendan Smith)

I propose taking questions 133, 120, 138, 135 together

A revised negotiating text on agriculture was issued yesterday evening and a text on non-agricultural market access earlier today. These texts are being issued with a view to facilitating a final WTO agreement by the end of 2008. It is by no means clear whether such an agreement will be reached this year. The range of issues outstanding across the broad spectrum of the negotiations and the US political situation are among the factors that make it uncertain whether an agreement can be secured in the coming period. Already there is slippage in the negotiating timetable. A Ministerial meeting, anticipated to take place on 19 May, has been deferred and the latest indications are that it will not now take place until the end of June or even early July.

Against this background, there is no doubt that these WTO negotiations represent a significant challenge for EU and Irish agriculture. I and my Government colleagues are seeking a balanced and fair outcome across all of the various pillars of the negotiations.

I am very concerned about some of the proposals being made in the agriculture negotiations and with the lack of balance in the overall process. It is not acceptable that the current negotiations are focused on agriculture while other negotiating areas are not making progress.

The Irish Government has and will continue to take every opportunity to express our concerns in the strongest terms in the various EU and WTO meetings dealing with these negotiations. I recently met my French counterpart in Dublin, and the current state of play and imbalance in these WTO negotiations were high on the agenda of this meeting. I can report that France and Ireland share the same concerns on the direction of these negotiations and will continue to insist that the Commission does not accept a deal which undermines EU agricultural production.

The Commission, including Commissioner Mandelson and his officials, are well aware of Ireland’s views on the matter. These views have been articulated clearly and consistently at all available forums over the last several years, including bilateral meetings, meetings of the Article 133 Committee, the Agriculture Council and the General Affairs Council. My colleague and predecessor, the Tanaiste, met the Commissioner on 29 April last and set out in no uncertain terms the concerns of the Irish Government in regard to the current situation. As the negotiations progress I will continue to impress on the Commission that Ireland will not accept an unbalanced agreement which does not provide real benefits to Ireland and the EU.

At yesterday’s Agriculture Council of Ministers meeting I met the Agriculture Commissioner, Mrs. Fischer Boel and I reiterated and highlighted Ireland’s concerns to the Commission and to other Member States, insisting that any WTO agreement must not place a disproportionate burden on EU and Irish agriculture.

I will also continue to ensure that Ireland plays a leading role in the Group of 14+ like-minded Member States who have come together to express concerns in relation to the direction of the WTO agriculture negotiations. I will continue to work closely with like-minded Ministers in other Member States to seek support for my position. I am travelling to Slovenia next week where I will have bilateral discussions on the WTO with my colleagues in this group.

At official level, my Department, and other Departments involved, have and will continue to work assiduously in the various technical meetings to ensure Ireland’s interests are best protected.

In summary, I will continue to pursue an outcome which does not undermine the 2003 reforms of the CAP and ensures that Irish and EU agriculture can compete on world markets.

As to the question of sensitive product status for the beef sector, the detailed negotiations regarding the treatment of sensitive products are not yet finalised. Under the proposals currently on the table, designation of beef as a sensitive product would reduce the proposed tariff cut of between 66 and 73% by two-thirds to a figure of approximately 23%. In turn, the EU would be expected to open an additional import quota for beef of some 290,000 tonnes. Although final decisions surrounding the designation of products as sensitive will not be taken until the final details of the treatment of such products is known, there is no doubt in my mind that the intention is that beef will feature among the products declared sensitive by the EU.

A major concern, even with sensitive product status, is that imports would be concentrated on the high value “steak” cuts. We have emphasised the nature of this specific problem repeatedly to the Commission over the course of the negotiations.

Overall, I continue to seek an outcome which will provide the maximum possible protection to the beef sector.

Parliamentary Question No.73, For ORAL answer on Tuesday, 8th April, 2008.

To ask the Minister for Agriculture, Fisheries and Food the details of the proposed World Trade Organisation import tariff cuts on the main farm sectors; if her Department has conducted research and calculation on the impact she expects these proposed cuts to have on farming here; and if she will make a statement on the matter. – David Stanton.


The Minister for Agriculture, Fisheries and Food: (Mary Coughlan)

The level of tariff reduction commitments to be applied in the next WTO Round are still the subject of the ongoing negotiations. These tariff reduction commitments are only one of a significant number of outstanding issues in these negotiations. The Chair of the WTO Agriculture Committee issued his latest draft agriculture modalities paper in February 2008. This paper outlines the methodology for tariff reductions and the range of tariff reductions which are currently under consideration. The tariff reduction formula provides for four bands of tariffs grouping the products with the lowest current tariffs in the bottom band and those with the highest current tariffs in the top band. The formula also provides for higher reductions for products in the top tariff band, that is the products with the highest current tariffs.

The Chair’s text proposes tariff reductions of between 66% and 73% for tariff lines in the highest tariff band. In terms of the EU tariff structure the highest tariff band includes beef, butter and some sheep tariff lines. If this level of tariff reduction were applied in full it would represent a huge challenge on the EU market for EU production of these products which are competing with third country imports.

The tariff reduction formula is one element of the agriculture market access negotiations. The Chair’s text also provides for the designation by each WTO member country of a certain number of tariff lines as so called ‘sensitive products’. The Chair states the number of lines which could be designated as sensitive should be in the range of 4-6% of total tariff lines. This designation provides for a reduction of up to two thirds from the tariff reduction which would normally apply under the proposed tariff reduction formula. However sensitive product designation also involves the creation of new Tariff Rate Quotas (TRQs). These new TRQs will be calculated for each product designated as sensitive on the basis of a percentage of domestic consumption of those products. The detailed methodology and level of these TRQs is also still the subject of ongoing negotiation, and the outcome of these discussions will therefore have a strong influence on any decision to declare sensitive products status for a particular product.

As I have outlined, there are a significant number of outstanding issues which are the subject of the ongoing negotiations in relation to import tariffs. The manner in which sensitive products are dealt with will be crucial to the access debate.

The outcome of this facet of the negotiations represents a key priority for me. I fully recognize the importance of the EU market for Irish agricultural exports and I will therefore be seeking to ensure that the outcome to these negotiations does not undermine this crucial and key market for Irish products.

Parliamentary Question No. 103, For ORAL answer on Tuesday, 8th April, 2008.

To ask the Minister for Agriculture, Fisheries and Food her views on the Irish Farmers Association estimate that the EU Trade Commissioner’s offer as part of the World Trade Organisation trade deal will cost the economy €4 billion per annum and result in the loss of 50,000 jobs in manufacturing and services and will put a further 50,000 farmers out of business (details supplied); and if she will make a statement on the matter. – David Stanton.


The Minister for Agriculture, Fisheries and Food: (Mary Coughlan)

I propose taking questions 90/110/103 together.

The negotiations on the next WTO Round have entered another intensive phase as efforts continue to reach a full and final agreement by the end of 2008. There is no doubt that the outcome of these negotiations will represent a significant challenge for EU and Irish agriculture.

The 2003 Reform of the CAP was undertaken with this Round of WTO negotiations clearly in mind. The move to non-trade distorting decoupled payments has allowed the EU make significant commitments in these negotiations in relation to reductions in the trade distorting supports such as market and price supports. The 2003 CAP Reforms also represent the limit of the EU Commission’s negotiating position in these negotiations. This negotiating position has been approved by the EU Council of Ministers and has been reiterated on several occasions by the Council. Any WTO agreement which would result in a further reform of the CAP would exceed this negotiating position and would be unacceptable.

I will continue to insist that the Commission respects this negotiating position in these discussions. The Common Agricultural Policy remains a cornerstone of the EU and the principles on which this policy is based are even more valid given the dynamics of the current global economy. My priorities in these negotiations are to ensure that Irish agricultural products remain competitive on EU and world markets. This can be achieved by securing appropriate levels of import protection for the EU market and ensuring that there is full parallel elimination of all forms of export subsidies used by other exporting countries such as state trading enterprises, food aid and export credits.

These negotiations are ongoing and there are a number of significant issues which remain unresolved. It would therefore be difficult at this point to analyse the overall impact on the Irish economy. The Commission have however recently provided some details of their assessment of the impact of the proposals made last February by the Chairman of the WTO Agriculture Committee. This analysis is currently the subject of discussion between Member States and the Commission. In addition some independent assessments are likely to emerge in the near future. In these circumstances I think it better, from both a technical and negotiating standpoint, to await further clarification from the Commission and input from other sources before drawing detailed conclusions on the likely impact of a possible trade deal, the details of which are not yet known.